In response to the COVID-19 pandemic’s potential impact on firms, the SEC has come forward with several contingency and relief measures in an effort to ease the regulatory burdens that investment advisors and stakeholders may be facing in the new all-remote work environment.
During the earlier days of the pandemic, the SEC announced that they were extending filing deadlines for a number of regulatory obligations including Form ADV, Form PF and Brochure Delivery. Now, both the SEC and NFA continue to monitor how the market is functioning as well as impending risks that may be lingering in this new environment in order to be able to provide swift guidance and relief to impacted parties if needed while still maintaining continuity of operations.
A comprehensive list of relief measures provided for regulatory filings are listed below along with key conditions to be followed by firms availing these reliefs and relaxations:
The relief specified in this Order is limited to filing or delivery obligations, as applicable, for which the original due date is on or after the date of the Original Order but on or prior to June 30, 2020.
For the time period specified above, a registered investment adviser is exempt from the requirements: (a) under Rule 204-1 under the Advisers Act to file an amendment to Form ADV; and (b) under Rule 204-3(b)(2) and (b)(4) related to the delivery of Form ADV Part 2 (or a summary of material changes) to existing clients, where the conditions below are satisfied; For the time period specified above, an exempt reporting adviser is exempt from the requirements under Rule 204-4 under the Advisers Act to file reports on Form ADV, where the conditions below are satisfied.
For the time period mentioned above, a registered investment adviser that is required by Section 204(b) of and Rule 204(b)-1 under the Advisers Act to file Form PF is exempt from those requirements, where the conditions below are satisfied.
NFA Compliance Rule 2-46 requires each CPO Member to file the NFA Form PQR on a quarterly basis with NFA for each pool that it operates within 60 days after the quarters ending in March, June and September and within 90 days after the quarter ending in December. Under these requirements, CPO Members are required to file the Form PQR for the quarter ended December 31, 2019 by March 30, 2020 and for the quarter ended March 31, 2020 by May 30, 2020. NFA is extending the due date for the December 31, 2019 PQR (due on March 30) until May 15, 2020 and the due date for the March 31, 2020 PQR (due on May 30, 2020) until July 15, 2020.NFA Compliance Rule 2-46 also requires each CTA Member to file the NFA Form PR on a quarterly basis with NFA within 45 days after each quarter end. Under this requirement, CTA Members are required to file NFA Form PR for the quarter ended March 31, 2020 by May 15, 2020. NFA is extending the due date for the March 31, 2020 NFA Form PR until June 30, 2020.
Conditions (Form PF and ADV)1
- The registered investment adviser or exempt reporting adviser is unable to meet a filing deadline or delivery requirement due to circumstances related to current or potential effects of COVID-19.
- The investment adviser relying on this Order with respect to the filing of Form ADV or delivery of its brochure, summary of material changes, or brochure supplement required by Rule 204-3(b)(2) or (b)(4), promptly notifies the Commission staff via email at IARDLive@sec.gov and discloses on its public website (or if it does not have a public website, promptly notifies its clients and/or private fund investors) that it is relying on this Order.
- Any investment adviser relying on this order with respect to filing Form PF required by Rule 204(b)-1 must promptly notify the Commission staff via email at FormPF@sec.gov stating that it is relying on this Order.
- The investment adviser files the Form ADV or Form PF, as applicable, and delivers the brochure (or summary of material changes) and brochure supplement required by Rule 204-3(b)(2) and (b)(4) under the Advisers Act, as soon as practicable, but not later than 45 days after the original due date for filing or delivery, as applicable.
As the industry continues to navigate through the pandemic and adjust to the new all-remote work environment, IVP Regulatory Reporting (Raptor) and Raptor-as-as-Service can assist firms by significantly reducing filing times and streamlining the compliance process through automation and a team of highly experienced regulatory analysts.“Order under section 206A of the investment advisers act of 1940 granting exemptions from specified provisions of the investment advisers act and certain rules the reunder,” Securities and Exchange Commission, March 25, 2020.
 “Coronavirus (COVID-19) Update–Regulatory Relief for CPOs and CTAs,” NFA, March 23, 2020.