On Nov. 25, the Securities and Exchange Commission (SEC) voted 5-0 to propose or repropose new rules revamping the framework for permissible use of derivatives and short sales by investment companies (other than money market funds), including mutual funds and exchange-traded funds, as well as closed-end funds and business development companies (Funds).
The new proposed rule departs from the SEC’s December 2015 proposal (which was ultimately dropped following the change in federal administration) in at least two notable ways:
Comments on the proposals are due 60 days following publication of the proposing release in the Federal Register. Details of the proposals can be found in the proposing release, which is available here.