On March 27, 2024, the U.S. Securities and Exchange Commission (“SEC”) announced rule changes to allow pure Internet investment advisers to register with the SEC (“Rules”).The revised rules cancel the existing rules at the lowest limit Exception method and requires Internet investment advisers to follow this rule:
- Providing investment advisory services exclusively to Internet clients (i.e., Internet investment advisors relying on the revised rules cannot have clients outside of their Internet services);
- Maintain at all times an operational, interactive website through which the Advisor provides investment advisory services to clients; and
- Disclose on its Form ADV that the Internet investment adviser has an operational interactive website and is eligible to file under the rule.
Investment advisers relying on the rule must comply with the amendments by March 31, 2025.
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17 CFR 275.203A-2(e); SEC Press Release, SEC Adopts Reforms Related to Investment Advisers Operating Only Through the Internet, March 27, 2024, available at https://www.sec.gov/news/press -release/2024-42.