Compliance and Regulatory Alerts | 04-02-24
SEC Adopts Internet Adviser Exemption Rule Changes
The SEC has announced its adoption of amendments to the internet adviser exemption governing SEC registration eligibility for certain internet investment advisers. The rule changes require advisers relying on the exemption to "have at all times an operational interactive website through which the adviser provides digital investment advisory services on an ongoing basis to more than one client." The amendments will also eliminate the current rule’s de minimis exception by requiring internet investment adviser to provide advice to all of its clients exclusively through an operational interactive website.
“These amendments modernize a 22-year-old rule to better protect investors in a digital age,” said SEC Chair Gary Gensler. “These changes better reflect what it means in 2024 truly to provide an exclusively internet-based service.”
An adviser relying on the exemption must comply with the rule by March 31, 2025. Any adviser no longer eligible under the exemption to register with the SEC must withdraw its registration by filing a Form ADV-W and register in one or more states by June 29, 2025.
How Bates Helps
Our RIA services include processing both SEC and state registrations, as well as transitions from SEC to state or state to SEC for investment advisers. We can also help investment advisers assess the application of new regulatory rules as they relate to their business model. Contact Bates Compliance today to learn more.