Ropes & Gray Investment Management Attorneys Discuss ETF Rule Proposal in BoardIQ and IFLR

A July 31 article in BoardIQ titled “ETF Rule Proposal Prompts Reporting Cost Questions” outlines that although the SEC’s proposed ETF rules could make life easier for fund directors who oversee those products, there are still questions fund boards should be asking, and doing so now could forestall any issues that could affect the fund complex if the rule is adopted as it’s currently written. Directors may want to ask, for example, “Would the rescission of their order have an adverse effect?” says investment management partner Jeremy Smith in the article. “If that’s the case, management would have to bring that to the attention of the SEC.” Mr. Smith also suggests, procedures would be established around that task.

A July 31 article published by International Financial Law Review titled “Custom baskets could help re-align ETF market” discusses how the proposals may close the gap between early entrants in the market and those that arrived only a few years ago. "Custom baskets proved a bit of an advantage for early entrants in the marketplace," said investment management counsel Ed Baer in the piece. “They have provide benefits in terms of tax efficiency and make portfolio management be more flexible and efficient.”