SEC Proposes Revising Offering Process for BDCs and Closed-End Funds

The SEC proposed modifying the offering process for business development companies ("BDCs") and other closed-end investment companies under the Securities Act. The SEC would permit these investment companies to use the securities offering rules that are currently available to operating companies.

The proposal would:

• streamline the registration process to allow eligible funds to use a "shelf registration statement";

• permit eligible funds to qualify as "well-known seasoned issuers";

• allow eligible funds to meet prospectus delivery requirements by using the same processes as are available to operating companies;

• allow eligible funds to use communication rules that are available to operating companies; and

• tailor the disclosure and regulatory framework for eligible funds "in light of the proposed amendments to the offering rules applicable to them."

In addition, the SEC proposed a new approach to registration fee payments for closed-end funds that are interval funds.

Comments on the proposal must be submitted no later than 60 days following publication in the Federal Register.