# 17 CFR § 270.12d1-1: Exemptions for investments in money market funds > Federal · Regulations · In force URL: https://www.frixlaw.com/law-library/statutes/ecfr-17-270.12d1-1 ## Section - **Citation:** 17 CFR § 270.12d1-1 - **Heading:** Exemptions for investments in money market funds - **Jurisdiction:** Federal - **Kind:** Regulations - **Status:** In force - **Text as of:** September 22, 2026 - **Source:** Publisher's official text - **Location:** Title 17—Commodity and Securities Exchanges > CHAPTER II—SECURITIES AND EXCHANGE COMMISSION > PART 270—RULES AND REGULATIONS, INVESTMENT COMPANY ACT OF 1940 ## Text (a) Exemptions for acquisition of money market fund shares. If the conditions of paragraph (b) of this section are satisfied, notwithstanding sections 12(d)(1)(A), 12(d)(1)(B), 12(d)(1)(G), 17(a), and 57 of the Act (15 U.S.C. 80a-12(d)(1)(A), 80a-12(d)(1)(B), 80a-12(d)(1)(G), 80a-17(a), and 80a-56)) and § 270.17d-1: (1) An investment company (acquiring fund) may purchase and redeem shares issued by a money market fund; and (2) A money market fund, any principal underwriter thereof, and a broker or a dealer may sell or otherwise dispose of shares issued by the money market fund to any acquiring fund. (b) Conditions—(1) Fees. The acquiring fund pays no sales charge, as defined in FINRA Rule 2341(b)(8) (“sales charge”), or service fee, as defined in FINRA Rule 2341(b)(9), charged in connection with the purchase, sale, or redemption of securities issued by a money market fund (“service fee”); or the acquiring fund's investment adviser waives its advisory fee in an amount necessary to offset any sales charge or service fee. (2) Unregistered money market funds. If the money market fund is not an investment company registered under the Act: (i) The acquiring fund reasonably believes that the money market fund satisfies the following conditions as if it were a registered open-end investment company: (A) Operates in compliance with § 270.2a-7; (B) Complies with sections 17(a), (d), (e), 18, and 22(e) of the Act (15 U.S.C. 80a-17(a), (d), (e), 80a-18, and 80a-22(e)); (C) Has adopted procedures designed to ensure that it complies with sections 17(a), (d), (e), 18, and 22(e) of the Act (15 U.S.C. 80a-17(a), (d), (e), 80a-18, and 80a-22(e)), periodically reviews and updates those procedures, and maintains books and records describing those procedures; (D) Maintains the records required by §§ 270.31a-1(b)(1), 270.31a-1(b)(2)(ii), 270.31a-1(b)(2)(iv), and 270.31a-1(b)(9); and (E) Preserves permanently, the first two years in an easily accessible place, all books and records required to be made under paragraphs (b)(2)(i)(C) and (D) of this section, and makes those records available for examination on request by the Commission or its staff; and (ii) The adviser to the money market fund is registered with the Commission as an investment adviser under section 203 of the Investment Advisers Act of 1940 (15 U.S.C. 80b-3). (c) Exemption from certain monitoring and recordkeeping requirements under § 270.17e-1. Notwithstanding the requirements of §§ 270.17e-1(b)(3) and 270.17e-1(d)(2), the payment of a commission, fee, or other remuneration to a broker shall be deemed as not exceeding the usual and customary broker's commission for purposes of section 17(e)(2)(A) of the Act if: (1) The commission, fee, or other remuneration is paid in connection with the sale of securities to or by an acquiring fund; (2) The broker and the acquiring fund are affiliated persons because each is an affiliated person of the same money market fund; and (3) The acquiring fund is an affiliated person of the money market fund solely because the acquiring fund owns, controls, or holds with power to vote five percent or more of the outstanding securities of the money market fund. (d) Definitions. (1) Investment company includes a company that would be an investment company under section 3(a) of the Act (15 U.S.C. 80a-3(a)) but for the exceptions to that definition provided for in sections 3(c)(1) and 3(c)(7) of the Act (15 U.S.C. 80a-3(c)(1) and 80a-3(c)(7)). (2) Money market fund means: (i) An open-end management investment company registered under the Act that is regulated as a money market fund under § 270.2a-7; or (ii) A company that would be an investment company under section 3(a) of the Act (15 U.S.C. 80a-3(a)) but for the exceptions to that definition provided for in sections 3(c)(1) and 3(c)(7) of the Act (15 U.S.C. 80a-3(c)(1) and 80a-3(c)(7)) and that: (A) Is limited to investing in the types of securities and other investments in which a money market fund may invest under § 270.2a-7; and (B) Undertakes to comply with all the other requirements of § 270.2a-7, except that, if the company has no board of directors, the company's investment adviser performs the duties of the board of directors. [71 FR 36655, June 27, 2006, as amended at 85 FR 74005, Nov. 19, 2020; 88 FR 37987, June 12, 2023] ## Nearby sections - [17 CFR § 202.2 § 202.2 Pre-filing assistance and interpretative advice.](https://www.frixlaw.com/law-library/statutes/ecfr-17-202.2.md) - [17 CFR § 202.6 § 202.6 Adoption, revision, and rescission of rules and regulations of general application.](https://www.frixlaw.com/law-library/statutes/ecfr-17-202.6.md) - [17 CFR § 202.9 § 202.9 Small entity enforcement penalty reduction policy.](https://www.frixlaw.com/law-library/statutes/ecfr-17-202.9.md) - [17 CFR § 202.10 § 202.10 Policy statement of the Securities and Exchange Commission concerning subpoenas to members of the news media.](https://www.frixlaw.com/law-library/statutes/ecfr-17-202.10.md) - [17 CFR § 202.12 § 202.12 Policy statement concerning cooperation by individuals in its investigations and related enforcement actions.](https://www.frixlaw.com/law-library/statutes/ecfr-17-202.12.md) - [17 CFR § 205.1 § 205.1 Purpose and scope.](https://www.frixlaw.com/law-library/statutes/ecfr-17-205.1.md) - [17 CFR § 205.6 § 205.6 Sanctions and discipline.](https://www.frixlaw.com/law-library/statutes/ecfr-17-205.6.md) - [17 CFR § 230.120 § 230.120 Inspection of registration statements.](https://www.frixlaw.com/law-library/statutes/ecfr-17-230.120.md) - [17 CFR § 230.122 § 230.122 Non-disclosure of information obtained in the course of examinations and investigations.](https://www.frixlaw.com/law-library/statutes/ecfr-17-230.122.md) - [17 CFR § 230.133 § 230.133 Definition for purposes of section 5 of the Act, of “sale”, “offer”, “offer to sell”, and “offer for sale”.](https://www.frixlaw.com/law-library/statutes/ecfr-17-230.133.md) - [17 CFR § 230.135b § 230.135b Materials not deemed an offer to sell or offer to buy nor a prospectus.](https://www.frixlaw.com/law-library/statutes/ecfr-17-230.135b.md) - [17 CFR § 230.136 § 230.136 Definition of certain terms in relation to assessable stock.](https://www.frixlaw.com/law-library/statutes/ecfr-17-230.136.md) - [17 CFR § 230.139b § 230.139b Publications or distributions of covered investment fund research reports by brokers or dealers distributing securities.](https://www.frixlaw.com/law-library/statutes/ecfr-17-230.139b.md) - [17 CFR § 230.142 § 230.142 Definition of “participates” and “participation,” as used in section 2(11), in relation to certain transactions.](https://www.frixlaw.com/law-library/statutes/ecfr-17-230.142.md) --- Source: Frix Law Library, https://www.frixlaw.com/law-library/statutes/ecfr-17-270.12d1-1. Check the current official text before relying on it. Not legal advice.