Suspension of Enforcement of California’s Fair Investment Practices by Venture Capital Companies Law
On March 17, 2026, California announced that it would suspend enforcement of the Fair Investment Practices by Venture Capital Companies Law (FIPVCC) until further notice.
The FIPVCC, as drafted, requires certain venture capital firms with sufficient ties to California to collect and annually report demographic and diversity-related information regarding their investment activities. As originally contemplated, covered entities were expected to register with the California Department of Financial Protection and Innovation (DFPI) and begin reporting by April 1, 2026.
The DFPI announced that implementation and enforcement of the FIPVCC will be suspended pending completion of a rulemaking process and the adoption of final regulations. The DFPI has confirmed that it will therefore not require covered entities to submit registrations or file reports by the April 1, 2026, deadline. This pause reflects the DFPI’s recognition that additional regulatory clarity is needed, with the regulated industry seeking guidance on key definitions, the scope of covered entities, and operational requirements for compliance.
While this suspension offers a temporary reprieve, covered entities should not view it as a permanent withdrawal of the FIPVCC's requirements as California remains steadfast in its desire to seek demographic information from regulated parties. DFPI has indicated it will seek input from relevant parties over the next few months before beginning formal rulemaking. Venture capital firms and other potentially covered entities should continue to monitor DFPI communications closely, preserve any demographic and investment data already collected in anticipation of future reporting obligations, and evaluate their internal compliance infrastructure in light of the forthcoming regulatory framework. We will continue to track developments and provide updates as the rulemaking process progresses.
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