2026-10822NoticeWallet

SEC Renews Rule Allowing Fund Affiliate Trades

Published Date: 6/1/2026

Notice

Summary

The SEC is asking to keep Rule 17a-7, which lets investment funds trade securities with their related companies without paying extra fees, as long as fair prices are kept. This rule mainly affects investment companies and their affiliates, helping them save money and avoid unfair deals. The SEC wants to extend the paperwork rules that make sure these trades stay honest and transparent, with no new costs or deadlines added right now.

Analyzed Economic Effects

2 provisions identified: 1 benefits, 1 costs, 0 mixed.

Recordkeeping Burden and Costs

Funds relying on rule 17a-7 must have board-adopted procedures, keep a permanent written copy of those procedures, make quarterly board determinations that affiliated transactions complied with the procedures, and keep written records of each determination and every rule 17a-7 transaction for at least six years. The SEC estimates about 446 funds use the rule, with an estimated 5 hours of recordkeeping per respondent, totaling about 2,230 annual hours and $1,659,120 in annual external costs.

Funds Can Cross-Trade With Affiliates

Rule 17a-7 lets a registered investment company trade securities with first- or second-tier affiliates that are related solely by a common investment adviser, director, or officer. The exemption permits these cross-trades to avoid brokerage commissions and limits the prices at which such purchases and sales may occur to prevent unfair pricing.

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Key Dates

Published Date
6/1/2026

Department and Agencies

Department
Independent Agency
Agency
Securities and Exchange Commission
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