Investors Can Get Documents Electronically

Summary#

The Improving Disclosure for Investors Act of 2025 is a proposed new federal law. It would direct the Securities and Exchange Commission (SEC) to make rules allowing certain financial firms to deliver required investor documents electronically; its stated goal is to provide for electronic delivery of those documents. The bill is not law, and it does not directly amend a named Act.

  • The covered firms include registered investment companies, business development companies, brokers and dealers, investment advisers, transfer agents, funding portals, and certain municipal and government securities dealers and brokers.
  • SEC rules would have to provide for a paper notice to investors who do not already receive all documents electronically, a transition to electronic delivery of up to 180 days, and paper reminders for up to two years after that transition.
  • Investors must be able to opt out at any time and receive paper versions.
  • The SEC would have to set requirements for notices, readability and retention, and measures to address failed electronic deliveries. Certain covered firms would also have to take reasonable steps to protect personal information.
  • If the SEC misses its rulemaking deadline, covered firms could use electronic delivery under the bill’s requirements, and that delivery would count as meeting their legal delivery duty. Self-regulatory organizations would also have to adopt or change their rules to match the law and SEC rules.

What it means for you#

  • Investors: If the bill became law and the required rules took effect, you could receive covered documents electronically, including prospectuses, account statements, confirmations, proxy statements, and privacy notices. The bill requires a way to opt out at any time and get paper copies.
  • Investors who rely on paper: The bill’s required rules would provide for an initial paper communication and a transition of up to 180 days to electronic delivery, followed by paper reminders for up to two years. The bill does not provide an exemption based on lack of internet access.
  • Covered firms: They would be allowed to meet delivery duties electronically, but would have to follow the SEC’s requirements. Electronic delivery could be by direct electronic delivery, a website notice, or another method reasonably designed to ensure receipt.
  • SEC and self-regulatory organizations: The SEC would have to propose rules within 180 days and finalize them within one year of enactment. Self-regulatory organizations would have to adopt or change their rules.
  • General public: The bill does not change the required substance or timing of the underlying investor documents.

Money#

No publicly available information on estimated public or private costs.

  • The bill requires SEC rulemaking and review, and requires self-regulatory organizations to adopt or change rules. It gives no cost estimate or specific funding amount.
  • Covered firms may need to make changes to deliver documents electronically and meet the new requirements; the bill does not estimate those costs.

What is unclear#

  • The supplied materials do not include current law or the relevant existing regulations, so it is not possible to verify which covered documents can already be delivered electronically.
  • The bill leaves many details to SEC rules, including the required notice content and timing, how failed deliveries must be fixed, and minimum readability and retention standards.
  • The bill does not specify how investors would opt out, or what happens if an electronic delivery fails despite the required safeguards.
  • “Reasonably designed” and “reasonable access” are not defined in the bill.
  • The bill requires certain firms—but not brokers, dealers, SEC-registered investment advisers, or investment companies—to take reasonable measures to protect personal information. It does not explain why those groups are treated differently.
  • The deadlines run from enactment. The bill does not set a separate date for the law to start operating.

Case for#

  • A possible argument for the bill is that electronic delivery gives firms more than one way to send required documents, including direct delivery or a notice that documents are available online.
  • The bill keeps a paper option: investors must be able to opt out at any time and receive paper versions.
  • Required rules on failed deliveries, readability, and document retention could help address risks created by electronic delivery.
  • The bill sets deadlines for the SEC and self-regulatory organizations to establish consistent rules.

Case against#

  • One concern is that the required transition could move investors from paper to electronic delivery, even though they can opt out. The bill does not provide a specific exception for investors without reliable internet access.
  • The quality of protections depends on SEC rules that are not yet written. The bill sets broad requirements but leaves many practical details to the SEC.
  • The bill requires specific privacy measures for some covered firms but excludes several major types of firms from that requirement.
  • A possible trade-off is that electronic delivery may be more convenient for some investors but harder to use for others. The bill does not explain how firms should address that difference.