SEC Division of Investment Management staff letter: Investment Company Institute

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON. D.C. 20549
DIVISION OF
INVESTMENT MANAGEMENT
October 8,2008
Karrie McMillan, Esq.
General Counsel
Investment Company Institute
1401 H Street, NW
Washington, DC 20005
Re: Participation in the U.S. Treasury Temporary Guarantee Promam for Money Market Funds Dear Ms. McMillan:
The U.S. Department of the Treasury ("Treasury") has established the Temporary Guarantee Program for Money Market Funds (the "Program"). Eligible money market funds may participate in the Program by entering into guarantee agreements with Treasury (collectively, the "Agreements"). You have asked for our assurances that we would not recommend enforcement action to the Securities and Exchange Commission under section 18(f) of the Investment Company Act of 1940 or the rules thereunder if eligible money market funds participate in the Program. Under the Program and the terms of the Agreements, Treasury will guarantee that shareholders of record of funds that participate in the Program ("Participating Funds") as of the close of business on September 19,2008 (the "Agreement Date") will receive $1 .OO for each of the shares they held in the Participating Fund on the Agreement Date or, if less, on the date a Participating Fund's net asset value per share falls below $0.995 per share ("Guarantee Event"). Under the Agreement, Treasury will remit any guarantee payment it is obligated to make to a paying agent account (designated by the Participating Fund or Treasury), which must be segregated from the assets of the Fund and held until disbursement to the shareholders described above. The Participating Fund must take such actions as Treasury may request to provide assurance that amounts held in the paying agent account are not deemed to be assets of the Participating Fund. Based on the facts and representations contained in your October 6,2008 letter, we will not recommend enforcement action to the Securities and Exchange Commission under section 18(f) of the Investment Company Act of 1940 or the rules thereunder if a Participating Fund executes an Agreement with Treasury and participates in the Program. This response expresses our views on enforcement action only and does not express any legal or interpretive conclusion