Stradley Ronon's John Baker and Joan Swirsky tell us that the SECs Final Rules on Money Market Fund Reform have been published in the Federal Register, which starts the clock ticking 60 days from now on the 18-month phase-in for additional disclosures and the 2-year phase-in period for the floating NAV and emergency gates and fees. The Federal Register version comes in at 249 pages, an easier load on printers than the original 869-page version. (Alas, it's just smaller print and 3 columns though.) Swirsky tells us that now, "Effective dates are 60 days from publication, and compliance dates are 9 and 18 months and 2 years from the effective date. I count to Oct. 14 as the effective date if publication is tomorrow." This makes: `July 14, 2015 - the compliance date for Form N-CR; April 13 2016 - the compliance date for the remaining reforms other than float/fees/gates; Oct. 14, 2016 - compliance date for those fundamental reforms. She adds, "The dates should be included in the publication so we can confirm. `If the reforms to eliminate ratings from Rule 2a-7 and to further tighten diversification are approved, the SEC expects to make those effective April 16, 2016 as well." In other regulatory news, we also were made aware of a primer on "U.S. Money Market Fund Reform" from Irish law firm Arthur Cox. Written by Kevin Murphy (who is scheduled to speak at our European Money Fund Symposium Sept. 22-23 in London), Sarah Cunniff, and Dara Harrington, it says, "[The] narrow decision of the SEC to impose a mandatory variable net asset value ("VNAV") for prime institutional constant net asset value ("CNAV") money market funds in the US is of little relevance to the EU in its quest for money market fund reform. It was always going to be a question of timing as to whether it would be the US or the EU who was going to be first to issue its reforms on money market funds. What the funds industry hoped for was a global solution to money market fund reform -- a reasonable objective given that both the EU and the US were looking at money market fund reform at the same time. Sadly a global solution has not emerged today. The real impact on the SEC decision to impose mandatory VNAV on prime institutional CNAV money market funds can be gleaned from the exemptions to that requirement.... As a result of these significant exemptions, we already know from submissions made to the SEC that as much as 54% of current prime CNAV money market funds in the US will retain their assets and conservatively 75% of the assets of existing CNAV money market funds in the US will remain in those CNAV money market funds. Accordingly, the key message from an EU perspective is that, with the exception of one segment of CNAV money market funds in the US (i.e. prime institutional money market funds), the SEC has clearly decided to retain CNAV money market funds."
