Reminder: Amended Internet Adviser Exemption - Effective Date July 8, 2024

This is a reminder that the amendments to Rule 203A-2(e) under the Investment Advisers Act of 1940, concerning the Internet Adviser Exemption, will take effect on July 8, 2024.

Definition of Internet Adviser: An Internet Adviser, as defined by the Investment Advisers Act of 1940, is an adviser who provides digital investment advisory services through an operational interactive website. This includes a website, mobile application, or similar digital platform, where advisory services are provided on an ongoing basis to more than one client.

Key Amendments:

1. Operational Interactive Website: Advisers must have an operational interactive website at all times.
2. Elimination of De Minimis Exception: The previous rule allowing advice to fewer than 15 non-internet clients has been removed.
3. Form ADV Amendments: Advisers must now represent on Schedule D of their Form ADV that they have an operational interactive website and qualify for the internet adviser exemption.

Important Dates:

• July 8, 2024: Effective date of the amendments.
• March 31, 2025: Deadline for advisers relying on the internet adviser exemption to comply with the rule and amend their Form ADV.
• June 29, 2025: Advisers not eligible for the exemption and without another basis for registration must either:
  • withdraw their registration with the Commission by filing Form ADV-W and, if necessary, register in one or more states, or;
  • utilize another applicable exemption to maintain SEC registration, if available.

For detailed information, please refer to the adopting release and fact sheet.

If you have any questions about the applicability of these amendments or need assistance with actionable items, please reach out for further discussion and guidance.

For more information, please contact Mitch Avnet:

p. (646) 346-2468 ; mavnet@compliance-risk.com