# 2026-00316: SEC Redefines 'Small Business' for Investment Firms with Inflation Tweaks

2026-00316, "Small Business" and "Small Organization" Definitions for Investment Companies and Investment Advisers for Purposes of the Regulatory Flexibility Act, is a Federal Register proposed rule from Securities and Exchange Commission published 2026-01-12, effective Comments should be received on or before March 13, 2026. (as of 2026-06-11).

- Canonical: https://policyrisk.com/federal-register/2026-00316
- As of: 2026-06-11
- Plain-text twin of the page above; the HTML and this file carry the same facts.

## Facts
- Document number: 2026-00316
- Title: "Small Business" and "Small Organization" Definitions for Investment Companies and Investment Advisers for Purposes of the Regulatory Flexibility Act
- Type: Proposed Rule
- Agencies: Securities and Exchange Commission
- Citation: 91 FR 1107
- Published: 2026-01-12
- Effective: Comments should be received on or before March 13, 2026.
- Comments close: not stated
- Significant: no
- Touches household money: no
- Regulation identifier numbers: 3235-AN39
- Last updated: 2026-06-11

## In one line

SEC Redefines 'Small Business' for Investment Firms with Inflation Tweaks

## Summary

The SEC wants to update the rules that decide what counts as a "small business" or "small organization" for investment companies and advisers by raising the asset limits. They’re also planning to adjust these limits regularly for inflation. If you’re an investment adviser or company, these changes could affect your filing rules, so get ready to comment by March 13, 2026!

## Abstract

The Securities and Exchange Commission (the "Commission" or the "SEC") is proposing to amend the rules under the Investment Company Act of 1940 (the "Investment Company Act") and under the Investment Advisers Act of 1940 (the "Advisers Act") that define the terms "small business" and "small organization" for purposes of the Regulatory Flexibility Act (the "RFA") to increase the asset-based thresholds used in those definitions. The Commission also is proposing a mechanism for periodic future inflation adjustments of the asset- based thresholds used in these definitions. The Commission further is proposing amendments to Form ADV and the rule providing continuing hardship exemptions from filing electronically for investment advisers in connection with the proposed amendments.

## Effects PRIA read

- Fund small-entity cutoff jumps to $10B: benefit, high. If you run or manage an investment company, the SEC proposes increasing the "small entity" net asset threshold from $50 million to $10 billion. The proposal would also require aggregating assets using a "family of investment companies" as defined in Form N-CEN, which changes which funds count as "s…
- Adviser RAUM cutoff raised to $1 billion: benefit, high. If you are an investment adviser, the SEC proposes raising the regulatory assets under management (RAUM) threshold from $25 million to $1 billion for purposes of defining a "small entity." The proposal would also conform the Control Relationship Threshold to this revised RAUM level.
- 10-year automatic inflation updates: benefit, medium. The SEC proposes a mechanism to allow the Commission to adjust the asset-based thresholds for small-entity definitions for inflation by order every 10 years. The adjustment mechanism would apply to the revised asset thresholds in rule 0-10 and rule 0-7.

## Related documents

- [2026-20466](https://policyrisk.com/federal-register/2026-20466): Adviser and Regulated Fund Custody Rules; Crypto Custody Rules, 2026-10-06
- [2026-19260](https://policyrisk.com/federal-register/2026-19260): Rescission of Rule 14a-8's Federal Regulation of Shareholder Proposals and Amendments to Rule 14a-4, 2026-09-21
- [2026-18424](https://policyrisk.com/federal-register/2026-18424): Political Contributions by Certain Investment Advisers, 2026-09-10
- [2026-18190](https://policyrisk.com/federal-register/2026-18190): Transfer Agent Rules, 2026-09-04
- [2026-17183](https://policyrisk.com/federal-register/2026-17183): Regulation Crypto Assets, 2026-08-21
- [2026-12163](https://policyrisk.com/federal-register/2026-12163): The Trade-Through Rule and Locked and Crossed Markets Provisions of Regulation NMS, 2026-06-17

## Sources
- [2026-00316 on federalregister.gov](https://www.federalregister.gov/documents/2026/01/12/2026-00316/small-business-and-small-organization-definitions-for-investment-companies-and-investment-advisers)
- [2026-00316 as published (PDF)](https://www.govinfo.gov/content/pkg/FR-2026-01-12/pdf/2026-00316.pdf)

## Related
- [Previous: 2026-00299, Airworthiness Directives; The Boeing Company Airplanes](https://policyrisk.com/federal-register/2026-00299)
- [Next: 2026-00372, National Bank Chartering](https://policyrisk.com/federal-register/2026-00372)
- [All Federal Register documents](https://policyrisk.com/federal-register)

Source: PRIA, https://policyrisk.com/federal-register/2026-00316 (as of 2026-06-11).