* See Strougo v. Padegs, 964 F. Supp. 783 (S.D.N.Y. 1997). See also Memorandum to Board of Governors No. 26-98, Closed-End
Investment Company Members No. 13-98, Investment Company Directors No. 3-98, Primary Contacts - Member Complex
34-98, and SEC Rules Members No. 33-98 (May 12, 1998) for information on the Maryland legislation.
[10590]
December 21, 1998
TO: BOARD OF GOVERNORS No. 82-98
CLOSED-END INVESTMENT COMPANY MEMBERS No. 46-98
INVESTMENT COMPANY DIRECTORS No. 11-98
PRIMARY CONTACTS - MEMBER COMPLEX No. 117-98
SEC RULES MEMBERS No. 112-98
RE: MASSACHUSETTS ENACTS INDEPENDENT DIRECTORS LEGISLATION
______________________________________________________________________________
I am pleased to report that on December 4, 1998, the Governor of Massachusetts signed into
law legislation that will reaffirm for purposes of Massachusetts trust law that the Investment Company
Act of 1940 governs the determination of whether a director of an investment company is an "interested
person." This new law will apply to all decisions or actions of a trustee occurring on or after March 4,
1999, the effective date of the legislation.
This legislation is similar to legislation that was enacted by Maryland in May of this year in
response to the Strougo* case. A copy of the portion of the Massachusetts Bill (i.e., Senate Bill 2079)
relating to investment company trustees is attached.
Matthew P. Fink
President
Attachment