WASHINGTON D.C. — The Securities and Exchange Commission adopted amendments on Wednesday to the rules that define which registered investment companies, investment advisers, and business development companies qualify as small entities for purposes of the Regulatory Flexibility Act. The changes update asset-based thresholds and aggregation methods used to determine regulatory status. They also update the way that related funds’ assets are aggregated for purposes of defining small entities.

The rule changes eliminate the investment adviser total assets threshold. The amendments provide for inflation adjustments to the asset-based thresholds by order every 10 years. The adopting release is published on the SEC website and will be published in the Federal Register.

"Updating the SEC’s definition of small entities for investment companies and investment advisers – which has not been done in nearly 30 years – is an important step to eliminate unnecessary regulatory burdens and modernize our rulebook," SEC Chairman Paul S. Atkins said. "These amendments more accurately capture the types of registered investment companies, investment advisers, and business development companies that are considered small relative to today’s market and will help ensure the Commission’s rulemaking is reflective of that reality."