Funds irked by general solicitation backpedal

Author: Danielle Myles | Published: 18 Jul 2013
  • Last week the SEC proposed filing and disclosure requirements for private funds that rely on their new general solicitation rights;
  • Hedge fund managers described the proposal as a step backwards,
  • The additional burdens could deter funds from advertising and impede capital formation;
  • But the long-term benefits of general solicitation could still transform the industry - not just through fundraising, but also transparency and rebranding.

Reporting requirements to be imposed on private funds looking to take advantage of their new marketing rights negate some of the benefits of last week’s general solicitation changes.

The hedge fund industry has described the plan as a step backwards, which undermines steps to lift the 80-year ban on private fund advertising

The US Securities & Exchange Commission (SEC) proposed the changes to Regulation D on...