Abstract
PurposeThe purpose of this paper is to provide a detailed discussion of the SEC's recent amendments to Rule 2a‐7 and other rules under the Investment Company Act of 1940 that affect money market funds, as approved by the Commission on January 27, 2010.Design/methodology/approachThe paper reviews the principal changes to the 1940 Act's money market fund rules; discusses the new obligations the Amendments impose on money market fund boards of directors as well as the new policies the Amendments require funds to adopt; reviews the various compliance dates for the Amendments.FindingsThe Amendments reflect three categories of changes to the rules governing money market funds: changes to Rule 2a‐7’s risk limiting conditions governing a fund portfolio's maturity, credit quality, diversification and liquidity; changes relating to operational aspects of money market funds; and new disclosure requirements.Originality/valueThe paper provides practical guidance by an experienced securities lawyer.
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