Regulatory Compliance for Private Funds

With one of the largest and most diversified investment management practices, Ropes & Gray is uniquely qualified to assist sponsors of private funds in navigating an increasingly complicated regulatory landscape around the world. We have significant experience in investment adviser, broker-dealer, commodity, securities/World Sky, anti-corruption, money laundering and other regulatory areas. We regularly advise sponsors of private funds in these areas as new funds or products are launched, compliance questions arise, new rules are adopted or regulatory examinations occur. Ropes & Gray’s comprehensive regulatory compliance practice is led by partners who have deep expertise in dealing with cross-border issues, and have led a number of complex advisory projects including advising on lending regulation in over 70 jurisdictions, offering investment professionals unrivaled counsel on a full range of regulatory and commercial matters. We work closely with our clients to develop solutions for their business to keep up with the speed and breadth of regulatory change.

Following recent changes in the Advisers Act that have greatly expanded the firms subject to registration and regulation, we have assisted hundreds of leading private fund sponsors in registering as investment advisers with the SEC and developing the required compliance programs, and have assisted numerous non-U.S. private fund sponsors in analyzing their regulatory obligations under U.S. law. Many of the newly registered firms have already been subject to SEC examinations and we have assisted over 250 clients as they have navigated a number of novel issues raised in these examinations. We have also represented dozens of such firms in SEC enforcement investigations.

Our U.S. and European regulatory teams work together to ensure coordinated advice for our private fund clients. In particular, Ropes & Gray’s London office has significant experience advising sponsors on marketing products in Europe, the regulatory implications when  structure new funds, establishing a European office and ongoing compliance with the relevant rules and regulations. In the run up to implementation of the case of AIFMD, we have advised both European and non-European sponsors on the disclosure, operating and compliance changes required to be effected as the new regime begins to be implemented assisting, in particular, those non-European sponsors wishing to market and offer funds in Europe. Managing the different European regulatory regimes (and how they fit within other international rules and frameworks) is challenging and we work closely with clients to help navigate them. We have advised a significant number of sponsor clients on the impact of the various European ESG regulatory regimes and the practical issues clients face. We take a holistic approach when providing advice to implement complex regulatory changes in relation to AIFMD, Brexit, SFDR, SMCR and MiFID II and believe in developing a program of implementation which works with your business.

Many of our private fund clients have affiliated SEC-registered broker-dealers. We have counseled those clients on the formation, registration, and FINRA membership process for their broker-dealers, and we advise clients on ongoing FINRA and Exchange Act compliance matters. Typical issues on which we advise our private fund broker-dealer clients include advertising, licensing, Regulation Best Interest and FINRA suitability, net capital, regulatory reporting, supervisory systems, updates to written supervisory procedures and expansions into new lines of business. We regularly assist private fund broker-dealers with SEC and FINRA examinations, regulatory inquiries and enforcement matters.

Our commodities law practice regularly advises clients on Commodity Futures Trading Commission and National Futures Association registration, regulation and compliance issues, and counsels commodity pool operators and commodity trading advisors on product design, fund formation, marketing, negotiations and documentation. We have advised numerous clients on the implications of financial reform initiatives and initiatives by the Commodity Futures Trading Commission, the inclusion of swaps as commodity interests, changes in position limits and aggregation, increased reporting, the rescission of registration exemptions, and restrictions on off-exchange foreign currency and metals transactions. Our team of U.S. and U.K. attorneys offer timely and seamless cross-border advice on U.S. and EU derivatives reform and rulemaking, including clearing, trading, margin and reporting rules. This includes compliance with swap execution facility (SEF) rules, completion of ISDA Dodd-Frank protocol questionnaires, U.S. person analysis and revisions to margin requirements. Given the broad scope and depth of our asset management offering, our colleagues practicing in tax, ERISA, labor and employment, intellectual property, data privacy, fintech, and enforcement are deeply embedded and experienced in applying their expertise to transactions in commodities, futures, forwards, options, swaps and other derivatives. Also valuable to clients is our extensive experience working with regulators at the Commodity Futures Trading Commission, the National Futures Association, futures exchanges and swap execution facilities, as these relationships provide us with insights into issues and the ever-changing regulatory environment. In addition, we are active participants in industry associations and serve as outside counsel to SIFMA Asset Management Group’s Derivatives Europe Committee.