Private Equity Funds – Page 3 – Global Investment Law Watch

Fifth Circuit Court of Appeals Hears Oral Arguments in Industry Groups’ Ongoing Petition to Vacate Private Fund Adviser Rules

Feb 12 2024

By: TJ Bright, Annabelle H. North, and Bradley D. Bostwick

On 5 February 2024, the US Fifth Circuit Court of Appeals heard oral arguments from the Securities and Exchange Commission (SEC) and industry groups representing private investment fund sponsors, in the industry groups’ ongoing petition to vacate the new private fund adviser rules (PFAR) adopted by the SEC on 23 August 2023.

SEC Expands Definition of Dealers and Government Securities Dealers

Feb 07 2024

By: Richard F. Kerr, Eden L. Rohrer, Jessica D. Cohn, and Raymond F. Jensen

On 6 February 2024, the US Securities and Exchange Commission (SEC) adopted two new rules – Rules 3a5-4 and 3a44-2 of the Securities Exchange Act of 1934 (the Act) – that significantly expand the definitions of a “dealer” and “government securities dealer.” The new rules define the phrase “as a part of a regular business” in Sections 3(a)(5) and 3(a)(44) of the Act to determine if a person is engaged in a “regular pattern of buying and selling securities that has the effect of providing liquidity to other market participants.” Such persons would be required to register as “dealers” or “government securities dealers” under Sections 15 and 15C of the Act, respectively.

CFTC Requests Comment on the Use of Artificial Intelligence in CFTC-Regulated Markets

Jan 30 2024

By: Cheryl L. Isaac, Matthew J. Rogers, and Benjamin C. Skillin

On 25 January, 2024, multiple Divisions of the Commodity Futures Trading Commission (CFTC) issued a Request for Comment (RFC) on the use of Artificial Intelligence (AI) in CFTC-regulated derivatives markets. The RFC seeks information on the current and potential uses of AI as well as the risks associated with using it. The RFC is intended to complement the Biden Administration’s Executive Order urging federal agencies to promote the safe, secure, and trustworthy development of AI. The CFTC staff views the RFC as an opportunity to “identify the highest priorities and return-on-investment projects with AI use cases” and enhance the CFTC’s data-driven approach to policy, surveillance, and enforcement.

Industry Groups File First Reply to SEC in Ongoing Petition Against New Private Fund Adviser Rules

Jan 29 2024

BY: TJ Bright and Annabelle North

On 22 January 2024, industry groups representing private investment fund sponsors, including the Alternative Investment Management Association (AIMA), National Association of Private Fund Managers, and Managed Funds Association, filed their first reply to the Securities and Exchange Commission’s (SEC) response in the groups’ ongoing petition against the new private fund adviser rules (PFAR) adopted by the SEC on 23 August 2023.

Europe: ESMA Publishes Long-Awaited Final Report on ELTIF 2.0 Regulatory Technical Standards

Dec 20 2023

By: Gayle Bowen and Shane Geraghty

On 19 December, the European Securities and Markets Authority (ESMA) published its final report setting out draft Regulatory Technical Standards under the amended European Long-Term Investment Funds Regulation.

ICMA’s Code of Conduct for ESG Ratings and Data Products Providers – A Step Towards Consistent Global Standards

Dec 18 2023

By: Carolyn Sng and Sook Young Yeu

The International Capital Market Association (ICMA) has released a voluntary code of conduct for ESG ratings and data products providers (the Code), reflecting recommendations by the International Organization of Securities Commissions (IOSCO). The Code is intended to be internationally interoperable and may be used by jurisdictions where no local code or regulation is in place.

Hong Kong Relaxes “Double Dipping” Restrictions For Large IPOs

Nov 27 2023

By: Carolyn Sng and Vincent Tso

The Stock Exchange of Hong Kong (HKSE) has introduced a new exemption to its “double dipping” rule for large IPOs. “Double dipping” refers to a subscription by an existing shareholder (including pre-IPO investors and cornerstone investors) or its close associate for further shares in the IPO, which is restricted by the HKSE on account of the actual or perceived preferential treatment by the issuer for its existing shareholders. This new exemption permits “double dipping” subject to certain size conditions being met, and is effective with immediate effect on 21 November 2023.

Singapore: MAS Consults on Simplified Regulatory Framework for Fund Managers

Nov 05 2023

By: Edward Bennett and Ke Jia Lim

On 24 October 2023, the Monetary Authority of Singapore (MAS) issued a consultation paper on the repeal of the regulatory regime for Registered Fund Management Companies (RFMCs).

Hong Kong Backs Industry-led Voluntary Code for ESG Ratings and Data Products Providers

Nov 02 2023

By: Carolyn Sng and Sook Young Yeu

The Securities and Futures Commission in Hong Kong (SFC) has announced its support for the development of a voluntary code of conduct (VCoC) for ESG ratings and data products providers. The proposed VCoC, which will be open for ESG ratings and data products providers to sign up voluntarily, and will align with international best practices as recommended by the International Organization of Securities Commissions.

Hong Kong Proposes Guidelines for Market Soundings

Oct 30 2023

By: Carolyn Sng and Tan Choo Lye

The Securities and Futures Commission (SFC) of Hong Kong is consulting on new guidelines to regulate market soundings in advance of transactions such as private placements and block trades. Market soundings are the communication of non-public information (whether price-sensitive or not) with potential investors prior to the announcement of the transaction to gauge investor interest or assist in determining the specifications of the potential transaction. It can be an integral part of price discovery, but the process may be open to abuse if parties trade on the back of non-public information obtained.

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