SEC Proposes Amendments to Exemptive Applications Procedures Under the Investment Company Act: Proposal Would Establish an Expedited Review Procedure for Routine Applications and Set an Internal Timeframe for Review of Non-Routine Applications

Sullivan & Cromwell LLP - October 22, 2019
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On October 18, 2019, the Securities and Exchange Commission issued a release (the “Release”) proposing to amend Rule 0-5 under the Investment Company Act of 1940 (“Investment Company Act”) to establish an expedited review procedure for routine exemptive applications that are substantially identical to recent precedent, and to adopt a new rule to set an internal timeframe for the staff of the Division of Investment Management (“Staff”) to take action on exemptive applications that do not qualify for the expedited review procedure.  In addition, the Release announces plans for the Staff to begin to publicly disseminate Staff comments on exemptive applications and applicants’ responses to those comments through the EDGAR system no later than 120 days after the final disposition of an application, following a process similar to that used by the Staff and the staff of the Division of Corporate Finance with respect to comment letters and responses on disclosure filings.  In the Release, the SEC notes that the proposed amendments are intended to improve the efficiency, transparency and certainty regarding timing of the application process.  The Release requests comment on the proposals, and includes a number of specific requests for comment.  Comments on the Release will be due 30 days following its publication in the Federal Register.