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Vedder Thinking | Articles SEC Extends Relief from 1940 Act In-Person Voting Requirements


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As previously reported, in March 2020, the SEC issued exemptive orders providing relief from certain provisions of the Investment Company Act of 1940 to registered funds in light of the outbreak of coronavirus disease 2019 (COVID-19). Among other things, these orders provided relief from the in-person voting requirements under Sections 15(c) and 32(a) of the 1940 Act and Rules 12b-1(b)(2) and 15a-4(b)(2)(ii) relating to the approval or renewal of advisory and underwriting agreements; the approval or renewal of distribution plans, agreements or arrangements; and the appointment of auditors. The relief was made available if: (1) reliance on the order would be necessary or appropriate due to circumstances related to the current or potential effects of COVID-19, (2) the votes cast for such matters would be cast at a meeting in which directors may participate by any means of communications that allow all directors to hear each other simultaneously during the meeting; and (3) the board, including a majority of independent directors, would ratify such actions at the next in-person meeting. The March orders provided relief for votes held from March 13, 2020 through August 15, 2020.

On June 19, 2020, the SEC, citing its monitoring of COVID-19 and its current understanding of the circumstances, issued a new order extending the previously issued relief from the 1940 Act’s in-person voting requirements for votes held through December 31, 2020. The relief remains subject to the same conditions set forth in the March orders.

A copy of the order is available here.


John S. Marten


Nathaniel Segal


Jacob C. Tiedt