We do not typically discuss rule proposals in our ComplianceAlerts as rule proposals can differ greatly from adopted rules. However, this one is worth it as its likelihood of passage is quite high. The new proposal is in relation to Form PF for private funds. This April 20, 2026, release amends Form PF once again from the rule adopted in 2024 with a current compliance date of October 1, 2026. This puts compliance with the 2024 amendments on hold while a new rule is developed.
This proposal serves to roll back many of the 2024 changes and goes even further to reduce the compliance burden on smaller firms as well as large hedge fund filers. Highlights of the proposal are found below:
- All filers – No need to file Form PF at all unless your private fund AUM is $1 billion or more.
- Large Hedge Funds – Several changes have been proposed to decrease the burden on the hedge fund industry, these include:
- Filing – No need to report as a large hedge fund unless hedge fund assets are $10 billion or more.
- Counterparty Exposures – Question 26 is amended to simplify the data collected within the table, and borrowing data for Question 42 and 43 will be reduced.
- Event Reporting – Much of the event reporting will be eliminated.
- Look through Provisions – All funds will be allowed to report on indirect exposures based upon reasonable estimates. This will change Questions 7, 8, 32, 33, 35, 36, and 47.
- Performance Volatility Reporting – Question 23c on this topic will be eliminated for all funds.
- Private Equity Funds – Quarterly event reporting under Section 6 regarding adviser-led secondaries, GP removals, termination periods, etc. will be eliminated.
As you can see, most of the changes are being made for large hedge fund filers. However, the asset size changes for reporting will significantly reduce the number of filers overall. This is in line with the recently released proposal to change the definition of a small entity adviser.
It is important to note that this is still a proposal, and nothing above can be taken as fact just yet. However, since this proposal focuses on the elimination of requirements, the industry should not have much push back. It will be interesting to see if any of the comment letters from trade associations take up the topic of systemic market risk exposure by reducing transparency for regulators and their ability to detect market stress.
Since this is a form only used by regulators (both the SEC and CFTC), they will be reducing their own compliance and data burdens by reducing the amount of data collected. However, too little data on risk posed by certain types of transactions, especially those involving leverage can pose a new risk of the pendulum swinging too far if a material market event should emerge and be unnoticed until too late.
The current events unfolding in the private credit markets are being evaluated by the SEC right now. They have asked the industry to opine on this in their comments on the proposal.
This new proposal has not yet been published in the federal register. There will be a 60-day reporting period for comment letters once published.
View Fact Sheet, “Proposed Amendments to Form PF”
View Proposed Rule “Form PF; Reporting Requirements for All Filers”
