March 18, 2025
What happened?
On March 14, 2025, the SEC announced that the compliance dates for the amendments to the Investment Company Act of 1940 fund “Names Rule” will be extended to June 11, 2026 for large fund groups, and to December 11, 2026 for small fund groups.
Large fund groups are defined as having $1 billion or more in net assets as of the end of their most recent fiscal year. The original rule issue in September 2023, stated that large fund groups with had to comply by December 11, 2025 and that small fund groups with less than $1 billion in net assets as of the end of their most recent fiscal year would have to comply by June 11, 2026.
The SEC stated that this six-month extension “is designed to balance the investor benefit of the amended Names Rule framework with funds’ needs for additional time to implement the amendments properly, develop and finalize their compliance systems, and test their compliance plans.”
What does this mean for me?
Firms should use the extra time to evaluate what changes need to be made to their fund investment monitoring systems, data reporting and disclosures, and to their compliance programs to prepare for compliance. The SEC also published a Frequently Ask Question (FAQ) page with updates to clarify what names would trigger a fund to require an 80% investment policy in the assets suggested by the fund’s name (see our prior coverage here related to the FAQ updates).
The amendment cited the timing of certain annual fund disclosure and reporting obligations that are tied to a fund’s fiscal year-end as a reason to move the deadline. Ensure that adjustments are made so that necessary year-end reporting and compliance changes for the Names Rule are addressed. If you have any questions or need assistance, our team of regulatory experts can help. Contact us today to learn more.
