January 21, 1993
TO: SEC RULES COMMITTEE NO. 6-93
RE: FEBRUARY 9 MEETING TO DISCUSS FUND LIQUIDITY STANDARDS
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As you know, several months ago, the SEC issued a release
proposing rules and rule amendments to create procedures for the
repurchase and redemption of shares of closed-end funds and open-
end funds on a periodic basis. (See Memorandum to SEC Rules
Committee No. 52-92, dated August 3, 1992.) In that release, the
SEC proposed certain conditions which would apply to these
"Closed-End Interval Funds" and "Open-End Interval Funds,"
respectively. Among other things, interval funds would be
subject to specific liquidity requirements designed to ensure
that they would be in a position to meet their periodic
repurchase or redemption policies.
The Institute filed a comment letter with the SEC in
November suggesting several revisions to the proposed liquidity
requirements for interval funds. (See Memorandum to SEC Rules
Committee No. 84-92, dated November 6, 1992.) However, in
connection with the SEC's proposals, Institute members have
expressed more general concerns about the liquidity standard for
traditional open-end funds. In this regard, it has been
suggested that the Institute consider addressing these issues
with the SEC while the interval funds proposals remain pending.
Therefore, the Institute has scheduled a meeting to discuss
issues relating to liquidity standards for mutual funds, to be
held on Tuesday, February 9 at 10:00 a.m. in the Institute's
David Silver Conference Room. Lunch will be served following the
meeting. Please call Laura Pawlowski at (202) 955-3515 to let
her know if you will attend.
Craig S. Tyle
Vice President-Securities