The Securities and Exchange Commission postponed hedge fund disclosure requirements by a year and is exploring ways to reduce the number of private industry firms that have to file the confidential information with the regulator, Chairman Paul Atkins said Wednesday.
The markets regulator voted to approve another delay — until Oct. 1, 2026 — for private funds to file additional disclosures about their financial positions during market tumult. The delay is meant to give the agency the time needed to undertake a broader review of potential changes to the confidential filing used by private funds to inform the regulator of their trades, performance and business structures.
The scope of data that funds are required to report has been a perennial fight between the industry and the regulator.
Atkins added during the meeting that he’d asked staff to explore ways to reduce the number of private funds required to file so-called Form PF “without meaningfully reducing the key risk and exposure information needed” by regulators to keep on top of financial instability.
The SEC has repeatedly postponed the Biden-era disclosures’ effective date. The Commodity Futures Trading Commission, which also regulates some private funds, is planning to soon move to delay its own additional disclosures deadline, Atkins said during the meeting.
The SEC chair said earlier this year he’d asked staff to undertake a “comprehensive review” of the data collection requirements and expressed concerns that the government’s use of the data might not justify the “massive burdens” it imposes on investment managers.
Under former SEC Chair Gary Gensler, the agency added disclosure requirements that aimed to help regulators better monitor the private fund industry and quickly get a handle on market tumult. Those included new information on significant margin calls or counterparty exposure and were meant to be filed soon after a fund manager was aware of an issue, rather than on a quarterly basis.
Proponents of the changes, including Democratic Commissioner Caroline Crenshaw, have said the measures would help stave off a future crisis. She criticized the SEC’s continued delays to the 2024 amendments for violating rules governing how agencies craft and implement new regulations. The repeated delays suggest the agency is doing so “to buy ourselves more time to write them out of existence before they ever go into effect,” she said during the meeting.
Investment managers had said the new reporting requirements didn’t reflect their business structures and could give an inaccurate view of the health and stability of their funds. The delay will also help fund managers avoid unnecessary compliance costs in implementing data reporting tools that could ultimately be scrapped, industry has said.
“The extension will improve data quality and give regulators time to reassess whether the rule aligns with its statutory purpose,” Bryan Corbett, president and chief executive officer of the Managed Funds Association, said in an emailed statement.
Photo: Diego M. Radzinschi/ALM
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