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Wednesday, May 9 2012

New Form PF Filings Update

An investment adviser meeting all of the following will be required to file Form PF:

  • the adviser is an SEC-registered investment adviser or an SEC-registered investment adviser that is also registered with the Commodity Futures Trading Commission as a commodity pool operator or commodity trading adviser;
  • the adviser manages one or more private funds;
  • the adviser and its related persons had at least $150 million in private fund assets under management as of the last day of its most recently completed fiscal year.

Initial filing dates, frequency and timing of filings and which sections of Form PF are required to be completed will depend upon the type of private fund adviser, regulatory assets under management and the adviser’s fiscal year end.

  • Liquidity fund advisers with over $5 billion in assets under management (and a December 31 fiscal year end) must file by July 15, 2012 and within 15 days of the end of each fiscal quarter thereafter.
  • Hedge fund advisers with over $5 billion in hedge fund assets under management must file by August 29, 2012 and within 60 days of the end of each fiscal quarter thereafter
  • Private fund advisers with over $5 billion in hedge fund assets under management must file within 120 days of the end of the fiscal year.

Initial filing dates for all other private fund advisers with a December 31 fiscal year end will be no later than April 30, 2013.

Form PF information will be submitted and viewed via a new system called the Private Fund Reporting Depository (PFRD). The PFRD system is scheduled to be live June 4, 2012 and user testing is already in progress. SEC-registered advisers are scheduled to receive entitlement to the PFRD system on June 1, 2012. The information on Form PF will not be available to the public. It will be used to assist the Financial Stability Oversight Council in its assessment of systemic risk in the U.S. financial system.

With these deadlines looming on the horizon, now is a good time to examine the data that this form will require and make certain you have everything in place to accomplish this easily. You may need to amend your subscription agreements in order to obtain all the required information.

Section 1a – Information about you and your related persons

All private fund advisers required to file Form PF must complete Section 1a. Section 1a asks general identifying information about you and the types of private funds you advise.

Section 1b – Information about the private funds you advise

All private fund advisers required to file Form PF must complete Section 1b. Section 1b asks for certain information regarding the private funds that you advise. You will need to fill out a separate Section 1b for each private fund you advise.

Section 2a – Aggregated information about hedge funds that you advise

You are required to complete Section 2a if you and your related persons, collectively, had at least $1.5 billion in hedge fund assets under management as of the last day of any month in the fiscal quarter immediately preceding your most recently completed fiscal quarter. You are not required to include the regulatory assets under management of any related person that is separately operated.

Section 2b – Information about qualifying hedge funds that you advise

If you are required to complete Section 2a, you must complete a separate Section 2b with respect to each qualifying hedge fund that you advise.

However, if you are reporting separately on the funds of a parallel fund structure that, in the aggregate, comprises a qualifying hedge fund, you must complete a separate Section 2b for each parallel fund that is part of that parallel fund structure (even if that parallel fund is not itself a qualifying hedge fund); and if you report answers on an aggregated basis for any master-feeder arrangement or parallel fund structure in accordance with Instruction 5, you should only complete a separate Section 2b with respect to the reporting fund for such master-feeder arrangement or parallel fund structure.

Section 3 – Information about liquidity funds that you advise

You are required to complete Section 3 if (i) you advise one or more liquidity funds and (ii) as of the last day of any month in the fiscal quarter immediately preceding your most recently completed fiscal quarter, you and your related persons, collectively, had at least $1 billion in combined money market and liquidity fund assets under management. You are not required to include the regulatory assets under management of any related person that is separately operated.

You must complete a separate Section 3 with respect to each liquidity fund that you advise.

However, if you report answers on an aggregated basis for any master-feeder arrangement or parallel fund structure, you should only complete a separate Section 3 with respect to the reporting fund for such master-feeder arrangement or parallel fund structure.

Section 4 – Information about private equity funds that you advise

You are required to complete Section 4 if you and your related persons, collectively, had at least $2 billion in private equity fund assets under management as of the last day of your most recently completed fiscal year. You are not required to include the regulatory assets under management of any related person that is separately operated. You must complete a separate Section 4 with respect to each private equity fund that you advise.

However, if you report answers on an aggregated basis for any master-feeder arrangement or parallel fund structure in accordance with Instruction 5, you should only complete a separate Section 4 with respect to the reporting fund for such master-feeder arrangement or parallel fund structure.

Section 5 – Request for temporary hardship exemption

You must complete Section 5 if you are requesting a temporary hardship exemption pursuant to SEC rule 204(b)-1(f).

Good Faith Estimates

You may respond using “good faith estimates based on data currently available” to the manager with respect to interests purchased prior to March 31, 2012 that have not been transferred on or after that date. The SEC is allowing this they realized that “advisers managing funds with securities outstanding prior to the adoption of Form PF would have to take additional steps in order to obtain this information because the investor diligence process will already have been completed.” The SEC expects that managers will have had the time to take those additional steps to acquire data with respect to the beneficial ownership of interests purchased (or transferred) on or after March 31, 2012.

For a copy of the Form PF please click here.

For more information on the PFRD system please click here.