On October 13, 2016, the Securities and Exchange Commission (the “SEC”) adopted new Rule 22e-4 under the Investment Company Act of 1940 (the “1940 Act”), which will require registered open-end investment companies (including open-end exchange-traded funds (“ETFs”) but excluding money market funds) to establish comprehensive liquidity risk management programs comprised of policies and procedures designed to address specified criteria. The SEC also adopted a new confidential reporting requirement to notify the SEC when a fund’s liquidity level exceeds 15 percent of net assets or when certain funds’ highly liquid investments fall below a stated minimum. The new rule establishes additional board responsibilities, and requires the board to appoint either the fund’s investment adviser or one or more fund officers as being responsible for administering the liquidity risk management program. In addition, the SEC adopted certain related recordkeeping requirements, as well as changes to Form N-1A and new Forms N-CEN and N-PORT to require certain disclosures and reporting regarding fund liquidity and liquidity risk management (collectively, the “Liquidity Rules”).

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