On July 16, 2026, the Securities and Exchange Commission (the “SEC”) proposed Regulation E‑Delivery (the “Proposed Rule”), a new rule that would permit investment advisers, investment companies, issuers, broker-dealers and other market intermediaries to satisfy certain delivery obligations under the federal securities laws through electronic delivery without first obtaining affirmative consent from investors and other recipients.[1] The Proposed Rule reflects the SEC’s view that electronic communication technologies and investor use of those technologies have evolved significantly since the SEC first issued electronic delivery guidance in the 1990s. If adopted substantially as proposed, the Proposed Rule would, among other things, establish a rule-based framework under which electronic delivery would become the default method of delivery for a broad range of required disclosures and communications under the federal securities laws.
Key Highlights of Proposed Regulation E‑Delivery
- The Proposed Rule would apply broadly to information required to be delivered under the federal securities laws. The SEC identified, among other examples, fund prospectuses, annual and semi-annual shareholder reports, proxy statements, trade confirmations, privacy notices, data breach notifications, Form CRS disclosures and Form ADV Part 2 brochures.
- The Proposed Rule would establish different delivery methods depending on whether covered information contains personal financial information (“PFI”).
- Existing paper recipients generally would need to receive two paper notices before being transitioned to default electronic delivery.
- The SEC also proposed rescinding Rule 30e‑3 under the Investment Company Act of 1940, as amended, which provides a specialized mechanism for internet availability of shareholder reports, and amending certain rules relating to proxy and tender offer delivery requirements.[2]
Default Electronic Delivery
The Proposed Rule would apply broadly to “covered information,” which is generally defined as information required to be delivered by a “covered entity” to a “covered recipient” under the federal securities laws. “Covered entities” include persons with delivery obligations in connection with such information under the federal securities laws, including issuers, investment advisers and broker-dealers, and “covered recipients” would include current or prospective customers, clients, investors, security holders, counterparties or similar recipients of covered information.[3] The Proposed Rule would become the SEC’s primary rule addressing electronic delivery and would establish a uniform rule for electronic delivery.
The Proposed Rule would establish a new framework under which issuers, investment advisers, broker-dealers and other covered entities could satisfy delivery obligations under the federal securities laws through electronic delivery. The Proposed Rule would allow a covered entity to deliver covered information through the use of electronic delivery if (i) the covered recipient has provided an electronic address (including an email address or a mobile phone number), (ii) the covered entity has provided prominent disclosure that it will send covered information to that electronic address and (iii) the covered recipient has not opted out of electronic delivery.[4] The covered entity could satisfy its delivery obligation in this manner regardless of whether it chooses e-delivery as a default or continues to require affirmative consent from covered recipients for e-delivery.
For investment advisers and investment companies, the Proposed Rule is significant because it would affect the method of delivery of a wide range of client and investor communications, including Form ADV Part 2, disclosures pursuant to Form CRS, fund annual and semi-annual shareholder reports, prospectuses, fund offering documents and other required disclosures, privacy notices and data breach notifications, along with proxy statements and trade confirmations.
Investor Protection Safeguards
The SEC did not propose a framework under which making information available online would automatically satisfy delivery obligations. Instead, the Proposed Rule includes several conditions intended to preserve investor choice and access to information. Importantly, covered recipients would retain the ability to opt out of electronic delivery and request paper copies free of charge, and covered entities would be required to satisfy conditions relating to website availability, delivery failures and related operational requirements.[5] The Proposed Rule would require covered entities to adopt and implement written policies and procedures reasonably designed to identify and remediate failed electronic deliveries. A covered entity that identifies an e-delivery failure would be required to promptly take reasonable remediation steps, including obtaining a new electronic address or delivering the covered information in paper format until the covered recipient provides a new electronic address.
Personal Financial Information
The Proposed Rule draws an important distinction between covered information that contains PFI and covered information that does not. The Proposed Rule would define “personal financial information” as “information specific to a covered recipient’s personal financial matters, such as an account number or details regarding a specific securities transaction.”[6]
For covered information that does not include PFI, a covered entity generally could choose to deliver the information directly to a covered recipient’s electronic address. For covered information that includes PFI, a covered entity generally would be required to deliver a statement of availability to the covered recipient’s electronic address, such as an email with a link to the website address where the covered recipient can access the information. A covered entity also could choose to use the statement-of-availability method for covered information that does not include PFI. [7]
From a practical perspective, the different treatment of PFI could pose operational challenges. Advisers and other covered entities may wish to consider whether communications can be classified based on whether they contain PFI and whether existing client or investor communication delivery systems could support different workflows depending on the nature of the information being transmitted as well as data protection risks. Advisers also may wish to consider whether third-party service providers, such as administrators, transfer agents, and custodians could support those workflows.
Transition for Existing Paper Recipients
The Proposed Rule includes a transition process to be followed for covered recipients receiving covered information in paper format for whom a covered entity wishes to transition to default electronic delivery. Such recipients generally would need to receive two paper notices before being transitioned to electronic delivery, with such notices providing information about the upcoming transition and the recipient’s ability to opt out of electronic delivery.[8] The first paper notice would need to be provided at least 180 days before the transition to default e-delivery, and the second paper follow-up notice would need to be provided 30 days before the transition.
For covered entities that currently use paper delivery for covered information (or a subset of covered information), the transition process would require identification of the affected recipients, delivery of the required notices and processing of resulting opt-out elections.
Existing Electronic Delivery Arrangements
Many investment advisers currently obtain affirmative investor or client consent to electronic delivery through subscription documents, advisory agreements, account-opening materials, investor portals and related onboarding processes. For firms that already deliver investor or client communications electronically pursuant to these arrangements, the Proposed Rule may not result in a significant change in the delivery method for those communications. However, those firms would need to assess whether existing electronic-delivery practices are structured in a manner that satisfies the Proposed Rule’s conditions if a firm seeks to rely on Regulation E‑Delivery. Firms that rely on administrators, transfer agents, intermediaries or other third-party service providers will also need to consider whether existing delivery arrangements with such third parties comply with the Proposed Rule’s requirements relating to delivery notices, delivery failures, paper-copy requests and investor elections. In addition, firms may need to evaluate whether existing compliance policies and procedures relating to electronic delivery, failed deliveries and service-provider oversight would require modification or whether new policies and procedures may need to be adopted to satisfy the Proposed Rule’s requirements.
The comment period for the Proposed Rule is expected to close on September 21, 2026. If the Proposed Rule is adopted, it would become effective 60 days after publication of the final rule in the Federal Register, however, the Proposed Rule would provide for a two-year interim period before the SEC’s prior e-delivery guidance is rescinded. [9]
Seward & Kissel will continue to monitor developments relating to the Proposed Rule and is available to assist clients in evaluating the proposal, preparing comments and assessing potential implementation considerations.