This Act mandates the SEC to establish rules allowing regulated financial entities to deliver required investor documents electronically while ensuring investors receive clear notice, the option to opt for paper, and continued access to information.
Thom Tillis
Senator
NC
The Improving Disclosure for Investors Act of 2025 mandates the SEC to establish new rules modernizing how financial firms deliver required regulatory documents to investors, primarily by facilitating electronic delivery. This legislation sets deadlines for the SEC to finalize rules that allow digital distribution of documents like prospectuses and annual reports, while ensuring investor protections remain in place. The bill focuses solely on the method of delivery, not the substance or timing of the required disclosures themselves. If the SEC delays, covered entities can proceed with electronic delivery based on the standards outlined in the Act.
New Bill Mandates SEC to Finalize Rules Allowing Digital Delivery of Investment Documents Within One Year
The Improving Disclosure for Investors Act of 2025 is aiming to drag the financial world into the 21st century by making electronic delivery the default for official investor documents. Essentially, this bill tells the Securities and Exchange Commission (SEC) to create a new framework that allows investment firms—like your broker, your mutual fund company, or your investment adviser—to stop mailing you stacks of paper and start sending documents digitally.
The End of Paper Prospectuses?
The core of the bill is simple: it mandates that the SEC propose new rules within 180 days and finalize them within one year. These rules will allow “covered entities”—which is nearly every regulated financial firm—to send you important “regulatory documents” electronically. This includes everything from your annual reports and privacy notices to the massive prospectus you probably never read. The bill defines electronic delivery broadly: it can be an email, or it can be a notification that the document is available on a website or app. This change is purely about how the document gets to you, not what information is required or when it’s due, keeping all existing reporting deadlines intact.
The Transition: Paper Safeguards for Digital Switch
The good news is that the bill recognizes not everyone is ready to go fully digital, or maybe they just prefer paper. So, it builds in some safeguards. Before your broker can switch you from paper to digital, they must send you an initial paper notice explaining that you can receive documents electronically. There’s then a grace period of up to 180 days for the transition. Crucially, the bill requires firms to send you an annual paper reminder for up to two years after the switch, reminding you that you can opt out of electronic delivery at any time and go back to paper. The SEC must also ensure that firms have systems to catch failed electronic deliveries and that all digital documents are readable and savable.
The Real-World Impact: Who Wins and Who Worries
For the financial industry, this bill is a huge win. Think of the mountains of paper and postage costs saved by mutual funds and brokerages every year. That’s a significant operational cost reduction, and the bill clarifies that electronic delivery satisfies nearly all existing requirements for a “written” document under current securities laws. For the average investor who manages their accounts online and prefers digital access, this is a convenience upgrade, speeding up access to information.
However, there are real-world concerns, especially for those who aren’t digital natives or lack reliable internet access—like many retirees or people in rural areas. While the opt-out is a key protection, the concern is that the system relies on investors actively opting out rather than opting in. If an investor misses the initial notice or the annual reminder, they could easily be switched to electronic delivery without realizing it, potentially missing crucial information like proxy statements or trade confirmations. Furthermore, the bill allows firms to start using electronic delivery immediately if the SEC misses the one-year deadline. While this prevents bureaucratic delays from stalling modernization, it could lead to a patchwork of standards across the industry before official, finalized rules are in place, potentially confusing investors during the rollout.