Secretary Galvin Adopts New Regulations:

New regulations have been adopted that are almost identical to those proposed on November 2, 2011 (see the link below). The regulations are effective February 3, 2012. The Division will not enforce these provisions until August 3, 2012. The exact text of the adopted regulations will be available after February 3, 2012.

1) Private Fund Exemption,

2) Change to the Definition of Institutional Buyer, and

3) Changes to Investment Adviser Discretion and Custody Requirements.

On April 20, 2011, the Massachusetts Securities Division (the “Division”) requested comment on proposed changes to 950 CMR 12. 00 et. seq. (the “Regulations”). Among other things, the Division proposed changes to the definition of institutional buyer found at 950 CMR 12.205(1)(a)(6), proposed an exemption for certain “private fund” advisers (a “private fund exemption”), and proposed changes to the regulatory requirements for those investment advisers with discretion over, or custody of, client funds (collectively, the “original proposed rules” or “original proposal”). A public hearing on this matter was held on June 23, 2011. In light of the comments received on these matters and certain developments in the regulatory framework since the original proposal, the Division has amended these proposals (the “amended proposed rules” or “amended proposals”) and is now seeking additional comment.

The amended proposal, after consideration of previously submitted public comments, makes substantive changes to the definition of institutional buyer, re-proposes a broadened private fund exemption (including the introduction of a grandfathering provision), and proposes requirements for advisers with discretion over, or custody of, client funds. This Request for Comment also proposes a technical change to 950 CMR 12.203(5)(a) to correct a typographical error. The substantive changes, as well as areas in which the Division is requesting additional comment, are described in more detail through the links below.

New Regulations effective February 3, 2012 (PDF)

Letter Approving New Regulations (dated 1/19/2012) (PDF)

Request for Comment (dated 11/2/2011)

Proposed Regulations (dated 11/2/2011)(PDF)

Submitting a Comment

Public Hearing

View Comments


Secretary Galvin Adopts New Regulations:

1) Use of Expert Network Firms,

2) Performance-Based Fees, and

3) Other Regulatory Changes.

The Massachusetts Securities Division (the "Division") has adopted new regulations. These changes include limitations on investment advisers' use of expert network firms, performance based fee restrictions, as well as other changes. For more information, click here.