Ropes & Gray’s Investment Management Update April – June 2025

Since our prior IM Update, in separate Alerts, we covered (i) the SEC’s decision to remove from its regulatory agenda proposed rulemakings relevant to the investment management industry, (ii) Ropes & Gray’s updated and expanded whitepaper on preparing for ETFs as a share class, and (iii) the SEC’s decision to drop its requirement that retail closed-end funds must limit their investments in private funds to 15% of their net assets. The following are summaries of (with links to) our coverage:

SEC Clears Unfinished Rulemakings from Regulatory Agenda
June 18, 2025
On June 12, 2025, the SEC issued a notice (the “Notice”) formally withdrawing certain proposed rulemakings issued in 2022 and 2023.

Preparing for ETFs as a Share Class: Updated and Expanded Second Edition
June 11, 2025
On March 17, 2025, Ropes & Gray published a whitepaper describing the much-anticipated Share Class Relief and outlining matters we believed Advisers and Boards may want to consider in connection with their initial implementation of a Combined Class Structure and their ongoing monitoring of such a structure. There have been a number of developments since then, which are outlined in this second installation. The new material in the second installation focuses primarily on the requirements for initial and periodic Board reports, as well as considerations relevant to the ongoing monitoring process, including the determination of the “numerical thresholds” contemplated by the anticipated Share Class Relief.

SEC Drops 15% Limit in Private Funds for Retail Closed-End Funds
May 23, 2025
Statements by SEC Chairman Paul S. Atkins and by Division of Investment Management Director Natasha J. Greiner indicate that the SEC staff will no longer require retail closed-end funds to limit their investments in private funds – i.e., funds relying upon Sections 3(c)(1) or 3(c)(7) of the 1940 Act – to 15% of their net assets.

The following summarizes additional recent legal developments of note affecting the investment management industry:

SEC and CFTC Extend Compliance Date of Form PF Amendments

On June 11, 2025, the SEC and the CFTC (the “Commissions”) issued a joint Release (the “Release”) extending the compliance date for the amendments to Form PF until October 1, 2025. The extension was issued less than 24 hours before the amendments’ compliance date. Here is the regulatory background for these amendments:

• On February 8, 2024, the Commissions adopted amendments (the “Amendments”) to Form PF, which is the form that certain SEC-registered investment advisers, including advisers that are also registered with the CFTC as commodity pool operators or commodity trading advisers, use to report confidential information about the private funds they advise.
• According to the 2024 release adopting the Amendments, the Commissions and the Financial Stability Oversight Council (“FSOC”) had “identified significant information gaps and situations where revised information would improve the Commissions’ and FSOC’s understanding of the private fund industry.” The release goes on to state that the Amendments are intended “to enhance FSOC’s monitoring and assessment of systemic risk and to collect additional data and make data more useful for the Commissions’ use in their respective regulatory programs.”
• The initial compliance date for the Amendments was March 12, 2025. On January 29, 2025, the Commissions extended the Amendments’ compliance date to June 12, 2025.

The Release notes that the Commissions were persuaded by recent comment letters from industry trade groups to the effect that a “further extension is now needed to provide filers and their third-party service providers sufficient time to develop and test their reporting systems before compliance with [amended Form PF].” Therefore, the Release provides that Form PF filers may continue to file existing Form PF until October 1, 2025.

For quarterly Form PF filers, the first amended Form PF filing will be due November 29, 2025, for information in respect of Q3 2025. For annual Form PF filers, the extension of the Amendments’ compliance date will not impact the timing of the initial filing using amended Form PF, which will remain April 30, 2026 for information in respect of calendar year 2025.

REGULATORY PRIORITIES CORNER

The following brief updates exemplify trends and areas of current focus of relevant regulatory authorities:

Upcoming Compliance Dates

The following is a reminder of the upcoming compliance dates of significant SEC rulemakings.

1. Amended Form N-CEN. Funds that are subject to Rule 22e-4 will be required to comply with the Form N-CEN amendments for reports filed on or after November 17, 2025. The related SEC release is summarized in a Ropes & Gray Alert.
2. Amended Regulation S-P Requirements. The amendments to Regulation S-P require broker-dealers, registered investment companies (including business development companies), and registered investment advisers to adopt written policies and procedures creating an incident response program to deal with unauthorized access to customer information, including procedures for notifying persons affected by the incident within 30 days. The compliance date is December 3, 2025. The related SEC release is summarized in a Ropes & Gray Alert.
3. Reporting Non-Cleared Bilateral Repo Transactions. On March 21, 2025, the Treasury Department’s Office of Financial Research (the “OFR”) announced that it was extending by 90 days the compliance date for certain entities required by a new rule to report information about their non-centrally cleared bilateral repurchase (“NCCBR”) transactions. The new compliance date is June 30, 2025 for “Category 2” reporters whose compliance date otherwise would have been April 1, 2025. The OFR rule is summarized in a Ropes & Gray Alert.
4. EDGAR Next Transition Begins. As described in a Ropes & Gray Alert, on September 27, 2024, the SEC adopted rule and form amendments to enhance the security and account management of its electronic filing system, EDGAR. The amendments, collectively referred to as “EDGAR Next,” are intended to address current security flaws in EDGAR access. The EDGAR Next transition period began March 24, 2025 and includes changes to account access and management. These changes apply to all filers, including individuals and entities that file under Section 13 or 16 filings. The changes do not take effect until September 15, 2025, meaning that, until then, filers will still be able to access their EDGAR accounts and file on EDGAR as they currently do. However, beginning September 15, filers that have not enrolled in EDGAR Next will be unable to file on EDGAR.

ADDITIONAL ROPES & GRAY ALERTS AND PODCASTS SINCE OUR FEBRUARY – MARCH IM UPDATE

SEC Lifts Moratorium on Registering Swiss Investment Advisers
June 17, 2025
On June 10, 2025, the SEC issued a press release announcing that, effective immediately, it would resume processing new and pending registration applications of investment advisers with their principal office and place of business in Switzerland (“Swiss Advisers”). This announcement, together with the companion press release from the Swiss financial regulator, FINMA, marks the end of the SEC’s multi-year moratorium on registering Swiss Advisers under the U.S. Investment Advisers Act.

Podcast Fully Invested: Exchange Act Registered Private Funds (’34 Act)
June 9, 2025
On this episode of Fully Invested, Ropes & Gray asset management partner Jessica Marlin and capital markets counsel Marc Rotter discussed ’34 Act Registered Private Funds. These funds register under the Securities Exchange Act of 1934 and disclose information publicly, while remaining exempt from the Investment Company Act of 1940. Jessica and Marc explored the funds’ features and differences in comparison to traditional private funds.

Trump DOL Withdraws Biden-Era ESG Rule and Crypto Guidance for ERISA Plans
May 30, 2025
On May 28, 2025, the U.S. Department of Labor (“DOL”) began to articulate the Trump administration’s retirement policy priorities with its decisions to (i) end its defense of the Biden-era ESG rule in a long-running lawsuit brought by a coalition of state attorneys general and instead engage in new rulemaking, and (ii) rescind 2022 guidance that had expressed significant concerns with adding cryptocurrency to a 401(k) plan investment menu (Compliance Assistance Release (“CAR”) No. 2025-01). It is unclear what the agency will repropose next year regarding ESG and investment duties for ERISA fiduciaries. CAR 2025-01 appears to reaffirm the agency’s historically neutral approach to investing, which neither endorses nor disapproves of specific investment categories. Moreover, promoting a more principles-based approach for evaluating and selecting plan investments that reflects a prudent process would be consistent with the DOL’s 2020 information letter (and 2021 supplement) that addresses incorporating private equity and other alternative assets in 401(k) plans – a topic that has generated substantial interest this year. It remains to be seen whether this approach will apply to investments involving ESG characteristics.

SEC Speaks 2025: Key Takeaways from Division of Enforcement Panels
May 23, 2025
At the SEC Speaks 2025 conference held in Washington, D.C. from May 19-20, 2025, senior SEC officials shared their observations on what the legal and business community can expect from the SEC’s Division of Enforcement (the “Division”) in the years to come. Over the course of two panels dedicated to the Division, panelists discussed key enforcement trends and priorities, including the Division’s renewed emphasis on individual liability, harm to retail investors, and dangerous foreign actors. The panelists also affirmed the Division’s continued commitment to traditional enforcement priorities and cautioned the defense bar and the broader public to be skeptical of contrary dire predictions. In addition, the panelists explained some recent reorganization efforts and how these changes will facilitate the Division’s work going forward. And the panelists provided the defense bar with guidance regarding effective legal advocacy, cooperation, and recommendations for dealing with the Division’s staff during their investigations.

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If you would like to learn more about the issues in this IM Update, please contact your usual Ropes & Gray attorney contacts.