AQR Delphi Long-Short Fund wins SEC exemption for multi-class shares and asset-based fees

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AQR Delphi SEC exemption

Highlights

AQR Delphi Long-Short Fund and AQR Capital Management, LLC receive SEC exemption on May 11, 2026, for multi-class shares and asset-based fees.
The SEC grants relief from sections 18(a)(2), 18(c), 18(i), rule 23c-3, and approves asset-based distribution or service fees under section 17(d) and rule 17d-1.
The SEC order requires that repurchases and fee structures avoid unfair discrimination among security holders and remain consistent with investor protection.

Regulatory approval and scope of relief

As reported by the Securities and Exchange Commission, AQR Delphi Long-Short Fund and AQR Capital Management, LLC filed their application on March 27, 2026, seeking exemptive relief under several provisions of the Investment Company Act of 1940. The Commission says the order covers exemptions from sections 18(a)(2), 18(c) and 18(i), as well as rule 23c-3, and approves the use of asset-based distribution and or service fees under section 17(d) and rule 17d-1.

The agency issued notice of the filing on May 11, 2026, through Investment Company Act Release No. 36146 and gave interested parties an opportunity to request a hearing. No hearing request is filed, and the Commission does not order one before granting the relief effective immediately, subject to the condition contained in the application.

Implications for fund structure and investor treatment

The SEC finds that granting the exemption is appropriate in the public interest and consistent with investor protection and the policy objectives of the Act. It also finds that proposed repurchases are to be carried out in a way that does not unfairly discriminate against holders of the class or classes of securities being purchased.

The order further states that the fund's proposed asset-based distribution and or service fees are consistent with the Act's provisions, policies and purposes, and are not to be implemented on terms less advantageous than those offered to other participants. The matter is issued for the Commission by the Division of Investment Management under delegated authority, with Assistant Secretary Sherry R. Haywood named in the order.

Our earlier article covered the UK Financial Conduct Authority’s legal action targeting Neil Woodford’s W4.0 stockpicking service, which the regulator alleges provided regulated investment advice and financial promotions without authorization. We noted that the case followed the FCA’s proposed £46 million fine and ban over issues tied to the collapse of Woodford’s equity income fund, underscoring the rising legal and compliance risks facing investment firms and market participants.

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