Rule 12d1-1-15USC 80a-6

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[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 15USC80a-6]

TITLE 15--COMMERCE AND TRADE
CHAPTER 2D--INVESTMENT COMPANIES AND ADVISERS
SUBCHAPTER I--INVESTMENT COMPANIES
Sec. 80a-6. Exemptions

(a) Exemption of specified investment companies
The following investment companies are exempt from the provisions of
this subchapter:
(1) Any company organized or otherwise created under the laws of
and having its principal office and place of business in Puerto
Rico, the Virgin Islands, or any other possession of the United
States; but such exemption shall terminate if any security of which
such company is the issuer is offered for sale or sold after the
effective date of this subchapter, by such company or an underwriter
therefor, to a resident of any State other than the State in which
such company is organized.
(2) Any company which since the effective date of this
subchapter or within five years prior to such date has been
reorganized under the supervision of a court of competent
jurisdiction, if (A) such company was not an investment company at
the commencement of such reorganization proceedings, (B) at the
conclusion of such proceedings all outstanding securities of such
company were owned by creditors of such company or by persons to
whom such securities were issued on account of creditors' claims,
and (C) more than 50 per centum of the voting securities of such
company, and securities representing more than 50 per centum of the
net asset value of such company, are currently owned beneficially by
not more than twenty-five persons; but such exemption shall
terminate if any security of which such company is the issuer is
offered for sale or sold to the public after the conclusion of such
proceedings by the issuer or by or through any underwriter. For the
purposes of this paragraph, any new company organized as part of the
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reorganization shall be deemed the same company as its predecessor;
and beneficial ownership shall be determined in the manner provided
in section 80a-3(c)(1) of this title.
(3) Any issuer as to which there is outstanding a writing filed
with the Commission by the Federal Savings and Loan Insurance
Corporation stating that exemption of such issuer from the
provisions of this subchapter is consistent with the public interest
and the protection of investors and is necessary or appropriate by
reason of the fact that such issuer holds or proposes to acquire any
assets or any product of any assets which have been segregated (A)
from assets of any company which at the filing of such writing is an
insured institution within the meaning of section 1724(a) \1\ of
title 12, or (B) as a part of or in connection with any plan for or
condition to the insurance of accounts of any company by said
corporation or the conversion of any company into a Federal savings
and loan association. Any such writing shall expire when canceled by
a writing similarly filed or at the expiration of two years after
the date of its filing, whichever first occurs; but said corporation
may, nevertheless, before, at, or after the expiration of any such
writing file another writing or writings with respect to such
issuer.
--------------------------------------------------------------------------\1\ See References in Text note below.
--------------------------------------------------------------------------(4) Any company which prior to March 15, 1940, was and now is a
wholly-owned subsidiary of a registered face-amount certificate
company and was prior to said date and now is organized and
operating under the insurance laws of any State and subject to
supervision and examination by the insurance commissioner thereof,
and which prior to March 15, 1940, was and now is engaged, subject
to such laws, in business substantially all of which consists of
issuing and selling only to residents of such State and investing
the proceeds from, securities providing for or representing
participations or interests in intangible assets consisting of
mortgages or other liens on real estate or notes or bonds secured
thereby or in a fund or deposit of mortgages or other liens on real
estate or notes or bonds secured thereby or having outstanding such
securities so issued and sold.
(5)(A) Any company that is not engaged in the business of
issuing redeemable securities, the operations of which are subject
to regulation by the State in which the company is organized under a
statute governing entities that provide financial or managerial
assistance to enterprises doing business, or proposing to do
business, in that State if-(i) the organizational documents of the company state that
the activities of the company are limited to the promotion of
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economic, business, or industrial development in the State
through the provision of financial or managerial assistance to
enterprises doing business, or proposing to do business, in that
State, and such other activities that are incidental or
necessary to carry out that purpose;
(ii) immediately following each sale of the securities of
the company by the company or any underwriter for the company,
not less than 80 percent of the securities of the company being
offered in such sale, on a class-by-class basis, are held by
persons who reside or who have a substantial business presence
in that State;
(iii) the securities of the company are sold, or proposed to
be sold, by the company or by any underwriter for the company,
solely to accredited investors, as that term is defined in
section 77b(a)(15) of this title, or to such other persons that
the Commission, as necessary or appropriate in the public
interest and consistent with the protection of investors, may
permit by rule, regulation, or order; and
(iv) the company does not purchase any security issued by an
investment company or by any company that would be an investment
company except for the exclusions from the definition of the
term ``investment company'' under paragraph (1) or (7) of
section 80a-3(c) of this title, other than-(I) any debt security that is rated investment grade by
not less than 1 nationally recognized statistical rating
organization; or
(II) any security issued by a registered open-end
investment company that is required by its investment
policies to invest not less than 65 percent of its total
assets in securities described in subclause (I) or
securities that are determined by such registered open-end
investment company to be comparable in quality to securities
described in subclause (I).
(B) Notwithstanding the exemption provided by this paragraph,
section 80a-9 of this title (and, to the extent necessary to enforce
section 80a-9 of this title, sections 80a-37 through 80a-50 of this
title) shall apply to a company described in this paragraph as if
the company were an investment company registered under this
subchapter.
(C) Any company proposing to rely on the exemption provided by
this paragraph shall file with the Commission a notification stating
that the company intends to do so, in such form and manner as the
Commission may prescribe by rule.
(D) Any company meeting the requirements of this paragraph may
rely on the exemption provided by this paragraph upon filing with
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the Commission the notification required by subparagraph (C), until
such time as the Commission determines by order that such reliance
is not in the public interest or is not consistent with the
protection of investors.
(E) The exemption provided by this paragraph may be subject to
such additional terms and conditions as the Commission may by rule,
regulation, or order determine are necessary or appropriate in the
public interest or for the protection of investors.
(b) Exemption of employees' security company upon application; matters
considered
Upon application by any employees' security company, the Commission
shall by order exempt such company from the provisions of this
subchapter and of the rules and regulations hereunder, if and to the
extent that such exemption is consistent with the protection of
investors. In determining the provisions to which such an order of
exemption shall apply, the Commission shall give due weight, among other
things, to the form of organization and the capital structure of such
company, the persons by whom its voting securities, evidences of
indebtedness, and other securities are owned and controlled, the prices
at which securities issued by such company are sold and the sales load
thereon, the disposition of the proceeds of such sales, the character of
the securities in which such proceeds are invested, and any relationship
between such company and the issuer of any such security.
(c) Exemption of persons, securities or any class or classes of persons
as necessary and appropriate in public interest
The Commission, by rules and regulations upon its own motion, or by
order upon application, may conditionally or unconditionally exempt any
person, security, or transaction, or any class or classes of persons,
securities, or transactions, from any provision or provisions of this
subchapter or of any rule or regulation thereunder, if and to the extent
that such exemption is necessary or appropriate in the public interest
and consistent with the protection of investors and the purposes fairly
intended by the policy and provisions of this subchapter.
(d) Exemption of closed-end investment companies
The Commission, by rules and regulations or order, shall exempt a
closed-end investment company from any or all provisions of this
subchapter, but subject to such terms and conditions as may be necessary
or appropriate in the public interest or for the protection of
investors, if-(1) the aggregate sums received by such company from the sale of
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all its outstanding securities, plus the aggregate offering price of
all securities of which such company is the issuer and which it
proposes to offer for sale, do not exceed $10,000,000, or such other
amount as the Commission may set by rule, regulation, or order;
(2) no security of which such company is the issuer has been or
is proposed to be sold by such company or any underwriter therefor,
in connection with a public offering, to any person who is not a
resident of the State under the laws of which such company is
organized or otherwise created; and
(3) such exemption is not contrary to the public interest or
inconsistent with the protection of investors.
(e) Application of certain specified provisions of subchapter to
otherwise exempt companies
If, in connection with any rule, regulation, or order under this
section exempting any investment company from any provision of section
80a-7 of this title, the Commission deems it necessary or appropriate in
the public interest or for the protection of investors that certain
specified provisions of this subchapter pertaining to registered
investment companies shall be applicable in respect of such company, the
provisions so specified shall apply to such company, and to other
persons in their transactions and relations with such company, as though
such company were a registered investment company.
(f) Exemption of closed-end company treated as business development
company
Any closed-end company which-(1) elects to be treated as a business development company
pursuant to section 80a-53 of this title; or
(2) would be excluded from the definition of an investment
company by section 80a-3(c)(1) of this title, except that it
presently proposes to make a public offering of its securities as a
business development company, and has notified the Commission, in a
form and manner which the Commission may, by rule, prescribe, that
it intends in good faith to file, within 90 days, a notification of
election to become subject to the provisions of sections 80a-54
through 80a-64 of this title,
shall be exempt from sections 80a-1 through 80a-52 of this title, except
to the extent provided in sections 80a-58 through 80a-64 of this title.
(Aug. 22, 1940, ch. 686, title I, Sec. 6, 54 Stat. 800; Proc. No. 2695,
eff. July 4, 1946, 11 F.R. 7517, 60 Stat. 1352; Pub. L. 86-70,
Sec. 12(e), June 25, 1959, 73 Stat. 143; Pub. L. 86-624, Sec. 7(c), July
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12, 1960, 74 Stat. 412; Pub. L. 95-598, title III, Sec. 310(b), Nov. 6,
1978, 92 Stat. 2676; Pub. L. 96-477, title I, Sec. 103, Oct. 21, 1980,
94 Stat. 2277; Pub. L. 100-181, title VI, Sec. 608, Dec. 4, 1987, 101
Stat. 1261; Pub. L. 104-290, title V, Secs. 501, 502, Oct. 11, 1996, 110
Stat. 3444, 3445.)
References in Text
For the
(a)(2), see
Section
repealed by
363.

effective date of this subchapter, referred to in subsec.
section 80a-52 of this title.
1724 of title 12, referred to in subsec. (a)(3), was
Pub. L. 101-73, title IV, Sec. 407, Aug. 9, 1989, 103 Stat.

Codification
Words ``Philippine Islands'' deleted from subsec. (a)(1) after
``Puerto Rico'' under the authority of Proc. No. 2695, granting
independence to the Philippine Islands, which was issued pursuant to
section 1394 of Title 22, Foreign Relations and Intercourse, and is set
out as a note under that section.

Amendments
1996--Subsec. (a)(5). Pub. L. 104-290, Sec. 501, added par. (5).
Subsec. (d)(1). Pub. L. 104-290, Sec. 502, substituted
``$10,000,000, or such other amount as the Commission may set by rule,
regulation, or order'' for ``$100,000''.
1987--Subsec. (a)(1). Pub. L. 100-181, Sec. 608(1), struck out
reference to Canal Zone.
Subsec. (a)(2) to (5). Pub. L. 100-181, Sec. 608(2), redesignated
former pars. (3) to (5) as (2) to (4), and struck out former par. (2)
which read as follows: ``Any company for which, in a proceeding in any
court of the United States or of a State, a receiver, trustee in a case
under title 11, or similar officer had been appointed or elected prior
to the effective date of this subchapter, and every such officer so
appointed or elected prior to the effective date of this subchapter; but
such exemption shall continue only so long as (A) the conduct of such
company's business remains subject to the supervision of such court or
officer thereof, and (B) such company does not sell exclusively for cash
any security of which it is the issuer, except short-term paper and
ordinary receiver's or trustee's certificates.''
1980--Subsec. (f). Pub. L. 96-477 added subsec. (f).
1978--Subsec. (a)(2). Pub. L. 95-598 substituted ``a case under
title 11'' for ``bankruptcy''.
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1960--Subsec. (a)(1). Pub. L. 86-624 struck out reference to Hawaii.
1959--Subsec. (a)(1). Pub. L. 86-70 struck out reference to Alaska.

Effective Date of 1978 Amendment
Amendment by Pub. L. 95-598 effective Oct. 1, 1979, see section
402(a) of Pub. L. 95-598, set out as an Effective Date note preceding
section 101 of Title 11, Bankruptcy.
Transfer of Functions
Federal Savings and Loan Insurance Corporation abolished and
functions transferred, see sections 401 to 406 of Pub. L. 101-73, set
out as a note under section 1437 of Title 12, Banks and Banking.
For transfer of functions of Securities and Exchange Commission,
with certain exceptions, to Chairman of such Commission, see Reorg. Plan
No. 10 of 1950, Secs. 1, 2, eff. May 24, 1950, 15 F.R. 3175, 64 Stat.
1265, set out under section 78d of this title.

Investment Company Provisions Inapplicable to Certain Life Insurance
Benefits Issued Prior to March 23, 1959
Subchapter inapplicable to certain life insurance benefits issued
prior to Mar. 23, 1959, under certain conditions, see section 29 of Pub.
L. 91-547, Dec. 14, 1970, 84 Stat. 1436, set out as a note under section
77c of this title.
Section Referred to in Other Sections
This section is referred to in sections 80a-3, 80a-7, 80a-15, 80a58, 80a-59, 80a-60, 80a-61, 80a-62, 80a-63, 80a-64 of this title.

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