August 22, 2024
On August 21, 2024, the SEC adopted a rule that updates the threshold for a fund to qualify as a “qualifying venture capital fund” under the Investment Company Act. The rule adjusts the current $10 million threshold to a threshold of $12 million in aggregate capital contributions and uncalled committed capital. The statutory definition now requires the threshold to be indexed for inflation once every five years by the SEC. The next revised threshold will occur after November 1, 2029. Revised thresholds will take into account the effects of inflation by referencing the Personal Consumption Expenditures Chain-type Price Index, which is published by the Department of Commerce.
Implementing the inflation adjustment to the statutory exclusion does not have a compliance period or extended effective date. The final rule will be effective 30 days after publication in the federal register. For more information see the SEC overview and rule text here.
