Industry Groups Offer Recommendations On SEC Valuation Proposal

A number of industry groups and other stakeholders offered recommendations on an SEC's proposal to establish a regulatory framework for fund valuation practices (see previous coverage).

The Committee on Investment Management Regulation of the New York City Bar Association ("Committee") suggested that various aspects of the proposed rule should be clarified or reconsidered. The Committee urged the SEC to consider (i) revising the proposed rule so that it provides guidance, rather than requirements, as to a board's exercise of good faith in determining fair value and (ii) clarifying the scope of a board's oversight role. Additionally, the Committee stated that the SEC should allow a fund's board to rely on the fund's chief compliance officer and investment adviser to identify conflicts of interest.