FYI: The Division of Investment Management’s Office of Disclosure Review and Accounting is urging funds filing registration statements under the automatic effectiveness rules (Rule 485(a)) to follow certain new practices when making filings that raise complex issues or issues of first impression not easily resolved because of a lack of precedent, such as novel investment strategies, fee structures and/or operational policies (for example, significant changes to policies related to purchases and redemptions by investors).
Although most filings that seek automatic effectiveness under Rule 485(a) do not raise these types of unique or novel issues, the staff is urging registrants with filings that do to contact the SEC staff before making the filing in order to discuss the novel issues presented in the filing. In addition, registrants are requested to respond to staff comments on a Rule 485(a) filing as a general matter no later than 5 business days before the filing is scheduled to become effective automatically. In cases where registrants are unable to submit responses to staff comments by that time, the staff requests that registrants file an amendment under Rule 485(b)(1)(iii) delaying the effectiveness date of the filing as needed until staff comments have been resolved.
These new practices are aimed at allowing both the SEC staff and registrants to completely and effectively consider the issues raised and assure a review of registration statement amendments in a manner that assists registrants in meeting their timing expectations.
The Accounting and Disclosure Information update (ADI 2019-07) addressing these new practices can be accessed here: https://www.sec.gov/investment/accounting-and-disclosure-information/adi-2019-07-review-certain-filings-under-automatic.
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