On March 4, 2020, the Division of Investment Management of the US Securities and Exchange Commission ("staff") issued a statement regarding the current and potential effects of COVID-19 on investment advisers and funds. The staff is monitoring this situation as it evolves and has conducted outreach efforts to determine potential effects. Based on its outreach, the staff found that fund boards with upcoming, planned in-person meetings may have concerns about traveling. As a result, the staff decided to extend the "no-action" relief it set out in its February 2019 letter to the Independent Directors Council. In this letter, the staff stated that it would not recommend enforcement action if fund boards do not comply with in-person voting requirements due to unforeseen or emergent circumstances impacting the directors. Given the evolving situation regarding COVID-19, the staff has temporarily extended this relief to cover all approvals and renewals (including material changes) of contracts, plans or arrangements under section 15(c) or rules 12b-1 or 15a-4(b)(2) and selection of a new independent public accountant pursuant to Section 32(a). The board, however, would need to ratify these actions at its next in-person board meeting.

The relief covers board meetings held between March 4 and June 15, 2020, although the staff might further extend this relief if circumstances warrant (with the possibility of different or additional conditions).

In the statement, the staff invited investment advisers and funds to contact them with concerns about the relief or about the effects of COVID-19 on operations, including requests for relief or guidance: 202-551-6825 or imocc@sec.gov. Notably, this relief does not change the deadline for filing Form ADV amendments.

The staff also encouraged funds and advisers to evaluate their policies, procedures and systems—in particular, business continuity plans and valuation procedures.

Funds and advisers might also want to evaluate their personnel and staffing policies and practices, including mitigation of "key personnel" risk and possible short-term outsourcing solutions.

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