WEST PALM BEACH, FL (HedgeCo.Net) – The U.S. Securities and Exchange Commission may vote on the hedge fund regulation initiative on Oct 26, according to news reports by Reuters. The initiative is acontroversial proposal to register the US hedge fund companies; sources close to the SEC said the new law will likely pass along the same margin as the first vote. The SEC declined to comment on thematter when asked.
The new law will require US based hedge fund advisers to register with the SEC, and to open up their books to instant inspection by the SEC staff. According to published reports, the agency is still divided on the matter. The preliminary vote conducted by the agency passed on a split 3-2 vote.
The US hedge fund industry participants and trade groups oppose such regulation, arguing that there are existing provisions on the books addressing such concerns. The new proposals they argue are unnecessary and burdensome. In recent comments, the SEC Chairman William Donaldson said about fifty percent of the US advisers have already registered their activities with the SEC.
It remains uncertain what happens after the passage of such law, there are expectations that the law if passed will be challenged in the courts, and a great possibility remains that such law will likely remain in limbo for years until the courts decide one way or another.
The looming US presidential election also leaves the possibility that a new administration may emerge. After Nov 2, the job of the SEC chairman Donaldson may also be on the line as well.
Paul Oranika
Editor-in-Chief
HedgeCo.Net
Email: Editor@hedgeco.net
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