Debevoise & Plimpton Discusses SEC’s Proposed Changes to Advertising Rule

On November 4, the Securities and Exchange Commission (the “SEC”) proposed amendments (the “Proposal”) to modernize Rule 206(4)-1 (the “Advertising Rule”) under the Investment Advisers Act of 1940 (the “Advisers Act”). [1] The first substantial amendment to the Advertising Rule since its adoption in 1961, the Proposal is intended to reflect “changes in the technology used for communication, the expectations of investors shopping for advisory services, and the nature of the investment advisory industry, including the types of investors seeking and receiving investment advisory services.”

While the Proposal appears to be designed to provide investment advisers, particularly private fund managers, … Read more