FYI: Last-Minute Changes to N-PORT Filing Schedule

FYI: Yesterday the SEC adopted an Interim Final Rule changing the filing schedule for Form N-PORT, the new Investment Company Act form on which registered funds will report their portfolio holdings in a structured data format.

Under Rule 30b1-9 as now amended, funds will be required to file Form N-PORT for each month in a fiscal quarter not later than 60 days after the end of that fiscal quarter. Under the rule as originally adopted in 2016 and scheduled to be phased in this year, funds would have been required to file each monthly report no later than 30 days after the end of each month.

Note that the monthly report on Form N-PORT for the third month of the quarter will continue to be made publicly available as originally envisioned. The monthly reports on Form N-PORT for the first and second months of the fiscal quarter will remain non-public.

The SEC also amended relevant rules and forms to require that funds, no later than 30 days after the end of each month, maintain in their records the information that is required to be included in Form N-PORT, so that information can be promptly made available to the Commission if requested. This means funds should not consider themselves relieved of the burden of preparing the requisite Form N-PORT information after the end of each month, even though the form will not need to be filed until after the end of the quarter in accordance with the amended rule.

These N-PORT changes were made after the assessment the SEC initiated in 2017 of its own computer systems, which caused the original filing schedule for Form N-PORT to be delayed. That assessment looked at the security of the EDGAR system as well as the security of non-public information collected and held by the SEC. These filing changes are intended to allow the SEC to continue to fulfill its mission and make filing more efficient for registrants, while simultaneously reducing the SEC’s cyber risk profile.

The Interim Final Rule adopted to change the N-PORT filing schedule does NOT change the compliance date for funds filing on N-PORT. Although delayed from the date originally envisioned in 2016/2017, the current compliance date is now set by Temporary Rule 30b1-9(T) as April 1, 2019, for large funds, and as April 1, 2020, for small funds. However, the SEC has recognized that, due to the last-minute nature of the changes made under the Interim Final Rule, some large funds – particularly those with fiscal quarters ending in March or April — may not be ready in time to file all three reports required under the rule as amended. Large funds in that category should carefully read the Compliance Date section of the Interim Final Rule adopting release for certain relief the SEC is offering those funds from the filing requirements for the initial filing period.

Although the SEC is technically requesting public comment on these N-PORT changes, it has made the determinations necessary for the changes to be adopted as an Interim Final Rule. This means the changes will become effective even without public comment, upon the date the Interim Final Rule release is published in the Federal Register.

It should also be noted that, in addition to amending the schedule for Form N-PORT, the SEC amended Form N-LIQUID to provide for a voluntary explanatory notes section. This could be useful, for example, for funds attempting to explain their methodology for “bucketing” securities under their liquidity risk management programs.

N-PORT Interim Final Rule adopting release:

SEC Press Release announcing the changes:

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