The U.S. Securities and Exchange Commission (SEC or Commission) on July 23, 2014 approved, by a vote of 3- 2, sweeping amendments to Rule 2a - 7 and other rules that govern money market funds (money funds) under the Investment Company Act of 1940 (1940 Act) (Amendments). The Amendments gene rally combine the two alternatives set forth in the proposing release issued in 2013 (Proposing Release) 2 – (i) requiring “institutional” money funds to operate with a floating net asset value (NAV), rounded to the fourth decimal place ( e.g. , $1.0000) and (ii) permitting (and, under certain circumstances, requiring) all money funds to impose a “liquidity fee” (up to 2%) and/or “redemption gate ,” once weekly liquidity levels fall below the required regulatory threshold . At the meeting approving the Amendment s, SEC Chair White stated thatthe Amendments “fundamentally change the way that most money market funds operate [and] will reduce the risk of runs in money market funds and provide important new tools that will help further protect investors and the financial system in a crisis.”

The Amendments also included other notable changes, such as tightening the diversification requirements under Rule 2a - 7, enhancing disclosure requirements and strengthening the stress testing standards of money fund portfolios. T he Amendments also revised Form PF to increase reporting obligations of registered investment advisers to unregistered money funds, which includes requirements for those advisers to disclose the funds’ portfolio holdings and certain other information. Fina lly, the Amendments contained a number of revisions to clarify certain provisions of Rule 2a - 7.

This DechertOnPoint briefly discusses the background and the events leading up the Amendments and describes each of the reforms made by the Amendments.