On February 8, 2024, the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) jointly adopted amendments to Form PF. Form PF is a reporting form similar to the European AIFMD Annex IV used by SEC-registered private funds such as hedge funds or private equity funds. The amendments aim to enhance reporting and improve data quality in several ways:
- Enhanced Reporting by Large Hedge Fund Advisers on Qualifying Hedge Funds:
- Large hedge fund advisers (those managing hedge funds with a net asset value of at least $500 million) shall provide better insight into the operations and strategies of these funds.
- Reporting will cover investment exposures, borrowing and counterparty exposure, market factor effects, currency exposure, turnover, country and industry exposure, central clearing counterparty reporting, risk metrics, investment performance by strategy, portfolio liquidity, and financing and investor liquidity.
- Enhanced Reporting on Basic Information About Advisers and Their Private Funds:
- Advisers will report additional information about themselves and their private funds.
- This additional information shall improve data quality, comparability, and trend identification.
- The goal is to reduce reporting errors and assist in identifying trends that could create systemic risk.
- Amendment to Reporting Complex Structures:
- This change aims to improve the ability of the Financial Stability Oversight Council (FSOC) to monitor and assess systemic risk.
- It also provides greater visibility for both FSOC and the Commissions into these arrangements.
- Removal of Aggregate Reporting for Large Hedge Fund Advisers:
- Aggregate reporting for large hedge fund advisers will be removed.
- This change reduces the reporting burden on advisers and focuses Form PF reporting on more valuable information for systemic risk assessment purposes.
The upcoming changes affect sections General Instructions, Section 1, and Section 2. The new regulation will come into force on March 12, 2025.
For further details please see https://www.sec.gov/news/press-release/2024-17.
If you have any questions or need any help with your Form PF reporting obligations, please contact our team at any time.
Source: U.S. Securities and Exchange Commission
