September 2024 – Page 2 – Global Investment Law Watch

More Marketing Missteps

Sep 10 2024

By: Pablo Man, Pamela Grossetti, Lance Dial and Jennifer Klass

On 9 September 2024, the Securities and Exchange Commission (SEC) announced settled charges against nine registered investment advisers for violations of Rule 206(4)-1 (the Marketing Rule). Unlike the prior settlements (which focused primarily on the use of hypothetical performance), these settlements focused on other elements of the Marketing Rule: (i) the prohibitions on statements of material fact that are untrue or that the adviser cannot substantiate; (ii) disclosures relating to testimonials and endorsements; and (iii) required disclosures for third-party ratings. Many of these violations were based on website disclosures. In total, nine advisers agreed to pay US$1,240,000 in combined civil penalties, ranging from US$60,000 to US$325,000.

SEC Enforcement Takes Broad View of Anti-Whistleblower Rule in Latest Action Targeting Investment Advisers and Broker-Dealer

Sep 06 2024

By: Hayley Trahan-Liptak and Taylor A. Listau

On 4 September 2024, the US Securities and Exchange Commission (SEC) announced that it settled charges against affiliated investment-advisers and a broker-dealer over the use of restrictive language in confidentiality agreements, in violation of Rule 21F-17(a) of the Securities Exchange Act of 1934. The firms agreed to pay a combined $240,000 in civil penalties to settle the charges. The enforcement action is the latest in the SEC’s ongoing focus on confidentiality provisions in release agreements; an emphasis that has increasingly focused on investment advisers and broker-dealers.

Japan Adopts “Asset Owner Principles” Amid Growing Interests in Alternative Investments Among Japanese Pensions

Sep 05 2024

By: Tsuguhito Omagari and Yuki Sako

On August 28, under the ongoing “Japan as a leading asset management center” policy initiative, the Japanese government adopted “Asset Owner Principles” (Principles), which are five “common principles” that are “useful” for asset owners in “fulfilling their responsibilities to manage assets (fiduciary duties) in consideration of the best interests of the beneficiaries.” Asset owners are described to include public pensions, benefit associations, corporate pensions, insurance companies and university funds. These Principles are:

Europe: BaFin Changes Its Process for Fund Passporting Into Germany

Sep 03 2024

By: Hilger Von Livonius, Emma O’Dwyer, Aoife Maguire, and Gayle Bowen

On 14 and 15 August 2024, the German Federal Financial Supervisory Authority (BaFin) updated the following guidance notices:

Guidance Notice on marketing of EU UCITS in Germany

Guidance Notice (2013) for marketing units or shares of EU AIFs or domestic special AIFs (Spezial-AIF) managed by an EU AIF management company to semi-professional and professional investors in the Federal Republic of Germany pursuant to section 323 of the Investment Code

ASIC Seeks to Clarify the Scope of the “Authorised Representative” Exemption

Sep 03 2024

By: Kane Barnett and Daniel Nastasi

The Australian Securities and Investments Commission (ASIC) has appealed certain findings in the recent decision in Australian Securities and Investments Commission v BPS Financial Pty Ltd [2024] FCA 457 (BPS Financial Decision) in relation to the scope of the authorised representative exemption. The authorised representative exemption is commonly relied upon and allows a person or entity to provide a financial service under the Corporations Act on behalf of the holder of an AFS licence without having to hold an AFS licence itself.

Archive:September 2024