In an interview with Private Funds Management, partners Marc Elovitz and Joseph Smith discuss regulator views on conflicts of interest and how to best deal with these issues as the fund formation climate becomes more complex. Marc and Joe also share their insights on how conflicts of interests are viewed by the SEC within the private equity space and how they are best dealt with in the industry.

Click here to read the interview.

The past year has been mixed for alternative funds. In the hedge fund space, industry assets under management increased by $70 billion to $3.22 trillion, despite lackluster overall returns and noisy withdrawals by certain institutional investors. In the private equity space, industry assets under management grew 4.2 percent to $2.49 trillion, and 8,975 new funds were launched. Regulatory requirements and investor preference for established managers have increased barriers to entry in both sectors. Meanwhile, competition for investor capital has created a buyer’s market with significant negotiation of fund terms.

Click here to read this article in which partner Stephanie Breslow and associate Patrick Dundas discuss current industry trends affecting hedge and investment funds and provide information regarding regulatory developments impacting the market.

An increasing number of private fund managers are turning to alternative products registered under the Investment Company Act of 1940 as a means of growing their assets under management and diversifying their product offerings and revenue streams.

Click here for special counsel Pamela Poland Chen‘s discussion of how closed-ends funds with the look and feel of a hedge fund can allow managers to access a broader investor base and a diversified income stream.

In a typical private equity fund, investors are making capital commitments to a limited partnership that will be drawn down over a number of years at the direction of the general partner of the limited partnership. The structure of the typical private equity fund and the fact that investors have no liquidity once they make their investments in a fund means that investors are often concerned about what happens if things go wrong with the fund.

Read partner Omoz Osayimwese’s discussion of the various remedies investors typically negotiate for in a private equity fund.

A decision issued on Jan. 24, 2017, in the U.S. District Court for the Southern District of New York dismissed a complaint alleging the payment of excessive advisory and administration fees by Prospect Capital Corporation, a business development company regulated under the Investment Company Act of 1940.

Click here to read more about these developments.

From 1 March 2017, the new variation margin rules for over-the-counter derivatives contained in the regulatory technical standards adopted by the European Commission will apply to certain European counterparties.

In anticipation of the 1 March deadline, European counterparties (and any non-EU entities, including funds, that trade with European financial institutions) are in the process of putting in place appropriate risk management procedures and compliant netting and collateral documentation to implement the new VM requirements.

Click here to read more about these developments.

In this SRZ Insights video, partners Eleazer Klein and Michael E. Swartz discuss the impact of Section 16(b), the short-swing profit rule that requires corporate insiders to disgorge any profits from trades made within six months of each other. In addition, the partners address how short-swing profit litigation is affecting hedge funds and talk about recent cases brought against fund managers.

In this SRZ Insights video, partner David M. Cohen discusses the potential impact of the Department of Labor’s fiduciary duty regulation on hedge funds. Though the new rule mostly focuses on retail investors, it could have impact on hedge funds due to the DOL’s possible recognition of certain shareholders as retail investors.