---
kind: "section"
citation: "15 U.S.C. § 80a–15"
title: "15"
title_heading: "Commerce and Trade"
number: "80a–15"
heading: "Contracts of advisers and underwriters"
release: "119-102"
date: "2026-07-12"
url: "https://uscodex.org/usc/15/80a-15"
units:
  - "Chapter 2D — Investment Companies and Advisers"
  - "Subchapter I — Investment Companies"
---

# §80a–15. Contracts of advisers and underwriters

- (a) **Written contract to serve or act as investment adviser; contents—** It shall be unlawful for any [person](/usc/15/80a–2.md?p=a-28) to serve or act as [investment adviser](/usc/15/80b–2.md?p=a-11) of a registered investment [company](/usc/15/80a–2.md?p=a-8), except pursuant to a written contract, which contract, whether with such registered [company](/usc/15/80a–2.md?p=a-8) or with an [investment adviser](/usc/15/80b–2.md?p=a-11) of such registered [company](/usc/15/80a–2.md?p=a-8), has been approved by the vote of a majority of the outstanding [voting securities](/usc/15/80a–2.md?p=a-42) of such registered [company](/usc/15/80a–2.md?p=a-8), and—
  - (1) precisely describes all compensation to be paid thereunder;
  - (2) shall continue in effect for a period more than two years from the date of its execution, only so long as such continuance is specifically approved at least annually by the board of [directors](/usc/15/80a–2.md?p=a-12) or by vote of a majority of the outstanding [voting securities](/usc/15/80a–2.md?p=a-42) of such [company](/usc/15/80a–2.md?p=a-8);
  - (3) provides, in substance, that it may be terminated at any time, without the payment of any penalty, by the board of [directors](/usc/15/80a–2.md?p=a-12) of such registered [company](/usc/15/80a–2.md?p=a-8) or by vote of a majority of the outstanding [voting securities](/usc/15/80a–2.md?p=a-42) of such [company](/usc/15/80a–2.md?p=a-8) on not more than sixty days’ written notice to the [investment adviser](/usc/15/80b–2.md?p=a-11); and
  - (4) provides, in substance, for its automatic termination in the event of its [assignment](/usc/15/80a–2.md?p=a-4).
- (b) **Written contract with company for sale by principal underwriter of security of which company is issuer; contents—** It shall be unlawful for any principal underwriter for a registered open-end [company](/usc/15/80a–2.md?p=a-8) to offer for sale, sell, or deliver after sale any [security](/usc/15/80a–2.md?p=a-36) of which such [company](/usc/15/80a–2.md?p=a-8) is the [issuer](/usc/15/80a–2.md?p=a-22), except pursuant to a written contract with such [company](/usc/15/80a–2.md?p=a-8), which contract—
  - (1) shall continue in effect for a period more than two years from the date of its execution, only so long as such continuance is specifically approved at least annually by the board of [directors](/usc/15/80a–2.md?p=a-12) or by vote of a majority of the outstanding [voting securities](/usc/15/80a–2.md?p=a-42) of such [company](/usc/15/80a–2.md?p=a-8); and
  - (2) provides, in substance, for its automatic termination in the event of its [assignment](/usc/15/80a–2.md?p=a-4).
- (c) **Approval of contract to undertake service as investment adviser or principal underwriter by majority of noninterested directors—** In addition to the requirements of subsections [(a)](#a) and [(b)](#b) of this section, it shall be unlawful for any registered investment [company](/usc/15/80a–2.md?p=a-8) having a board of [directors](/usc/15/80a–2.md?p=a-12) to enter into, renew, or perform any contract or [agreement](/usc/15/7a.md?p=2), written or oral, whereby a [person](/usc/15/80a–2.md?p=a-28) undertakes regularly to serve or act as [investment adviser](/usc/15/80b–2.md?p=a-11) of or principal underwriter for such [company](/usc/15/80a–2.md?p=a-8), unless the terms of such contract or [agreement](/usc/15/7a.md?p=2) and any renewal thereof have been approved by the vote of a majority of [directors](/usc/15/80a–2.md?p=a-12), who are not parties to such contract or [agreement](/usc/15/7a.md?p=2) or interested [persons](/usc/15/80a–2.md?p=a-28) of any such party, cast in [person](/usc/15/80a–2.md?p=a-28) at a meeting called for the purpose of voting on such approval. It shall be the duty of the [directors](/usc/15/80a–2.md?p=a-12) of a registered investment [company](/usc/15/80a–2.md?p=a-8) to request and evaluate, and the duty of an [investment adviser](/usc/15/80b–2.md?p=a-11) to such [company](/usc/15/80a–2.md?p=a-8) to furnish, such information as may reasonably be necessary to evaluate the terms of any contract whereby a [person](/usc/15/80a–2.md?p=a-28) undertakes regularly to serve or act as [investment adviser](/usc/15/80b–2.md?p=a-11) of such [company](/usc/15/80a–2.md?p=a-8). It shall be unlawful for the [directors](/usc/15/80a–2.md?p=a-12) of a registered investment [company](/usc/15/80a–2.md?p=a-8), in connection with their evaluation of the terms of any contract whereby a [person](/usc/15/80a–2.md?p=a-28) undertakes regularly to serve or act as [investment adviser](/usc/15/80b–2.md?p=a-11) of such [company](/usc/15/80a–2.md?p=a-8), to take into account the purchase price or other consideration any [person](/usc/15/80a–2.md?p=a-28) may have paid in connection with a transaction of the type referred to in paragraph [(1)](#f-1), [(3)](#f-3), or [(4)](#f-4) of subsection (f).
- (d) **Equivalent of vote of majority of outstanding voting securities in case of common-law trust—** In the case of a common-law trust of the character described in [section 80a–16(c) of this title](/usc/15/80a–16.md), either written approval by holders of a majority of the outstanding shares of beneficial interest or the vote of a majority of such outstanding shares cast in [person](/usc/15/80a–2.md?p=a-28) or by proxy at a meeting called for the purpose shall for the purposes of this section be deemed the equivalent of the vote of a majority of the outstanding [voting securities](/usc/15/80a–2.md?p=a-42), and the provisions of paragraph (42) of [section 80a–2(a) of this title](/usc/15/80a–2.md?p=a) as to a majority shall be applicable to the vote cast at such a meeting.
- (e) **Exemption of advisory boards or members from provisions of this section—** Nothing contained in this section shall be deemed to require or contemplate any action by an [advisory board](/usc/15/80a–2.md?p=a-1) of any registered [company](/usc/15/80a–2.md?p=a-8) or by any of the members of such a board.
- (f) **Receipt of benefits by investment adviser from sale of securities or other interest in such investment adviser resulting in assignment of investment advisory contract—**
  - (1) An [investment adviser](/usc/15/80b–2.md?p=a-11), or a corporate trustee performing the functions of an [investment adviser](/usc/15/80b–2.md?p=a-11), of a registered investment [company](/usc/15/80a–2.md?p=a-8) or an affiliated [person](/usc/15/80a–2.md?p=a-28) of such [investment adviser](/usc/15/80b–2.md?p=a-11) or corporate trustee may receive any amount or benefit in connection with a sale of [securities](/usc/15/80a–2.md?p=a-36) of, or a sale of any other interest in, such [investment adviser](/usc/15/80b–2.md?p=a-11) or corporate trustee which results in an [assignment](/usc/15/80a–2.md?p=a-4) of an investment advisory contract with such [company](/usc/15/80a–2.md?p=a-8) or the change in [control](/usc/15/80a–2.md?p=a-9) of or identity of such corporate trustee, if—
    - (A) for a period of three years after the time of such action, at least 75 per centum of the members of the board of [directors](/usc/15/80a–2.md?p=a-12) of such registered [company](/usc/15/80a–2.md?p=a-8) or such corporate trustee (or successor thereto, by [reorganization](/usc/15/80a–2.md?p=a-33) or otherwise) are not (i) interested [persons](/usc/15/80a–2.md?p=a-28) of the [investment adviser](/usc/15/80b–2.md?p=a-11) of such [company](/usc/15/80a–2.md?p=a-8) or such corporate trustee, or (ii) interested [persons](/usc/15/80a–2.md?p=a-28) of the predecessor [investment adviser](/usc/15/80b–2.md?p=a-11) or such corporate trustee; and
    - (B) there is not imposed an unfair burden on such [company](/usc/15/80a–2.md?p=a-8) as a result of such transaction or any express or implied terms, conditions, or understandings applicable thereto.
  - (2)
    - (A) For the purpose of paragraph (1)(A) of this subsection, interested [persons](/usc/15/80a–2.md?p=a-28) of a corporate trustee shall be determined in accordance with [section 80a–2(a)(19)(B) of this title](/usc/15/80a–2.md?p=a-19-B): Provided, That no [person](/usc/15/80a–2.md?p=a-28) shall be deemed to be an interested [person](/usc/15/80a–2.md?p=a-28) of a corporate trustee solely by reason of (i) his being a member of its board of [directors](/usc/15/80a–2.md?p=a-12) or [advisory board](/usc/15/80a–2.md?p=a-1) or (ii) his membership in the immediate family of any [person](/usc/15/80a–2.md?p=a-28) specified in clause (i) of this subparagraph.
    - (B) For the purpose of paragraph (1)(B) of this subsection, an unfair burden on a registered investment [company](/usc/15/80a–2.md?p=a-8) includes any arrangement, during the two-year period after the date on which any such transaction occurs, whereby the [investment adviser](/usc/15/80b–2.md?p=a-11) or corporate trustee or predecessor or successor [investment advisers](/usc/15/80b–2.md?p=a-11) or corporate trustee or any interested [person](/usc/15/80a–2.md?p=a-28) of any such adviser or any such corporate trustee receives or is entitled to receive any compensation directly or indirectly (i) from any [person](/usc/15/80a–2.md?p=a-28) in connection with the purchase or sale of [securities](/usc/15/80a–2.md?p=a-36) or other property to, from, or on behalf of such [company](/usc/15/80a–2.md?p=a-8), other than bona fide ordinary compensation as principal underwriter for such [company](/usc/15/80a–2.md?p=a-8), or (ii) from such [company](/usc/15/80a–2.md?p=a-8) or its [security](/usc/15/80a–2.md?p=a-36) holders for other than bona fide investment advisory or other services.
  - (3) If—
    - (A) an [assignment](/usc/15/80a–2.md?p=a-4) of an investment advisory contract with a registered investment [company](/usc/15/80a–2.md?p=a-8) results in a successor [investment adviser](/usc/15/80b–2.md?p=a-11) to such [company](/usc/15/80a–2.md?p=a-8), or if there is a change in [control](/usc/15/80a–2.md?p=a-9) of or identity of a corporate trustee of a registered investment [company](/usc/15/80a–2.md?p=a-8), and such adviser or trustee is then an [investment adviser](/usc/15/80b–2.md?p=a-11) or corporate trustee with respect to other assets substantially greater in amount than the amount of assets of such [company](/usc/15/80a–2.md?p=a-8), or
    - (B) as a result of a merger of, or a sale of substantially all the assets by, a registered investment [company](/usc/15/80a–2.md?p=a-8) with or to another registered investment [company](/usc/15/80a–2.md?p=a-8) with assets substantially greater in amount, a transaction occurs which would be subject to paragraph (1)(A) of this subsection,

    such discrepancy in size of assets shall be considered by the [Commission](/usc/15/80a–2.md?p=a-7) in determining whether or to what extent an application under [section 80a–6(c) of this title](/usc/15/80a–6.md?p=c) for exemption from the provisions of paragraph (1)(A) of this subsection should be granted.

  - (4) Paragraph (1)(A) of this subsection shall not apply to a transaction in which a controlling block of outstanding [voting securities](/usc/15/80a–2.md?p=a-42) of an [investment adviser](/usc/15/80b–2.md?p=a-11) to a registered investment [company](/usc/15/80a–2.md?p=a-8) or of a corporate trustee performing the functions of an [investment adviser](/usc/15/80b–2.md?p=a-11) to a registered investment [company](/usc/15/80a–2.md?p=a-8) is—
    - (A) distributed to the public and in which there is, in fact, no change in the identity of the [persons](/usc/15/80a–2.md?p=a-28) who [control](/usc/15/80a–2.md?p=a-9) such [investment adviser](/usc/15/80b–2.md?p=a-11) or corporate trustee, or
    - (B) transferred to the [investment adviser](/usc/15/80b–2.md?p=a-11) or the corporate trustee, or an affiliated [person](/usc/15/80a–2.md?p=a-28) or [persons](/usc/15/80a–2.md?p=a-28) of such [investment adviser](/usc/15/80b–2.md?p=a-11) or corporate trustee, or is transferred from the [investment adviser](/usc/15/80b–2.md?p=a-11) or corporate trustee to an affiliated [person](/usc/15/80a–2.md?p=a-28) or [persons](/usc/15/80a–2.md?p=a-28) of the [investment adviser](/usc/15/80b–2.md?p=a-11) or corporate trustee: Provided, That (i) each transferee (other than such adviser or trustee) is a natural [person](/usc/15/80a–2.md?p=a-28) and (ii) the transferees (other than such adviser or trustee) owned in the aggregate more than 25 per centum of such [voting securities](/usc/15/80a–2.md?p=a-42) for a period of at least six months prior to such transfer.

## Source credit

(Aug. 22, 1940, ch. 686, title I, § 15, 54 Stat. 812; Pub. L. 91–547, § 8, Dec. 14, 1970, 84 Stat. 1419; Pub. L. 94–29, § 28(1), (2), (4), June 4, 1975, 89 Stat. 164, 165; Pub. L. 100–181, title VI, § 611, Dec. 4, 1987, 101 Stat. 1261.)

## Notes

### Editorial Notes

### Amendments

1987—Subsec. (d). Pub. L. 100–181, § 611(1), substituted “paragraph (42)” for “paragraph (40)”.

Subsec. (f)(3)(B). Pub. L. 100–181, § 611(2), substituted a comma for the period at end.

1975—Subsec. (c). Pub. L. 94–29, § 28(2), inserted provisions making it unlawful for the directors of a registered investment company, in connection with their evaluation of the terms of any contract whereby a person undertakes regularly to serve or act as investment adviser of such company, to take into account the purchase price or other consideration any person may have paid in connection with a transaction of the type referred to in paragraph (1), (3), or (4) of subsec. (f).

Subsec. (d). Pub. L. 94–29, § 28(4), substituted “section 80a–16(c) of this title” for “subsection (b) of section 80a–16 of this title”.

Subsec. (f). Pub. L. 94–29, § 28(1), added subsec. (f).

1970—Subsec. (a). Pub. L. 91–547, § 8(a), struck out introductory phrase “After one year from the effective date of this subchapter” and “unless in effect prior to March 15, 1940,” before “has been approved”, and “by the investment adviser” after “assignment” in item (4), and substituted “It” for “it”.

Subsec. (b). Pub. L. 91–547, § 8(b), struck out introductory phrase “After one year from the effective date of this subchapter,” and concluding phrase “, unless in effect prior to March 15, 1940” after “which contract” before item (1), struck out “by such underwriter” after “assignment” in item (2), and substituted “It” for “it”.

Subsec. (c). Pub. L. 91–547, § 8(c), made it the duty of the directors of a registered investment company to request and evaluate, and the duty of an investment adviser to such company to furnish, such information as may reasonably be necessary to evaluate the terms of any contract whereby a person undertakes regularly to serve or act as investment adviser of such company, substituted “interested persons” for “affiliated persons”, and struck out “except a written agreement which was in effect prior to March 15, 1940,” after “written or oral,”, item (1) designation following “have been approved” and item “or (2) by the vote of a majority of the outstanding voting securities of such company” after “any such party,”, and inserted “the vote” in phrase “by the vote of a majority”, and provision respecting voting “cast in person at a meeting called for the purpose of voting on such approval”.

Subsecs. (d) to (f). Pub. L. 91–547, § 8(d), redesignated subsecs. (e) and (f) as (d) and (e), respectively, and struck out former subsec. (d) which prohibited any person after March 15, 1945, from acting as investment adviser to, or principal underwriter for, any registered investment company pursuant to a written contract in effect prior to March 15, 1940, unless such contract was renewed prior to March 15, 1945, in such form as to make it comply with subsecs. (a) or (b).

### Statutory Notes and Related Subsidiaries

### Effective Date of 1975 Amendment

Amendment by Pub. L. 94–29 effective June 4, 1975, see section 31(a) of Pub. L. 94–29, set out as a note under section 78b of this title.

### Effective Date of 1970 Amendment

Amendment by Pub. L. 91–547 effective on expiration of one year after Dec. 14, 1970, see section 30(1) of Pub. L. 91–547, set out as a note under section 80a–52 of this title.