Derivatives Rule: Updated Reporting Forms Available for Fund Filers
Feb. 16, 2022
On November 2, 2020, the Securities and Exchange Commission (the “Commission”) adopted new rule 18f-4 under the Investment Company Act of 1940, which governs funds’ use of derivatives. In connection with rule 18f-4, the Commission also adopted new reporting requirements and amendments to Forms N-PORT, N-LIQUID (re-titled as “Form N-RN”), and N-CEN.
A fund may rely on rule 18f-4 before the compliance date of August 19, 2022, provided that the fund satisfies the rule’s conditions. Because the new reporting requirements will enhance the Commission’s ability to oversee funds’ use of and compliance with rule 18f-4 effectively, the Commission requires a fund that relies on rule 18f-4 prior to the rule’s compliance date also to comply with the amendments it adopted to Form N-PORT and Form N-CEN, as applicable, once these updated forms are available for filing on EDGAR. In addition, rule 18f-4 provides that, if a fund experiences a reportable event on Form N-RN, the fund must file with the Commission a report on Form N-RN within the period and according to the instructions specified in that form.
The Commission recognized in the release adopting rule 18f-4 and related amendments that funds relying on rule 18f-4 before the compliance date would not be able to comply with the amendments to Forms N-PORT, N-CEN, and N-RN until Commission staff had completed the process of updating these amended forms for filing on the Commission’s EDGAR system. The Commission stated that Commission staff would issue a notice to the public when the updated forms are available for filing on EDGAR. Commission staff has now completed these updates, and the updated forms are available for filing on EDGAR.
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ADIs are recurring publications that summarize the staff’s views regarding various requirements of the federal securities laws.
The statements in this ADI represent the views of the Division of Investment Management. This update is not a rule, regulation or statement of the Securities and Exchange Commission. Further, the Commission has neither approved nor disapproved its content. Future changes in rules, regulations, and/or staff no-action and interpretive positions may supersede some or all of the information in a particular ADI.
We hope that this ADI will assist registrants in preparing their filings. We also welcome feedback on this ADI and on any disclosure matters. If you have any questions or feedback, please contact:
IM Investment Company Regulation Office at 202.551.6792.