Investigation of violations
The Administration may make such investigations as it deems necessary to determine whether a licensee or any other person has engaged or is about to engage in any acts or practices which constitute or will constitute a violation of any provision of this chapter, or of any rule or regulation under this chapter, or of any order issued under this chapter. The Administration shall permit any person to file with it a statement in writing, under oath or otherwise as the Administration shall determine, as to all the facts and circumstances concerning the matter to be investigated. For the purpose of any investigation, the Administration is empowered to administer oaths and affirmations, subpena witnesses, compel their attendance, take evidence, and require the production of any books, papers, and documents which are relevant to the inquiry. Such attendance of witnesses and the production of any such records may be required from any place in the United States. In case of contumacy by, or refusal to obey a subpena issued to, any person, including a licensee, the Administration may invoke the aid of any court of the United States within the jurisdiction of which such investigation or proceeding is carried on, or where such person resides or carries on business, in requiring the attendance and testimony of witnesses and the production of books, papers, and documents; and such court may issue an order requiring such person to appear before the Administration, there to produce records, if so ordered, or to give testimony touching the matter under investigation. Any failure to obey such order of the court may be punished by such court as a contempt thereof. All process in any such case may be served in the judicial district whereof such person is an inhabitant or wherever he may be found.
Examinations and reports
15 U.S.C. 80a–1Each small business investment company shall be subject to examinations made by direction of the Investment Division of the Administration, which may be conducted with the assistance of a private sector entity that has both the qualifications to conduct and expertise in conducting such examinations, and the cost of such examinations, including the compensation of the examiners, may in the discretion of the Administration be assessed against the company examined and when so assessed shall be paid by such company. Fees collected under this subsection shall be deposited in the account for salaries and expenses of the Administration, and are authorized to be appropriated solely to cover the costs of examinations and other program oversight activities. Every such company shall make such reports to the Administration at such times and in such form as the Administration may require; except that the Administration is authorized to exempt from making such reports any such company which is registered under the Investment Company Act of 1940 [ et seq.] to the extent necessary to avoid duplication in reporting requirements.
Examinations of small business investment companies
Valuations
Frequency of valuations
In general
Each licensee shall submit to the Administrator a written valuation of the loans and investments of the licensee not less often than semiannually or otherwise upon the request of the Administrator, except that any licensee with no leverage outstanding shall submit such valuations annually, unless the Administrator determines otherwise.
Material adverse changes
Not later than 30 days after the end of a fiscal quarter of a licensee during which a material adverse change in the aggregate valuation of the loans and investments or operations of the licensee occurs, the licensee shall notify the Administrator in writing of the nature and extent of that change.
Independent certification
In general
Not less than once during each fiscal year, each licensee shall submit to the Administrator the financial statements of the licensee, audited by an independent certified public accountant approved by the Administrator.
Audit requirements
Valuation criteria
Pub. L. 85–699, title III, § 310Pub. L. 87–341, § 975 Stat. 755Pub. L. 89–779, § 580 Stat. 1360Pub. L. 90–104, title II, § 20881 Stat. 271Pub. L. 100–590, title I, § 104102 Stat. 2992Pub. L. 102–366, title IV106 Stat. 1016Pub. L. 104–208, div. D, title II, § 208(f)110 Stat. 3009–745Pub. L. 105–135, title II, § 216111 Stat. 2603Pub. L. 106–554, § 1(a)(9) [title IV, § 406]114 Stat. 2763(, as added , , ; amended , , ; , , ; , , ; , §§ 406(b), 407(a), 408(b), , ; , (h)(1)(C), , , 3009–747; , , ; , , , 2763A–691.)
Editorial Notes
References in Text
section 661 of this titleFor definition of “this chapter”, referred to in subsec. (a), see References in Text note set out under .
act Aug. 22, 1940, ch. 68654 Stat. 789section 80a–51 of this titleThe Investment Company Act of 1940, referred to in subsec. (b), is title I of , , which is classified generally to subchapter I (§ 80a–1 et seq.) of chapter 2D of this title. For complete classification of this Act to the Code, see and Tables.
Amendments
Pub. L. 106–5542000—Subsec. (c)(4). substituted “1 year” for “five years”.
Pub. L. 105–1351997—Subsec. (b). inserted after first sentence “Fees collected under this subsection shall be deposited in the account for salaries and expenses of the Administration, and are authorized to be appropriated solely to cover the costs of examinations and other program oversight activities.”
Pub. L. 104–208, § 208(f)(1)1996—Subsec. (b). , inserted “which may be conducted with the assistance of a private sector entity that has both the qualifications to conduct and expertise in conducting such examinations,” after “Investment Division of the Administration,” in first sentence.
Pub. L. 104–208, § 208(h)(1)(C)Subsec. (c)(4). , struck out “not less than four years in the case of section 301(d) licensees and in all other cases,” after “small businesses for”.
Pub. L. 104–208, § 208(f)(2)ProvidedSubsec. (d). , inserted heading and amended text of subsec. (d) generally. Prior to amendment, text read as follows: “Each small business investment company shall adopt written guidelines for determination of the value of investments made by such company. The board of directors of corporations and the general partners of partnerships shall have the sole responsibility for making a good faith determination of the fair market value of the investments made by such company. Determinations shall be made and reported to the Administration not less than semiannually or at more frequent intervals as the Administration determines appropriate: , That any company which does not have outstanding financial assistance under the provisions of this subchapter shall be required to make such determinations and reports to the Administration annually, unless the Administration, in its discretion, determines otherwise.”
Pub. L. 102–366, § 407(a)1992—Subsec. (b). , substituted “Investment Division of” for “Administration by examiners selected or approved by”.
Pub. L. 102–366, § 408(b)Subsec. (c)(5). , inserted before semicolon at end “, if such restriction is applicable”.
Pub. L. 102–366, § 406(b)Subsec. (d). , added subsec. (d).
Pub. L. 100–5901988—Subsec. (b). struck out second sentence, which read as follows: “Each such company shall be examined at least once each year, except that the Administrator may waive examination in the case of a company whose operations have been suspended by reason of the fact that the company is involved in litigation or is in receivership.”
Pub. L. 100–590Subsec. (c). added subsec. (c).
Pub. L. 90–1041967—Subsec. (b). required at least annual examination of small business investment companies but provided for waiver of examination of a company whose operations have been suspended because the company is involved in litigation or is in receivership.
Pub. L. 89–7791966— designated existing provisions as subsec. (a) and added subsec. (b).
Statutory Notes and Related Subsidiaries
Effective Date of 1997 Amendment
Pub. L. 105–135section 3 of Pub. L. 105–135section 631 of this titleAmendment by effective , see , set out as a note under .
Effective Date of 1967 Amendment
Pub. L. 90–104section 211 of Pub. L. 90–104section 681 of this titleAmendment by effective 90 days after , see , set out as a note under .
Effect of Small Business Equity Enhancement Act of 1992 on Securities Laws
Pub. L. 102–366section 418 of Pub. L. 102–366section 661 of this titleNothing in amendment by to be construed to affect applicability of securities laws or to otherwise supersede or limit jurisdiction of Securities and Exchange Commission, see , set out as a note under .
Transfer of Resources
Pub. L. 102–366, title IV, § 407(b)106 Stat. 1016