Common use of Request for Comment Clause in Contracts

Request for Comment. The Commission requests comment on the Report. Comments received will better enable the Commission and the newly-established Financial Stability Oversight Council (which will be taking over the work of the PWG in this area) to consider the options discussed in this Report to identify those most likely to materially reduce money market funds’ susceptibility to runs and to pursue their implementation. As the Report states, we anticipate that following the comment period a series of meetings will be held in Washington, DC with various stakeholders, interested persons, experts, and regulators to discuss the options in the Report. We request comments on the options described in the Report both individually and in combination. Commenters should address the effectiveness of the options in mitigating systemic risks associated with money market funds, as well as their potential impact on money market fund investors, fund managers, issuers of short-term debt and other stakeholders. We also are interested in comments on other issues commenters believe are relevant to (‘‘PWG’’) conducted a study of possible further money market fund reform, reforms that might mitigate money market funds’ susceptibility to runs.1 The results of this study are included in the report issued on October 21, 2010 and attached to this release as an Appendix (the ‘‘Report’’).2 The Report expresses support for the new rules regulating money market funds that the Commission approved last February.3 These new rules seek to 1 The members of the PWG include the Secretary 4 The new rules further limit the credit, liquidity, and interest rate risks money market funds may assume and require fund managers to stress test their portfolios against potential economic shocks. They also require money market funds to improve their disclosure to investors and the Commission and provide a means to wind down the operations of a fund that ‘‘breaks the buck’’ or suffers a run, in an orderly way that is fair to the fund’s investors and reduces the risk of market losses that could spread to other funds. For a discussion of the market stresses experienced by money market funds in 2007 and 2008, see Money Market Fund Reform, Investment Company Act Release No. 28807 (June 30, 2009) [74 FR 32688 (July 8, 2009)], at section including other approaches for lessening systemic risk not identified in the Report. We urge commenters to submit empirical data and other information in support of their comments. Dated: November 3, 2010. By the Commission. of the Treasury Department (as chairman of the II.D (‘‘SEC Proposing Release’’). PWG), the Chairman of the Board of Governors of the Federal Reserve System, the Chairman of the SEC, and the Chairman of the Commodity Futures Trading Commission. 2 The Report is also available at ▇▇▇▇://▇▇▇▇▇.▇▇▇/ press/releases/docs/ 10.21%20PWG%20Report%20Final.pdf. 3 Money Market Fund Reform, Investment Company Act Release No. 29132 (Feb. 23, 2010) [75 FR 10060 (Mar. 4, 2010)] (‘‘SEC Adopting Release’’). 5 See SEC Adopting Release, supra note 3, at section I. In proposing the new rules, we had requested comment on additional, more fundamental regulatory changes, including several of those discussed in the Report. See SEC Proposing Release, supra note 4, at section III. Following the adoption of the new rules, the Commission has continued to explore more significant changes in light of the comments received on that release and through our staff’s work within the PWG.