Developments Of Note
SEC Staff Extends Standish Ayer Analysis To Section 3(C)(7) Funds
The staff of the SEC’s Division of Investment Management (the "Staff") has provided no action relief to permit a 401(k) plan (a "Plan") that allows its participants to choose among generic investment options to be a "qualified purchaser" for purposes of Section 3(c)(7) of the Investment Company Act of 1940 (the "1940 Act") provided that the Plan meets certain conditions. In the 1997 SEC Release adopting rules related to private investment companies, the SEC cast doubt on whether the Staff’s analysis in The Standish, Ayer & Wood, Inc. Stable Value Group Trust (pub. avail. Dec. 28, 1995) ("Standish Ayer"), which applies to private investment companies limited to 100 investors under Section 3(c)(1) of the 1940 Act ("3(c)(1) Funds") would also apply to private investment companies under Section 3(c)(7) ("Section 3(c)(7) Funds"). In Standish Ayer, the Staff took the position that where a Plan
