[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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