CITE
15 USC Sec. 80a-14 01/05/2009
EXPCITE
TITLE 15 - COMMERCE AND TRADE
CHAPTER 2D - INVESTMENT COMPANIES AND ADVISERS
SUBCHAPTER I - INVESTMENT COMPANIES
HEAD
Sec. 80a-14. Size of investment companies
STATUTE
(a) Public offerings
No registered investment company organized after August 22, 1940,
and no principal underwriter for such a company, shall make a
public offering of securities of which such company is the issuer,
unless -
(1) such company has a net worth of at least $100,000;
(2) such company has previously made a public offering of its
securities, and at the time of such offering had a net worth of
at least $100,000; or
(3) provision is made in connection with and as a condition of
the registration of such securities under the Securities Act of
1933 [15 U.S.C. 77a et seq.] which in the opinion of the
Commission adequately insures (A) that after the effective date
of such registration statement such company will not issue any
security or receive any proceeds of any subscription for any
security until firm agreements have been made with such company
by not more than twenty-five responsible persons to purchase from
it securities to be issued by it for an aggregate net amount
which plus the then net worth of the company, if any, will equal
at least $100,000; (B) that said aggregate net amount will be
paid in to such company before any subscriptions for such
securities will be accepted from any persons in excess of twenty-
five; (C) that arrangements will be made whereby any proceeds so
paid in, as well as any sales load, will be refunded to any
subscriber on demand without any deduction, in the event that the
net proceeds so received by the company do not result in the
company having a net worth of at least $100,000 within ninety
days after such registration statement becomes effective.
At any time after the occurrence of the event specified in clause
(C) of paragraph (3) of this subsection the Commission may issue a
stop order suspending the effectiveness of the registration
statement of such securities under the Securities Act of 1933 [15
U.S.C. 77a et seq.] and may suspend or revoke the registration of
such company under this subchapter.
(b) Study on effects of size
The Commission is authorized, at such times as it deems that any
substantial further increase in size of investment companies
creates any problem involving the protection of investors or the
public interest, to make a study and investigation of the effects
of size on the investment policy of investment companies and on
security markets, on concentration of control of wealth and
industry, and on companies in which investment companies are
interested, and from time to time to report the results of its
studies and investigations and its recommendations to the Congress.
SOURCE
(Aug. 22, 1940, ch. 686, title I, Sec. 14, 54 Stat. 811.)
REFERENCES IN TEXT
The Securities Act of 1933, referred to in subsec. (a), is act
May 27, 1933, ch. 38, title I, 48 Stat. 74, as amended, which is
classified generally to subchapter I (Sec. 77a et seq.) of chapter
2A of this title. For complete classification of this Act to the
Code, see section 77a of this title and Tables.
TRANSFER OF FUNCTIONS
For transfer of functions of Securities and Exchange Commission,
with certain exceptions, to Chairman of such Commission, see Reorg.
Plan No. 10 of 1950, Secs. 1, 2, eff. May 24, 1950, 15 F.R. 3175,
64 Stat. 1265, set out under section 78d of this title.