H.R. 2441: Improving Disclosure for Investors Act of 2025

The Improving Disclosure for Investors Act of 2025 aims to modernize the way regulatory documents required under securities laws are delivered to investors by allowing for electronic delivery. Here are the main points of the bill:

1. Electronic Delivery Rules

The Securities and Exchange Commission (SEC) is tasked with creating rules to let certain entities fulfill their requirements to deliver regulatory documents electronically. They must propose these rules within 180 days of the bill's enactment and finalize them within a year.

2. Requirements for Transitioning to Electronic Delivery

• Initial Communication: For investors who do not opt for electronic delivery, entities must send an initial paper notification about the option for electronic delivery.
• Transition Period: There will be a transition period of up to 180 days before full electronic delivery begins.
• Annual Reminders: For two years following the transition, these investors must receive an annual paper reminder about their option to opt out of electronic delivery.
• Content Requirements: The SEC will set requirements for the content of initial communications regarding the shift to electronic delivery.
• Notice of Document Availability: There will be guidelines for notifying investors about where they can find the regulatory documents online.
• Opt-Out Mechanism: Investors must have a clear method to opt out of electronic delivery at any time and request paper versions of the documents instead.
• Failure Handling: Entities must have adequate measures in place to address any failures in delivering documents electronically.
• Readability Standards: There will be minimum standards for how electronic documents must be structured to ensure they are readable and retainable.
• Confidentiality Measures: Further requirements may be imposed on certain covered entities to safeguard personal information included in regulatory documents sent electronically.

3. Non-Alteration of Existing Regulations

The bill clarifies that the new electronic delivery methods will not change the substance or timing of existing requirements for delivering regulatory documents.

4. Commission Oversight

• Review of Existing Rules: The SEC must review its existing regulations to identify any that need to be amended to allow for electronic delivery of written documents.
• Self-Regulatory Organizations: Organizations that regulate themselves in the financial sector must align their rules with the new electronic delivery framework outlined in this bill.

5. Definitions

The bill includes definitions for terms such as “regulatory documents,” “covered entities,” and “electronic delivery,” which specify the types of documents impacted and the entities that would use electronic means to deliver them.

Relevant Companies

• BLK (BlackRock): As a large investment management company that offers various funds, BlackRock may need to adapt its document delivery processes to comply with the electronic mandates set forth by this bill.
• VFIAX (Vanguard 500 Index Fund): This fund, like many others, will likely be affected by the requirements for delivering disclosures electronically to its investors, impacting how it communicates important regulatory materials.