IB
Union Calendar No. 239
118THCONGRESS
1
STSESSION H. R. 1807
[Report No. 118–295]
To direct the Securities and Exchange Commission to promulgate rules with
respect to the electronic delivery of certain required disclosures, and
for other purposes.
IN THE HOUSE OF REPRESENTATIVES
MARCH27, 2023
Mr. H
UIZENGA(for himself, Mr. AUCHINCLOSS, Mr. STEIL, and Mr. NICKEL)
introduced the following bill; which was referred to the Committee on Fi-
nancial Services
D
ECEMBER1, 2023
Additional sponsor: Mr. R
UTHERFORD
D
ECEMBER1, 2023
Reported with an amendment, committed to the Committee of the Whole
House on the State of the Union, and ordered to be printed
[Strike out all after the enacting clause and insert the part printed in italic]
[For text of introduced bill, see copy of bill as introduced on March 27, 2023]
VerDate Sep 11 2014 23:55 Dec 01, 2023 Jkt 049200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6652 E:\BILLS\H1807.RH H1807
kjohnson on DSK7ZCZBW3PROD with $$_JOB 2
•HR 1807 RH
A BILL
To direct the Securities and Exchange Commission to pro-
mulgate rules with respect to the electronic delivery of
certain required disclosures, and for other purposes.
VerDate Sep 11 2014 23:55 Dec 01, 2023 Jkt 049200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6652 E:\BILLS\H1807.RH H1807
kjohnson on DSK7ZCZBW3PROD with $$_JOB 3
•HR 1807 RH
Be it enacted by the Senate and House of Representa-1
tives of the United States of America in Congress assembled, 2
SECTION 1. SHORT TITLE. 3
This Act may be cited as the ‘‘Improving Disclosure 4
for Investors Act of 2023’’. 5
SEC. 2. ELECTRONIC DELIVERY. 6
(a) P
ROMULGATION OF RULES.—Not later than 180 7
days after the date of the enactment of this section, the Secu-8
rities and Exchange Commission shall propose and, not 9
later than 1 year after the date of the enactment of this 10
section, the Commission shall finalize, rules, regulations, 11
amendments, or interpretations, as appropriate, to allow 12
a covered entity to satisfy the entity’s obligation to deliver 13
regulatory documents required under the securities laws to 14
investors using electronic delivery. 15
(b) R
EQUIREDPROVISIONS.—Rules, regulations, 16
amendments, or interpretations the Commission promul-17
gates pursuant to subsection (a) shall: 18
(1) With respect to investors that do not receive 19
all regulatory documents by electronic delivery, pro-20
vide for— 21
(A) delivery of an initial communication in 22
paper form regarding electronic delivery; 23
VerDate Sep 11 2014 23:55 Dec 01, 2023 Jkt 049200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6203 E:\BILLS\H1807.RH H1807
kjohnson on DSK7ZCZBW3PROD with $$_JOB 4
•HR 1807 RH
(B) a transition period not to exceed 180 1
days until such regulatory documents are deliv-2
ered to such investors by electronic delivery; and 3
(C) during a period not to exceed 2 years 4
following the transition period set forth in sub-5
paragraph (B), delivery of an annual notice in 6
paper form solely reminding such investors of the 7
ability to opt out of electronic delivery at any 8
time and receive paper versions of regulatory 9
documents. 10
(2) Set forth requirements for the content of the 11
initial communication described in paragraph (1)(A). 12
(3) Set forth requirements for the timing of de-13
livery of a notice of website availability of regulatory 14
documents and the content of the appropriate notice 15
described in subsection (h)(3)(B). 16
(4) Provide a mechanism for investors to opt out 17
of electronic delivery at any time and receive paper 18
versions of regulatory documents. 19
(5) Require measures reasonably designed to 20
identify and remediate failed electronic deliveries of 21
regulatory documents. 22
(6) Set forth minimum requirements regarding 23
readability and retainability for regulatory docu-24
ments that are delivered electronically. 25
VerDate Sep 11 2014 23:55 Dec 01, 2023 Jkt 049200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6203 E:\BILLS\H1807.RH H1807
kjohnson on DSK7ZCZBW3PROD with $$_JOB 5
•HR 1807 RH
(7) For covered entities other than brokers, deal-1
ers, investment advisers registered with the Commis-2
sion, and investment companies, require measures 3
reasonably designed to ensure the confidentiality of 4
personal information in regulatory documents that 5
are delivered to investors electronically. 6
(c) E
XEMPTIONFROMCERTAINREQUIREMENTS.— 7
Section 101(c) of the Electronic Signatures in Global and 8
National Commerce Act (15 U.S.C. 7001(c)) shall not apply 9
with respect to a regulatory document delivered in accord-10
ance with this section. 11
(d) R
ULE OFCONSTRUCTION.—Nothing in this section 12
shall be construed as altering the substance or timing of 13
any regulatory document obligation under the securities 14
laws or regulations of a self-regulatory organization. 15
(e) T
REATMENT OFREVISIONSNOTCOMPLETED IN A 16
T
IMELYMANNER.—If the Commission fails to finalize the 17
rules, regulations, amendments, or interpretations required 18
under subsection (a) before the date specified in such sub-19
section— 20
(1) a covered entity may deliver regulatory docu-21
ments using electronic delivery in accordance with 22
subsections (b) through (d); and 23
(2) such electronic delivery shall be deemed to 24
satisfy the obligation of the covered entity to deliver 25
VerDate Sep 11 2014 23:55 Dec 01, 2023 Jkt 049200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6203 E:\BILLS\H1807.RH H1807
kjohnson on DSK7ZCZBW3PROD with $$_JOB 6
•HR 1807 RH
regulatory documents required under the securities 1
laws. 2
(f) O
THERREQUIREDACTIONS.— 3
(1) R
EVIEW OF RULES .—The Commission 4
shall— 5
(A) within 180 days of the date of enact-6
ment of this Act, conduct a review of the rules 7
and regulations of the Commission to determine 8
whether any such rules or regulations require de-9
livery of written documents to investors; and 10
(B) within 1 year of the date of enactment 11
of this Act, promulgate amendments to such rules 12
or regulations to provide that any requirement 13
to deliver a regulatory document ‘‘in writing’’ 14
may be satisfied by electronic delivery. 15
(2) A
CTIONS BY SELF-REGULATORY ORGANIZA -16
TIONS.—Each self-regulatory organization shall adopt 17
rules and regulations, or amend the rules and regula-18
tions of the self-regulatory organization, consistent 19
with this Act and consistent with rules, regulations, 20
amendments, or interpretations finalized by the Com-21
mission pursuant to subsection (a). 22
(3) R
ULE OF APPLICATION .—This subsection 23
shall not apply to a rule or regulation issued pursu-24
ant to a Federal statute if that Federal statute spe-25
VerDate Sep 11 2014 23:55 Dec 01, 2023 Jkt 049200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6203 E:\BILLS\H1807.RH H1807
kjohnson on DSK7ZCZBW3PROD with $$_JOB 7
•HR 1807 RH
cifically requires delivery of written documents to in-1
vestors. 2
(g) D
EFINITIONS.—In this section: 3
(1) C
OMMISSION.—The term ‘‘Commission’’ 4
means the Securities and Exchange Commission. 5
(2) C
OVERED ENTITY.—The term ‘‘covered enti-6
ty’’ means— 7
(A) an investment company (as defined in 8
section 3(a)(1) of the Investment Company Act 9
of 1940 (15 U.S.C. 80a–3(a)(1))) that is reg-10
istered under such Act; 11
(B) a business development company (as de-12
fined in section 2(a) the Investment Company 13
Act of 1940 (15 U.S.C. 80a–2(a))) that has elect-14
ed to be regulated as such under such Act; 15
(C) a registered broker or dealer (as defined 16
in section 3(a)(4) and section 3(a)(5) of the Se-17
curities Exchange Act of 1934) (15 U.S.C. 18
78c(a)(4) & 78c(a)(5)); 19
(D) a registered municipal securities dealer 20
(as defined in section 3(a)(30) of the Securities 21
Exchange Act of 1934) (15 U.S.C. 78c(a)(30)); 22
(E) a registered government securities 23
broker or government securities dealer (as de-24
fined in section 3(a)(43) and section 3(a)(44) of 25
VerDate Sep 11 2014 23:55 Dec 01, 2023 Jkt 049200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6203 E:\BILLS\H1807.RH H1807
kjohnson on DSK7ZCZBW3PROD with $$_JOB 8
•HR 1807 RH
the Securities Exchange Act of 1934) (15 U.S.C. 1
78c(a)(43) & 78c(a)(44)); 2
(F) a registered investment adviser (as de-3
fined in section 202(a)(11) of the Investment Ad-4
visers Act of 1940) (15 U.S.C. 80b–1(a)(11)); 5
(G) a registered transfer agent (as defined 6
in section 3(a)(25) of the Securities Exchange 7
Act of 1934) (15 U.S.C. 78c(a)(25)); or 8
(H) a registered funding portal (as defined 9
in the second paragraph (80) of section 3(a) of 10
the Securities Exchange Act of 1934) (15 U.S.C. 11
78c(a)(80)). 12
(3) E
LECTRONIC DELIVERY.—The term ‘‘elec-13
tronic delivery’’, with respect to regulatory docu-14
ments, includes— 15
(A) the direct delivery of such regulatory 16
document to an electronic address of an investor; 17
(B) the posting of such regulatory document 18
to a website and direct electronic delivery of an 19
appropriate notice of the availability of the regu-20
latory document to the investor; and 21
(C) an electronic method reasonably de-22
signed to ensure receipt of such regulatory docu-23
ment by the investor. 24
VerDate Sep 11 2014 23:55 Dec 01, 2023 Jkt 049200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6203 E:\BILLS\H1807.RH H1807
kjohnson on DSK7ZCZBW3PROD with $$_JOB 9
•HR 1807 RH
(4) REGULATORY DOCUMENTS .—The term ‘‘regu-1
latory documents’’ includes— 2
(A) prospectuses meeting the requirements 3
of section 10(a) of the Securities Act of 1933 (15 4
U.S.C. 77j(a)); 5
(B) summary prospectuses meeting the re-6
quirements of— 7
(i) section 230.498 of title 17, Code of 8
Federal Regulations; or 9
(ii) section 230.498A of title 17, Code 10
of Federal Regulations; 11
(C) statements of additional information, as 12
described under section 270.30e–3(h)(3) of title 13
17, Code of Federal Regulations; 14
(D) annual and semi-annual reports to in-15
vestors meeting the requirements of section 30(e) 16
of the Investment Company Act of 1940 (15 17
U.S.C. 80a–29(e)); 18
(E) notices meeting the requirements under 19
section 270.19a–1 of title 17, Code of Federal 20
Regulations; 21
(F) confirmations and account statements 22
meeting the requirements under section 240.10b– 23
10 of title 17, Code of Federal Regulations; 24
VerDate Sep 11 2014 23:55 Dec 01, 2023 Jkt 049200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6203 E:\BILLS\H1807.RH H1807
kjohnson on DSK7ZCZBW3PROD with $$_JOB 10
•HR 1807 RH
(G) proxy statements meeting the require-1
ments under section 240.14a–3 of title 17, Code 2
of Federal Regulations; 3
(H) privacy notices meeting the require-4
ments of Regulation S–P under subpart A of 5
part 248 of title 17, Code of Federal Regulations; 6
(I) affiliate marketing notices meeting the 7
requirements of Regulation S–AM under subpart 8
B of part 248 of title 17, Code of Federal Regu-9
lations; and 10
(J) all other regulatory documents required 11
to be delivered by covered entities to investors 12
under the securities laws and the rules and regu-13
lations of the Commission and the self-regulatory 14
organizations. 15
(5) S
ECURITIES LAWS.—The term ‘‘securities 16
laws’’ has the meaning given the term in section 3(a) 17
of the Securities Exchange Act of 1934 (15 U.S.C. 18
78c(a)). 19
(6) S
ELF-REGULATORY ORGANIZATION .—The 20
term ‘‘self-regulatory organization’’ means— 21
(A) a self-regulatory organization, as de-22
fined in section 2(a)(26) of the Securities Ex-23
change Act of 1934 (15 U.S.C. 78c(a)(26)); and 24
VerDate Sep 11 2014 23:55 Dec 01, 2023 Jkt 049200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6203 E:\BILLS\H1807.RH H1807
kjohnson on DSK7ZCZBW3PROD with $$_JOB 11
•HR 1807 RH
(B) the Municipal Securities Rulemaking 1
Board. 2
(7) W
EBSITE.—The term ‘‘website’’ means an 3
internet website or other digital, internet, or elec-4
tronic-based information repository, such as a mobile 5
application, to which an investor of a covered entity 6
has been provided reasonable access. 7
VerDate Sep 11 2014 23:55 Dec 01, 2023 Jkt 049200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6203 E:\BILLS\H1807.RH H1807
kjohnson on DSK7ZCZBW3PROD with $$_JOB Union Calendar No.
239
118
TH
CONGRESS
1
ST
S
ESSION
H. R. 1807
[Report No. 118–295]
A BILL
To direct the Securities and Exchange Commission
to promulgate rules with respect to the electronic
delivery of certain required disclosures, and for
other purposes.
D
ECEMBER
1, 2023
Reported with an amendment, committed to the Com-
mittee of the Whole House on the State of the Union,
and ordered to be printed
VerDate Sep 11 2014 23:55 Dec 01, 2023 Jkt 049200 PO 00000 Frm 00012 Fmt 6651 Sfmt 6651 E:\BILLS\H1807.RH H1807
kjohnson on DSK7ZCZBW3PROD with $$_JOB