On June 22, 2011, the Securities and Exchange Commission (the "SEC") adopted final rules to implement certain provisions of Title IV of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The final rules, which were adopted substantially as proposed, will generally require advisers to hedge funds and other private funds to register with the SEC under the Investment Advisers Act of 1940 (the "Advisers Act") unless they qualify for one of three new exemptions. The exemptions apply to (1) advisers solely to "venture capital funds", (2) advisers solely to private funds with less than $150 million in private fund assets under management in the United States, and (3) foreign private advisers. Although all three categories of advisers would be exempt from registration, the SEC will require advisers relying on the first two of these exemptions ("exempt reporting advisers") to file certain reports with the SEC. In addition to these exemptions, the final rules exclude "family offices" from the definition of investment adviser, thereby excluding these advisers from regulation under the Advisers Act. Lastly, the final rules reallocate regulatory responsibility for certain mid-size advisers from the SEC to the states and provide for certain new reporting requirements applicable to registered advisers and exempt reporting advisers. In order to allow those advisers who may now be required to register sufficient time in which to meet their obligations, the SEC has decided to delay their registration deadline until March 30, 2012.

We will be examining in more detail the implementation of the final rules and the various specific exemptions in subsequent client alerts. Please check back for further updates.

For the full text of the final rules, please visit the following hyperlinks:

Implementation Release: http://sec.gov/rules/final/2011/ia-3221.pdf

Exemptions Release: http://sec.gov/rules/final/2011/ia-3222.pdf

Family Offices Release: http://sec.gov/rules/final/2011/ia-3220.pdf