[Federal Register Volume 64, Number 123 (Monday, June 28, 1999)]
[Unknown Section]
[Pages 34539-34540]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-16316]
=======================================================================
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
17 CFR Part 200
[Release No. IA-1804]
Delegation of Authority to Cancel Registration of Certain
Investment Advisers
AGENCY: Securities and Exchange Commission.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: The Securities and Exchange Commission (''Commission'') is
amending its rules to delegate its authority to the Director of the
Division of Investment Management to cancel the registration of any
investment adviser that is not eligible for Commission registration.
This amendment updates the staff's delegated authority to reflect
recent amendments to the Investment Advisers Act of 1940, and is
intended to conserve Commission resources by permitting the staff to
cancel, when appropriate, the registration of investment advisers that
are not eligible to be registered with the Commission.
EFFECTIVE DATE: The rule will become effective June 28, 1999.
FOR FURTHER INFORMATION CONTACT: J. David Fielder, Senior Counsel, at
(202) 942-0530, Task Force on Investment Adviser Regulation, Division
of Investment Management, Securities and Exchange Commission, 450 Fifth
Street, N.W., Washington, D.C. 20549-0506.
SUPPLEMENTARY INFORMATION: The National Securities Market Improvement
Act of 1996 (``Improvement Act'') \1\ amended the Investment Advisers
Act of 1940 (``Advisers Act'') to reallocate federal and state
regulatory responsibility for investment advisers. Under section 203A
of the Advisers Act, the Commission has regulatory responsibility for
advisers with at least $25 million of assets under management and
advisers to a registered investment company.\2\ Section 203A prohibits
all other advisers from registering with the Commission.\3\
---------------------------------------------------------------------------
\1\ Pub. L. No. 104-290, 110 Stat. 3416 (1996) (codified in
scattered sections of the United States Code).
\2\ 15 U.S.C. 80b-3a(a).
\3\ 15 U.S.C. 80b-3a(a). The Commission has adopted a rule that
exempts certain types of advisers from this prohibition. 17 CFR
275.203A-2.
---------------------------------------------------------------------------
Section 203(h) of the Advisers Act authorizes us to cancel the
registration of certain investment advisers.\4\ Before enactment of the
Improvement Act, we had authority to cancel the registration
[[Page 34540]]
of advisers that were no longer in business, and we delegated this
authority to the staff.\5\ The Improvement Act amended Section 203(h)
and gave us additional authority to cancel the registration of
investment advisers that are ``prohibited from registering as an
investment adviser under section 203A. * * *'' \6\ Today, we are
delegating this authority to the staff as well.
---------------------------------------------------------------------------
\4\ 15 U.S.C. 80b-3(h).
\5\ We have delegated this authority to the Division of
Investment Management (17 CFR 200.30-5(e)(2)), the Office of Filings
and Information Services (17 CFR 200.30-11(b)(2)(i)), and the Office
of Compliance, Inspections and Examinations (17 CFR 200.30-
18(h)(1)).
\6\ 15 U.S.C. 80b-3(h).
---------------------------------------------------------------------------
We expect the staff periodically to identify advisers whose
registration should be canceled because they are not eligible for
Commission registration. The staff may submit matters to the Commission
for consideration as it deems appropriate. Before the staff cancels the
registration of any adviser, the staff will notify the adviser and
provide an opportunity to dispute the basis for the proposed
cancellation, and any investment adviser whose registration is canceled
by the staff may appeal that decision directly to the Commission.\7\
---------------------------------------------------------------------------
\7\ 17 CFR 201.430.
---------------------------------------------------------------------------
The Commission finds, in accordance with Section 553(b)(3)(A) of
the Administrative Procedure Act, that this amendment relates solely to
agency organization, procedure, or practice, and does not relate to a
substantive rule.\8\ Accordingly, notice and opportunity for public
comment are unnecessary, and publication of the amendment 30 days
before its effective date is also unnecessary.
---------------------------------------------------------------------------
\8\ 5 U.S.C. 553(b)(3)(A).
---------------------------------------------------------------------------
List of Subjects in 17 CFR Part 200
Administrative practice and procedure, Authority delegations
(Government agencies).
Text of Amendment
For the reasons set out in the preamble, Title 17, Chapter II of
the Code of Federal Regulations is amended as follows:
PART 200--ORGANIZATION; CONDUCT AND ETHICS; AND INFORMATION AND
REQUESTS
1. The authority citation for part 200 continues to read in part as
follows:
Authority: 15 U.S.C. 77s, 78d-1, 78d-2, 78w, 78ll(d), 78mm, 79t,
77sss, 80a-37, 80b-11, unless otherwise noted.
* * * * *
2. Section 200.30-5 is amended by revising paragraph (e)(2) to read
as follows:
Sec. 200.30-5 Delegation of authority to Director of Division of
Investment Management.
* * * * *
(e) * * *
(2) Pursuant to section 203(h) of the Act (15 U.S.C. 80b-3(h)), to
authorize the issuance of orders canceling registration of investment
advisers, or applications for registration, if such investment advisers
or applicants for registration are no longer in existence, not engaged
in business as investment advisers, or are prohibited from registering
as investment advisers under Section 203A of the Act (15 U.S.C. 80b-
3a).
* * * * *
Dated: June 22, 1999.
By the Commission.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 99-16316 Filed 6-25-99; 8:45 am]
BILLING CODE 8010-01-P