The U.S. Securities and Exchange Commission has proposed amendments to Rule 17a-7 under the Investment Company Act to restore cross-trading capabilities for most fixed income securities between registered funds and their affiliates. This practice was previously restricted by fund valuation rules implemented in 2020.
The proposal introduces updated pricing and oversight conditions and requires funds engaging in cross-trades to submit summary reports. SEC Chair Paul Atkins stated that cross-trading can help funds avoid public market transaction costs. The public comment period for the proposed rule change will remain open for 60 days.
SEC Proposes Rule Change to Restore Fixed Income Cross-Trading for Registered Funds
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