TAILIEUCHUNG - President’s Working Group Report on Money Market Fund Reform Options

The issue of liability is most relevant where custody is delegated. According to Article 22(2), the depositary's liability "shall not be affected by the fact that it has entrusted to a third party all or some of the assets in its safe-keeping". The UCITS Directive contains no further provisions governing liability for the loss of a financial instrument where custody has been delegated to a third party. This issue is left to the general principle expressed in Article 22(2), which gives a wide margin of interpretation to Member States. For instance, some Member States only impose an obligation to monitor. | INVESTMENT If I COMPANY l INSTITUTE 1401 H Street NW Washington DC 20005-2148 USA 202 326-5800 February 16 2012 Ms. Elizabeth M. Murphy Secretary Securities and Exchange Commission 100 F. Street NE Washington DC 20549-1090 Re President s Working Group Report on Money Market Fund Reform Options File No. 4-619 Dear Ms. Murphy The Investment Company Institute is pleased to offer the following submission for consideration by the Securities and Exchange Commission as it contemplates whether any additional regulation of money market funds is appropriate. Money market funds which seek to offer investors liquidity a market-based rate of return and stability of principal all at a reasonable cost serve as an effective cash management tool for investors and as an indispensable source of short-term financing for the global economy. Given the importance of these funds ICI and its members have devoted significant time and resources to strengthening the regulation of money market funds and making them more robust under adverse market conditions. To this end on February 7 2012 we submitted the attached submission as a resource to the International Organization of Securities Commissions Standing Committee on Investment Management as it examines money market funds particularly the . money market fund industry. The submission begins with an overview of the . money market Section I . Next it describes the regulation of . money market funds including the SEC s recent reforms and how the funds weathered their first stress test since those reforms Section II . Finally the submission examines each of the reform options currently under serious consideration in the United States and describes how they would undermine money market funds value to investors effectively destroying these funds and disrupting the supply of credit to businesses states and local governments and consumers Section III . The Investment Company Institute is the national association of . .

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