On July 15, 2009, the U.S. Department of the Treasury proposed legislation entitled the “Private Fund Investment Advisers Registration Act of 2009” that would require all investment advisers to hedge funds and other private pools of capital, including private equity and venture capital funds, with more than $30 million of assets under management to register with the SEC. Currently, under the Advisers Act, an investment adviser is exempt from registration if during the preceding 12 months the adviser has fewer than 15 clients (with each fund being considered one client) and does not hold itself out generally to the public or act as an investment adviser.

Also, on July 15, 2009, before the Subcommittee on Securities, Insurance and Investment of the U.S. Senate Committee on Banking, Housing, and Urban Affairs, Andrew “Buddy” Donohue testified that the SEC supports the registration of private fund advisers under the Advisers Act. He also discussed other legislative options, such as the registration of private funds under the 1940 Act and/or providing the SEC with rulemaking authority in the 1940 Act exemptions on which private funds rely, that he recommended be considered by the Subcommittee.