[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 3671 Introduced in Senate (IS)]
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119th CONGRESS
2d Session
S. 3671
To amend the Investment Company Act of 1940 with respect to the
authority of closed-end companies to invest in private funds, and for
other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
January 15, 2026
Mr. Daines (for himself and Mr. Rounds) introduced the following bill;
which was read twice and referred to the Committee on Banking, Housing,
and Urban Affairs
_______________________________________________________________________
A BILL
To amend the Investment Company Act of 1940 with respect to the
authority of closed-end companies to invest in private funds, and for
other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Increasing Investor Opportunities
Act''.
SEC. 2. CLOSED-END COMPANY AUTHORITY TO INVEST IN PRIVATE FUNDS.
(a) In General.--Section 5 of the Investment Company Act of 1940
(15 U.S.C. 80a-5) is amended by adding at the end the following:
``(d) Closed-End Company Authority To Invest in Private Funds.--
``(1) In general.--Except as otherwise prohibited or
restricted by this Act (or any rule issued under this Act), the
Commission may not prohibit or otherwise limit a closed-end
company from investing any or all of the assets of the closed-
end company in securities issued by private funds.
``(2) Other restrictions on commission authority.--Except
as otherwise prohibited or restricted by this Act (or any rule
issued under this Act), the Commission may not impose any
condition on, restrict, or otherwise limit--
``(A) the offer to sell, or the sale of, securities
issued by a closed-end company that invests, or
proposes to invest, in securities issued by private
funds; or
``(B) the listing of the securities of a closed-end
company described in subparagraph (A) on a national
securities exchange.
``(3) Unrelated restrictions.--The Commission may impose a
condition on, restrict, or otherwise limit an activity
described in paragraph (1) or subparagraph (A) or (B) of
paragraph (2) if that condition, restriction, or limitation is
unrelated to the underlying characteristics of a private fund
or the status of a private fund as a private fund.
``(4) Rule of application.--Notwithstanding section 6(f),
this subsection shall also apply to a closed-end company that
elects to be treated as a business development company pursuant
to section 54.''.
(b) Definition of Private Fund.--Section 2(a) of the Investment
Company Act of 1940 (15 U.S.C. 80a-2(a)) is amended by adding at the
end the following:
``(55) The term `private fund' has the meaning given the
term in section 202(a) of the Investment Advisers Act of 1940
(15 U.S.C. 80b-2(a)).''.
(c) Treatment by National Securities Exchanges.--Section 6 of the
Securities Exchange Act of 1934 (15 U.S.C. 78f) is amended by adding at
the end the following:
``(m) Closed-End Companies.--
``(1) In general.--Except as otherwise prohibited or
restricted by rules of the exchange that are consistent with
section 5(d) of the Investment Company Act of 1940 (15 U.S.C.
80a-5(d)), an exchange may not prohibit, condition, restrict,
or impose any other limitation on the listing or trading of the
securities of a closed-end company when the closed-end company
invests, or may invest, some or all of the assets of the
closed-end company in securities issued by private funds.
``(2) Definitions.--In this subsection--
``(A) the term `closed-end company'--
``(i) has the meaning given the term in
section 5(a) of the Investment Company Act of
1940 (15 U.S.C. 80a-5(a)); and
``(ii) includes a closed-end company that
elects to be treated as a business development
company pursuant to section 54 of the
Investment Company Act of 1940 (15 U.S.C. 80a-
53); and
``(B) the term `private fund' has the meaning given
in section 202(a) of the Investment Advisers Act of
1940 (15 U.S.C. 80b-2(a)).''.
(d) Investment Limitation.--Section 3(c) of the Investment Company
Act of 1940 (15 U.S.C. 80a-3(c)) is amended--
(1) in paragraph (1), in the matter preceding subparagraph
(A), in the second sentence, by striking ``subparagraphs (A)(i)
and (B)(i)'' and inserting ``subparagraphs (A)(i), (B)(i), and
(C)''; and
(2) in paragraph (7)(D), by striking ``subparagraphs (A)(i)
and (B)(i)'' and inserting ``subparagraphs (A)(i), (B)(i), and
(C)''.
(e) Rules of Construction.--
(1) Definition.--In this subsection, the term ``closed-end
company'' has the meaning given the term in section 5(a) of the
Investment Company Act of 1940 (15 U.S.C. 80a-5(a)).
(2) Rules.--Nothing in this section, or in any amendment
made by this section, may be construed to limit or amend--
(A) any fiduciary duty owed--
(i) to a closed-end company; or
(ii) by an investment adviser (as defined
in section 2(a) of the Investment Company Act
of 1940 (15 U.S.C. 80a-2(a))) to a closed-end
company; or
(B) the valuation, liquidity, or redemption
requirements or obligations of a closed-end company, as
required under the Investment Company Act of 1940 (15
U.S.C. 80a-1 et seq.).
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