SEC Issues No-Action Letter Expanding Interpretation of the Definition of “Knowledgeable Employee”

March 26, 2014

The staff of the Division of Investment Management of the U.S. Securities and Exchange Commission (the “Staff”) has issued a no-action letter in response to a request by the Managed Funds Association (the “MFA Letter”), broadening the Staff’s prior interpretations of the definition of “knowledgeable employee” in Rule 3c-5 (the “Rule”) under the Investment Company Act of 1940, as amended (the “Investment Company Act”). In doing so, the Staff expanded and clarified some of its positions regarding the definition of knowledgeable employee set forth in a 1999 no-action letter to the American Bar Association Section of Business Law (the “ABA Letter”).

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