
From the U.S. Code Online via GPO Access
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[Laws in effect as of January 2, 2001]
[Document not affected by Public Laws enacted between
  January 2, 2001 and January 28, 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 
    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.
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    \1\ See References in Text note below.
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        (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 
        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 
    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 
    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 
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 effective date of this subchapter, referred to in subsec. 
(a)(2), see section 80a-52 of this title.
    Section 1724 of title 12, referred to in subsec. (a)(3), was 
repealed by Pub. L. 101-73, title IV, Sec. 407, Aug. 9, 1989, 103 Stat. 
363.

                          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''.
    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, 80a-
58, 80a-59, 80a-60, 80a-61, 80a-62, 80a-63, 80a-64 of this title.
