SEC Proposes to Remove NRSRO Ratings from Rule 2a-7 and Other Investment Company Act Rules and Forms

March 24, 2011
The SEC recently proposed amendments to certain rules, including Rule 2a-7, under the Investment Company Act that would replace references to credit ratings issued by NRSROs with more subjective standards of creditworthiness. The proposal is intended to implement certain provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. This update examines the proposal and its potential impact on, among other things, the universe of securities in which a money market fund may invest.