On April 7, a Washington D.C. appeals court said that a 2004 rule requiring mutual fund boards to be independent must be reexamined by the Securities and Exchange Commission,
The ruling adds fuel to the already contentious debate over the rule and puts SEC
Chairman Christopher Cox in the driver’s seat to change or drop the rule, which currently holds that 75% of mutual fund board members be independent of fund company management.
The U.S. Chamber of Commerce has made several attempts to eliminate the rule, which was passed by a 3-2 vote in 2004 under former SEC chairman William Donaldson. In a lawsuit, the Chamber argued that the SEC had not given enough consideration to compliance costs or regulation alternatives.