A bipartisan bill directing the Securities and Exchange Commission to promulgate rules allowing regulated entities like mutual funds, exchange-traded funds, registered broker-dealers and registered advisers to deliver required documents to investors electronically as the default option has been reintroduced in the House.
The Improving Disclosure for Investors Act, reintroduced Monday by Rep. Bill Huizenga, R-Mich.; Rep. Jake Auchincloss, D-Mass.; Rep. Bryan Steil, R-Wisc.; and Rep. Wiley Nickel, D-N.C., would require the SEC to propose rules within 180 days of the bill's enactment to allow for electronic delivery of all regulatory documents to investors and to issue final rules within one year after becoming law.
The bill, which was originally introduced in December during the previous congressional session, would provide a 180-day transition period to default all customers to electronic delivery for whom firms have an email address on file. Investors could opt out any time to receive paper versions of the documents.
"By allowing disclosures through electronic means it will reduce costs and increase efficiency while still providing investors the ability to continue with paper delivery if that is their preferred method," Mr. Huizenga said in a news release.
Kenneth E. Bentsen Jr., president and CEO of the Securities Industry and Financial Markets Association, said in a statement that "the time has come — and arguably is overdue — to implement electronic delivery as the default means for delivering investor communications, while giving investors the power to choose paper delivery if preferred."
Separately, the SEC on March 22 issued a rule proposal aimed at modernizing filings for registrants by requiring nearly all forms, filings and other materials be submitted to the SEC electronically.