SEC and 28 Countries Sign MOUs Allowing Cross-Border Exams
The SEC announced that it has established supervisory arrangements with 28 EU and EEA countries, which include memoranda of understanding allowing the SEC to conduct on-site examinations in those countries. According to the SEC, the MOUs “enhance the SEC staff’s ability to share information about certain entities in the asset management industry, such as investment advisers and investment fund managers.” The supervisory arrangements provide a framework for “supervisory cooperation” regarding market oversight.
OUR TAKE: The SEC wants to forestall firms from parking operations outside the U.S. in an effort to avoid SEC jurisdiction and examinations. The (unintended?) consequence is that many European firms with limited U.S. operations may see an uptick in SEC inquiries into non-U.S. operations.