The reference below comes directly from the SEC website and provides the reader with a good overview of the different laws and rules which govern the hedge fund industry, and the order in which those rules are applied (that is, the securities statutes trump SEC interpretive releases). This reference is important for hedge fund managers to understand because there are many different types of authority which are cited in this blog and in the hedge fund offering documents and hedge fund compliance manuals. If you have questions on what sources are the most important for your particular situation, you should discuss this with your hedge fund attorney. As always feel free to contact us if you have legal questions regarding your hedge fund.
Researching the Federal Securities Laws Through the SEC Website
This guide provides an overview of how to research the securities law through the SEC website and is provided as a service to investors and members of the public. It is neither a legal interpretation nor a statement of SEC policy. If you have questions concerning the meaning or application of a particular law or rule you should consult with an attorney who specializes in securities law. This guide does not address primary and secondary sources available in print or through other websites, other than those to which the SEC website links. The guide is organized by providing suggestions for the research of:
* Statutes (the Securities Laws)
* SEC Rules and Regulations
* SEC Concept Releases
* SEC Interpretive Releases
* SEC Staff Interpretations
In general, you should conduct your research on the federal securities laws in the order prescribed above. This is because while the federal statutes and the SEC rules and regulations have the force of law, other SEC-issued documents vary in the degree to which they carry the force of law.
Major pieces of legislation, such as the Securities Act of 1933, the Securities Exchange Act of 1934, and the Investment Company Act of 1940, provide the framework for the SEC’s oversight of the securities markets. These statutes are broadly drafted, establishing basic principles and objectives. The laws that govern the securities industry include:
* Securities Act of 1933
* Securities Exchange Act of 1934
* Public Utility Holding Company Act of 1935 (repealed)
* Trust Indenture Act of 1939
* Investment Company Act of 1940
* Investment Advisers Act of 1940
* Securities Investor Protection Act of 1970
* Public Company Accounting Reform and Corporate Responsibility Act of 2002 (Sarbanes-Oxley Act of 2002)
You can find general descriptions of the objectives of each of these statutes in the “About the SEC” section of our website. The web pages of the Division of Investment Management and the Division of Corporation Finance also provide links to the federal securities laws and regulations that each Division oversees.
TIP: The SEC website links to the text of the federal securities laws provided by the House Committee on Financial Services. The texts include references to the United States Code (U.S.C). U.S.C. citations are the official citations for federal laws. You can find the securities laws in Title 15 of the U.S.C. For example, the Securities Act of 1933 is 15 U.S.C. § 77a et seq.; the Securities Act of 1934 is 15 U.S.C. § 78a et seq.; the Investment Company Act of 1940 is 15 U.S.C. § 80-1 et seq.; and the Investment Adviser Act is 15 U.S.C. §80b-1 et seq.
As a convenience to researchers and investors, the SEC website provides a link to the University of Cincinnati’s Securities Lawyer’s Deskbook. The Securities Lawyer’s Deskbook allows you to research the text of the federal securities laws and regulations by using key words and phrases.
Legislative history is the official record of the passage of a statute. It is useful if you are looking for Congressional intent at the time Congress passed a particular statute. Although our website does not link to the legislative history of the securities laws, we provide a link to the Library of Congress’ THOMAS online database. Through THOMAS, you can research the legislative history for more recent securities laws. The THOMAS database begins with the 104th Congress (1995). It also provides searches for bill summary, bill text, and public law beginning with the 93rd Congress (1973).
TIP: The Securities Lawyer’s Deskbook is helpful when checking for legislative or administrative changes. As noted in its Introduction, “the data on any page of the Securities Lawyer’s Deskbook can be checked for incorporation of the latest regulatory or legislative action by reviewing the history note at the bottom of each page.”
SEC Rules and Rulemaking
Rulemaking is the process by which federal agencies implement legislation passed by Congress and signed into law by the President. The SEC engages in rulemaking to maintain fair and orderly markets and to protect investors by altering regulations or creating new ones. There are both official and unofficial sources of SEC rules and regulations.
NOTE: If you are researching administrative regulations, including SEC rules, you always should check whether they are current. You also should check the coverage and status of all sources.
* The Federal Register. The Federal Register is the official daily publication where the SEC and other federal agencies first publish proposed regulations for comment, adopted final regulations, explanations of actions taken, and announcements of significant interpretations of the law. The Regulatory Actions section of our webpage may include links to the Federal Register publication of a specific rule. If our web pages do not link to a Federal Register release, you can find a copy of the release by going to the website of the U.S. Government Printing Office.
* The Code of Federal Regulations. After publication in the Federal Register, final regulations are then arranged by subject into the Code of Federal Regulations (CFR). SEC rules are found in Chapter II of Title 17 — Commodity and Securities Exchanges. Chapters are divided into parts, which cover particular topics. Parts are divided into sections (which correspond to rule numbers). The parts covering the federal securities laws are:
o 17 CFR, part 230 – Securities Act of 1933
o 17 CFR, part 240 – Securities Exchange Act of 1934
o 17 CFR, part 250 – Public Utility Holding Company Act of 1935
o 17 CFR, part 260 – Trust Indenture Act of 1939
o 17 CFR, part 270 – Investment Company Act of 1940
o 17 CFR, part 275 – Investment Advisers Act of 1940
o 17 CFR, part 300 – Securities Investor Protection Act (Rules of SIPC)
You can find other frequently requested material in the CFR at:
o 17 CFR, part 200 – General SEC Rules (includes organization of SEC, codes of conduct and ethics; information requests)
o 17 CFR, part 201 – SEC Rules of Practice
o 17 CFR, part 202 – Informal Procedures
o 17 CFR, part 203 – Investigations
o 17 CFR, part 210 – Regulation S-X
o 17 CFR, part 229 – Regulation S-K
Tip: Individuals often refer to SEC rules and regulations by the number only, without reference to the entire CFR citation. However, you need the full CFR citation to find a specific rule. For example if you are looking for Rule 10b-5 of the Securities Exchange Act of 1934, the citation is 17 CFR 240.10b-5. An idiosyncrasy of the federal securities laws is that the term “regulation” often refers to a collection of rules for example, Regulation S-K and Regulation SHO.
The SEC’s website provides access to regulations codified in the CFR. In addition, the SEC’s website includes selected rules and regulations on the Forms web page.
CFR Titles are updated annually. Therefore if you are researching recent rulemaking, you should check GPO’s website for the monthly “List of CFR Sections Affected.” (LSA). As noted on GPO’s web page, the LSA “lists proposed, new, and amended Federal regulations that have been published in the Federal Register since the most recent revision date of a CFR title. Each LSA issue is cumulative and contains the CFR part and section numbers, a description of its status (e.g., amended, confirmed, revised), and the Federal Register page number where the change(s) may be found.”
The CFR references the Federal Register citation for the original adopting release as well as any releases amending the rule or regulation.
The “Regulatory Actions” section of our website is an unofficial source of both Final and Proposed Rulemaking Releases. You should note that the date of the releases reported on our website is the date of the Commission’s approval and not the publication date in the Federal Register.
Tip: Rulemaking releases, unlike the text of the rules found in the CFR, provide in-depth background information about the origin of specific rules. The releases include, for example, the staff’s basis for drafting the rule, changes from earlier proposed rules, and a summary of public comments.
* Final Rules. Final rules releases dating back to September 1994 are available on our website as are selected rulemaking releases for the period from 1962 to 1994. The Details section for a particular release will include links to the proposed rule(s), comments, and also identify the effective date and the compliance date (where appropriate). The “Final Rules” section also will include amendments or corrections to the rule as well as notices of extensions or compliance dates.
* Proposed Rules. In addition to releases of proposed rules, the “Regulatory Actions” web page includes links to public comments about the rules as well as links to related releases. We also post the Federal Register version of the release. You can find the proposed rules by looking for either the release number (in some cases the first of several release numbers for the specific rule) or by date. The web page does not organize the proposed rules by subject matter or by file number. The website includes proposed rules going back to 1994.
What Is an Effective Date?
The effective date is the date on which a rule or regulation becomes law.
What Is a Compliance Date?
The compliance date is the date on which the entities covered by the rule must comply with the rule.
What Do the Prefixes to the Release Numbers Mean?
The prefixes included in the release numbers identify the Act pursuant to which the rule was promulgated. Common prefixes are:
33-: Securities Act of 1933
34-: Securities Exchange Act of 1934
35-: Public Utility Holding Company Act of 1935
39-: Trust Indenture Act of 1939
IA-: Investment Advisers Act of 1940
IC-: Investment Company Act of 1940
FR-: Financial Releases (should not be confused with citations to the Federal Register)
If you are researching a rule by release number, you can use the non-EDGAR search engine at the top of our home page. This will help you to locate a release in the event that this is not the release number identified on the rulemaking pages.
What Is the Difference Between an SR- and an S7- File?
S7- files are the file numbers assigned to Commission rules. SR-files refer to rules of the self-regulatory organizations.
SEC Concept Releases
The Commission occasionally publishes “concept” releases to solicit the public’s views on securities issues so that we can better evaluate the need for future rulemaking. The Regulatory Actions section of our web site includes concept releases dating back to 1994.
SEC Interpretive Releases
The Commission occasionally provides guidance on topics of general interest to the business and investment communities by issuing “interpretive” releases, in which we publish our views and interpret the federal securities laws and SEC regulations. Interpretive releases (like concept releases) are not positive law but provide useful guidance as to the position of the SEC staff on various issues. The “Regulatory Actions” web page includes interpretive releases from 1995 to the present. The Regulatory Actions web page does not organize the releases by topic. However, the web page for the Division of Corporation Finance includes interpretive releases and other information, organized by subject category, dating back to 2002. The Division of Market Regulation’s web page also includes interpretive releases.
Tip: The CFR includes indices of interpretive releases of the Commission, organized by the relevant Act. The CFR includes the Federal Register citation. For example, you can find citations for interpretive releases covering the Securities Exchange Act at 17 CFR, part 241.
SEC Policy Statements
From time to time, the Commission issues a “policy statement” to clarify its position on a particular matter. The policy statements include interagency statements. You can find the policy statements on our “Regulatory Actions web page.
SEC Staff Interpretations
The SEC staff provides informal guidance through various oral and written statements. Because they represent the views of the staff, these interpretations are not legally binding. You can find links to the available interpretations through the Staff Interpretations section of our website.
SEC Staff Legal and Accounting Bulletins
Staff Legal Bulletins summarize the Commission staff’s views regarding various aspects of the federal securities laws and SEC regulations. They represent interpretations and policies followed by the Divisions of Corporation Finance, Market Regulation, or Investment Management on any given matter.
Staff Accounting Bulletins reflect the Commission staff’s views regarding accounting-related disclosure practices. They represent interpretations and policies followed by the Division of Corporation Finance and the Office of the Chief Accountant in administering the disclosure requirements of the federal securities laws. You also can find the Codification of Staff Accounting Bulletins on our website.
No-Action, Exemptive and Interpretive Letters
No-action, exemptive and interpretive letters issued by the staff members of the Divisions of Corporation Finance, Market Regulation, and Investment Management posted on our web site date back to 2002. Staff Letters to Industry from the staff of the Office of the Chief Accountant are posted from 1998 to the present. No-action letters are letters are inquiries sent by individuals or entities about a specified proposed conduct requesting that the SEC staff not recommend an enforcement action in the event that the proposed conduct occurs.
Where to Obtain SEC Materials Not Available on Our Website
You can request SEC rules and other materials not available on our website by accessing How to Request Public Documents.
Where to Go for Additional Assistance
If you need assistance in find SEC laws or regulations on our website, please call the Office of Investor Education and Advocacy at (202) 551-6551 or email [email protected]