Registered investment companies counsel

For the same reasons, the rule change also should benefit independent directors. Fiduciary A fiduciary is a person or organization that acts on behalf of another person or persons to manage assets, executing in care, good faith, and loyalty. Funds that currently do not have a majority of independent directors on their boards and that would like to rely on the Exemptive Rules may incur some costs. Control of the selection and nomination process at all times should rest with a fund’s independent directors.

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SECURITIES AND EXCHANGE COMMISSION

The numerous references to RIAs within the Investment Advisers Act of popularized the term, which is closely associated with the term investment advisor spelled «investment adviser» in U. An investment adviser is defined by the Securities and Exchange Commission as an individual or a firm that is in the business of giving advice about securities. Registered Investment Adviser firms receive compensation in the form of fees for providing financial advice and investment management. They are required to act as a fiduciary. This is very different from broker-dealers and their representatives, who provide recommendations for a commission. Broker-dealers and their representatives are not required to act as a fiduciary, they simply must make suitable recommendations for a client.

Those commenters did not, however, provide an estimate of the costs to small entities. Basic Information We are adopting the requirement to disclose basic information about directors in an easy-to-read tabular format, as proposed. Limits on Coverage of Directors under Joint Insurance Policies We are adopting an amendment to rule 17d-1 dwhich permits funds to purchase «errors and omissions» joint insurance policies for their officers and directors. These commenters noted that using dollar ranges would provide shareholders with sufficient information to assess whether directors’ interests were aligned with their own, making disclosure of exact dollar amounts unnecessary. While the specifics rules ICAA members must follow are granular, generally speaking, they embrace a fiduciary duty to clients, with a basic premise of making suitable recommendations for their clients. News view all. Two commenters argued that the proposed fund ownership disclosure would disadvantage directors of smaller funds as these funds are more likely to be stand-alone funds or part of a fund complex with fewer funds, thereby reducing the likelihood that such funds would meet directors’ particular investment objectives. Several commenters recommended, however, that disclosure of a director’s holdings should be made on a fund-by-fund basis, rather than a complex-wide basis, arguing that it would be more relevant to disclose to shareholders a director’s ownership of the specific funds on whose board the director serves. The basis of the independent directors’ determination is required to be recorded in the minutes of the directors’ meeting. The American Bar Association formed a task force to examine the role of counsel to independent directors, and the task force released a report offering guidance to counsel and fund directors regarding standards of independence for counsel, and guidelines for reducing potential conflicts of interest «ABA Task Force Report». Limits on Coverage of Directors under Joint Insurance Registered investment companies counsel Rule 17d-1 d 7 under the Act permits funds to purchase joint liability insurance policies without first obtaining a Commission order permitting this joint arrangement, provided that certain conditions are met. The requirement that mutual funds disclose basic information about directors in an easy-to-read tabular format in the fund’s annual report to shareholders, SAI, and proxy statements for the election of directors benefits shareholders by ensuring that shareholders receive information about the identity and experience of their directors both annually and whenever they are asked to vote to elect directors. We continue to believe that the estimates of the burden hours contained in the Proposing Release are appropriate. Basic Information 2. Need for the Rules and Rule Amendments 1.