he entity is an “exchange” or “clearing agency” as those terms are defined in section 3 of the Securities Exchange Act of 1934 (15 U.S.C. §78c), and (ii) the entity is registered under sections 6 (15 U.S.C. 78f) and 17A (15 U.S.C. §78q-1) of that Act.Other Exchange Act registered entity (Exemption #9)—An entity qualifies for this exemption if both of the following criteria apply: (i) the entity is not a securities reporting issuer as defined in Exemption #1, broker or dealer as defined in Exemption #7, or securities exchange or clearing agency as defined under Exemption #8; and (ii) the entity is registered with the Securities and Exchange Commission under the Securities Exchange Act of 1934.Investment company or investment advisor (Exemption #10)—An entity qualifies for this exemption if both of the following criteria apply: (i) the entity is an “investment company” or “investment advisor” defined in either (x) an investment company in section 3 of the Investment Company Act of 1940 (15 U.S.C. §80a-3), or (y) an investment advisor in section 202 of the Investment Advisors Act of 1940 (15 U.S.C. §80b-2), and (ii) the entity is registered with the Securities Exchange Commission under either of these authorities: (x) the Investment Company Act of 1940 (15 U.S.C. §80a-1, et. seq.), or (y) the Investment Advisors Act of 1940 (15 U.S.C. §80b-1, et. seq.).Venture capital fund advisor (Exemption #11)—An entity qualifies for this exemption if both of the following criteria apply: (i) the entity is an investment advisor that is described in section 203(l) of the Investment Advisors Act of 1940 (15 U.S.C. §80b-3(1)), and (ii) the entity has filed Item 10 Schedule A, and Schedule B of Part 1A of Form ADV, or any successor thereto, with the Securities Exchange Commission.Insurance company (Exemption #12)—An entity qualifies for this exemption if the entity is an “insurance company” as defined section 2 of the Investment Company Act of 1940 (15 U.S.C. §80a-2).State-licensed insurance producer (

entity is an “exchange” or “clearing agency” as those terms are defined in section 3 of the Securities Exchange Act of 1934 (15 U.S.C. § 78c), and (ii) the entity is registered under sections 6 (15 U.S.C. 78f) and 17A (15 U.S.C. § 78q-1) of that Act.Other Exchange Act registered entity (Exemption #9)—An entity qualifies for this exemption if both of the following criteria apply: (i) the entity is not a securities reporting issuer as defined in Exemption #1, broker or dealer as defined in Exemption #7, or securities exchange or clearing agency as defined under Exemption #8; and (ii) the entity is registered with the Securities and Exchange Commission under the Securities Exchange Act of 1934.Investment company or investment advisor (Exemption #10)—An entity qualifies for this exemption if both of the following criteria apply: (i) the entity is an “investment company” or “investment advisor” defined in either (x) an investment company in section 3 of the Investment Company Act of 1940 (15 U.S.C. § 80a-3), or (y) an investment advisor in section 202 of the Investment Advisors Act of 1940 (15 U.S.C. § 80b-2), and (ii) the entity is registered with the Securities Exchange Commission under either of these authorities: (x) the Investment Company Act of 1940 (15 U.S.C. § 80a-1, et. seq.), or (y) the Investment Advisors Act of 1940 (15 U.S.C. § 80b-1, et. seq.).Venture capital fund advisor (Exemption #11)—An entity qualifies for this exemption if both of the following criteria apply: (i) the entity is an investment advisor that is described in section 203(l) of the Investment Advisors Act of 1940 (15 U.S.C. § 80b-3(1)), and (ii) the entity has filed Item 10 Schedule A, and Schedule B of Part 1A of Form ADV, or any successor thereto, with the Securities Exchange Commission.Insurance company (Exemption #12)—An entity qualifies for this exemption if the entity is an “insurance company” as defined section 2 of the Investment Company Act of 1940 (15 U.S.C. § 80a-2).State-licensed insurance produ

5 is the only Rule that takes effect on the later date of January 3, 2020. See Mich. Rule 4.5(1).Some preliminary definitions are required to interpret Mich Rule 4.5.Michigan Securities Rule 1.1: Definitions Relevant to the Private Fund Adviser Exemption"3(c)(1) fund" is a "qualifying investment fund" that is excluded from the definition of investment company under Section 3(c)(1) of the Investment Company Act of 1940, 15 USC 80a-3(c)(1). See Mich Rule 1.1(a)."Private fund adviser" is an investment adviser who provides advice to one or more "qualifying private funds."

es where such beneficial owner has significant influence over the audit client, except for the following loans obtained from a financial institution under its normal lending procedures, terms, and requirements:(1i) Automobile loans and leases collateralized by the automobile;(2ii) Loans fully collateralized by the cash surrender value of an insurance policy;(3iii) Loans fully collateralized by cash deposits at the same financial institution; and(4iv) A mortgage loan collateralized by the borrower’s primary residence provided the loan was not obtained while the covered person in the firm was a covered person.(2) For purposes of paragraph (c)(1)(ii)(A) of this section:(i) the term audit client for a fund under audit excludes any other fund that otherwise would be considered an affiliate of the audit client;(ii) The term fund means: an investment company or an entity that would be an investment company but for the exclusions provided by Section 3(c) of the Investment Company Act of 1940 (15 U.S.C. 80a-3(c)); or a commodity pool as defined in Section 1a(10) of the U.S. Commodity Exchange Act, as amended [(7 U.S.C. 1-1a(10)], that is not an investment company or an entity that would be an investment company but for the exclusions provided by Section3(c) of the Investment Company Act of 1940 (15 U.S.C. 80a-3(c)).Footnotes1) Auditor Independence With Respect to Certain Loans or Debtor-Creditor Relationships, Release No. 33-10648(June 18, 2019) (Adopting Release).2) “Audit client” is defined to include affiliates of the audit client, which, for a registered investment company, includes all entities within the “investment company complex,” regardless of whether the audit firm actually provides audit services to those other entities.The “investment company complex” of an audit client that is an investment company is defined in Rule 2‑01(f)(14) to include, among other things: (i) the company’s investment adviser; (ii) any affiliates of the investment adviser that are investment advisers or prov

issuance of the NOI does not represent affirmative FERC action to modify its policy on blanket authorizations for investment companies under FPA Section 203, it does signal that FERC intends to consider policy modifications seriously and comprehensively. Coupled with the issuance by FERC of various orders expressing concern with upstream affiliations, [27] the NOI reminds public utilities to monitor upstream owners, e.g., in the context of Section 203 applications, not eligible for a blanket authorization, and market-based rate (MBR) applications and associated relational database filings.[1] Federal Power Act Section 203 Blanket Authorizations for Investment Companies, Docket No. AD24-6-000, 185 FERC ¶61,192 (the "NOI").[2] For the purposes of the NOI, FERC held that the term "investment company" means any issuer that "holds itself out as being engaged primarily, or proposes to engage primarily, in the business of investing, reinvesting, or trading in securities.".” NOI at P 1, n.1. 15 U.S.C. § 80a-3(a)(1)(A).[3] 16 U.S.C. § 824b.[4] Commissioner Christie expressed support for the review of FERC’s blanket authorization policy arguing that FERC must further evaluate whether investment companies are exercising control over utilities and are not just passive investors. Commissioner Christie opined that “it is simply no longer a credible assertion that investment companies are always or should be assumed to be merely passive investors as these investment companies wield significant financial power.” See Commissioner Christie NOI Concurrence at P 2.[5] 88 Fed. Reg. 89,346, 89,350 (Dec. 27, 2023).[6] 16 U.S.C. § 824b(a)( 2).[7]See, e.g., 18 C.F.R § 33.1(c)(2)(ii) (granting a holding company a blanket authorization to acquire certain voting securities).[8]SeeCap. Rsch & Mgmt. Co., 116 FERC ¶ 61,267 (2006); see alsoThe Goldman Sachs Grp., 134 FERC ¶ 61,227 (2011); BlackRock, Inc., 179 FERC ¶ 61,049 (2022).[9] NOI at p. 8.[10] NOI at p 8 noting that at the beginning of 2010, there was approximately

roceeding.Request for Public CommentsThe NOI invites interested parties to submit comments on the 17 questions raised therein. Initial comments are due March 26, 2024 (90 days after the NOI’s date of publication in the Federal Register). Reply comments are due April 25, 2024 (120 days after the NOI’s date of publication in the Federal Register, i.e., 30 days after initial comments are due).[1] FERC’s Notice of Inquiry (https://ferc.gov/media/e-1-ad24-6-000).[2] 16 U.S.C. 796(22) and 16 U.S.C. 796(23) (https://www.law.cornell.edu/uscode/text/16/796).[3] 18 C.F.R. 33.1(c) (https://www.ecfr.gov/current/title-18/chapter-I/subchapter-B/part-33)[4] “Investment Companies” is defined in FERC’s Notice of Inquiry as those companies meeting the definition of “investment companies” in the Investment Company Act of 1940, which includes any issuer that “holds itself out as being engaged primarily, or proposes to engage primarily, in the business of investing, reinvesting, or trading in securities.” 15 U.S.C. § 80a-3.[5] 18 C.F.R. 33.1(c)(9) (https://www.ecfr.gov/current/title-18/chapter-I/subchapter-B/part-33).[6] FERC’s Notice of Inquiry ¶ 7 (https://ferc.gov/media/e-1-ad24-6-000).[7] FERC’s Notice of Inquiry ¶ 8 (https://ferc.gov/media/e-1-ad24-6-000).[8] Commissioner Christie Concurring Statement ¶ 1 (https://ferc.gov/media/e-1-ad24-6-000).[9] Commissioner Christie Concurring Statement ¶ 3 (https://ferc.gov/media/e-1-ad24-6-000).[10]Id.[11] Commissioner Christie Concurring Statement ¶ 4 (https://ferc.gov/media/e-1-ad24-6-000).

prepare to comply with the Act and consider their eligibility for any exemptions.While some entities are expressly exempt, most structures require an individualized assessment to determine its potential reporting obligations and compliance with the CTA.Even if an entity is exempt, its portfolio companies and subsidiaries might not be.A fund manager who is registered with the SEC might be exempt even though the fund itself might not be.Compliance with the CTA as a Reporting Company requires a robust internal process to track and continuously monitor new investors and subsequently update beneficial ownership information with FinCEN. 31 U.S.C. § 5336(a)(11) 31 C.F.R. § 1010.380(c)(2)(x),(xi), (xxii). The investment company or investment adviser exemption under the CTA exempts an entity if it meets both of the following requirements: (1) the entity is an “investment company” or “investmentAdviser,” defined as either an investment company in section 3 of the InvestmentCompany Act of 1940 (15 U.S.C. 80a-3); or an investment adviser in section 202 of theInvestment Advisers Act of 1940 (15 U.S.C. 80b-2) and (2). 31 C.F.R. § 1010.380(c)(2)(xi).

ncluding how the rules with legacy status will apply to such Advisers. In addition, though certain aspects of the rule that require a facts and circumstances analysis will become clearer as the rule is interpreted through no-action letters and enforcement actions, the Adopting Release has helpful commentary on how the SEC will likely interpret those aspects of the Private Fund Rules and be a guiding light in the meantime.Notes1 Pursuant to the Adopting Release, the SEC adopted the following: 17 CFR 275.206(4)-10 (final rule 206(4)-10), 17 CFR 275.211(h)(1)-1 (final rule 3 211(h)(1)-1), 17 CFR 275.211(h)(1)-2 (final rule 211(h)(1)-2), 17 CFR 275.211(h)(2)-1 (final rule 211(h)(2)-1), 17 CFR 275.211(h)(2)-2 (final rule 211(h)(2)-2) and 17 CFR 275.211(h)(2)-3 (final rule 211(h)(2)-3) under the Advisers Act.2 Section 202(a)(29) of the Advisers Act defines the term "private fund" as an issuer that would be an investment company, as defined in Section 3 of the Investment Company Act of 1940 (15 U.S.C. 80a-3) (Investment Company Act), but for Section 3(c)(1) or 3(c)(7) of the Investment Company Act.3 "SEC Enhances the Regulation of Private Fund Advisers," SEC 2023-155 (Aug. 23, 2023).4 References to RIAs include private fund advisers required to be registered with the SEC.5 An ERA is an investment adviser who qualifies for the exemption from registration under rule 203(l)-1 or rule 203(m)-1 under the Advisers Act.6 17 C.F.R. 275.206-2.7 Final rule 211(h)(1)-2; SEC Release No. IA-6383 at 60.8 Final rule 206(4)-10; SEC Release No. IA-6383 at 161.9 Final rule 211(h)(2)-2; SEC Release No. IA-6383 at 186.10 Final rule 211(h)(2)-1; SEC Release No. IA-6383 at 205.11 Page 23 SEC Release No. IA-6383 at 212.12 Page 23 SEC Release No. IA-6383 at 218.13 SEC Release No. IA-6383 at 224.14 SEC Release No. IA-6383 at 236.15 SEC Release No. IA-6383 at 243.16 Final rule 211(h)(2)-3; SEC Release No. IA-6383 at 261.17 SEC Release No. IA-6383 at 274.18 SEC Release No. IA-6383 at 280.19 SEC Release No. IA-6383

submitted comments regarding the same. Moreover, the liability threshold being shifted downward (therefore making it easier for an investor to bring a claim) is likely to increase the amount of diligence advisers have to undergo to ensure they’re protected from these claims. On the other hand, an environment where information flows more freely (as a result of both the increased diligence and the advisers’ and funds’ concern as to liability limitation) and investors have better insight into the funds may lead to more investing which is, of course, a net positive for the funds and the advisers. Regardless of the actual effect as to the perceived intent, the Proposed Rules, if finalized, will bring substantive changes in the world of private funds, for their advisers and investors alike.1Section 202(a)(29) of the Investment Advisers Act of 1940 defines the term “private fund” as an issuer that would be an investment company, as defined in Section 3 of the Investment Company Act of 1940 (15 U.S.C. 80a-3) (“Investment Company Act”), but for Section 3(c)(1) or Section 3(c)(7) of that Act.[View Source]

epartment or agency of the United States, or under the laws of the United States; A depository institution (as defined in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813); A credit union (as defined in section 101 of the Federal Credit Union Act (12 U.S.C. 1752); A bank holding company (as defined in section 2 of the Bank Holding Company Act of 1956 (12 U.S.C. 1841)) or a savings and loan holding company (as defined in section 10(a) of the Home Owners’ Loan Act (12 U.S.C. 1467a(a)); A broker or dealer (as defined in section 3 of the Securities Exchange Act of 1934 (15 U.S.C. 78c)) that is registered under section 15 of the Securities Exchange Act of 1934 (15 U.S.C. 78o); An exchange or clearing agency (as defined in section 3 of the Securities Exchange Act of 1934 (15 U.S.C. 78c)) that is registered under section 6 or 17A of the Securities Exchange Act of 1934 (15 U.S.C. 78fand 78q–1); An investment company (as defined in section 3 of the Investment Company Act of 1940 (15 U.S.C. 80a–3)) or an investment adviser (as defined in section 202(11) of the Investment Advisers Act of 1940 (15 U.S.C. 80b–2(11))), if the company or adviser is registered with the Securities and Exchange Commission, has filed an application for registration which has not been denied, under the Investment Company Act of 1940 (15 U.S.C. 80a–1et seq.) or the Investment Adviser Act of 1940 (15 U.S.C. 80b–1et seq.), or is an investment adviser described under section 203(l) of the Investment Advisers Act of 1940 (15 U.S.C. 80b–3(l)); An insurance company (as defined in section 2 of the Investment Company Act of 1940 (15 U.S.C. 80a–2); A registered entity (as defined in section 1a of the Commodity Exchange Act (7 U.S.C. 1a)), or a futures commission merchant, introducing broker, commodity pool operator, or commodity trading advisor (as defined in section 1a of the Commodity Exchange Act (7 U.S.C. 1a)) that is registered with the Commodity Futures Trading Commission; A public accounting firm registere