Driscoll R. Ugarte – Duane Morris on Capital Markets

On September 30, 2026, the Securities and Exchange Commission voted to propose a package of rule amendments aimed at expanding retail investor access to private market strategies. The SEC also issued a separate request for comment on new ways for individuals to qualify as accredited investors. Chairman Paul Atkins said the effort is intended to facilitate individual investor participation in private markets while protecting investors from bad actors and fraud. He noted that it complements the President’s Executive Order on Democratizing Access to Alternative Assets for 401(k) Investors. The SEC has also published a fact sheet on the proposals.

The Proposed Amendments

The proposals would:

Expand the ability of registered investment advisers to receive performance-based compensation, calculated on capital gains or capital appreciation, from additional categories of clients, including regulated funds. Under the Investment Adviser Performance-Based Compensation Modernization proposal, this would extend an arrangement long associated with hedge fund, private equity, and venture capital strategies to advisers of regulated funds, which may make those advisers more likely to offer private market strategies to retail investors.
Amend certain fund registration and reporting forms to require disclosure of performance-based compensation.
Update the interval fund framework under the Interval Fund Modernization proposal, including by allowing repurchases to be scheduled at times that better match the liquidity profile of the portfolio.
Replace the existing exemptive orders that regulated closed-end funds currently rely on with a rules-based regime permitting the issuance of multiple share classes.

Possible New Paths to Accredited Investor Status

Separately, the SEC is seeking comment on additional ways individuals could qualify as accredited investors without relying solely on income or net worth. Rule 501(a)(10) of Regulation D permits the SEC to designate professional certifications, designations, or credentials as a basis for accredited investor status, and the SEC is considering the following:

Passing an accredited investor examination to be developed by FINRA;
Holding a U.S. CPA license;
Holding a CFA charter;
Holding a CFP certification in the United States; or
Holding a Series 79, Series 86, or Series 87 license.

Takeaways

For fund sponsors and advisers, the proposals could open a meaningful distribution channel by making it more feasible to bring private-market-style strategies into registered fund structures. Sponsors should consider how the new performance-fee and interval fund provisions would affect product design, liquidity terms, and disclosure.

Issuers conducting private offerings should watch the accredited investor proposals closely. A credential- or exam-based pathway could expand the pool of eligible investors for Regulation D offerings, though the details remain to be seen.

The comment periods will remain open for 60 days after the proposing releases and notices are published in the Federal Register, so market participants have an opportunity to shape the final rules.

Duane Morris will continue to monitor these proposals. If you have questions about how they may affect your fund, offering, or advisory business, please contact Driscoll R. Ugarte, R. Charles (Chuck) Miller, or any other member of the Duane Morris Capital Markets team.

July 28, 2026July 28, 2026 by Driscoll R. Ugarte

SEC Approves New Nasdaq $5 Million Market Value Floor with Immediate Delisting and No Automatic Stay

By Driscoll R. Ugarte

On July 22, 2026, the Securities and Exchange Commission approved an overhaul of Nasdaq’s continued listing standards, creating a new baseline market value of listed securities (MVLS) requirement that leaves little room for companies that fall below it. New Nasdaq Rules 5450(a)(3) and 5550(a)(6) will require all listed companies to maintain an MVLS (the consolidated closing bid price multiplied by total shares outstanding of the listed class) of at least $5 million. What makes this rule change notable is not the dollar threshold itself, but the consequences of failing to meet it.

Read the full Alert on the Duane Morris LLP website.

June 3, 2026June 3, 2026 by Driscoll R. Ugarte

SEC Formally Proposes to Rescind Climate-Related Disclosure Rules: What Happens Next?

By Driscoll R. Urgate

On May 29, 2026, the SEC voted unanimously to propose rescinding in their entirety the climate-related disclosure rules adopted by a 3-2 vote in March 2024 (the Climate Rules). Chairman Paul Atkins framed the action around materiality, stating that SEC disclosure obligations should be “guided by materiality as the North Star” and “imposed only when the expected benefits justify the likely costs and burdens.”

The Climate Rules, which would have mandated reporting on climate risks, Scope 1 and 2 greenhouse gas emissions, transition plans, and financial statement footnotes for severe weather events, never took effect. Immediately upon adoption, trade associations, state attorneys general, and business groups challenged the Climate Rules, with litigation consolidating in the Eighth Circuit (Iowa v. SEC, No. 24-1522). The Commission stayed the Climate Rules on April 4, 2024, and they have remained inoperative since.

Timeline of Key Events

The path to this proposed rescission includes several notable milestones. In February 2025, Acting SEC Chairman Mark Uyeda directed Commission staff to request that the Eighth Circuit refrain from scheduling oral arguments and outlined his concerns about the Commission’s statutory authority to adopt the Climate Rules. On March 27, 2025, the Commission voted to withdraw its defense of the Climate Rules, with Commissioner Caroline A. Crenshaw dissenting. Following the SEC’s withdrawal, a coalition of 18 states and the District of Columbia intervened to uphold the Climate Rules. On September 12, 2025, the Eighth Circuit issued an order holding the consolidated petitions for review in abeyance until such time as the Commission reconsidered the Climate Rules through notice-and-comment rulemaking or renewed its defense.

The Commission has now taken the step contemplated by that order, proposing to rescind the Climate Rules through a formal notice-and-comment rulemaking.

Meanwhile, climate disclosure requirements continue to advance at the state level. In February 2026, the New York State Senate passed the Climate Corporate Data Accountability Act, which is legislation modeled in significant respects on California’s climate disclosure laws. The bill remains pending before the New York Assembly.

Rationale for Rescission

The Commission now believes the 2024 Climate Rules “were a dramatic overreach of the Commission’s statutory authority and, independently, unsound as a matter of policy.” Even assuming it had authority to adopt the Climate Rules, the Commission identifies independent policy grounds for rescission: the Climate Rules are inconsistent with a registrant-specific, materiality-based disclosure framework; they stray beyond the policy concerns of the federal securities laws; they impose substantial costs not justified by informational benefits; and they conflict with the Commission’s objectives of facilitating capital formation and promoting public company status.

Commissioner Uyeda, in his supporting statement, emphasized that the concept of materiality, including as it relates to climate change, is already well embedded in the SEC’s existing disclosure obligations, whether in the description of the business, risk factor disclosure, management’s discussion and analysis, financial statements, or notes thereto. He characterized the Climate Rules as “a rule to influence how a business operates hidden under a cloak of disclosure.”

Commissioner Hester Peirce likewise supported the proposal, noting that adherence to a merit-neutral, materiality-centered disclosure framework is consistent with both the SEC’s statutory authority and the healthy functioning of U.S. capital markets. The Commission’s proposing release, Release No. 33-11421, sets forth the legal and policy bases for rescission in detail.

Next Steps

The public comment period will remain open for 60 days following publication of the proposing release in the Federal Register. Given that the original 2022 climate proposal generated more than 16,000 public comments, a similarly robust comment process is anticipated. After reviewing public comments, the Commission would be required to vote again before the rescission could become final.

In the meantime, the Climate Rules remain in place and have never been operative. As discussed in the accompanying Client Alert, companies should not assume that the absence of federal climate disclosure mandates means the end of climate-related reporting obligations. California’s SB 253 and SB 261, New York’s proposed Climate Corporate Data Accountability Act, the European Union’s Corporate Sustainability Reporting Directive, and various international standards under the International Sustainability Standards Board framework continue to advance. As a result, many public and private companies may remain or become subject to climate-related reporting obligations regardless of what the SEC ultimately does.

We will continue to monitor developments and provide updates as the SEC’s rulemaking process unfolds. Read a more detailed analysis of this update on the Duane Morris LLP website.