On July 16, 2026, the Securities and Exchange Commission (“SEC”) proposed Regulation E-Delivery (“Reg E-Delivery”). Reg E-Delivery not only provides a “default” e-delivery election but also provides firms[1] a perhaps unintended opportunity to review potentially inconsistent delivery election records and establish a more reliable recordkeeping process going forward. Reg E-Delivery would allow firms to opt clients into receiving certain client disclosures[2] electronically without receiving the client’s affirmative consent. In other words, instead of requiring clients to “opt-in” to e-delivery by written consent, clients would instead be required to “opt-out” of e-delivery in writing. Notably, in support of this change from current SEC guidance on e-delivery, the SEC explained that it has been able to meaningfully review investor preferences and current practices now that e-delivery has been available for 30 years and technology (smartphones/tablets, cloud storage, artificial intelligence, digital reporting, etc.), including its adoption by investors and industry participants, has significantly increased since the COVID-19 pandemic.
From a legal standpoint, the proposal of a new rule, rather than updated SEC guidance, is welcome. A new rule would (1) supersede at least some[3] SEC guidance on the topic, thereby consolidating most of the SEC’s expectations in one place; and (2) exempt Covered Information from the requirements of the Electronic Signatures in Global and National Commerce Act (“E-sign Act”), which previously had to be applied in tandem with the SEC e-delivery guidance. The type of documents deliverable electronically under the proposed rule would be broad, and include prospectuses for funds and other issuers, fund annual and semi-annual shareholder reports, proxy statements, trade confirmations, disclosures pursuant to Form CRS, and Form ADV Part 2 Brochures.
However, importantly, the proposed Reg E-Delivery would not be all encompassing when it comes to the multitude of documents a financial firm may have to deliver to its clients. For example, broker-dealer disclosures may be governed by SRO rules. Reg E-Delivery may nevertheless have a practical impact where an SRO rule allows electronic delivery that is consistent with SEC e-delivery standards, such as FINRA Rule 2231 governing customer account statements. In addition, certain delivery requirements relevant to a firm’s client accounts would not be covered as they are governed by other agency rules, such as tax disclosures covered by IRS rules and regulations. Accordingly, Reg E-Delivery is not a universal solution to every document a financial firm may be required to deliver. While it may substantially reduce paper mailings, it will not eliminate them.
In line with the SEC’s goals to provide requirements that allow for flexibility in e-delivery while providing user-friendly formats and protecting personal financial information, the proposed rule contemplates firms taking the following steps (without charge to the client):
- The firm must collect a valid e-mail address and have policies and procedures to keep that e-mail address current.
- The firm must provide a prominent disclosure to the client regarding the default e-delivery of certain information.
- The firm must give the client the option to opt out of e-delivery.
- The firm must ensure the information delivered via e-delivery takes into account the sensitivity of the information and must deliver the information in a way to protect personal financial information.
- The firm must ensure the delivery is timely, which generally means in accordance with applicable Federal securities laws.
The SEC is also proposing a transition process which will allow firms to have a “fresh start” at collecting e-delivery preferences. The transition process would avoid firms having to go back out to clients who have already affirmatively elected e-delivery, which at most firms, is the majority of their client base.
The SEC comment period is 60 days, with comments required to be received by September 21, 2026.
While the proposal is still subject to the comment process, we expect some version of Reg E-Delivery to ultimately be adopted. If that occurs, firms may finally have an opportunity to reduce the operational burden, expense, and environmental impact associated with mailing mountains of paper disclosures. As such, firms should be taking this opportunity to inventory their client mailings, determine which ruleset requires delivery, determine whether Reg E-delivery can now be utilized, and see if firm systems can properly handle an increased e-delivery protocol. Further, firms should be reviewing their client base elections to determine the scope of clients who will likely fall within the proposed transition process (and ensure that scope is accurate).
[1] Generally, a “Covered Entity” would include any person/entity required to deliver Covered Information, as defined below, which would include those persons registered under the Securities Exchange Act of 1934, the Investment Advisers Act of 1940, and the Investment Company Act. However, persons/entities who have delivery obligations pursuant to self-regulatory organization (“SRO”) rules or through other state or federal agencies are not included in the scope of Reg E-Delivery.
[2] ”Covered Information” is defined as information required to be delivered to a covered recipient under the Federal securities laws, such as the Form CRS, Reg BI disclosures, Form ADV Part 2 brochures, Reg S-P privacy notices, trade confirmations, and margin disclosures. Covered Information would not include disclosures made pursuant to any applicable state laws or SRO rules, including FINRA.
[3] The proposed Reg E-Delivery contemplates superseding 1995 and 1996 SEC guidance while maintaining the majority of the 2020 SEC guidance, with only certain sections of the 2020 SEC guidance being superseded.