A person who acts as an investment adviser must register with the appropriate regulatory authorities or qualify for a registration exemption. An investment adviser generally is any person who, for compensation, engages in the business of advising others as to the value of securities, or as to the advisability of investing in, purchasing, or selling securities. Two commonly relied upon exemptions are the private fund adviser exemption and the venture capital fund adviser exemption, each of which is discussed in more detail below.
The private fund adviser exemption
An investment adviser is exempt from the requirement to register with the Securities Exchange Commission under the private fund adviser exemption if it solely advises “private funds” and its total “regulatory assets under management” are less than $150 million.
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