1101 Market Street, 11th Floor • Philadelphia, PA 19107

Phone: 215-238-6300 • Fax: 215-238-1267 •



Contact: Daniel A. Cirucci

Phone: (215) 238-6340

Section Comments on '40 Act Proposals

Section Comments on '40 Act Proposals

On January 27, 2000, the Business Law Section, through its Subcommittee on Investment Companies, submitted a comment letter to the Securities and Exchange Commission on its rulemaking proposals to modify the composition requirements of boards of investment companies, to impose additional disclosure requirements and to require that counsel to funds be "independent." In its letter, the Section argued that any modification of board composition requirements should be accomplished through legislation not agency rulemaking.  The Section opposed the "independet counsel" proposal on the ground, among others, that it improperly sought to regulate the practice of law, which is the  subject of state regulation.  Finally, the Section concluded that the Commission's disclosure proposals were overbroad, not intended to ensure disclosure of information material to investors and raised privacy concerns.  The comment letter is available for review in the "Comment Letters" area, which is accessible through the Business Law Section's homepage.