[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[S. 3948 Introduced in Senate (IS)]

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117th CONGRESS
  2d Session
                                S. 3948

To amend the Investment Company Act of 1940 to prohibit limitations on 
    closed-end companies investing in private funds, and for other 
                               purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             March 29, 2022

  Mr. Daines introduced the following bill; which was read twice and 
    referred to the Committee on Banking, Housing, and Urban Affairs

_______________________________________________________________________

                                 A BILL


 
To amend the Investment Company Act of 1940 to prohibit limitations on 
    closed-end companies investing in private funds, and for other 
                               purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Increasing Investor Opportunities 
Act''.

SEC. 2. CLOSED-END COMPANY AUTHORITY TO INVEST IN PRIVATE FUNDS.

    (a) In General.--Section 5 of the Investment Company Act of 1940 
(15 U.S.C. 80a-5) is amended by adding at the end the following:
    ``(d) Closed-End Company Authority To Invest in Private Funds.--
            ``(1) In general.--The Commission may not limit a closed-
        end company from investing any or all of the assets of the 
        company in a private fund solely or primarily because of the 
        status of the fund as a private fund.
            ``(2) Application.--Notwithstanding section 6(f), this 
        subsection shall apply to a closed-end company that elects to 
        be treated as a business development company pursuant to 
        section 54.''.
    (b) Definition of Private Fund.--
            (1) Investment company act of 1940.--Section 2(a) of the 
        Investment Company Act of 1940 (15 U.S.C. 80a-2(a)) is amended 
        by adding at the end the following:
            ``(55) The term `private fund' means an issuer that would 
        be an investment company but for the exception provided for in 
        paragraph (1) or (7) of section 3(c).''.
            (2) Investment advisers act of 1940.--Section 202(a) of the 
        Investment Advisers Act of 1940 (15 U.S.C. 80b-2(a)) is 
        amended--
                    (A) by redesignating the second paragraph (29) 
                (relating to ``commodity pool'' and other terms) as 
                paragraph (31); and
                    (B) by amending paragraph (29) to read as follows:
            ``(29) The term `private fund' has the meaning given the 
        term in section 2(a) of the Investment Company Act of 1940 (15 
        U.S.C. 80a-2(a)).''.
    (c) Treatment by National Securities Exchanges.--Section 6(b) of 
the Securities Exchange Act of 1934 (15 U.S.C. 78f(b)) is amended by 
adding at the end the following:
            ``(11)(A) The rules of the exchange do not prohibit the 
        listing or trading of securities of a closed-end company by 
        reason of the amount of the investment by the company of assets 
        in private funds.
            ``(B) In this paragraph--
                    ``(i) the term `closed-end company'--
                            ``(I) has the meaning given the term in 
                        section 5(a) of the Investment Company Act of 
                        1940 (15 U.S.C. 80a-5(a)); and
                            ``(II) includes a closed-end company that 
                        elects to be treated as a business development 
                        company under section 6(f) of the Investment 
                        Company Act of 1940 (15 U.S.C. 80a-6(f)); and
                    ``(ii) the term `private fund' has the meaning 
                given the term in section 2(a) of the Investment 
                Company Act of 1940 (15 U.S.C. 80a-2(a)).''.
    (d) Investment Limitation.--Section 3(c) of the Investment Company 
Act of 1940 (15 U.S.C. 80a-3(c)) is amended--
            (1) in paragraph (1), in the matter preceding subparagraph 
        (A), in the second sentence, by striking ``subparagraphs (A)(i) 
        and (B)(i)'' and inserting ``subparagraphs (A)(i), (B)(i), and 
        (C)''; and
            (2) in paragraph (7)(D), by striking ``subparagraphs (A)(i) 
        and (B)(i)'' and inserting ``subparagraphs (A)(i), (B)(i), and 
        (C)''.
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