SEC to Make E-Delivery Default for Investor Disclosures

The Securities and Exchange Commission on Thursday proposed a rule that would make electronic delivery the default for most required investor communications, replacing a decades-old system that generally requires paper delivery unless investors affirmatively opt into electronic communications. 

The proposed Regulation E-Delivery, announced today, would permit issuers, broker/dealers, investment advisers and other regulated entities to satisfy federal securities law delivery requirements by electronically providing required documents, while preserving investors’ ability to continue receiving paper copies upon request. The proposal would cover a broad range of disclosures, including mutual fund and corporate prospectuses, shareholder reports, proxy statements, trade confirmations, Form Customer Relationship Summary disclosures and Form ADV Part 2 brochures. 

The proposal marks one of the SEC’s most significant modernization efforts in years, reflecting how investors increasingly consume financial information through digital channels.

Under the existing framework, paper remains the default delivery method unless investors explicitly consent to electronic delivery. The new rule would instead allow firms to send disclosures electronically without first obtaining affirmative consent, provided they satisfy specified conditions. 

“Today, the Commission took an important step toward allowing the financial services industry to harness technology for the benefit of everyday American investors,” SEC Chair Paul Atkins said in a statement. Atkins wrote that the proposal would move the agency toward “a regulatory framework suitable for the modern era,” adding that “in an age of artificial intelligence and blockchain technology, a default to paper delivery should be a relic, not a standard.” 

According to the SEC, electronic delivery could provide investors with more timely, interactive and personalized disclosures while reducing paper, printing and postage expenses for issuers and market intermediaries. The agency stated those cost savings could ultimately benefit investors. 

The proposal includes safeguards for investors who currently receive paper documents. Before transitioning those recipients to electronic delivery, firms would be required to send two paper notices explaining the upcoming change and informing investors how they can opt to continue receiving paper disclosures. 

According to the SEC, the proposed rule would generally supersede its longstanding guidance-based approach to electronic delivery, replacing it with a formal regulatory framework designed to better reflect current technology and investor behavior. 

The proposal will be open for public comment for 60 days after publication in the Federal Register.