SEC Adopts Amendments to the Internet Adviser Exemption

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Quick TakeThe SEC adopted amendments to modernize Rule 203A-2(e) under the Advisers Act (Internet Adviser Exemption), which allows advisers that provide investment advice to clients exclusively through an “interactive website” (except for a de minimis non-internet client exception) to register with the SEC despite not meeting the SEC’s assets under management minimum threshold.


The Internet Adviser Exemption was adopted in 2002 and is designed to remove the burden of multiple state registration requirements that could apply to internet-based advisers serving investors located throughout the United States. The amendments, which were adopted as proposed, narrow the exemption and require advisers relying on the exemption to maintain an “operational” interactive website through which the adviser provides investment advisory services to more than one client on an ongoing basis. Under the amendments, an adviser must have its website operational at the time of registration or rely on the 120-day exemption under Rule 203A-2(c) to develop its website within the 120-day period.

The amendments also eliminate the de minimis exception which allowed an adviser relying on the Internet Adviser Exemption to provide advisory services outside of its interactive website to up to 14 clients in a 12-month period and require instead that advisory services be offered exclusively through an operational interactive website.

In addition, the amendments amend Form ADV to require an adviser relying on the exemption to represent on Form ADV that, among other things, it has an operational interactive website.

The amendments will take effect 90 days after they are published in the Federal Register, and compliance with the amendments will be required by March 31, 2025.

The amendments can be found here.

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