Most shareholders of registered investment companies hold fund shares through intermediaries. This means that fund records only identify the intermediary as the record owner, and the fund has limited information about the underlying beneficial shareholders. As a result, funds have no ability to communicate directly with many shareholders, and must rely on intermediaries to deliver fund materials, such as shareholder reports and prospectuses.
The Securities and Exchange Commission’s rules require funds to reimburse intermediaries for “reasonable expenses” incurred in forwarding fund materials to beneficial owners of fund shares. The New York Stock Exchange rules contain a fee schedule that sets forth maximum permissible processing fees. Intermediaries virtually always outsource delivery of fund materials to a fulfillment vendor, which then invoices the fund for the expenses.
This resource center contains the latest news, statements, and policy work around the issue of processing fees.
The System Governing Whether and How Funds
Can Contact Investors Must Be Reformed
A new report shows how ICI is shining a spotlight on the problems with
the OBO/NOBO system—and how the SEC can fix it.
Statements and News
This section contains the latest statements, speeches, and news releases from ICI on the issues around processing fees.
ICI Survey: Flawed Fee System Doubles Costs to Fund Shareholders for Broker Delivery of Fund Reports
ICI remains committed to representing funds and their shareholders. In fulfilling that mission, ICI actively engages with regulators and comments on policy proposals on the issues around processing fees. This section contains the comment letters ICI has submitted on these issues.
This section contains the latest SEC releases on the issues around processing fees.
- Request for Comments on the Processing Fees Charged by Intermediaries for Distributing Materials Other Than Proxy Materials to Fund Investors
Jun 5, 2018
- Order Granting Approval to Proposed Rule Change Adopting Maximum Fees Member Organizations May Charge in Connection with the Distribution of Shareholder Reports Pursuant to Electronic Delivery Rules
Nov 18, 2016
- Order Granting Approval to Proposed Rule Change Amending NYSE Rules 451 and 465 and Related Provisions
Oct 18, 2013
- Order Instituting Proceedings to Determine Whether to Disapprove Proposed Rule Change Amending NYSE Rules 451 and 465 and Related Provisions
May 23, 2013
- Notice of Filing of Proposed Rule Change Amending NYSE Rules 451 and 465 and Related Provisions
Feb 15, 2013
- Concept Release on the US Proxy System
Jul 14, 2010
- Order Approving Proposed Rule Change and Amendment No.1 to NYSE Rules Regarding the Transmission of Shareholder Communication Material and Proxy Reimbursement Guidelines
Mar 25, 2002
- Notice of Filing of Proposed Rule Change and Amendment No. 1 to NYSE Rules Regarding the Transmission of Shareholder Communication Material and Proxy Reimbursement Guidelines
Jan 9, 2002