One of the most important features of the law is that advisors with assets under management of $150 million or more must register with the Securities and Exchange Commission, the US regulator.

The deadline for advisors to comply with new rules is almost eight months away – July 2011. But Kinetic said: “Practically, however, advisors should begin preparing as soon as possible to allow sufficient time to meet the deadline.”

The new law, as has already been noted by lawyers and advisors, will be particularly sensitive for family offices. Until now, almost every family office that has not registered with the SEC as an investment advisor or formed a private trust company has been excused from registering by the “fewer than 15 clients” exemption from the definition of an investment advisor of the Investment Advisors Act of 1940.

Advisors with less than $150 million of AuM – but more than $25 million – must register with state, rather than federal, regulators. As a result of the switch, Kinetic Partners says, some advisors may de-register with the SEC. Foreign private advisors are only exempt from the SEC registration rule if it has no place of business in the US, less than $25 million of AuM from US investors, fewer than 15 US investors and if it does not “hold itself out generally to the public in the US as an investment advisor”, Kinetic Partners said.

Kinetic sets out a number of other steps advisors should take. For example, to determine if an advisor should register at SEC or state level, it advises firms to prepare and admit required entitlement forms to the Financial Industry Regulatory Authority to create an account with the Investment Advisor Registration Depository.

Among other advice points, Kinetic said advisors must determine who will be the designated chief operating officer at a firm; review existing policies and procedures to see if the firm must comply with the 1940 Investment Advisers Act, and also comply with Rule 206-2 of the Advisers Act, otherwise known as the Books & Records rule.