Global Investment Law Watch

Exploring the legal and regulatory issues affecting the worldwide asset management community.

 

1
Europe: Modernisation of the PRIIPs KID Considered by European Parliament
2
Out of the Shadows: SEC Shines a Light on Insider Trading
3
The SEC Narrows the Internet Adviser Exemption
4
Update to the Naming Convention for Exchange Traded Products
5
Not That FAR Away
6
SEC’s Increased Focus on “AI Washing:” Charges Announced Against Two Investment Advisers for Violations of the Marketing Rule
7
Australia: Labelling Responsible Investment Products
8
Australia: ASIC Issues New Legislative Instrument for Exchange Traded Funds
9
NAPFM, AIMA, and MFA File Complaint Against SEC’s New Dealer Rule
10
Singapore Tax: Implications of Section 10L on Investment Funds

Europe: Modernisation of the PRIIPs KID Considered by European Parliament

By: Áine Ní Riain and Shane Geraghty

On 20 March 2024, the European Parliament’s Committee on Economic and Monetary Affairs (ECON) voted in favour of draft modernisation measures for the PRIIPs Key Information Document (KID).

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Out of the Shadows: SEC Shines a Light on Insider Trading

By: Neil T. Smith, Hayley Trahan-Liptak, and Sophia A. Khan

The traditional understanding of how the government charges insider trading is evolving, as the Securities and Exchange Commission (SEC) pushes to expand the scope of what constitutes misappropriation of material non-public information (MNPI) under Rule 10b-5.

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The SEC Narrows the Internet Adviser Exemption

By: Jennifer L. Klass, Matthew J. Rogers, and Bradley D. Bostwick

On 27 March 2024, the US Securities and Exchange Commission (SEC) adopted amendments (the Amendments) to Rule 203A-2(e) under the Investment Advisers Act of 1940, known as the “Internet Adviser Exemption.” The Internet Adviser Exemption allows certain advisers that provide investment advice through an interactive website (Internet Advisers) to register with the SEC, even if they do not have enough assets under management to otherwise qualify for federal registration.

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Update to the Naming Convention for Exchange Traded Products

By: Matthew Watts, Lisa Lautier and Dhivya Kalyanakumar

Since 2017, the Australian Securities and Investments Commission (ASIC) has provided guidance to licensed exchanges on exchange traded products (ETP) naming conventions under Information Sheet 230 (INFO 230). This policy is designed to help ensure that admission and monitoring standards for ETP’s support fair, orderly and transparent markets.

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Not That FAR Away

By: Claudine Salameh and Tamsyn Sharpe

On 15 March 2024 the Financial Accountability Regime (FAR) came into effect for authorised-deposit taking institutions (ADIs). Application of the FAR will be extended to insurers and registrable superannuation entities from 15 March 2025.

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SEC’s Increased Focus on “AI Washing:” Charges Announced Against Two Investment Advisers for Violations of the Marketing Rule

By: Matthew Rogers and Annabelle North

Following up on its previously-issued Investor Alert warning investors on the use of so-called “AI washing” by advisers in their marketing materials, the Securities and Exchange Commission (SEC) announced on 18 March 2024 the settlements of charges against two investment advisers for “making false and misleading statements about their purported use of artificial intelligence (AI).”

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Australia: ASIC Issues New Legislative Instrument for Exchange Traded Funds

By: Matthew Watts, Lisa Lautier and Dhivya Kalyanakumar

On 15 March 2024 the Australian Securities and Investments Commission (ASIC) issued a new legislative instrument extending existing regulatory relief previously only available to passively managed index tracking exchange traded funds (ETFs) so that it will now also apply to a broader range of ETFs (such as actively managed ETFs) quoted on a financial market operated by the ASX or Cboe.  

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NAPFM, AIMA, and MFA File Complaint Against SEC’s New Dealer Rule

By: Richard F. Kerr, Eden L. Rohrer, Jessica D. Cohn, and Raymond F. Jensen

On 18 March 2024, the National Association of Private Fund Managers, Alternative Investment Management Association, Limited and Managed Funds Association (together, Plaintiffs) jointly filed a complaint (Complaint) against the US Securities and Exchange Commission (SEC) alleging that the SEC’s newly adopted final rule (Dealer Rule) vastly overstepped and expanded the SEC’s authority. The Complaint, which was filed in federal court in Texas, details how the Dealer Rule, expanding those industry participants who would be “dealers” under the Securities Exchange Act of 1934, is overbroad and was adopted in violation of the Administrative Procedures Act.

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Singapore Tax: Implications of Section 10L on Investment Funds

By: Edward Bennett, Roberta Chang, Anita Zhou and Ke Jia Lim

Historically, Singapore has not taxed capital gains. However, since 1 January 2024, under the newly enacted Section 10L of the Income Tax Act 1947 of Singapore, gains received in Singapore from the sale or disposal of any foreign asset (e.g. shares issued by a company incorporated outside Singapore) by an entity within a multinational group will be treated as taxable income if the entity does not have adequate economic substance in Singapore. Section 10L is designed to address international tax avoidance risks and align the key areas of Singapore’s tax regime with international norms and the European Union’s Code of Conduct Group’s foreign source income exemption (FSIE) guidance.

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