SEC adopts overhaul to Form PF, requiring more frequent reporting for some advisers

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SEC adopts overhaul to Form PF, requiring more frequent reporting for some advisers

08 June 2023

The U.S. Securities and Exchange Commission (SEC) adopted final amendments to Form PF, the confidential reporting form required for certain SEC-registered investment advisers (RIAs) to private funds, on 3 May 2023. The amendments, first proposed by the SEC in January 2022, mainly affect RIAs, certain large hedge funds, and private equity funds, but they impose certain quarterly material event reporting requirements by all advisers to private equity funds that are required to file Form PF. The changes, which come a decade after the form was introduced, are designed to enhance the ability of the cross-governmental Financial Stability Oversight Council (FSOC) to monitor systemic risk as well as bolster the SEC’s regulatory oversight of private fund advisers and investor protection.

The amendments introduce the following requirements:

1. New Section 6 requires quarterly reporting by all private equity fund advisers regarding the following events:

Adviser-led secondary transactions; and
When investors remove a fund’s general partner (GP) or otherwise opt to terminate the investment period or terminate the fund.

2. Amendments to Section 4 will require enhanced annual reporting by large private equity fund advisers to improve FSOC’s ability to monitor systemic risk and improve the ability of both FSOC and the SEC to identify and assess changes in market trends, including as to certain GP and limited partner (LP) clawback events and additional data on fund-level borrowing.

3. New Section 5 requires current reporting (i.e. as soon as practicable and no later than 72 hours) by certain large hedge fund advisers to report events that may indicate significant stress that could harm fund investors or signal risk in the broader financial system, including significant withdrawals or redemptions, extraordinary investment losses, or significant margin or default events.