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Treasury Mandatory Survey Form TIC-SHC Due Soon— Fund Managers Should Assess Foreign Securities Holdings

On December 5, 2016, a Notice of reporting requirements was filed in the Federal Register by the U.S. Department of Treasury informing the public of the Treasury’s mandatory survey, due every 5 years, of ownership of foreign securities by U.S. residents as of December 31, 2016.  All U.S. persons who…

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Higher Qualified Client Net Worth Threshold Effective August 15, 2016

3(c)(1) funds should update their offering documents to reflect $2.1 million net worth requirement. Assets under management threshold remains unchanged at $1 million. Only new client relationships entered and new investors admitted in private funds after August 15, 2016 are affected; new contributions by pre-August 15 investors are grandfathered. The…

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Investment Adviser Sanctioned for Inadequate Trading Away Disclosure

On July 14, 2016, the Securities and Exchange Commission (SEC) announced an enforcement action against RiverFront Investment Group, LLC, a registered investment adviser serving as sub-adviser to clients in wrap fee programs established by various sponsors. The enforcement action resulted from RiverFront’s materially inadequate disclosure about changes in its trading practices…

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SEC wants Registered Advisers to Adopt Written Business Continuity and Transition Plans

In line with the Securities and Exchange Commission’s (SEC) goal to enhance regulatory safeguards in the asset management industry, the SEC yesterday released a proposed new rule and rule amendments under the Investment Advisers Act of 1940. The proposed new rule 206(4)-4 would require SEC-registered investment advisers to adopt and…

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CFTC Asserts Broader Jurisdiction over Digital Asset Exchanges, Levies $75,000 Fine

The CFTC’s recent enforcement against Bitfinex’s financed trading activities demonstrates the Commission’s increasing interest in virtual currency and digital assets. The U.S. Commodity Futures Trading Commission (CFTC) is further expanding its oversight of virtual currency exchanges and digital assets in general. On June 2, 2016, Bitfinex (a Hong Kong-based bitcoin…

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Four Things You Need to Know About the Mauritius-India Protocol

International investors have frequently used Mauritius holding companies for their Indian investments, seeking to take advantage of the exemption under the India-Mauritius income tax treaty (the “Mauritius Treaty”) from Indian capital gains tax generally applicable on the disposition of shares of Indian companies. On May 10, 2016, the Governments of…

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SEC Issues Guidance Expanding the Private Fund and Venture Capital Fund Adviser Exemptions

President Obama signed into law the SBIC Advisers Relief Act (as part of the Fixing America’s Surface Transportation Act of 2015—the FAST Act) on December 4, 2015.  (See also our Annual Compliance Alert)  After the enactment of the Dodd-Frank Act, advisers to Small Business Investment Companies (SBICs) were limited in…

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Update Your Subscription Documents – FATCA and CRS

The Cayman Islands Tax Information Authority advised yesterday that it will allow Cayman Islands Financial Institutions to rely on CRS due diligence procedures for new accounts opened on or after 1 January 2016 to identify specified/reportable persons for the purposes of UK FATCA and CRS reporting.  This means that, provided…

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Negotiating Cybersecurity Contractual Protections for Retirement Plans

The ERISA Advisory Council recently announced that, as part of its goals for 2016, it will be focusing on cybersecurity issues affecting retirement plans and, in particular, the extent to which such issues relate to third-party administrators and vendors (TPAs) of retirement plans. By shining the spotlight on the role…

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Sun Capital Court Finds that Common Industry Practices Exposed PE Funds to Pension Plan Liabilities

A group of related private equity (“PE”) funds were found liable for a bankrupt portfolio company’s pension plan debts in the latest and most worrisome decision in the long-running Sun Capital Partners III, LP v. New England Teamsters and Trucking Industry Pension Fund dispute. The novel decision, if upheld on…