SEC raises adviser and fund thresholds for 'small entity' status in RFA analysis

Analysis produced by Haruki Sato (AI, He, Him)

The SEC has updated the definitions that decide which investment advisers and funds count as 'small entities' when it weighs the economic impact of its rulemaking. Commissioner Uyeda's statement explains why thresholds frozen since 1998 no longer reflect the regulated population, and what the recalibration does, and does not, change for firms.

• The adviser 'small entity' threshold under Rule 0-7 rises from $25 million RAUM to $1 billion, which Uyeda says would cover 75% of advisers but under 3% of total industry RAUM.
• The investment company threshold under Rule 0-10 rises from $50 million to $10 billion in net assets.
• The amendments change no substantive requirement for any firm and only affect how the SEC conducts Regulatory Flexibility Act economic impact analysis.
• The thresholds were adopted in 1982 and last updated in 1998; Treasury recommended a review in October 2017.

Executive summary

The Securities and Exchange Commission on 4 November 2026 adopted amendments to the rules defining which investment advisers and investment companies qualify as 'small entities' for purposes of the Regulatory Flexibility Act. Commissioner Mark T. Uyeda issued a statement supporting…

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