Log in or register
Share on LinkedInShare on LinkedIn

ARTICLE · 30 OCTOBER 2026

SEC Proposes Expanded Fund Cross Trading Under Rule 17a-7

Proskauer Rose LLP
Proskauer Rose LLP
Contributor
Proskauer Rose LLP

Proskauer Rose LLP

Firm Overview Proskauer is an elite global law firm with more than 900 lawyers across key financial...

View firm profile
Explore more from Proskauer Rose LLP

The Securities and Exchange Commission has proposed significant amendments to Rule 17a-7 that would dramatically expand cross-trading opportunities for regulated investment funds, particularly in fixed-income securities. The proposal introduces new pricing methodologies and compliance requirements while addressing limitations created by the 2020 adoption of Rule 2a-5.

United StatesFinance and Banking
Robert H. Sutton
Robert H. Sutton
Nathan Schuur
Nathan Schuur
Sasha Burger
Sasha Burger
Vlad Bulkin
Vlad Bulkin
Author LinkedIn connections

On October 9, 2026, the Securities and Exchange Commission (the “SEC”) proposed amendments to Rule 17a-7 under the Investment Company Act of 1940 (the “Investment Company Act”) that would expand the securities eligible for cross trading by registered investment companies and business development companies (“regulated funds”). The proposal would permit cross trading of many fixed-income securities, while revising pricing and transaction conditions and adding compliance review, board reporting, recordkeeping and regulatory reporting requirements.

Background on Rule 17a-7 and Cross Trading

Cross trades are transactions in which a regulated fund sells a portfolio investment to, or purchases a portfolio investment from, another fund or other person that is an affiliated person of the regulated fund (or an affiliated person’s affiliated person). The Investment Company Act generally prohibits cross trades between a regulated fund and its first- and second-tier affiliates in order to

We operate a free-to-view policy, asking only that you register in order to read all of our content. Please login or register to view the rest of this article.

Register for freeORLog in

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

View source

Related Articles

Legal Intelligence Newsletters: sign up for the latest legal and regulatory news on your chosen topics

Read more about

Related Comparative Guides

See more popular content from

Article

SEC Advances “Responsible Retailization” Through A Potential Accredited Investor Exam And Potential Regulated Fund Reforms

On September 30, 2026, the Securities and Exchange Commission (SEC) issued two rule proposals and five notices aimed at expanding investors’ access to private markets. The package would add ways to qualify as an accredited investor, including passing a new exam administered by the Financial Industry Regulatory Authority (FINRA), broaden performance-based compensation and modernize regulated funds, including interval funds and business development companies (BDCs).
United StatesFinance and Banking
Proskauer Rose LLP
Proskauer Rose LLP
Article

SEC Proposes Rule Amendments To Expand Retail Access To Private Markets

The SEC has proposed sweeping amendments to expand retail investor access to private market strategies, including changes to performance-based compensation rules for registered investment advisers and modernization of the interval fund framework. The proposals also explore new credential-based pathways for individuals to qualify as accredited investors, potentially opening private offerings to a broader pool of eligible participants.
United StatesFinance and Banking
Duane Morris LLP
Duane Morris LLP
Article

SEC Approves FINRA’s New “Outside Activities” Rule

The Securities and Exchange Commission has approved FINRA Rule 3290, which will replace existing rules governing outside business activities and private securities transactions for registered persons. This new rule narrows the scope to focus on investment-related activities while maintaining similar supervisory obligations for member firms. Understanding the key changes and implementation requirements will be critical for broker-dealers as they update their compliance policies and procedures.
United StatesFinance and Banking
WilmerHale
WilmerHale
Article

New NYSE Delisting Rules: What Microcap Companies Need To Know About The $0.25 Minimum Trading Price

The SEC has approved new NYSE and NYSE American listing rules establishing a $0.25 minimum trading price, effective July 1, 2027. A single closing price below this threshold triggers immediate trading suspension and delisting proceedings with no cure period. Companies trading at low share prices must act now during the transition period to implement reverse stock splits and establish monitoring procedures before this hard floor takes effect.
United StatesFinance and Banking
Bevilacqua
Bevilacqua
Article

The Financing Problem Behind the AI Infrastructure Boom: What Lenders and Sponsors Need to Watch

As AI infrastructure spending surges toward $697 billion in 2026, hyperscalers and compute providers are increasingly turning to debt, structured financing, and GPU-backed collateral to fund expansion. While demand projections remain bullish, a critical timing gap is emerging between capital deployment and cash flow generation, creating significant risks for lenders, sponsors, and operators across the ecosystem.
United StatesFinance and Banking
Riveron
Riveron
Article

SEC Advances “Responsible Retailization” Through A Potential Accredited Investor Exam And Potential Regulated Fund Reforms

On September 30, 2026, the Securities and Exchange Commission (SEC) issued two rule proposals and five notices aimed at expanding investors’ access to private markets. The package would add ways to qualify as an accredited investor, including passing a new exam administered by the Financial Industry Regulatory Authority (FINRA), broaden performance-based compensation and modernize regulated funds, including interval funds and business development companies (BDCs).
United StatesFinance and Banking
Proskauer Rose LLP
Proskauer Rose LLP
Article

DOL Pulls The Plug On Plan To Move FLSA Interpretations Out Of The CFR

The U.S. Department of Labor's Wage and Hour Division has withdrawn its controversial proposal to remove nine parts of longstanding Fair Labor Standards Act interpretive guidance from the Code of Federal Regulations. What does this reversal mean for employers who have relied on these decades-old interpretations, and how does the Supreme Court's Loper Bright decision reshape the legal weight of agency guidance going forward?
United StatesEmployment and HR
Proskauer Rose LLP
Proskauer Rose LLP
Article

Parliament’s Position On SFDR 2.0

The European Parliament's Committee on Economic and Monetary Affairs has adopted its position on the Sustainable Finance Disclosure Regulation reform, establishing key divergences with the European Commission and Council on professional investor exemptions and fossil fuel investment criteria. With trilogue negotiations set to begin in October 2026, private markets managers face critical decisions about how to position their funds under the new three-category framework expected to take effect in early 2029.
United KingdomCorporate/Commercial Law
Proskauer Rose LLP
Proskauer Rose LLP
Article

CFTC Moves To Reinforce Federal Authority Over Event Contracts As New Jersey Seeks Supreme Court Review

The CFTC has proposed classifying event contracts as swaps while excluding traditional casino-style gambling products, directly responding to ongoing federal-state disputes over prediction markets and sports betting jurisdiction. These regulatory actions seek to clarify the agency's authority over event contracts amid conflicting appellate court decisions and pending Supreme Court review.
United StatesFinance and Banking
Proskauer Rose LLP
Proskauer Rose LLP
Article

False Claims Act Roundup Series: Q2 2026 – Federal And State Agencies Use Data To Operationalize Enforcement

The Department of Justice has operationalized its fraud-enforcement architecture through data analytics, targeting healthcare providers with multi-district strike forces, Medicare Advantage risk-adjustment actions, and accelerated qui tam review processes. How are federal and state agencies using publicly available data to drive False Claims Act enforcement, and what proactive steps should healthcare organizations take to identify and remediate potential exposure before becoming the focus of government atte
United StatesFood, Drugs, Healthcare, Life Sciences
Proskauer Rose LLP
Proskauer Rose LLP