SEC Sets Effective and Compliance Dates for Amendments to Money Market Fund Rules

The SEC set an effective date of October 2, 2023 for amendments to ICA Rule 2a-7 ("Money Market Funds") aimed at preventing runs on money market funds during times of financial stress. Also effective on October 2, 2023 are amendments to Form N-1A, Form N-CSR, and amended ICA Rule 31a-2 (as to records to be preserved by registered investment companies). In addition, the SEC set an effective date of June 11, 2024 for amendments to Forms N-CR, N-MFP and PF. Applicable compliance dates are outlined in the Federal Register release here.

As previously covered, the amendments will:

• remove from the existing money market funds rule the authority of funds to impose gates on redemption, and liquidity fees on redeeming investors if weekly liquid assets fall below a certain threshold;
• increase the amount of assets with daily liquidity that a money market fund must hold from 10 percent to 25 percent of its assets and increase the amount of assets with weekly liquidity that a money market fund must hold from 30 percent to 50 percent of its assets;
• add provisions that specify how funds must calculate weighted average maturity and weighted average life;
• modify certain reporting requirements on Forms N-MFP and N-CR to improve the availability of money market fund information, and making conforming changes to Form N-1A to reflect the changes to the regulatory framework for these funds; and
• update Form PF to require large liquidity fund advisers to provide additional information regarding the liquidity funds they advise.