November 26, 1993
TO: SEC RULES COMMITTEE NO. 108-93
UNIT INVESTMENT TRUST COMMITTEE NO. 58-93
RE: INSTITUTE COMMENT LETTER ON SEC'S PROPOSED AMENDMENTS TO
RULE 485
__________________________________________________________
As we previously reported, the Securities and Exchange Commission has
proposed amendments to Rule 485 under the Securities Act of 1933 under which
mutual funds and unit investment trusts file post-effective amendments to their
registration statements. (See Memorandum to SEC Rules Committee No. 82-93; Unit
Investment Trust Committee No. 46-93, dated September 23, 1993.) Attached is the
Institute's comment letter on the proposals.
The Institute's letter expresses general support for the proposals because
they would provide greater efficiencies while preserving current investor
protections. In particular, the letter expresses support for the proposed
expansion of the purposes for which a B-Amendment could be filed.
In its letter, the Institute strongly opposes the proposal to prohibit the
use of Rule 485 in the case of an amendment adding a series to an open-end
management investment company. The letter emphasizes that such a dramatic
departure from the carefully-crafted review process in Rule 485 would create
significant delays in the introduction of new portfolios and would impose
substantial costs on mutual funds and their shareholders, without providing
investors with any meaningful new protection.
The letter also urges the Commission to expand the list in Rule 485(b) of
permissible purposes for a B-Amendment, to include amendments that are
accompanied by a representation that the only changes being made are
substantially similar to those in a previous filing. (The Commission's proposal
would amend Rule 485(b) to allow certain types of post-effective amendments not
otherwise eligible for automatic effectiveness under paragraph (b) to become
effective automatically, but only by the Commission upon a registrant's request.)
Thomas M. Selman
Assistant Counsel
Attachment