SEC Submits Proposal to OIRA to Amend Investment Adviser Pay-to-Play Rule

The SEC submitted a proposed rule to the Office of Information and Regulatory Affairs ("OIRA") that would amend the investment adviser pay-to-play rule to address identified compliance burdens.

The submission follows the SEC's addition of "Pay-to-Play Reform" to the 2026 regulatory agenda, which it announced in July and which flags the item as deregulatory and economically significant. OIRA reviews federal rulemakings deemed significant regulatory actions at both the proposed and final rule stages. The Office generally has up to 90 days, subject to extension, to complete its review, after which the SEC could issue a notice of proposed rulemaking. The SEC's agenda projects issuing a proposal in October 2026, though the agency notes such dates are estimates.

The substance of the proposed rule has not been disclosed. An SEC spokesperson told Reuters that the Commission "is heeding years of complaints from across the political spectrum and will consider a proposal to address these issues and reform the rule."

Rule 206(4)-5 ("Political contributions by certain investment advisers"), the pay-to-play rule, generally bars an investment adviser from being paid for advisory services to a state or local government entity for two years after the adviser, certain of its executives and employees, or a political action committee it controls makes a contribution to an official who can influence the hiring of advisers. The rule includes a de minimis exception for individual contributions of up to $350 per election to a candidate the contributor can vote for, and up to $150 where the contributor cannot.