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INVESTMENT COMPANIES

HEARINGS

BEFORE A

SUBCOMMITTEE OF THE

COMMITTEE ON
INTERSTATE AND FOREIGN COMMERCE
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HOUSE OF REPRESENTATIVES

28 ng

SEVENTY-SIXTH CONGRESS

THIRD SESSION

ON

H. R. 10065

A BILL TO PROVIDE FOR THE REGISTRATION AND
REGULATION OF INVESTMENT COMPANIES
AND INVESTMENT ADVISERS, AND

FOR OTHER PURPOSES

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COMMITTEE ON INTERSTATE AND FOREIGN COMMERCE

CLARENCE F. LEA, California, Chairman ROBERT CROSSER, Ohio

CHARLES A. WOLVERTON, New Jersey ALFRED L. BULWINKLE, North Carolina JAMES WOLFENDEN, Pennsylvania VIRGIL CHAPMAN, Kentucky

PEHR G. HOLMES, Massachusetts WILLIAM P. COLE, JR., Maryland

B. CARROLL REECE, Tennessee EDWARD A. KELLY, Illinois

JAMES W. WADSWORTH, New York HERRON PEARSON, Tennessee

CHARLES A. HALLECK, Indiana LYLE H. BOREN, Oklahoma

OSCAR YOUNGDAHL, Minnesota MARTIN J. KENNEDY, New York

CARL HINSHAW, California ELMER J. RYAN, Minnesota

CLARENCE J. BROWN, Ohio
CHARLES L. SOUTH, Texas

CHARLES F. RISK, Rhode Island
JAMES P. MCGRANERY, Pennsylvania
DONALD L. O'TOOLE, New York
LUTHER PATRICK, Alabama
RUDOLPH G. TENEROWICZ, Michigan

ELTON J. LAYTON, Clerk
F. P. RANDOLPH, Assistant Clerk

SUBCOMMITTEE

WILLIAM P. COLE, JR., Maryland, Chairman LYLE H. BO EN, Oklahoma

CHARLES A. WOLVERTON, New Jersey DONALD L. O'TOOLE, New York

B, CARROLL REECE, Tennessee

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INVESTMENT TRUSTS AND INVESTMENT COMPANIES

THURSDAY, JUNE 13, 1940

Hous E of REPRESENTATIVEs, SUBCOMMITTEE of THE CoMMITTEE on INTERSTATE AND FoREIGN CoMMERCE, Washington, D. C.

The subcommittee met at 10 a.m., in the committee room, Hon. William P. Cole, Jr. (chairman of the subcommittee), presiding. Mr. Col.F. The subcommittee will come to order. H. R. 8935 was introduced March 14, 1940, by Nr. Lea, of California. A companion bill, S. 3580, was introduced, at the same time in the Senate by Senator Wagner. Since that time the State Committee on Banking and Currency held extensive hearings on S. 3580, a companion measure to H. R. 8935, with the result that S. 4108 was reported on June 6 by the Senate Committee on Banking and Currency. In order to have that bill before us in House form also, (with the approval of Mr. Lea,) I introduced yesterday the same bill in the House, which is H. R. 10065. It is upon all of these bills that the hearing before this subcommittee will be held. I think that the committee will be more interested in the last two bills I mentioned, which present the views of the Senate Committee on Banking and Currency and with which we understand the industry is in agreement. (The House bill is as follows:)

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A BILL To provide for the registration and regulation of investment companies and investment advisers, and for other purposes

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

TITLE I–INVESTMENT COMPANIES
FINDINGS AND DECLARATION OF POLICY

SEC. 1. (a) Upon the basis of facts disclosed by the record and reports of the Securities and Exchange Commission made pursuant to section 30 of the Public Utility Holding Company Act of 1935, and facts otherwise disclosed and ascertained, it is hereby found that investment companies are affected with a national public interest in that, among other things— (1) the securities issued by such companies, which constitute a substantial part of all securities publicly offered, are distributed, purchased, paid for, exchanged, transferred, redeemed, and repurchased by use of the mails and means and instrumentalities of interstate commerce, and in the case of the numerous companies which issue redeemable securities this process of distribution and redemption is continuous;

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