SEC Adopts Repurchase Agreement RuleNews


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SEC Adopts Repurchase Agreement Rule

Amendments to Investment Company Act approved

By John M. Baker, Esq.

July 6, 2001 – The SEC today posted a release adopting a new rule and related rule amendments under the 1940 Act that affect the ability of investment companies to invest in repurchase agreements and pre-refunded bonds under the Act. Release No. IC-25058 (July 5, 2001).

The new rule primarily codifies and updates staff positions that have permitted investment companies to “look through” counterparties to certain repurchase agreements and treat the securities comprising the collateral as investments for certain purposes under the Act. New rule 5b-3 and the related amendments to rules 2a-7 and 12d3-1 will be effective August 15, 2001.

The release is available online at

Copyright 2001, John M. Baker, Esq., Stradley, Ronon, Stevens & Young, LLP, 1220 19th Street, N.W., Suite 700, Washington, DC 20036 – (202) 822-9611- Fax (202) 822-0140 This article was originally posted to the FundLaw List, To subscribe to FundLaw, send a blank e-mail to

Nothing herein is intended as legal or financial advice. The law is different in different jurisdictions, and the facts of a particular matter can change the application of the law. Please consult an attorney or your financial advisor before acting upon the information contained in this article.  



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Mark Astarita is a nationally recognized securities attorney, who represents investors, financial professionals and firms in securities litigation, arbitration and regulatory matters, including SEC and FINRA investigations and enforcement proceedings.

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