Background
On the same day that Donald Trump was inaugurated as president for the second time, he issued a memorandum for the heads of executive departments and agencies titled “Regulatory Freeze Pending Review.” That memorandum directed federal agencies to consider postponing the effective date of any rules that had been issued but had not yet taken effect. Such pauses were for the purpose of (a) reviewing any questions of fact, law, and policy that the rules may raise and (b) taking further appropriate regulatory action if substantial questions were identified.
This raised doubts about several prior SEC actions, including its August 2024 adoption of amendments to its Form N-PORT monthly reporting form that is applicable to most registered investment companies. Those 2024 amendments had not yet taken effect at the time of the president’s January 2025 memorandum and, in April 2025, the SEC substantially extended the effectiveness and compliance dates for those amendments in order to provide time for its required review and further appropriate action, if any.
The Latest SEC Action
On February 18, 2026, the SEC proposed further amendments to Form N-PORT, based on its review, which included a reconsideration of “the overall effectiveness and usability of information reported on the form.” In addition to the regulatory freeze memorandum issued on January 20, 2025, the SEC’s proposing release cited other Trump executive orders “expressing a policy goal of reducing regulatory burdens.” Moreover, the SEC emphasized that its proposal issued on February 18, 2026, also reflected its consideration of additional information and concerns that had been communicated to it by industry participants subsequent to its August 2024 amendments, as well as certain litigation challenging those amendments.
Overview of Proposals
Outlined below are the most significant ways that the SEC’s February 18, 2026, proposal would change Form N-PORT’s requirements, as compared with its requirements following the SEC’s August 24, 2024, amendments.
- Time to File. Funds would have up to 45 days (rather than 30 days) after month-end to file their reports on Form N-PORT. The SEC believes this change “would continue to provide the Commission with reasonably timely data while also reducing [funds’] operational burdens and the risk of errors.”
- Quarterly Information. The SEC would make information about fund portfolio holdings available to the public only for the last month (rather than for every month) of each quarter and only 60 days after the quarter’s end. (Funds nevertheless would still also have to file the first two months’ holding information with their applicable N-PORT filings for those months.) By contrast, under the August 2024 amendments, the SEC planned to make each month’s portfolio holdings publicly available 60 days after the end of the applicable month. The SEC’s latest proposal reflects its heightened concern, among others, that the more frequent publication of portfolio holdings contemplated by its August 2024 proposal could “increase the risk … [that external] parties may obtain at no cost the benefits of the investment research and analysis that went into developing the fund’s investment strategies.”
- Debt Security Positions. The threshold level of debt security positions that triggers Form N-PORT reporting of certain portfolio risk metrics would be increased to 50% (as compared with 25% currently) of a portfolio’s net assets. This would substantially reduce the number of portfolios for which such metrics need to be reported. According to the SEC’s release, this change “is designed to focus the risk metrics reporting requirement on funds with more significant exposure to debt securities to better balance the benefits and costs of the reporting.”
- Debt Security Risk Metrics. As to portfolios for which debt security position risk metrics would still be required to be reported, the SEC proposes to:
- Require only one interest rate risk metric calculation (i.e., portfolio price sensitivity reporting for a 100-basis-point change in rates, as opposed to both a 100- and a 1-basis-point change).
- Simplify the reporting requirements for that interest rate risk metric and for the current credit spread risk metric.
The SEC believes these changes can reduce burdens on funds while still adequately serving the needs of investors and the SEC.
- Reporting in U.S. Dollars. For consistency, however, the February 18 proposal would require that the debt security position risk metric information required by Form N-PORT be presented in U.S. dollars, whereas, historically, some funds have used other currencies.
- Multi-Class Total Returns. Total return information would be required only for one class of a multi-class fund, rather than for each class as currently required. The SEC notes that total return information is available for each class from other sources and that such information for a single class — as prescribed in the proposal — should be adequate for the SEC’s purposes.
- Derivative Instruments. Information about gains/losses and appreciation/depreciation for derivative instruments would no longer be required to be reported separately for each instrument type (e.g., forward, future, option, swap). Rather, this information would be reported for broader asset categories (e.g., commodity contracts, credit contracts, equity contracts). The proposing release notes that this change “would reduce reporting burdens without significantly affecting the utility of the reported information, as the Commission and the public would continue to have derivatives-related information elsewhere on the form, such as the types and amounts of derivatives instruments the … fund holds, to understand the impact of derivatives on fund returns.”
- Information No Longer Required To Be Reported. Form N-PORT’s current requirements to report the following information would be deleted:
- Information relating to compliance with the SEC’s amended “names” rule (35d-1) under the Investment Company Act of 1940 (including information about which specific fund investments are in any 80% basket that the rule requires to support the fund’s name).
- Information about whether each of the fund’s non-derivative instruments is “long” or “short.”
- Conversion ratios and price sensitivity data with respect to convertible debt securities.
- Explanations of why multiple debt classifications are ascribed to any single investment.
According to the proposing release, the SEC’s overarching rationale is that “[r]emoving these requirements would not have a significant effect on the Commission’s uses of the data and [is] not expected to significantly affect the public’s ability to assess relevant information about” reporting funds.
- New Information Required To Be Reported. New requirements to report the following information would be added to Form N-PORT:
- For multiple-class funds that offer an ETF share class, information about the ETF class’s net assets and shareholder investment/redemption flows. This proposal is “designed to provide the Commission and investors with information to better understand the size and flows of this type of fund structure.”
- “Ticker” symbols by registrant, and for each class of a registrant or series, as applicable, as well as certain other class-level identifiers, as applicable. These amendments are “designed to help data users more efficiently use other information that is reported on the form.”
The SEC proposes that registrants would have a transition period to come into compliance with the new requirements of Form N-PORT. The transition period would be 12 months for funds or fund families with net assets of $10 billion or more as of the end of the most recent fiscal year, and 18 months for all others.
The SEC will receive comments on the proposed amendments until April 24, 2026.
