An exemption from investment adviser registration was proposed for private fund advisers by the California Department of Corporations. The exemption, if adopted, would replace the currently effective de minimis exemption that has been extended by emergency for 90 days from January 18, 2012 and anticipated to become inoperative on June 28, 2012. The proposed exemption would require private fund advisers to meet certain conditions, including the advisers not being subject to specified "bad boy" disqualification provisions, submitting SEC-filed reports required by Rule 204-4 of the Investment Advisers Act of 1940, and paying the $125 adviser registration fee to make the exemption effective for one year. Additional requirements would apply to private fund advisers to 3(c)(1) funds.
While no public hearing is currently scheduled, interested persons may submit written comments about the proposed rule until 5:00 p.m. on February 20, 2012. Comments may be mailed to the Department of Corporations, Attn: Karen Fong, Office of Legislation and Policy, 1515 K Street, Suite 200, Sacramento, CA 95814, or emailed to firstname.lastname@example.org, or faxed to (916)-322-5875.