(The news featured below is a selection from the news covered in the Federal Securities Law Reporter.)

Further Comments Sought On Independent Fund Directors Rule 

The SEC invited further comments on proposed amendments that impose two independent director conditions on mutual funds. Earlier this year, a federal court of appeals vacated the mutual fund governance rules, but withheld effectiveness for 90 days to give the Commission a chance to reopen the record for comment on the costs of implementing the rules. The court found that the Commission's bare request for information on costs and its expectation that these costs would be minimal did not place interested parties on notice that in the absence of receiving reliable cost data during the comment period the Commission would base its cost estimates on an extra-record summary of extra-record survey data.

The rules require that fund chairs be independent and that boards be composed of at least 75 percent of directors who are independent. The two rules were part of a larger program of regulatory reforms adopted by the Commission to address serious conflicts of interest in the fund industry. Comments must be received on or before August 21, 2006.

Release No. IC-27395 is reported at ¶87,610.