15 U.S.C. § 80A
Section 80a · Subclassification of management companies
Amended 2 times on record
Applied in 20 court decisions — leading case King v. Kansas City Southern Industries, Inc. (1975)
Most recently applied in 418 U.S. App. D.C. 131 - Copley Fund, Inc. v. Securities & Exchange Commission (August 2015)
For the purposes of this subchapter, management companies are divided into open-end and closed-end companies, defined as follows:
(1) “Open-end company” means a management company which is offering for sale or has outstanding any redeemable security of which it is the issuer.
(2) “Closed-end company” means any management company other than an open-end company.
Management companies are further divided into diversified companies and non-diversified companies, defined as follows:
(1) “Diversified company” means a management company which meets the following requirements: At least 75 per centum of the value of its total assets is represented by cash and cash items (including receivables), Government securities, securities of other investment companies, and other securities for the purposes of this calculation limited in respect of any one issuer to an amount not greater in value than 5 per centum of the value of the total assets of such management company and to not more than 10 per centum of the outstanding voting securities of such issuer.
(2) “Non-diversified company” means any management company other than a diversified company.
A registered diversified company which at the time of its qualification as such meets the requirements of paragraph (1) of subsection (b) of this section shall not lose its status as a diversified company because of any subsequent discrepancy between the value of its various investments and the requirements of said paragraph, so long as any such discrepancy existing immediately after its acquisition of any security or other property is neither wholly nor partly the result of such acquisition.
Editorial notes U.S. Code · Office of the Law Revision Counsel
Amendments
1987—Subsec. (a)(2). Pub. L. 100–181 substituted “Closed-end” for “Close-end”.
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, §§1, 2, eff. May 24, 1950, 15 F.R. 3175, 64 Stat. 1265, set out under section 78d of this title.
Cross References
Acquisition of securities by registered investment company deemed investment in an investment company, see section 80a–12 of this title.
Registration statement, subclassification to be included, see section 80a–8 of this title.
Value as to assets of registered investment companies, definition of, see section 80a–2 of this title.
Vote required for change in subclassification, see section 80a–13 of this title.