SEC extends Form ADV deadline for advisory firms affected by COVID-19

Registered investment advisers will have 45 extra days to file ADVs, brochure updates

This story has been corrected to reflect a 45-day extension for filing Form ADVs.

The Securities and Exchange Commission announced Friday night it is extending the deadline for filing registration paperwork for investment advisers who have been affected by COVID-19.

Under the SEC’s order, registered investment advisers have an extra 45 days to submit an amended Form ADV, which is a registration document that describes the advisory business, and Form ADV Part 2, a narrative brochure that outlines a firm’s services, fees, disciplinary history and conflicts of interest.

The SEC said advisers are eligible for the filing relief if they are “unable to meet a filing deadline or delivery requirement due to circumstances related to current or potential effects of COVID-19.”

An adviser who wants to take advantage of the deadline extension must notify the SEC via email at [email protected] and disclose on its website that it will be delaying its ADV filing, describe why it could not file its ADV on time, and indicate when it will be filing the paperwork.

Most investment advisers file their ADVs by the end of the first quarter. The order covers those due through April 30.

The Investment Adviser Association recently told the SEC that its members were experiencing difficulties in meeting the ADV deadline. Collecting and confirming the required data had to be done while simultaneously dealing with client worries and business continuity challenges.

“We are extremely pleased and we’re grateful to both the commission and the Division of Investment Management for being so responsive to our concerns,” said Gail Bernstein, IAA general counsel. “This is uncharted territory for all of us. [The SEC] is signaling flexibility. They are proactive and responsive to real concerns.”

In a press release, the SEC said the disruptions to everyday life caused by the coronavirus could prevent some RIAs “operating in affected areas” from staying on schedule to file their ADVs.

Some advisory firms are or will soon start working remotely. Some may have personnel who have been exposed to or have contracted the disease.

It’s not clear whether the SEC has criteria for determining whether a firm’s operations have been harmed by the coronavirus or whether it’s based on facts and circumstances. An SEC spokesperson was not immediately available for comment.

In a separate order, the SEC provided relief to mutual funds for required in-person board meetings as well as for deadlines related to annual and semi-annual reports and other documents.

“Investment funds and advisers are at the forefront of Main Street investor access to financial markets, and the commission is monitoring closely the impacts of the coronavirus on investors and market participants,” SEC Chairman Jay Clayton said in a statement. “As investors, investment funds, investment advisers and other market participants endeavor to address these challenges, the commission stands ready to take action in the interest of our investors and our markets as appropriate. Today’s targeted relief will provide additional time so affected funds and advisers can continue meeting the expectations of their investors and clients.”

The SEC could take more steps to ease regulatory burdens, as the coronavirus pandemic unfolds.

“This may not be the end of relief that’s needed,” Ms. Bernstein said.