The SEC's New Rulemaking Agenda: A Deregulatory Road Map for Advisers and Funds

The Securities and Exchange Commission (SEC or the Commission) has released its latest regulatory flexibility agenda—the public list of rules the agency expects to propose or adopt in the coming year (the SEC 2026 Agenda).¹ This edition, which typically would have been published in the spring, arrived unusually late. It is styled as the “2026 agenda,” but by the time it appeared, several of the items listed had already been proposed.² Even so, it is the clearest published statement to date of how Chairman Paul Atkins’ SEC intends to reshape the rulebook governing investment advisers and registered funds. 

As one might expect, every item under the Division of Investment Management rulemaking agenda is formally designated as “deregulatory.”³ The SEC 2026 Agenda also maps neatly onto the framework Chairman Atkins has been describing in speeches for the past year, which he calls the “A-C-T” strategy: advance regulatory frameworks into the modern era, clarify jurisdictional lines, and transform the rulebook by returning it to first principles.⁴ For advisers and funds, that translates into three key themes: 

• Reduce burdens from core compliance rules, including updating the adviser recordkeeping and pay-to-play rules.
• Modernize rules written for a paper and telephone era, such as an e-delivery rule and addressing innovations such as crypto and digital assets.
• Continue the sustained push to expand retail access to private markets.

While the SEC 2026 Agenda addresses all the rulemakings under the Commission’s authority, including, for example, important rules related to the definition of a dealer, the regulatory status of finders, and transfer agent rules, this discussion focuses on the agenda items that directly affect investment advisers and funds. 

New for Investment Advisers

Many of the new rulemaking agenda items focus on investment advisers, addressing long-standing pain points, such as Rule 206(4)-5 under the Investment Advisers Act of 1940, as amended (the Advisers Act), commonly known as the “pay-to-play” rule, and the need to modernize some of the regulatory requirements, such as the Advisers Act’s recordkeeping requirements. While many of these items were not formally on the last agenda, it has been clear that the following are matters the current Commission would like to address.

Pay-To-Play Reform

Rule 206(4)-5 under the Advisers Act sets forth requirements relating to political contributions and related solicitation activity by investment advisers who seek to provide advisory services to government entities. Advisers have long raised issues with the strict liability and harsh consequences of the adviser pay-to-play rule, which includes a two-year compensation “time out” when an adviser or its covered associates make political contributions above small de minimis amounts to officials who can influence the award of government advisory business.

The SEC 2026 Agenda includes an item entitled “Pay to Play Reform” and describes the project only as addressing “identified compliance burdens.” Given the long-standing issues investment advisers have raised with Rule 206(4)-5, it is likely that the rulemaking efforts would focus on the very low contribution thresholds, the harshness of a two-year revenue forfeiture for inadvertent foot faults, the breadth of the “covered associate” definition and its lookback, and the limited exceptions for returned contributions. 

Recordkeeping Modernization

Also new is a project to propose amendments to Rule 204-2, the adviser books and records rule. As described in the SEC 2026 Agenda, the project is intended to address the “appropriate scope” and “identified compliance burdens related to electronic communications.”⁵ Brian Daly, the director of the Division of Investment Management, presaged this agenda item at an American Bar Association audience in December, noting that “the language of the [Advisers Act recordkeeping] rule still reflects a paper-based mindset.”⁶  

Given the project description and the fact that this agenda item arises after the off-channel communications enforcement sweep, we expect that the Commission would be seeking to amend the recordkeeping rules to define which electronic communications an adviser must actually retain, rather than policing the question through enforcement. The SEC 2026 Agenda also includes consideration of broker-dealer recordkeeping rules, specifically to clarify the “business as such” requirement under Rule 17a-4 under the Securities Exchange Act of 1934, as amended.⁷ We are hopeful that these proposals will provide some clarity around recordkeeping requirements associated with the use of artificial intelligence, which has been an area of industry focus. 

New for Funds and Products

Much like the agenda for advisers, the items added to the SEC rulemaking agenda for funds reflect the “A-C-T” agenda of Chair Atkins, and many have been previewed through speeches or other venues, including the following:

Retail Access to Private Markets

Potentially the most significant addition is a new agenda item entitled “Enhancing Retail Exposure to Private Markets.” The agenda describes amendments or new rules under both the Advisers Act and the Investment Company Act of 1940, as amended (the 1940 Act), to facilitate retail investor access to private markets through registered funds and, separately, to allow advisers to charge performance fees to an expanded set of clients.⁸

We expect that any proposal resulting from this agenda item to center on enhancing public and retail investor access to privately offered investments through registered vehicles such as closed-end funds like interval and tender offer funds, paired with a potential loosening of the qualified client limits on performance-based compensation. Prior to this item being added to the SEC 2026 Agenda, it was unclear if the Commission would seek to implement this policy priority through staff guidance or other informal incremental steps. Its inclusion on the SEC 2026 Agenda suggests that rulemaking (rather than other avenues) is on the horizon. Notably, this is one of the few agenda items that include a “statement of need” where the Commission explains the reasoning behind the potential rulemaking. Here, the Commission noted that “[f]acilitating retail investor exposure to private markets through registered funds and modernizing the performance fee framework would provide needed investment opportunities for retail investors seeking to diversify their investment allocation in line with their investment time horizon and risk tolerance and open more opportunities for retail investors.”

Affiliated Securities-Lending Agents

Another significant addition addresses a lower profile but nonetheless an important matter. The SEC 2026 Agenda includes an agenda item relating to a potential new exemptive rule that would permit registered funds to use an affiliated securities-lending agent compensated with a share of lending revenue, subject to certain conditions.⁹

Today, such arrangements generally require exemptive relief because of the affiliated transaction prohibitions in Section 17 of the 1940 Act. A rule would level the field between fund complexes that hold legacy orders and those that do not, and it might improve securities-lending economics for funds and their shareholders.

Electronic Delivery at Last

The SEC 2026 Agenda also now includes a cross-divisional project that would modernize the framework for electronic delivery of documents required under the federal securities laws, which still defaults to paper for many fund and adviser communications.¹⁰ The industry has sought an e-delivery default for well over a decade. If proposed and adopted, this would provide the industry with the most immediately tangible cost reductions of any item on the SEC 2026 Agenda.

The SEC 2026 Agenda also includes a number of potential rulemaking items from divisions other than the Division of Investment Management, but items that may still impact funds or advisers. For example, the SEC 2026 Agenda includes new proposed rules related to the proxy process, “including certain filing and procedural requirements relating to proxy solicitations and shareholder meetings, to reduce costs and compliance burdens” that could have significant effects on funds.¹¹ Similarly, a new rule proposal on the regulatory status of “finders” may have significant impacts on the marketing of private funds.¹²  

Still on the List: Cross Trades, Custody, and Reporting

There are a few carryovers from the prior agenda that have not yet been acted upon. The first is Rule 17a-7, which governs the circumstances under which registered investment companies may engage in cross trades. The ability for registered investment companies to engage in cross trades of fixed income securities has been significantly limited by the definition of “readily available market quotations” included in amendments to Rule 2a-5 that were adopted in 2019. Amendments to Rule 17a-7 have been on the SEC agenda since the spring 2025 agenda, and a workable fixed income cross-trading exemption would be a welcome return to past practice and result in immediate cost savings for fund shareholders.¹³ 

A second key item remaining on the SEC 2026 Agenda relates to modernizing the custody rules under both the Advisers Act and the 1940 Act, expressly including crypto assets.¹⁴ This replaces, rather than continues, the 2023 safeguarding proposal, which drew heavy criticism and was formally withdrawn in 2025.¹⁵ The statement of need accompanying this item focuses on the necessity for clarifying how advisers and funds can hold crypto assets in compliance with custody requirements, consistent with the chairman’s broader digital asset agenda.

Rounding out the carryovers, the Commission has already proposed amendments scaling back Form N-PORT portfolio reporting (proposed in February 2026) and a long-overdue update to the “small entity” definitions used in regulatory flexibility analyses, which would raise the adviser threshold for being considered a small entity from US$25 million to US$1 billion in assets under management.¹⁶ While a technical matter, the updates to the “small entity” definitions carry outsized significance from a regulatory process perspective, as the expanded definitions would require the Commission to consider tailored treatment for a far larger population of advisers and funds in every future rulemaking.

What Fell Off the Agenda

Comparing this agenda to the prior edition, the most significant deletion for advisers is the joint SEC and Financial Crimes Enforcement Network (FinCEN) customer identification program rulemaking, which had been listed at the final rule stage. Its removal is consistent with The US Department of the Treasury’s decision to postpone the related investment adviser anti-money laundering program rule to January 2028 and to revisit both rulemakings in the interim.¹⁷  

Timing and Takeaways

Each item on the SEC 2026 Agenda includes a “proposal date” field. Nearly every investment management item shows a proposal date of October 2026. Historically, the published target dates have not been a reliable indicator of when the Commission will actually take action on rules, so these dates are best read as a statement of ambition rather than a schedule. SEC 2026 Agenda dates are nonbinding, and realistically, we expect a steady flow of proposals from late 2026 through 2027, with adoptions stretching beyond. 

As to takeaways, please note the following:

First, Engage Before the Proposal Is Issued

The Commission has invited engagement, and the items on the SEC 2026 Agenda are drafted at a high level of generality. A critical point to keep in mind is that the Commission is limited in what changes they can adopt to a rule after it is proposed, and it can only make changes that are a “logical outgrowth” of what is discussed in the proposal. Advisers and fund sponsors with specific pain points, such as the pay-to-play time out, recordkeeping requirements, or fixed income cross trades, can have outsized impact on any ultimate rule proposals by engaging prior to their publication. 

Second, Do Not Confuse Direction With Relief

This agenda signals deregulation in many core compliance areas, but these changes are still aspirational. Every rule discussed above remains in force as written until amended. Pay-to-play exposure is at its peak in an election year, the recordkeeping rules have not been updated to directly address off-channel communications (despite indications that enforcement has been de-prioritized), and custody obligations for crypto remain unsettled. Compliance programs should always reflect the rules that are currently on the books, not anticipated changes, and deregulation does not mean no regulation. The examination staff will expect advisers and funds to comply with existing rules.

Third, Expect the Deregulatory Posture to Be Tested

As with all rulemaking, rule proposals that are deregulatory in nature, such as proposals that would expand retail access to illiquid assets or relax custody and recordkeeping standards, are subject to comment and further evaluation by the Commission and its staff. Further, the current deregulatory stance could shift dramatically under the next administration.¹⁸ 

If you have questions about any of the items on the agenda or would like assistance engaging with the Commission or the staff on any of these issues, please contact us.