It shall be unlawful for any registered investment company, in contravention of such rules and regulations or orders as the Commission may prescribe as necessary or appropriate in the public interest or for the protection of investors-
It shall be unlawful for any registered open-end company (other than a company complying with the provisions of section 80a-10(d) of this title) to act as a distributor of securities of which it is the issuer, except through an underwriter, in contravention of such rules and regulations as the Commission may prescribe as necessary or appropriate in the public interest or for the protection of investors.
It shall be unlawful for any registered diversified company to make any commitment as underwriter, if immediately thereafter the amount of its outstanding underwriting commitments, plus the value of its investments in securities of issuers (other than investment companies) of which it owns more than 10 per centum of the outstanding voting securities, exceeds 25 per centum of the value of its total assets.
No issuer of any security purchased or acquired by a registered investment company pursuant to this subparagraph shall be obligated to redeem such security in an amount exceeding 1 per centum of such issuer's total outstanding securities during any period of less than thirty days. Such investment company shall exercise voting rights by proxy or otherwise with respect to any security purchased or acquired pursuant to this subparagraph in the manner prescribed by subparagraph (E) of this subsection.
Notwithstanding any provisions of this subchapter, any registered investment company may hereafter purchase or otherwise acquire any security issued by any one corporation engaged or proposing to engage in the business of underwriting, furnishing capital to industry, financing promotional enterprises, purchasing securities of issuers for which no ready market is in existence, and reorganizing companies or similar activities; provided-
For the purpose of paragraph (1) of section 80a-5(b) of this title any investment in any such corporation shall be deemed to be an investment in an investment company.
Notwithstanding any provisions of this chapter, any registered face-amount certificate company may organize not more than two face-amount certificate companies and acquire and own all or any part of the capital stock thereof only if such stock is acquired and held for investment: Provided, That the aggregate cost to such registered company of all such stock so acquired shall not exceed six times the amount of the minimum capital stock requirement provided in subdivision (1) of subsection (a) of section 80a-28 of this title for a face-amount company organized on or after March 15, 1940: And provided further, That the aggregate cost to such registered company of all such capital stock issued by face-amount certificate companies organized or otherwise created under laws other than the laws of the United States or any State thereof shall not exceed twice the amount of the minimum capital stock requirement provided in subdivision (1) of subsection (a) of said section 80a-28 for a company organized on or after March 15, 1940. Nothing contained in this subsection shall be deemed to prevent the sale of any such stock to any other person if the original purchase was made by such registered face-amount certificate company in good faith for investment and not for resale.
Notwithstanding the provisions of this section any registered investment company and any company or companies controlled by such registered company may purchase or otherwise acquire from another investment company or any company or companies controlled by such registered company more than 10 per centum of the total outstanding voting stock of any insurance company owned by any such company or companies, or may acquire the securities of any insurance company if the Commission by order determines that such acquisition is in the public interest because the financial condition of such insurance company will be improved as a result of such acquisition or any plan contemplated as a result thereof. This section shall not be deemed to prohibit the promotion of a new insurance company or the acquisition of the securities of any newly created insurance company by a registered investment company, alone or with other persons. Nothing contained in this section shall in any way affect or derogate from the powers of any insurance commissioner or similar official or agency of the United States or any State, or to affect the right under State law of any insurance company to acquire securities of any other insurance company or insurance companies.
15 U.S.C. § 80a-12
EDITORIAL NOTES
REFERENCES IN TEXTThe Securities Exchange Act of 1934, referred to in subsec. (d)(1)(B), (E)(i), is act June 6, 1934, ch. 404, 48 Stat. 881, which is classified generally to 2B (§78a et seq.) of this title. For complete classification of this Act to the Code, see section 78a of this title and Tables.
AMENDMENTS2010-Subsec. (d)(1)(J). Pub. L. 111-203 substituted "any provision of this paragraph" for "any provision of this subsection". 1998-Subsec. (d)(1)(G)(i)(III)(bb). Pub. L. 105-353 substituted "the acquired company" for "the acquired fund". 1996-Subsec. (d)(1)(D), (E). Pub. L. 104-290, §202(3), substituted "this paragraph" for "this paragraph (1)". Subsec. (d)(1)(E)(iii). Pub. L. 104-290, §202(1)(A), struck out "in the event such investment company is not a registered investment company," after "(iii)".Subsec. (d)(1)(E)(iii)(bb). Pub. L. 104-290, §202(1)(B), inserted "in the event that such investment company is not a registered investment company," after "(bb)".Subsec. (d)(1)(F). Pub. L. 104-290, §202(3), substituted "this paragraph" for "this paragraph (1)".Subsec. (d)(1)(G). Pub. L. 104-290, §202(2), (4), added subpar. (G). Former subpar. (G) redesignated (H). Subsec. (d)(1)(H). Pub. L. 104-290, §202(3), substituted "this paragraph" for "this paragraph (1)". Pub. L. 104-290, §202(2), redesignated subpar. (G) as (H). Former subpar. (H) redesignated (I). Subsec. (d)(1)(I). Pub. L. 104-290, §202(3), substituted "this paragraph" for "this paragraph (1)" wherever appearing. Pub. L. 104-290, §202(2), redesignated subpar. (H) as (I). Subsec. (d)(1)(J). Pub. L. 104-290, §202(5), added subpar. (J).1987-Subsec. (d)(1)(A)(iii). Pub. L. 100-181, §610(1), substituted "treasury" for "Treasury". Subsec. (d)(1)(G). Pub. L. 100-181, §610(2), substituted "is reasonably possible" for "it reasonably possible". Subsec. (f). Pub. L. 100-181, §610(3), substituted "thereof only" for "only thereof". 1970-Subsec. (d)(1). Pub. L. 91-547 substituted provisions designated as subpars. (A) to (C) and (E) to (H) for former introductory provisions reading "It shall be unlawful for any registered investment company and any company or companies controlled by such registered investment company to purchase or otherwise acquire after August 22, 1940, any security issued by or any other interest in the business of-" and subpar. (1) reading "any other investment company of which such registered investment company and company or companies controlled by such registered company shall not at the time of such purchase or acquisition own in the aggregate at least 25 per centum of the total outstanding voting stock, if such registered investment company and any company or companies controlled by it own in the aggregate or as a result of such purchase or acquisition will own in the aggregate more than 5 per centum of the total outstanding voting stock of such other investment company if the policy of such other investment company is the concentration of investments in a particular industry or group of industries, or more than 3 per centum of the total outstanding voting stock of such other investment company if the policy of such other investment company is not the concentration of investments in a particular industry or group of industries, except and cl. (B) exception reading "a security purchased with the proceeds of payments on periodic payment plan certificates, pursuant to the terms of the trust indenture under which such certificates are issued", cl. (A) of such subpar. (1) being incorporated in subpar. (D) of this par. (1). Subsec. (d)(2). Pub. L. 91-547 incorporated existing introductory text and subpar. (2) provisions in provisions redesignated as par. (2) and struck out "after August 22, 1940," after "purchase or otherwise acquire". Subsec. (d)(3). Pub. L. 91-547 incorporated existing introductory text and subpar. (3) provisions in provisions redesignated as par. (3) and struck out "after August 22, 1940," after "purchase or otherwise acquire".
STATUTORY NOTES AND RELATED SUBSIDIARIES
EFFECTIVE DATE OF 2010 AMENDMENT Amendment by Pub. L. 111-203 effective 1 day after July 21, 2010, except as otherwise provided, see section 4 of Pub. L. 111-203 set out as an Effective Date note under section 5301 of Title 12, Banks and Banking.
EFFECTIVE DATE OF 1970 AMENDMENT Amendment by Pub. L. 91-547 effective Dec. 14, 1970, see section 30 of Pub. L. 91-547 set out as a note under section 80a-52 of this title.
EXECUTIVE DOCUMENTS
TRANSFER OF FUNCTIONSFor transfer of functions of Securities and Exchange Commission, with certain exceptions, to Chairman of such Commission, see Reorg. Plan No. 10 of 1950, §§1, 2, eff. May 24, 1950, 15 F.R. 3175, 64 Stat. 1265, set out under section 78d of this title.