SECURITIES AND EXCHANGE COMMISSION 

17 CFR Parts 230, 232, 239, and 274 

[Release Nos. 33-9006, 34-59391, 39-2462, IC-28617; File Number S7-12-08] 

RIN 3235-AK13 

INTERACTIVE DATA FOR MUTUAL FUND RISK/RETURN SUMMARY 

AGENCY: Securities and Exchange Commission. 

ACTION: Final rule. 

SUMMARY: We are adopting rule amendments requiring mutual funds to provide 

risk/return summary information in a form that is intended to improve its usefulness to 

investors. Under the rules, risk/return summary information could be downloaded 

directly into spreadsheets, analyzed in a variety of ways using commercial off-the-shelf 

software, and used within investment models in other software formats. Mutual funds 

will provide the risk/return summary section of their prospectuses to the Commission and 

on their Web sites in interactive data format using the eXtensible Business Reporting 

Language (“XBRL”). The interactive data will be provided as exhibits to registration 

statements and as exhibits to prospectuses with risk/return summary information that 

varies from the registration statement. The rules are intended not only to make 

risk/return summary information easier for investors to analyze but also to assist in 

automating regulatory filings and business information processing. Interactive data has 

the potential to increase the speed, accuracy, and usability of mutual fund disclosure, and 

eventually reduce costs. We also are adopting rules to permit investment companies to 

submit portfolio holdings information in our interactive data voluntary program without 

being required to submit other financial information. 
 

 

 

 

 

 

 

 

 

 

DATES: Effective Date: July 15, 2009. Compliance Date: January 1, 2011. Section 

II.H. of this release contains information on the effective date and the compliance date. 

FOR FURTHER INFORMATION CONTACT: Brent J. Fields, Assistant Director, 

Office of Disclosure and Review, Mark H. Berman, Senior Special Counsel, Office of 

Special Projects, Tara R. Buckley, Senior Counsel, Office of Chief Counsel, Deborah D. 

Skeens, Senior Counsel, and Alberto H. Zapata, Senior Counsel, Office of Disclosure 

Regulation, Division of Investment Management, at (202) 551-6784, Securities and 

Exchange Commission, 100 F Street, NE, Washington, DC 20549-5720. 

SUPPLEMENTARY INFORMATION: The Securities and Exchange Commission 

(“Commission”) is adopting amendments to rules 4851

 and 4972 under the Securities Act 

of 1933 (“Securities Act”), rules 11,3 202,4 401,5 and 4056 of Regulation S-T,7 and Form 

N-1A8 under the Securities Act and the Investment Company Act of 1940 (“Investment 

Company Act”).9 

1 17 CFR 230.485. 

2 17 CFR 230.497. 

3 17 CFR 232.11. 

4 17 CFR 232.202. 

5 17 CFR 232.401. 

6 The Commission recently added new rule 405 to Regulation S-T [17 CFR 232.405] in a 

separate release. See Securities Act Release No. 9002 (Jan. 30, 2009) [74 FR 6776 (Feb. 

10, 2009)] (“Interactive Data Adopting Release”). 

7	 17 CFR 232.10 et seq. 

8	 17 CFR 239.15A and 274.11A. 

9	 The Commission proposed these rule and form amendments in June 2008. See Securities 

Act Release No. 8929 (June 10, 2008) [73 FR 35442 (June 23, 2008)] (“Proposing 

Release”). 

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Table of Contents 

Executive Summary............................................................................................................ 4
 

I. INTRODUCTION AND BACKGROUND .............................................................. 8
 

A. Commission Initiatives to Update the Public Disclosure Process .......................... 8
 

B. Current Filing Technology and Interactive Data .................................................. 12
 

II. DISCUSSION.......................................................................................................... 17
 

A. Submission of Risk/Return Summary Information Using Interactive Data ......... 18
 

B. Content and Submission Requirements for Interactive Risk/Return Summary 

Information ........................................................................................................... 26
 

C. Web Site Posting of Interactive Data.................................................................... 31
 

D. Consequences of Non-Compliance and Hardship Exemption.............................. 34
 

E. Interactive Data List of Tags and Commission Viewer........................................ 39
 

F. Application of Federal Securities Laws................................................................ 45
 

G. Changes to the Voluntary Program....................................................................... 53
 

H. Compliance Date................................................................................................... 56
 

III.	 PAPERWORK REDUCTION ACT........................................................................ 60
 

IV. COST/BENEFIT ANALYSIS................................................................................. 73
 

V. CONSIDERATION OF BURDEN ON COMPETITION AND PROMOTION OF 

EFFICIENCY, COMPETITION, AND CAPITAL FORMATION........................ 91
 

VI. FINAL REGULATORY FLEXIBILITY ANALYSIS ........................................... 96
 

VII. STATUTORY AUTHORITY ............................................................................... 102
 

TEXT OF RULE AND FORM AMENDMENTS.......................................................... 103 

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Executive Summary 

The principal elements of the rule amendments we are adopting today are as 

follows: 

• Open-end management investment companies (“mutual funds”)10 must submit to 

the Commission a new exhibit with their risk/return summary information in 

interactive data format, beginning with initial registration statements, and posteffective amendments that are annual updates to effective registration statements 

that become effective after January 1, 2011.11 

• An interactive data file submitted with a registration statement must be filed as a 

post-effective amendment under rule 485(b) under the Securities Act12 and must 

be filed after effectiveness of the related filing, but no later than 15 business days 

after the effective date of the related filing. An interactive data file required to be 

submitted with a form of prospectus filed pursuant to rule 497(c) or (e) under the 

Securities Act may be submitted with the filing or subsequent thereto, but no 

10	 An open-end management investment company is an investment company, other than a 

unit investment trust or face-amount certificate company, that offers for sale or has 

outstanding any redeemable security of which it is the issuer. See Sections 4 and 5(a)(1) 

of the Investment Company Act [15 U.S.C. 80a-4 and 80a-5(a)(1)]. 

11	 We have adjusted the compliance date to provide mutual funds sufficient time to become 

familiar with interactive data. See infra Section II.H. Interactive data will be required as 

an exhibit to a registration statement or post-effective amendment thereto that contains 

risk/return summary information and to any form of prospectus filed pursuant to rule 

497(c) or (e) under the Securities Act [17 CFR 230.497(c) or (e)] that contains risk/return 

summary information that varies from the registration statement. Interactive data will not 

be required as an exhibit to a post-effective amendment that does not contain risk/return 

summary information or to a form of prospectus filed pursuant to rule 497(c) or (e) that 

does not contain risk/return summary information that varies from the registration 

statement. 

12	 A post-effective amendment filed under rule 485(b) under the Securities Act [17 CFR 

230.485(b)] may become effective immediately upon filing. A post-effective amendment 

may only be filed under rule 485(b) if it is filed for one or more specified purposes, 

including to make non-material changes to the registration statement. 

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later than 15 business days after the filing made pursuant to rule 497. 

•	 Risk/return summary information in interactive data format must be provided as 

an exhibit identified in General Instruction C.3.(g).(iv) of Form N-1A.13 

•	 The rules do not alter the requirements to provide risk/return summary 

information with the traditional format filings.14
 

•	 A mutual fund required to provide risk/return summary information in interactive 

data format to the Commission also is required to post that information in 

interactive data format on its Web site not later than the end of the calendar day it 

submitted or was required to submit the interactive data exhibit to the 

Commission, whichever is earlier.15 

•	 If a mutual fund does not submit or post interactive data as required, the fund’s 

ability to file post-effective amendments to its registration statement under rule 

485(b) under the Securities Act will be automatically suspended until the fund 

submits and posts the interactive data as required. 

•	 Mutual funds providing risk/return summary information in interactive data 

format are required to use the most recent list of tags released by XBRL U.S.16 as 

13	 Form N-1A is the form used by mutual funds to register under the Investment Company 

Act and to offer securities under the Securities Act. 

14	 When we extended the voluntary program to the mutual fund risk/return summary, we 

stated in the adopting release that the interactive data submission would be supplemental 

to filings and not replace the required traditional electronic format of the information it 

contains. We also said that volunteers would be required to continue to file their 

traditional electronic filings. See Part II.A. of Securities Act Release No. 8823 (July 11, 

2007) [72 FR 39290, 39292 (July 17, 2007)]. 

15	 The Web site posting requirement applies only to the extent a mutual fund already 

maintains a Web site. 

16	 The appropriate list of tags for document and entity identifier elements will be a list 

released by XBRL U.S., see infra note 46, and will be required to be used by all issuers 

required to submit interactive data. 

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required by Regulation S-T and the EDGAR Filer Manual.17 Mutual funds also 

are required to tag a limited number of document and entity identifier elements, 

such as the form type and the fund’s name. As with interactive data for the 

risk/return summary, these document and entity identifier elements must be 

formatted using the appropriate list of tags as required by Regulation S-T and the 

EDGAR Filer Manual. 

• New rule 406T of Regulation S-T18 addresses the liability for an interactive data 

file and provides that an interactive data file is: 

o Subject to the anti-fraud provisions of Section 17(a)(1) of the Securities 

Act, Section 10(b) of and rule 10b-5 under the Securities Exchange Act of 

1934 (“Exchange Act”), and Section 206(1) of the Investment Advisers 

Act of 1940 (“Investment Advisers Act”), except as provided below; 

o Deemed not filed or part of a registration statement or prospectus for 

purposes of Sections 11 or 12 of the Securities Act, is deemed not filed 

for purposes of Section 18 of the Exchange Act or Section 34(b) of the 

Investment Company Act, and otherwise is not subject to liability under 

these sections; 

17 

18 

Rule 405 of Regulation S-T directly sets forth the basic tagging requirements and 

indirectly sets forth the rest of the tagging requirements through the requirement to 

comply with the EDGAR Filer Manual, which is available on the Commission’s Web site 

at: http://www.sec.gov/info/edgar/edmanuals.htm. Consistent with rule 405, the 

EDGAR Filer Manual contains the technical tagging requirements. See Interactive Data 

Adopting Release, supra note 6 (adopting rule 405 of Regulation S-T). Currently, we are 

in the process of updating the EDGAR Filer Manual to reflect changes in the tagging 

requirements applicable to financial statements. See Interactive Data Adopting Release, 

supra note 6. We anticipate that similar updates to address revisions in the tagging 

requirements applicable to fund risk/return summary information and portfolio holdings 

will be finalized during 2009. 

See Interactive Data Adopting Release, supra note 6 (adopting rule 406T of Regulation 

S-T). 

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o	 Deemed filed for purposes of (and, as a result, benefit from) rule 103 of 

Regulation S-T;19 and 

o	 Subject to liability for a failure to comply with rule 405 of Regulation 

S-T,20 but shall be deemed to have complied with rule 405 and would not 

be subject to liability under the anti-fraud provisions set forth above or 

under any other liability provision if the electronic filer: 

	 makes a good faith attempt to comply with rule 405; and 

	 after the electronic filer becomes aware that the interactive data 

file fails to comply with rule 405, promptly amends the interactive 

data file to comply with rule 405. 

•	 These liability provisions will apply only until October 31, 2014, and, thereafter, 

an interactive data file will be subject to the same liability provisions as the 

related official filing. 

•	 The voluntary program is being modified to allow for participation by mutual 

funds with respect to risk/return summary information up until January 1, 2011, 

but continue to permit investment companies to participate with respect to 

financial statement information thereafter. As a result, the voluntary program 

19	 The interactive data file is deemed filed for purposes of rule 103 of Regulation S-T [17 

CFR 232.103] and, as a result, in general, the mutual fund would not be subject to 

liability for electronic transmission errors beyond its control if the mutual fund corrects 

the problem through an amendment as soon as reasonably practicable after the fund 

becomes aware of the problem. Interactive data files are deemed filed for purposes of 

rule 103 regardless of whether they are eligible for the modified treatment provided by 

rule 406T at the time submitted. Rule 406T expressly provides that interactive data files 

are deemed filed for purposes of rule 103 to remove any negative inference that otherwise 

might be drawn due to the fact that rule 406T deems interactive data files to be not filed 

for other specified purposes. 

20	 See supra note 17. 

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will continue after the compliance date of these rule amendments for the financial 

statements of investment companies that are registered under the Investment 

Company Act, business development companies,21 and other entities that report 

under the Exchange Act and prepare their financial statements in accordance with 

Article 6 of Regulation S-X. 

•	 Registered investment companies, business development companies, and other 

entities that report under the Exchange Act and prepare their financial statements 

in accordance with Article 6 of Regulation S-X are permitted to submit exhibits 

under the voluntary program containing a tagged schedule of portfolio holdings 

without having to submit other financial information in interactive data format. 

We intend to monitor implementation and, if necessary, make appropriate 

adjustments to the adopted amendments. 

I. INTRODUCTION AND BACKGROUND 

A.	 Commission Initiatives to Update the Public Disclosure Process 

Over the last several decades, developments in technology and electronic data 

communication have facilitated greater transparency in the form of easier access to, and 

analysis of, financial reporting and disclosures. Technological developments also have 

significantly decreased the time and cost of filing disclosure documents with us. Most 

notably, in 1993 we began to require electronic filing on our Electronic Data Gathering, 

Analysis, and Retrieval System (“EDGAR”).22 Since then, widespread use of the Internet 

21	 Business development companies are a category of closed-end investment companies that 

are not required to register under the Investment Company Act. See Section 2(a)(48) of 

the Investment Company Act [15 U.S.C. 80a-2(a)(48)]. 

22	 In 1993, we began to require domestic issuers to file most documents electronically. 

Securities Act Release No. 6977 (Feb. 23, 1993) [58 FR 14628 (Mar. 18, 1993)]. 

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has vastly decreased the time and expense of accessing disclosure filed with us. 

We continue to update our filing standards and systems as technologies improve, 

consistent with our goal to promote efficient and transparent capital markets. Most 

recently, we unveiled the Interactive Data Electronic Applications database (“IDEA”), 

which will initially supplement and eventually replace EDGAR, and which is designed to 

take full advantage of interactive technology in order to provide investors with better and 

more useful financial disclosures.23 Also, since 2003 we have required electronic filing 

of certain ownership reports filed on Forms 3,24 4,25 and 526 in a format that provides 

interactive data, and recently we adopted similar rules governing the filing of Form D.27 

In addition, recently we have encouraged, and in some cases required, mutual funds and 

public reporting companies to provide disclosures and communicate with investors using 

the Internet.28 

In addition, we also implemented a voluntary filer program, started in 2005,29 that 

Electronic filing began with a pilot program in 1984. Securities Act Release No. 6539 

(June 27, 1984) [49 FR 28044 (July 10, 1984)]. 

23	 See SEC Announces Successor to EDGAR Database, Securities and Exchange 

Commission Press Release, Aug. 19, 2008, available at: 

http://www.sec.gov/news/press/2008/2008-179.htm. 

24	 17 CFR 249.103 and 274.202. 

25	 17 CFR 249.104 and 274.203. 

26	 17 CFR 249.105. 

27	 17 CFR 239.500. 

28	 See, e.g., Investment Company Act Release No. 28584 (Jan. 13, 2009) [74 FR 4546 (Jan. 

26, 2009)] (“Summary Prospectus Adopting Release”); Exchange Act Release No. 57172 

(Jan. 18, 2008) [73 FR 4450 (Jan. 25, 2008)]; Exchange Act Release No. 56135 (July 26, 

2007) [72 FR 42222 (Aug. 1, 2007)]; Exchange Act Release No. 55146 (Jan. 22, 2007) 

[72 FR 4148 (Jan. 29, 2007)]; Securities Act Release No. 8591 (July 19, 2005) [70 FR 

44722 (Aug. 3, 2005)]. 

29	 Securities Act Release No. 8529 (Feb. 3, 2005) [70 FR 6556 (Feb. 8, 2005)] (“Voluntary 

Program Adopting Release”). 

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has allowed us to evaluate certain uses of interactive data. The voluntary program allows 

companies to submit financial statements on a supplemental basis in interactive format as 

exhibits to specified filings under the Exchange Act and the Investment Company Act. 

Over 100 operating companies participated in the voluntary program. These companies 

span a wide range of industries and company characteristics, and have a total market 

capitalization of over $2 trillion. Companies that participated in the program were still 

required to file their financial statements in American Standard Code for Information 

Interchange (“ASCII”) or HyperText Markup Language (“HTML”).30 Four mutual fund 

complexes participated in the voluntary program and have submitted financial statement 

information in interactive data format.31 

In 2007, we extended the program to enable mutual funds voluntarily to submit in 

interactive data format supplemental information contained in the risk/return summary 

section of their prospectuses.32 The risk/return summary contains information about a 

fund’s investment objectives and strategies, costs, risks, and past performance.33 

Twenty-five mutual funds from a variety of fund families have submitted risk/return 

summary information in interactive data format. These funds represent 15 fund 

complexes, and consist of a range of fund types, including 14 equity funds, two balanced 

30 HTML is a standardized language commonly used to present text and other information 

on Web sites. 

31 These four fund complexes made 23 submissions representing 12 mutual funds. 

32 Securities Act Release No. 8823 (July 11, 2007) [72 FR 39290 (July 17, 2007)] 

(“Risk/Return Voluntary Program Adopting Release”). 

33 Items 2, 3, and 4 of Form N-1A. 

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funds, five bond funds, and four money market funds. The funds participating in the 

voluntary program also include larger and smaller funds.34 

Since the establishment of the voluntary program for mutual fund risk/return 

summary information, the Commission has continued its evaluation of interactive data, 

including interactive data submitted by mutual funds. The Commission’s evaluation of 

interactive data has included the hosting of three roundtables on the topic of interactive 

data reporting,35 as well as the creation, in April 2008 of a viewer that allowed investors 

to read, analyze, and compare the interactive risk/return summary data submitted by 

mutual funds.36 

Additionally, prior to launching the risk/return viewer, Commission staff 

reviewed all of the interactive data files submitted to the Commission to help ensure the 

accuracy of the interactive risk/return summary data displayed on the Commission’s Web 

site, and the staff communicated with the filers in order to identify and correct any 

technical issues with the submissions.37 Further, as noted below, Commission staff also 

surveyed voluntary program participants for specific data regarding the costs of preparing 

and submitting risk/return summary information in interactive data, including software 

34	 Based on industry assets as of September 2008, four of the five largest fund complexes 

have submitted tagged risk/return summary information as part of the voluntary filing 

program. Lipper-Directors’ Analytical Data, Reuters Sept. 2008. As of September 2008, 

the two smallest mutual funds participating in the voluntary program had net assets of 

approximately $41 million and $17 million. Id. 

35	 See materials available at http://www.sec.gov/spotlight/xbrl/xbrl-meetings.shtml. 

36	 As discussed in Section I.B. infra, information in interactive data format is intended to be 

processed by software applications and is not readable by humans without a viewer. 

37	 See infra Section II.E.3. (discussing the Commission’s risk/return summary interactive 

data viewer). 

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costs and internal and external labor costs.38 Six of the participating mutual funds 

responded, providing data in response to this voluntary program questionnaire. These six 

respondents represent mutual fund complexes whose assets comprise a range of 

approximately .01% to 12% of all the assets of the mutual funds that will be required to 

submit interactive data.39 

In a companion release, we recently adopted rules requiring companies, other than 

investment companies that are registered under the Investment Company Act, business 

development companies, and other entities that report under the Exchange Act and 

prepare their financial statements in accordance with Article 6 of Regulation S-X, to 

submit financial information to the Commission in interactive data format.40 In this 

release, as part of our continuing efforts to assist investors who use Commission 

disclosures, as well as filers of that disclosure, we are adopting rule amendments to 

require that mutual fund risk/return summary information be provided in a format that 

makes the information interactive. 

B. Current Filing Technology and Interactive Data 

Companies filing electronically are required to file their registration statements 

and periodic reports in ASCII or HTML format.41 Also, to a limited degree, our 

38	 See Section III. below. Of the 22 mutual funds that participated in the voluntary program 

at the time the Commission proposed these amendments, nine were provided 

questionnaires on the details of their cost experience, and six responses were collected 

representing the cost data for ten funds. 

39	 Based on total mutual fund assets of $10.6 trillion. Lipper-Directors’ Analytical Data, 

Reuters Sept. 2008. 

40	 Interactive Data Adopting Release, supra, note 6. 

41	 Rule 301 of Regulation S-T [17 CFR 232.301] requires electronic filings to comply with 

the EDGAR Filer Manual, and Section 5.2 of the EDGAR Filer Manual requires that 

electronic filings be in ASCII or HTML format. Rule 104 of Regulation S-T [17 CFR 

232.104] permits filers to submit voluntarily as an adjunct to their official filings in 

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electronic filing system uses other formats for internal processing and document-type 

identification. For example, our system uses eXtensible Markup Language (“XML”) to 

process reports of beneficial ownership of equity securities on Forms 3, 4, and 5 under 

Section 16(a) of the Exchange Act.42 

Electronic formats such as HTML, XML, and XBRL are open standards43 that 

define or “tag” data using standard definitions. The tags establish a consistent structure 

of identity and context. This consistent structure can be recognized and processed by a 

variety of different software applications. In the case of HTML, the standardized tags 

enable Web browsers to present Web sites’ embedded text and information in a 

predictable format. In the case of XBRL, software applications, such as databases, 

financial reporting systems, and spreadsheets, recognize and process tagged information. 

XBRL was derived from the XML standard. It was developed and continues to 

be supported by XBRL International, a consortium of approximately 550 organizations 

representing many elements of the financial reporting community worldwide in more 

than 20 jurisdictions, national and regional. XBRL U.S., the international organization’s 

U.S. jurisdiction representative, is a non- profit organization44 that includes companies, 

public accounting firms, software developers, filing agents, data aggregators, stock 

ASCII or HTML unofficial PDF copies of filed documents. Unless otherwise stated, we 

refer to filings in ASCII or HTML as traditional format filings. 

42	 15 U.S.C. 78p(a). 

43	 The term “open standard” is generally applied to technological specifications that are 

widely available to the public, royalty-free, at minimal or no cost. 

44	 XBRL U.S. is a 501(c)(6) organization. Internal Revenue Code Section 501(c)(6) applies 

to “Business leagues, chambers of commerce, real-estate boards, boards of trade, or 

professional football leagues (whether or not administering a pension fund for football 

players), not organized for profit and no part of the net earnings of which inures to the 

benefit of any private shareholder or individual.” See 26 U.S.C 501(c)(6). 

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exchanges, regulators, financial services companies, and industry associations.45 

Risk/return summary information in interactive format requires a standard list of 

tags. These tags are similar to definitions in an ordinary dictionary, and they cover a 

variety of concepts that can be read and understood by software applications. For the 

risk/return summary, a mutual fund will use the most recent list of tags for risk/return 

summary information released by XBRL U.S.46 This list of tags contains descriptive 

labels, authoritative references to Commission regulations where applicable, and other 

elements, all of which provide the contextual information necessary for interactive data47 

to be recognized and processed by software.48 

The initial risk/return summary list of tags received acknowledgement from 

45	 XBRL U.S. supports efforts to promote interactive financial and business data specific to 

the U.S. 

46	 Unless stated otherwise, when we refer to the “list of tags for risk/return summary 

information” we mean the interactive data list of tags released and maintained by XBRL 

U.S., including any modifications. This list was initially developed by the Investment 

Company Institute (“ICI”), which is a national association of the U.S. investment 

company industry. 

47	 The rules define the interactive data in machine-readable format required to be submitted 

as the “interactive data file,” which will be required with every interactive data 

submission. See Interactive Data Adopting Release, supra note 6 (adopting new 

definitions under 17 CFR 232.11). 

48	 For example, contextual information identifies the entity to which it relates, usually by 

using the filer’s Central Index Key (“CIK”) number. A hypothetical filer converting its 

traditional electronic disclosure of total annual fund operating expenses of 0.73% must 

create interactive data that identifies what the 0.73% represents, total annual fund 

operating expenses, and that the number is a percentage. The contextual information 

includes other information as necessary; for example, the date of the prospectus to which 

it relates and the series and class to which it applies. 

A mutual fund may issue multiple “series” of shares, each of which is preferred over all 

other series in respect of assets specifically allocated to that series. Rule 18f-2 under the 

Investment Company Act [17 CFR 270.18f-2]. Each series is, in effect, a separate 

investment portfolio. 

A mutual fund may issue more than one class of shares that represent interests in the 

same portfolio of securities with each class, among other things, having a different 

arrangement for shareholder services or the distribution of securities, or both. Rule 18f-3 

under the Investment Company Act [17 CFR 270.18f-3]. 

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XBRL International in June 2007,49 and was used by mutual funds participating in the 

Commission’s voluntary program. More recently, XBRL U.S. has updated the 

architecture of the list of tags for risk/return summary information and conformed the list 

of tags to changes we recently adopted to the risk/return summary disclosure 

requirements.50 The list was recently issued for public comment,51 and it is expected to 

be finalized and submitted to XBRL International for acknowledgement by the end of 

January 2009. Related documents, such as the architecture and technical guides, also are 

due to be released publicly by the end of January 2009. 

Data tags are applied to risk/return summary information by using commercially 

available software that guides a preparer to tag information in the risk/return summary, 

such as line item costs in a mutual fund’s fee table, with the appropriate tags in the 

standard list. This involves locating an element in the list of tags that represents the 

particular disclosure that is to be tagged. Occasionally, because mutual funds have some 

49	 The list of tags is available on XBRL International’s Web site at: 

http://xbrl.org/Taxonomy/rr-summarydocument-20070516-acknowledged.htm. 

There are two levels of XBRL tag recognition: (1) “acknowledgement” is formal 

recognition that a list of tags complies with XBRL specifications, including testing by a 

defined set of validation tools; and (2) “approval” is a formal recognition requiring more 

detailed quality assurance and testing, including compliance with official XBRL 

guidelines for the type of tag list under review, creation of a number of instance 

documents, and an open review period after acknowledgement. For more information 

regarding the XBRL tag list recognition process, see “Taxonomy Recognition Process” 

on the XBRL International Web site available at: 

http://www.xbrl.org/TaxonomyRecognition/. 

50	 See infra Section II.E.1. (discussing the list of tags for risk/return summary information); 

Summary Prospectus Adopting Release, supra note 28. 

51	 XBRL U.S. released the updated list of tags for risk/return summary information for 

public comment on October 21, 2008. The list is available on the XBRL U.S. Web site 

at: http://xbrl.us/imtaxonomies/Pages/default.aspx. See XBRL U.S. Announces Public 

Review of Data Tags for Mutual Fund Risk/Return Summary and Schedule of 

Investments, available on the XBRL U.S. Web site at: 

http://xbrl.us/press/Pages/20081021.aspx. The comment period closed on November 24, 

2008. 

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flexibility in preparing the risk/return summary, particularly the narrative portions, it is 

possible that a mutual fund may wish to use a non-standard disclosure that is not included 

in the standard list of tags. In this situation, a fund will create a company-specific 

element, called an extension. Alternatively, a mutual fund may choose to outsource the 

tagging process. 

Because mutual fund risk/return summary information in interactive data format 

is intended to be processed by software applications, the unprocessed interactive data is 

not readable by humans. Thus, viewers are necessary to convert, or “render,” the 

interactive data file to human readable format. Some viewers, for example, may be 

compared to Web browsers that are used to read HTML files. 

The Commission’s Web site currently provides links to viewers that allow the 

public to read mutual fund and other company disclosures submitted using interactive 

data. One of these viewers allows users to view and compare mutual fund risk/return 

summary information, including investment objectives and strategies, costs, risks, and 

past performance, that is submitted in interactive data format.52 These viewers are 

intended to demonstrate the capability of software to present interactive data in humanreadable form and to provide open source software to give developers a free resource 

they can use as is or build upon. As noted above, software also is able to process 

interactive data so as to automate and, as a result, facilitate access to and analysis of 

tagged data. In addition, we are aware of other applications under development that may 

A mutual fund information viewer for the voluntary program is available at: 

http://a.viewerprototype1.com/viewer. 

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provide additional and advanced functionality.53 

II.	 DISCUSSION 

The Commission received 16 comment letters on the proposed rule amendments, 

including comments from trade associations, fund complexes, a data aggregator, 

technology service providers, and individual investors and professionals.54 The 

commenters generally supported both the use of technology to better inform mutual fund 

investors and the Commission’s goal of providing risk/return summary information in 

interactive data format.55 Most commenters, however, stated that requiring mutual funds 

to provide tagged risk/return summary information is premature.56 As discussed below, 

commenters also raised other concerns regarding the proposal, including concerns 

regarding the adequacy of the existing technology necessary to create and submit 

53	 A list of interactive data products and service providers is available at: 

http://xbrl.us/Vendors/Pages/default-expand.aspx. 

54	 See comment letters of the American Bar Association (“ABA”) (Aug. 18, 2008); James J. 

Angel, Ph.D, C.F.A. (“Angel”) (Aug. 4, 2008); Gary J. Coles (“Coles”) (July 25, 2008); 

Committee of Annuity Insurers (“Annuity Insurers”) (July 23, 2008); Confluence (Aug. 

1, 2008); Data Communiqué, Inc. (“Data Communiqué”) (July 31, 2008); Federated 

Investors, Inc. (“Federated”) (Aug. 12, 2008); Robert Gilmore, C.P.A. (“Gilmore”) (July 

31, 2008); Walter C. Hamscher (“Hamscher”) (July 31, 2008); ICI (Aug. 1, 2008); Lipper 

(July 29, 2008); OppenheimerFunds, Inc. (“Oppenheimer”) (Aug. 4, 2008); Lorna A. 

Schnase (“Schnase”) (July 25, 2008); Jay Starkman, C.P.A. (“Starkman”) (July 30, 

2008); T. Rowe Price Associates, Inc. (“T. Rowe Price”) (Aug. 1, 2008); and The 

Vanguard Group, Inc. (“Vanguard”) (Aug. 1, 2008). Comment letters received in 

response to the Proposing Release are available at: http://www.sec.gov/comments/s7-12­

08/s71208.shtml or from our Public Reference Room at 100 F Street, NE, Washington, 

DC 20549. 

55	 Twelve commenters generally supported tagging risk/return summary information in 

interactive data format. See letters of ABA, Angel, Annuity Insurers, Confluence, Data 

Communiqué, Gilmore, Hamscher, ICI, Lipper, Oppenheimer, T. Rowe Price, and 

Vanguard. Three commenters did not support requiring interactive disclosure of 

risk/return summary data. See letters of Federated, Schnase, and Starkman. One 

commenter expressed no explicit opinion on the matter. See letter of Coles. 

56	 See letters of ABA, Confluence, Data Communiqué, Federated, Gilmore, ICI, 

Oppenheimer, Schnase, T. Rowe Price, and Vanguard. 

17
 
 

 

 

 

 

 

 

interactive data files,57 what information should be required to be tagged,58 the proposed 

compliance date,59 and the potential liability of mutual funds under the federal securities 

laws related to tagged risk/return summary information.60 

For the reasons discussed below, we continue to believe that the enormous 

potential of interactive data for enhancing investors’ access to mutual fund information 

justifies implementation of this initiative. Therefore, we are adopting the proposed 

amendments with some modifications to address commenters’ concerns. The rule 

amendments are intended to make risk/return summary information easier for investors to 

analyze and to assist in automating regulatory filings and business information 

processing. 

A. Submission of Risk/Return Summary Information 

Using Interactive Data
 

We are adopting, as proposed, rule amendments that require mutual funds to 

submit a complete set of their risk/return summary information, set forth in Items 2, 3, 

and 4 of Form N-1A,61 in interactive data format.62 In addition, mutual funds are 

required to provide document and entity identifier tags, such as the form type and the 

fund’s name. As was the case in the voluntary program, the new requirement for 

57	 See letters of Confluence, Federated, Gilmore, ICI, Oppenheimer, Schnase, Starkman, 

and T. Rowe Price. 

58	 See letters of ABA, Confluence, Data Communiqué, Federated, and Schnase. 

59	 See letters of Confluence, Data Communiqué, Federated, Gilmore, ICI, Oppenheimer, 

Schnase, T. Rowe Price, and Vanguard. 

60	 See letters of ABA, Federated, ICI, Oppenheimer, and Schnase. 

61	 Recently, the Commission adopted amendments to Form N-1A, see Summary Prospectus 

Adopting Release, supra note 28, under which the risk/return summary information, 

formerly contained in Items 2 and 3 of Form N-1A, was reconfigured in Items 2, 3, and 4 

of Form N-1A. We apply the tagging rules to the information required by amended Form 

N-1A. 

62	 See Item 405(b)(2) of Regulation S-T. 

18
 
interactive data reporting is intended to be disclosure neutral in that we do not intend the 

rules to result in mutual funds providing more, less, or different disclosure for any given 

disclosure item, regardless of whether the format is ASCII, HTML, or XBRL. 

We are adopting these rule amendments because the submission of interactive 

risk/return summary information at this time is an important next step in increasing the 

accessibility of this information to mutual fund investors and others. Requiring mutual 

funds to submit the risk/return summary section of their prospectuses using interactive 

data format will enable investors, analysts, and the Commission staff to capture and 

analyze that information more quickly and at less cost than is possible using the same 

information provided in a static format. Any investor with a computer and an Internet 

connection will have the ability to acquire and download interactive data that have 

generally been available only to intermediaries and third-party analysts. The interactive 

data rule amendments do not change disclosure requirements under the federal securities 

laws and regulations, but will add a requirement to include risk/return summary 

information in an interactive data format as an exhibit. Thus, requiring that filers provide 

risk/return summary information using interactive data will not otherwise alter at all the 

disclosure or formatting standards of mutual fund prospectuses. These filings will 

continue to be available as they are today for those who prefer to view the traditional 

text-based document. 

Interactive data can create new ways for investors, analysts, and others to retrieve 

and use the information. For example, users of risk/return summary information will be 

able to download cost and performance information directly into spreadsheets, analyze it 

using commercial off-the-shelf software, or use it within investment models in other 

19
 
 

 

 

 

software formats. Through interactive data, what is currently static, text-based 

information can be dynamically searched and analyzed, facilitating the comparison of 

mutual fund cost, performance, and other information across multiple classes of the same 

fund and across the more than 8,000 mutual funds currently available.63 

Interactive data also provides an opportunity to automate regulatory filings and 

business information processing, with the potential to increase the speed, accuracy, and 

usability of mutual fund disclosure. Such automation may eventually reduce costs. A 

mutual fund that uses a standardized interactive data format at earlier stages of its 

reporting cycle may reduce the need for repetitive data entry and, therefore, the 

likelihood of human error. In this way, interactive data may improve the quality of 

information while reducing its cost. Also, to the extent investors currently are required to 

pay for access to mutual fund risk/return summary information that has been extracted 

and reformatted into an interactive data format by third-party sources, the availability of 

interactive data in Commission filings may allow investors to avoid additional costs 

associated with third-party sources. 

As noted above, although most commenters generally supported the concept of 

interactive disclosure of risk/return summary information,64 they also asserted that this 

initiative is premature.65 In particular, several commenters urged the Commission to 

defer requiring mutual funds to submit interactive risk/return summary information 

because pending Commission proposals related to a mutual fund summary prospectus 

63 Investment Company Institute, 2008 Investment Company Fact Book, at 15 (2008), 

available at: http://www.icifactbook.org/pdf/2008_factbook.pdf (as of year-end 2007, 

there were 8,752 mutual funds). 

64 See supra note 55. 

65 See supra note 56. 

20
 
 

 

 

 

 

 

and exchange-traded funds (“ETFs”) would change the information in the risk/return 

summary.66 Related to those comments, commenters also asserted that: (1) the list of 

tags for risk/return summary information would require updating if the proposed changes 

to the risk/return summary are adopted; (2) the list of tags’ architecture needed to be 

updated; and (3) related tools are not sufficiently developed.67 Commenters also stated 

that implementation is premature because more information needs to be collected from 

the current voluntary program.68 

While we are sensitive to these commenters’ concerns, they do not warrant delay 

in this important initiative, particularly given recent progress related to these comments. 

First, the Commission recently adopted amendments to Form N-1A related to the 

Summary Prospectus Initiative and the ETF Initiative.69 These amendments do not 

66	 See letters of Data Communiqué, Federated, ICI, Oppenheimer, Schnase, T. Rowe Price, 

and Vanguard. The Commission proposed revisions to Form N-1A’s risk/return 

summary disclosure requirements as part of two separate rulemaking initiatives. See 

Investment Company Act Release No. 28064 (Nov. 21, 2007) [72 FR 67790 (Nov. 30, 

2007)] (proposing amendments intended to enhance mutual fund disclosure of certain key 

information, including risk/return summary information, by, among other things, 

permitting mutual funds to provide such information in the form of a summary 

prospectus if certain conditions are satisfied) (“Summary Prospectus Initiative”); and 

Investment Company Act Release No. 28193 (Mar. 11, 2008) [73 FR 14618 (Mar. 18, 

2008)] (proposing amendments to the mutual fund risk/return summary to provide certain 

information relating specifically to ETFs) (“ETF Initiative”). 

67	 See letters of Confluence, Federated, ICI, Oppenheimer, Schnase, and T. Rowe Price. 

68	 See letters of Federated, ICI, and Schnase. 

69	 These amendments were presented to the Commission at an open meeting on November 

19, 2008. See Summary Prospectus Adopting Release, supra note 28. Form N-1A 

changes related to both the Summary Prospectus Initiative and the ETF Initiative were 

adopted together in the Summary Prospectus Adopting Release. 

In the Summary Prospectus Initiative, we requested comment on whether the proposed 

linking requirements for documents posted on an Internet Web site should be modified. 

See Summary Prospectus Initiative, supra note 66. We received one comment on this 

issue opposing the modification of the proposed linking requirements. See letter of Data 

Communiqué. The linking requirements were adopted as proposed. See Summary 

Prospectus Adopting Release, supra note 28. 

21
 
 

 

 

 

 

significantly alter the content requirements of the risk/return summary section, consisting 

of limited modifications to the disclosure in the Fee Table.70 Mutual funds will not be 

required to comply with these new Form N-1A disclosure requirements until January 1, 

2010,71 providing almost one year for them to revise their disclosure. Second, as 

discussed further below,72 revisions to the list of tags for risk/return summary information 

to account for these limited disclosure changes and revisions to the architecture have 

been issued for public comment and are expected to be finalized by the end of January 

2009. Again, this will provide mutual funds with substantial time to prepare to tag their 

risk/return summary information. Third, while the Commission’s current viewer permits 

the rendering of tagged risk/return summary information, progress has been made to 

develop a more advanced tool that will allow issuers to test their tagged exhibits prior to 

submitting them to the Commission.73 This upgrade to the viewer will be phased in, but 

should be completed during mid-2009. 

70	 These amendments include: (1) requiring mutual funds that offer discounts on front-end 

sales charges for volume purchases (so-called “breakpoint discounts”) to include a brief 

narrative disclosure alerting investors to the availability of those discounts, see Item 3 of 

Form N-1A; Instruction 1(b) to Item 3 of Form N-1A; (2) revising the parenthetical 

heading for “Annual Fund Operating Expenses” in the Fee Table to read “expenses that 

you pay each year as a percentage of the value of your investment,” see Item 3 of Form 

N-1A; (3) requiring mutual funds, other than money market funds, to include brief 

disclosure regarding portfolio turnover immediately following the fee table example, see 

Instruction 5 to Item 3 of Form N-1A; and (4) permitting mutual funds to place two 

additional captions in the Fee Table directly below the “Total Annual Fund Operating 

Expenses” caption in cases where there are expense reimbursement or fee waiver 

arrangements that will reduce any fund operating expenses, see Instruction 3(e) to Item 3 

of Form N-1A. The amendments also require modification for ETFs to the narrative 

explanation preceding the Fee Table to clarify that investors may pay brokerage 

commissions not reflected in the Fee Table. Instruction 1(e)(i) and (ii) to Item 3 of Form 

N-1A. 

71	 See Summary Prospectus Adopting Release, supra note 28. 

72	 See infra Section II.E.1. (discussing the list of tags for risk/return summary information). 

73	 See infra Section II.E.3. (discussing the Commission’s risk/return summary interactive 

data viewer). 

22
 
 

 

 

 

Finally, the Commission has been exploring, via the voluntary program, the use of 

interactive data for several years, including the submission of tagged financial 

information and risk/return summary information. Twenty-five mutual funds have 

submitted over 40 exhibits tagged with interactive data, giving the Commission 

experience in adapting to the technology. In addition, over 100 operating companies 

have submitted financial statements tagged in interactive data format. Each submission 

has enabled issuers to gain experience with submitting tagged documents and enabled the 

Commission to refine its technology infrastructure to accept and efficiently render these 

interactive exhibits. Moreover, given the extended compliance date discussed below, 

mutual funds will have almost two years to resolve technical issues and may continue 

participating in the voluntary program in the interim to gain more experience submitting 

interactive data. 

In addition to the recommendations to delay this initiative, some commenters 

expressed concern that limiting the interactive data filing requirement to only risk/return 

summary information could lead investors to place undue emphasis on this information,74 

and several commenters suggested that the Commission consider expanding this tagging 

requirement to include non-risk/return disclosures in the new mutual fund summary 

prospectus.75 Two of these commenters recommended that all items in the summary 

prospectus should be tagged.76 We believe that implementation of our interactive data 

74	 See letters of ABA, Data Communiqué, and Federated. See also related discussion 

concerning commenters’ suggestion that cautionary legends be permitted, infra Section 

II.B. 

75	 See letters of Confluence, Data Communiqué, and Schnase; see also discussion of 

Summary Prospectus Initiative, supra note 66, and Summary Prospectus Adopting 

Release, supra note 28. 

76	 See letters of Confluence and Schnase. 

23
 
 

 

 

 

 

 

 

initiative should begin with the mutual fund risk/return summary, but we will continue to 

evaluate the benefits of tagging all items in the summary prospectus, as well as other 

information. 

Several commenters questioned whether XBRL is the appropriate standard format 

for interactive data disclosure, asserting that it is not sufficiently developed at this time.77 

Specifically, commenters asserted that there are a limited number of commercial software 

products that are compatible with XBRL,78 and that rendering and validating are still 

expensive and problematic issues.79 One commenter also expressed concern that 

endorsing XBRL could have the effect of stifling competition for other languages, 

although this commenter acknowledged that she was unaware of other languages that are 

likely to become competitive with XBRL.80 

While we acknowledge that XBRL is an evolving technology, we believe it is the 

appropriate interactive data format with which to supplement ASCII and HTML. Our 

experience with the voluntary program, including feedback from company, accounting, 

and software communities, points to XBRL as the appropriate open standard for the 

purposes of this rule.81 XBRL data will be compatible with a wide range of open source 

and proprietary XBRL software applications. As discussed above, many XBRL-related 

products exist for analysts, investors, filers, and others to create and compare disclosures 

more easily, the development process will likely be hastened by mutual fund disclosure 

using interactive data. 

77 See letters of Gilmore, Schnase, and Starkman. 

78 See letter of Starkman. 

79 See letter of Gilmore. 

80 See letter of Schnase. 

81 See note 58 of the Proposing Release, supra note 9. 

24
 
 

 

 

 

 

 

 

Several other factors support our views regarding XBRL’s broad and growing 

acceptance, internationally as well as in the U.S. For example, the Advisory Committee 

on Improvements to Financial Reporting (“CIFiR”)82 presented its final recommendations 

to the Commission in its final report issued in August 2008,83 which includes a 

recommendation that the Commission, over the long term, require the filing of financial 

and non-financial information using XBRL once specified conditions are satisfied.84 We 

believe that sufficient progress has been made regarding each of these conditions.85 Also, 

XBRL has been used by other U.S. agencies,86 and several foreign securities regulators 

82	 The Commission established CIFiR to examine the U.S. financial reporting system, with 

the goals of reducing unnecessary complexity and making information more useful and 

understandable for investors. See SEC Establishes Advisory Committee to Make U.S. 

Financial Reporting System More User-Friendly for Investors, Securities and Exchange 

Commission Press Release, June 27, 2007, available at: 

http://www.sec.gov/news/press/2007/2007-123.htm. 

CIFiR conducted open meetings on March 13-14, 2008 and May 2, 2008, in which it 

heard reactions from an invited panel of participants to CIFiR’s proposal regarding 

required filing of financial information using interactive data. Archived Webcasts of the 

meetings are available at http://sec.gov/about/offices/oca/acifr.shtml. The panelists 

presented their views and engaged with CIFiR members regarding issues relating to 

requiring interactive data tagged financial statements, including tag list and technological 

developments, implications for large and small public companies, needs of investors, 

necessity of assurance and verification of such tagged financial statements, and legal 

implications arising from such tagging. 

83	 See Final Report of the Advisory Committee on Improvements to Financial Reporting to 

the United States Securities and Exchange Commission (August 1, 2008), (“CIFiR 

Report”), available at: http://www.sec.gov/about/offices/oca/acifr/acifr-finalreport.pdf. 

84	 Id. at 98. The recommendation appears in chapter 4 of the CIFiR Report. 

85	 See discussion at note 135, and accompanying text, of Interactive Data Adopting Release, 

supra note 6. 

86	 Since 2005, the Federal Deposit Insurance Corporation (“FDIC”), the Board of 

Governors of the Federal Reserve System, and the Office of the Comptroller of the 

Currency have required the insured institutions that they oversee to file their quarterly 

Consolidated Reports of Condition and Income (called “Call Reports”) in interactive data 

format using XBRL. Call Reports, which include data about an institution’s balance 

sheet and income statement, are used by these federal agencies to assess the financial 

health and risk profile of the financial institution. 

25
 
 

 

 

 

 

 

have adopted voluntary or required XBRL reporting.87 

B. Content and Submission Requirements for 

Interactive Risk/Return Summary Information 

We are adopting, as proposed, the requirement that an interactive data file must be 

submitted to the Commission for any registration statement or post-effective amendment 

thereto on Form N-1A that includes or amends information provided in response to Items 

2, 3, or 4.88 In response to commenters’ concerns,89 however, we are modifying our rules 

to encompass changes to risk/return summary information that mutual funds may make 

pursuant to rule 497 under the Securities Act.90 Specifically, in the Proposing Release, 

we asked for comment on whether mutual funds should be required to submit tagged 

risk/return summary information for prospectuses submitted pursuant to rule 497 under 

the Securities Act. Rule 497 sets out general filing requirements for fund prospectuses 

and provides, among other things, that funds must file any prospectus that contains 

information that varies from that in the registration statement.91 Commenters addressing 

87	 For example, such countries include Canada, China, Israel, Japan, Korea, and Thailand. 

88	 See rule 405(b)(2) of Regulation S-T; General Instruction C.3.(g).(i) of Form N-1A. We 

are also adopting technical amendments to rule 405 that reflect this requirement. As 

previously noted, rule 405 of Regulation S-T directly sets forth the basic tagging 

requirements and indirectly sets forth the rest of the tagging requirements through the 

requirement to comply with the EDGAR Filer Manual. Consistent with rule 405, the 

EDGAR Filer Manual will contain the detailed tagging requirements. 

89	 See infra note 96 and accompanying discussion. 

90	 17 CFR 230.497. 

91	 Specifically, (1) rule 497(c) under the Securities Act requires mutual funds to file, within 

five days after the effective date of a registration statement or the commencement of a 

public offering after the effective date of a registration statement, whichever occurs later, 

ten copies of each form of prospectus and form of statement of additional information 

(“SAI”) used after the effective date; and (2) rule 497(e) under the Securities Act 

provides that, after the effective date of a registration statement, no prospectus that 

purports to comply with Section 10 of the Securities Act [15 U.S.C. 77j] or SAI that 

varies from any form of prospectus or form of SAI filed pursuant to rule 497(c) shall be 

used until filed with the Commission. 

26
 
 

 

 

 

 

 

 

the matter uniformly recommended that updates to interactive risk/return summary 

information should be required when such information is revised in a filing made 

pursuant to rule 497 under the Securities Act,92 asserting that failure to do so could: 

(1) compromise the integrity of the entire interactive data program;93 (2) result in a 

rendered file containing different information from the current prospectus, potentially 

leading to liability;94 and (3) result in investors accessing stale tagged data.95 

We agree with commenters’ concerns that failure to include changes to risk/return 

summary information in filings made pursuant to rule 497 could result in investors and 

others accessing outdated interactive data. For that reason we are modifying the 

proposed rules, in response to the commenters’ recommendations, to require that an 

interactive data file must be submitted to the Commission for any form of prospectus 

filed pursuant to rule 497(c) or (e) under the Securities Act that includes information 

provided in response to Items 2, 3, or 4 that varies from the registration statement.96 

We also are adopting, as proposed, the requirement that an interactive data file to 

a Form N-1A filing, whether the filing is an initial registration statement or a posteffective amendment thereto, must be submitted as an amendment to the registration 

statement to which the interactive data file relates and must be submitted after the 

registration statement or post-effective amendment that contains the related information 

becomes effective but not later than 15 business days after the effective date of that 

92 See letters of Data Communiqué, ICI, and Schnase. 

93 See letter of Data Communique. 

94 See letter of ICI. 

95 See letter of Schnase. 

96 See General Instruction C.3.(g).(ii) of Form N-1A. We also revised paragraphs (c) and 

(e) of rule 497 to clarify that mutual funds must, if applicable pursuant to General 

Instruction C.3.(g) of Form N-1A, include an interactive data file. 

27
 
 

 

 

registration statement or post-effective amendment.97 Our requirement that the 

interactive data file be submitted within 15 business days is intended both to provide 

funds with adequate time to prepare the exhibit and to make the interactive data available 

promptly. An exhibit containing interactive data format risk/return summary information 

can be submitted under rule 485(b) of the Securities Act, which provides for immediate 

effectiveness of amendments that make non-material changes, and will only need to 

contain the new exhibit, a facing page, a signature page, a cover letter explaining the 

nature of the amendment, and a revised exhibit index. 

To address the inclusion of tagged risk/return summary information submitted 

with rule 497 filings discussed above, our amendments provide that tagged risk/return 

summary exhibits must be submitted with or after the filing of a form of prospectus 

pursuant to rule 497(c) or (e) under the Securities Act. The tagged exhibits may be 

submitted concurrently with the rule 497 filing or up to 15 business days subsequent to 

the filing made pursuant to rule 497.98 Similar to the submissions under rule 485(b), the 

15 business days is intended to provide funds adequate time to prepare their interactive 

data exhibits. 

We also are adopting, as proposed, the requirement that an interactive data file be 

submitted as an exhibit to Form N-1A, but also include a modification to address 

submissions made with rule 497 filings, providing that an interactive data file must be 

97 See General Instruction C.3.(g).(i) to Form N-1A. 

98 See General Instruction C.3.(g).(ii) to Form N-1A. Pursuant to the EDGAR Filer 

Manual, mutual funds should include an interactive data file as an exhibit (EX-101) 

contained in an EDGAR 497 submission. Funds submitting their exhibit subsequent to 

their initial rule 497 filing should make a second EDGAR 497 submission that includes 

(1) a 497 document (this 497 document may, in accordance with rule 411 under the 

Securities Act, incorporate by reference the first rule 497 filing and should include the 

accession number of that first rule 497 filing), and (2) any related interactive data exhibit. 

28
 
 

 

 

 

 

 

 

submitted as an exhibit to the filing made pursuant to rule 497.99 Similar to the voluntary 

program, the rules require that the information contained in the risk/return summary 

section in the traditional format filing be the same as in the interactive data format.100 

We have not changed this equivalency standard for risk/return summary information 

provided in interactive data format as required by the rules. As proposed, we also are 

adopting the requirement that an interactive data file be submitted in such a manner that 

will permit the information for each series and, for any information that does not relate to 

all of the classes in a filing, each class of the fund to be separately identified.101 

However, information that is not class-specific, such as investment objectives, is not 

required to be separately identified by class. 

The rules do not eliminate or alter existing substantive disclosure requirements for 

risk/return summary information. The rules also do not eliminate or alter existing ASCII 

or HTML filing requirements. We believe investors and other users may wish to obtain 

an electronic or printed copy of the entire registration statement in ASCII or HTML, 

either in addition to or instead of disclosure formatted using interactive data. To clarify 

the intent of the rules, we have included an instruction to rule 405 of Regulation S-T 

stating that the rules require a disclosure format, but do not change substantive disclosure 

requirements.102 The rules also state clearly that the information in interactive data 

format should not be more or less than the information in the ASCII or HTML part of the 

99 See General Instruction C.3.(g).(iv) of Form N-1A. 

100 See rule 405(b)(2) of Regulation S-T. 

101 See General Instruction C.3.(g).(iv) of Form N-1A. 

102 See Interactive Data Adopting Release, supra note 6 (adopting Preliminary Note 2 to rule 

405). 

29
 
 

 

 

 

 

 

 

Form N-1A filing.103 

As noted previously, several commenters expressed concern that tagging only a 

fund’s risk/return summary information may give such information too much emphasis, 

and may encourage some investors to act on incomplete information.104 These 

commenters suggested that registrants be permitted to include a legend similar to that 

required as part of the voluntary program, cautioning investors, before making an 

investment decision, to read and consider the full prospectus or other filing from which 

the information was taken.105 Because we believe it is inappropriate for the interactive 

data files to alter or differ from the information included in the related official filing, we 

have not included any provision permitting the inclusion of additional cautionary 

language in the interactive data file. Pursuant to commenters’ recommendations, 

however, we intend to modify the Commission’s interactive data viewer to include a 

legend recommending that users review a fund’s full prospectus.106 This legend on the 

viewer serves a similar goal as the tagged cautionary language within an interactive data 

file.107 

While one commenter asserted that interactive data should be embedded in 

HTML filings,108 two other commenters stated that such a requirement should be deferred 

103	 See rule 405(b)(2) of Regulation S-T. 

104 See letters of ABA, Federated, ICI, Oppenheimer, and Schnase. 

105 Id. 

106	 See infra Section II.E.3. (discussing the Commission’s risk/return summary interactive 

data viewer). 

107	 The Commission encourages third-party viewers also to include this legend, however, we 

note that the liability provisions we have adopted attach only to interactive data as viewed 

on the Commission’s viewer. See infra Section II.F. (discussing liability). 

108	 See letter of Hamscher. 

30
 
 

 

 

 

 

until embedding technology is sufficiently developed.109 We agree that it is necessary to 

monitor the usefulness of interactive data reporting to investors and the cost and ease of 

providing interactive data before attempting further integration of the interactive data 

format. However, the rules will treat interactive data as part of the official filing, instead 

of as only a supplement as is the case in the voluntary program.110 

C. Web Site Posting of Interactive Data 

In the Proposing Release, we proposed to require that each mutual fund provide 

the same interactive data that would be required to be provided to the Commission on its 

Web site, if it has one. Several commenters opposed this requirement,111 with some 

asserting that posting interactive data files on the Web without a tool to convert them to 

viewable format may confuse and frustrate investors.112 

We continue to believe that interactive data, consistent with our rules, should be 

easily accessible for all investors and other market participants. As such disclosure 

becomes more widely available, advances in interactive data software, online viewers, 

search engines, and other Web tools may in turn facilitate improved access to and 

usability of the data, promoting its awareness and use. Encouraging widespread 

accessibility to mutual funds’ risk/return summary information furthers our mission to 

promote fair, orderly, and efficient markets, and facilitates capital formation. Web site 

availability of the interactive data will encourage its widespread dissemination, 

contributing to lower access costs for users. We therefore are adopting the requirement 

109 See letters of Data Communiqué and Schnase. 

110 As further discussed below in Section II.F., however, for a specified period, interactive 

data generally will be deemed not filed for purposes of specified liability provisions. 

111 See letters of ABA, ICI, Schnase, Starkman, T. Rowe Price, and Vanguard. 

112 See letters of ICI and T. Rowe Price. 

31
 
 

 

 

 

 

 

that each mutual fund provide its interactive data files on the fund’s Web site, if it has 

one.113 The interactive data is required to be posted on a fund’s Web site no later than the 

end of the calendar day it is submitted to the Commission or is required to be submitted 

to the Commission, whichever is earlier.114 As proposed, funds would have been 

required to post the interactive data on their Web sites by the end of the business day on 

the earlier of the date the interactive data is submitted or is required to be submitted to the 

Commission. In order to make it easier for mutual funds to satisfy the posting 

requirement by providing several more hours in which to comply but still have the posted 

information available in a timely manner, the rule amendments, as adopted, will require 

posting by the end of the calendar rather than business day specified. 

We also are revising the proposed rule to require that the interactive data be 

posted on a fund’s Web site as long as the registration statement to which it relates 

remains current.115 We believe that such a period strikes an appropriate balance between 

the fund effort needed to post and the investor benefit from having access to the posted 

113	 See General Instruction C.3.(g).(i) and (ii) of Form N-1A. 

114	 See Interactive Data Adopting Release, supra note 6 (adopting rule 405(g)); rule 405(a). 

Rule 405(a) requires posting to a “corporate” Web site. For mutual funds, this would 

require posting to the fund’s Web site. 

The day the interactive data is submitted electronically to the Commission may not be the 

business day on which it was deemed officially filed. For example, a filing submitted 

after 5:30 p.m. generally is not deemed officially filed until the following business day. 

Under the rules, the Web posting would be required at any time on the same calendar day 

that the interactive data exhibit to a mutual fund filing is deemed officially filed or 

required to be filed, whichever is earlier. 

115	 See rule 405(a)(4) of Regulation S-T; see also General Instruction C.3.(g).(iii) of Form 

N-1A. Section 10(a)(3) of the Securities Act [15 U.S.C. 77j(a)(3)] generally requires that 

when a prospectus is used more than nine months after the effective date of the 

registration statement, the information in the prospectus must be as of a date not more 

than sixteen months prior to such use. The effect of this provision is to require mutual 

funds to update their prospectuses annually to reflect current cost, performance, and other 

financial information. A mutual fund updates its registration statement by filing a posteffective amendment to the registration statement. 

32
 
 

 

material through the additional source of the mutual fund’s Web site. In this regard, we 

note that the interactive data will be available on the Commission’s Web site. 

One commenter, who opposed the proposal to require Web site posting, 

recommended that funds instead be required to post a link to the Commission’s Web site 

to access the XBRL files.116 However, we believe that access to the interactive data on 

mutual fund Web sites will enable search engines and other data aggregators to more 

quickly and cheaply aggregate the data and make them available to investors because the 

data will be available directly from the filer, instead of through third-party sources that 

may charge a fee. It could also transfer reliability costs of data availability to the public 

sector by reducing the likelihood that investors cannot access the data through the 

Commission’s Web site due to down-time for maintenance or to increased network 

traffic. We also believe that the availability of interactive data on mutual fund Web sites 

will make it easier and faster for investors to collect information on a particular fund, 

rather than if investors were required to visit separately (for example, by hyperlink) and 

search the Commission’s Web site for information, particularly if the investor is already 

searching the mutual fund’s Web site. Therefore, to help further our goals of decreasing 

user cost and increasing information availability over the long term, our rules do not 

allow mutual funds to comply with the Web posting requirement by including a hyperlink 

to the Commission’s Web site. 

This requirement is consistent with the increasing role that mutual fund Web sites 

perform in supplementing the information filed electronically with the Commission by 

delivering risk/return summary information and other disclosure directly to investors. 

See letter of Data Communiqué. 

33
 

116 
 

 

 

We also believe that this requirement can provide an incentive for mutual funds to add 

content to or otherwise enhance their Web sites thereby improving investor experience. 

For example, we recently adopted amendments that would permit a person to satisfy the 

mutual fund prospectus delivery obligations under the Securities Act by sending or giving 

key information directly to investors in the form of a summary prospectus and providing 

the statutory prospectus on an Internet Web site.117 Mutual funds may also satisfy certain 

disclosure obligations by posting required disclosures on their Web sites.118 In addition, 

many mutual funds provide on their Web sites access to their prospectuses, statements of 

additional information, and other Commission filings.119 This rule will expand such Web 

site posting by requiring mutual funds with Web sites to post their interactive data as 

well. 

D. Consequences of Non-Compliance and Hardship 

Exemption 

We are adopting, as proposed, a rule amendment providing that, if a filer does not 

provide the required interactive data submission, or post the interactive data on its Web 

site, by the required due date, the filer’s ability to file post-effective amendments under 

117	 See Summary Prospectus Adopting Release, supra note 28. Upon an investor’s request, a 

mutual fund also would be required to send the statutory prospectus to the investor in 

paper or by e-mail. 

118	 See, e.g., Securities Act Release No. 8458 (Aug. 23, 2004) [69 FR 52788 (Aug. 27, 

2004)] (disclosure regarding portfolio managers); Securities Act Release No. 8408 (April 

19, 2004) [69 FR 22300 (April 23, 2004)] (disclosure regarding market timing and 

selective disclosure of portfolio holdings); Securities Act Release No. 8393 (Feb. 27, 

2004) [69 FR 11244 (Mar. 9, 2004)] (shareholder reports and quarterly portfolio 

disclosure); Securities Act Release No. 8188 (Jan. 31, 2003) [68 FR 6564 (Feb. 7, 2003)] 

(disclosure of proxy voting policies and records); Exchange Act Release No. 47262 (Jan. 

27, 2003) [68 FR 5348 (Feb. 3, 2003)] (disclosure of code of ethics). 

119	 Mutual funds filing registration statements are required to disclose whether or not they 

make available free of charge on or through their Web site, if they have one, their SAI 

and shareholder reports. Funds that do not make their reports available in that manner 

also must disclose the reasons that they do not. See Item 1(b)(1) of Form N-1A. 

34
 
 

 

 

 

rule 485(b), which provides for immediate effectiveness of amendments that make nonmaterial and other changes, will be automatically suspended.120 Any suspension becomes 

effective at the time that the filer fails to meet the requirement to submit or post 

interactive data and terminates as soon as the filer has submitted and posted that data. 

The suspension applies to a failure to submit and post interactive data as an exhibit to a 

registration statement or as an exhibit to a filing under rule 497 under the Securities Act. 

The suspension applies to post-effective amendments filed after the suspension 

becomes effective, but does not apply to post-effective amendments that were filed 

before the suspension became effective. The suspension does not apply to post-effective 

amendments filed solely for purposes of submitting interactive data, which will enable a 

filer to cure its failure to submit interactive data by filing an amendment under rule 

485(b) and posting the information on its Web site. Similarly, a filer may cure a failure 

to submit an interactive data file that is required to be submitted with a rule 497 filing by 

making a subsequent rule 497 filing with the interactive data exhibit and also posting the 

information on its Web site. 

Several commenters opposed this automatic suspension as unnecessary, 

particularly given Commission authority to punish those who violate its rules.121 Some 

commenters asserted that it could lead to potential penalties for minor violations of the 

interactive filing requirements.122 We continue to believe that precluding the use of 

immediate effectiveness of post-effective amendments during any period of failure to 

comply is an appropriate means to direct attention to the interactive data requirement 

120 See rule 485(c)(3) under the Securities Act. 

121 See letters of ABA, Federated, ICI, and Oppenheimer. 

122 See letters of Federated and ICI. 

35
 
 

 

 

 

 

without permanently suspending a mutual fund’s ability to file post-effective 

amendments under rule 485(b) once the fund has remedied the failure. The provision 

strikes an appropriate balance between limiting non-compliant mutual funds from using 

the immediate effectiveness provision, yet also providing an easy remedy to diminish any 

risk of any undue penalty to funds. 

We previously proposed conditioning a fund using rule 485(b) upon the fund 

having on file with the Commission a current report on Form N-SAR.123 We ultimately 

did not adopt that proposal in response to commenters’ criticisms that the proposal was 

unnecessary and potentially unfair to funds, and their recommendation that the 

Commission rely upon its enforcement remedies to punish late filers.124 One commenter 

urged us to take a similar approach related to our proposed suspension for failure to 

comply with the interactive data requirements.125 Unlike that prior proposal, which 

linked a fund’s ability to rely upon rule 485(b) to Form N-SAR, a form separate from the 

registration statement, the suspension that we are adopting today relates to a specific 

requirement in Form N-1A. We believe that it is appropriate to link a fund’s ability to 

receive immediate effectiveness with a requirement that the fund be current in its filing 

obligations with respect to that form. 

Several commenters also raised concerns over the language of the suspension in 

proposed rule 485(c), which would apply to any “registrant.”126 The commenters 

asserted that a fund that is part of a series fund may be prevented from filing a post123 17 CFR 274.101. See Securities Act Release No. 7015 (Sept. 21, 1993) [58 FR 50291 

(Sept. 27, 1993)]. 

124 See Securities Act Release No. 7083 (Aug. 17, 2004) [59 FR 43460 (August 24, 1994)]. 

125 See letter of Federated. 

126 See letters of ICI, Oppenheimer, and Schnase. 

36
 
 

 

 

effective amendment to its registration statement under rule 485(b) if another fund in that 

series had an issue with an interactive data file. 

One of those commenters recommended that, if the proposal is adopted, the 

Commission clarify that “registrant” means the specific series at issue.127 We do not 

believe that the commenter’s recommendation is workable. Specifically, multi-series 

funds are generally contained within the same prospectus in a registration statement, and 

post-effective amendments are typically filed concurrently for multiple series. In such a 

case, it is generally unworkable to permit automatic effectiveness for certain series while 

prohibiting reliance upon rule 485(b) for other series in the same filing. Further, the 

requirement that a fund’s registration statement is compliant with its interactive data 

obligations should apply to all of the risk/return summary information in that registration 

statement, and, thus, if a registrant is not current in its obligations, the ability to rely upon 

rule 485(b) should be suspended until remedied. 

As noted in the Proposing Release, the failure to provide the required interactive 

data submission will not affect a mutual fund’s ability to incorporate by reference the 

mutual fund’s prospectus or statement of additional information (“SAI”) into another 

document, such as the summary prospectus.128 We received no comments regarding this 

issue. 

Consistent with the treatment of other applicable reporting obligations, we are 

adopting, as proposed, a continuing hardship exemption for the inability timely to submit 

127 See letter of Schnase. 

128 Rule 303(a)(3) of Regulation S-T [17 CFR 232.303(a)(3)] restricts the ability of 

registered investment companies to incorporate by reference into an electronic filing 

documents that have not been filed in electronic format. We will not interpret rule 303 to 

apply to the failure to file interactive data files. 

37
 
 

 

 

 

 

 

electronically interactive data. Rule 202 of Regulation S-T provides for continuing 

hardship exemptions.129 

Rule 202 permits a filer to apply in writing for a continuing hardship exemption if 

information otherwise required to be submitted in electronic format cannot be so filed 

without undue burden or expense. If the Commission or the staff, through authority 

delegated from the Commission, grants the request, the filer must file the information in 

paper by the applicable due date and file a confirming electronic copy if and when 

specified in the grant of the request. 

As proposed, we are revising rule 202 to provide that a grant of a continuing 

hardship exemption for interactive data will not require a paper submission.130 If the filer 

did not electronically submit the interactive data by the end of the period for which the 

exemption was granted, the filer’s ability to file post-effective amendments under rule 

485(b) will be suspended until it does electronically submit the interactive data.131 

Similarly, we are revising rule 202 to provide an essentially mirror-image exemption 

from the requirement for a mutual fund that has a Web site to post the interactive data on 

its Web site.132 We did not receive any comments addressing this issue. 

129	 Rule 201 of Regulation S-T [17 CFR 232.201] provides for temporary hardship 

exemptions. We are not adopting a temporary hardship exemption because our rules 

provide a mutual fund with a 15-business day period for submitting the interactive data 

file for a related official filing. 

130	 See rule 202 as adopted in Interactive Data Adopting Release, supra note 6. 

131 Amendment to Note 4 to rule 202 as adopted in Interactive Data Adopting Release, supra 

note 6; rule 485(c)(3). 

132 Id. 

38
 
 

 

 

 

 

 

 

 

E. Interactive Data List of Tags and Commission Viewer 

1. Data Tags 

Under the rule, mutual funds are required to submit their risk/return summary 

information in an interactive data file using the most recent list of tags released by XBRL 

U.S. for risk/return summary information, as approved for use by the Commission.133 

Interactive data is required for the entirety of the risk/return summary information, 

including information for all series and all classes.134 

The submission also must include any supporting files as prescribed by the 

EDGAR Filer Manual.135 Mutual funds are required to tag a limited number of document 

and entity identifier elements, such as the form type and the fund’s name. As with 

interactive data for the risk/return summary, these document and identity identifiers are 

formatted using the appropriate list of tags as required by Regulation S-T and the 

EDGAR Filer Manual.136 

Several commenters asserted that the list of tags for risk/return summary 

information required additional development before the Commission mandates filing of 

risk/return summaries in interactive data format.137 Three commenters asserted that there 

are significant technical difficulties relating to the current list of tags,138 noting, for 

133	 See Interactive Data Adopting Release, supra note 6 (adopting amendments to rule 11 of 

Regulation S-T and adopting new rule 405(a)) and amendments to rule 405(a). 

134	 See General Instruction C.3.(g) of Form N-1A. 

135	 As discussed supra note 17, rule 405 of Regulation S-T directly sets forth the basic 

tagging requirements and indirectly sets forth the rest of the tagging requirements, which 

are contained in the EDGAR Filer Manual. See Interactive Data Adopting Release, supra 

note 6 (adopting rule 405 of Regulation S-T). 

136	 Id. 

137	 See letters of Federated, Gilmore, ICI, Oppenheimer, Schnase, and Vanguard. 

138	 See letters of Federated, ICI, and Vanguard. 

39
 
 

 

 

 

 

 

 

 

 

 

example, that the current tagging software did not provide a way to accurately replicate 

footnotes to the fee table, or special symbols such as registered marks.139 Commenters 

further asserted that mutual funds would not have sufficient time to resolve these 

technical issues,140 to test the final list of tags,141 or to review the various software 

options for compliance with the rules.142 Several commenters also asserted that 

currently-available tagging software has yet to be finalized for use in rendering 

interactive versions of risk/return summary information.143 These commenters urged that 

required use of the list of tags be delayed until these deficiencies have been remedied,144 

and the list has been acknowledged by XBRL International.145 One commenter 

expressed concern that the revisions to the list would not be finalized and acknowledged 

by XBRL International in a brief enough time period to allow thorough evaluation and 

implementation prior to the proposed compliance date.146 

Given the status of the list of tags for risk/return summary information, we do not 

believe the issues raised by commenters warrant delay of the initiative. As previously 

noted, XBRL U.S. has updated the architecture of the list of tags developed by the ICI 

and conformed the list to the changes in the risk/return summary that we adopted as part 

of our Summary Prospectus Initiative.147 Among other things, the updates are intended to 

139 See letters of Federated and Vanguard. 

140 See letter of Federated. 

141 See letter of ICI. 

142 See letters of ICI and Oppenheimer. 

143 See letters of Federated, Gilmore, ICI, and Oppenheimer. 

144 See letters of Federated and Vanguard. 

145 See letters of ICI and Schnase. 

146 See letter of Oppenheimer. 

147 See Summary Prospectus Adopting Release, supra note 28. 

40
 
 

 

address technical problems, such as the difficulty of tagging footnotes that were cited by 

commenters. It is anticipated that these changes related to the architecture and addition 

of new tags will be finalized by the end of January 2009,148 almost two years before the 

compliance date for submission of tagged risk/return summary information. Further, the 

contract with XBRL U.S. requires that the list of tags receive acknowledgement prior to 

finalization. 

Furthermore, there are a growing number of software applications available to 

preparers and consumers that are designed to help make interactive data increasingly 

useful to both retail and institutional investors, as well as to other participants in the U.S. 

and global capital markets. On this basis, we believe interactive data, and in particular 

the XBRL standard, are growing and that the list of tags for risk/return summary 

information is now sufficiently comprehensive to require that mutual funds provide their 

risk/return summary information in interactive data format. 

Updates to the list of tags for risk/return summary reporting may be posted and 

available for downloading from time to time to reflect changes in the risk/return summary 

requirements, refinements to the list of tags, or for other reasons. To provide mutual 

funds sufficient time to become familiar with any such updates, we anticipate giving 

advance notice before requiring use of an updated list of tags. Based on experience to 

date with the list of tags for risk/return summary information, we believe that, with the 

enhancements to the list of tags that XBRL U.S. is developing, the list of tags will be 

sufficiently developed to support the interactive data disclosure requirements in the rules. 

One of the useful aspects of interactive data is its extensibility – that is, the ability 

See supra note 51 and accompanying text. 

41
 

148 
 

 

 

 

 

to add to the standard list of tags in order to accommodate unique circumstances in a 

mutual fund’s particular disclosures. The use of customized tags, however, may also 

serve to reduce the ability of users to compare similar information across mutual funds. 

In order to promote comparability across funds, we are adopting, as proposed, the rule 

provision that limits the use of extensions to circumstances where the appropriate element 

does not exist in the standard list of tags.149 Wherever possible and when a standard 

element is appropriate, preparers are required to change the label for an element that 

exists in the standard list of tags, instead of creating a new customized tag.150 We 

received no comments concerning this issue. 

2. Regulation S-T and the EDGAR Filer Manual 

We are adopting, as proposed, the requirement that mutual funds provide 

interactive data in the form of exhibits to the related registration statement on Form 

N-1A, and we are also adopting a requirement that mutual funds provide interactive data 

in the form of exhibits to any related form of prospectus filed pursuant to rule 497(c) or 

(e) under the Securities Act that includes risk/return summary information that varies 

from the registration statement.151 Interactive data will be required to comply with our 

Regulation S-T152 and the EDGAR Filer Manual. The EDGAR Filer Manual is available 

149	 Rule 405(c)(1)(iii)(B) as adopted in Interactive Data Adopting Release, supra note 6. 

150	 Rule 405(c)(1)(iii)(A) as adopted in Interactive Data Adopting Release, supra note 6. 

151	 The requirement to submit interactive data as an exhibit appears in General Instruction 

C.3.(g).(iv) of Form N-1A. 

152	 Rule 405 of Regulation S-T directly sets forth the basic tagging and posting requirements 

for the XBRL data and requires compliance with the EDGAR Filer Manual. Consistent 

with rule 405, the EDGAR Filer Manual contains the detailed tagging requirements. 

42
 
 

 

 

 

 

 

 

 

on our Web site.153 It includes technical information for making electronic filings with 

the Commission. Volume II of this manual includes guidance on the preparation, 

submission, and validation of interactive data submitted under the voluntary program.154 

In addition to both Regulation S-T, which includes the rules we are adopting, and 

the instructions in our EDGAR Filer Manual, filers may access other sources for 

guidance in tagging their financial information. These include the XBRL U.S. Preparers 

Guide; user guidance accompanying tagging software; and financial printers and other 

service providers. New software and other forms of third-party support for tagging 

risk/return summary information using interactive data are also becoming available. 

3. Commission Viewer 

Some commenters asserted that the Commission’s mutual fund viewer required 

more development before the Commission requires filings in interactive data format.155 

Specifically, commenters expressed concern that the viewer was too narrow and 

uncomfortable to read,156 that filers in the voluntary program were unable to view an 

interactive data exhibit prior to submitting the exhibit,157 and that existing viewers, 

including the Commission’s, do not display the tagged files consistently.158 

While, as discussed above, the Commission’s current viewer permits the 

rendering of tagged risk/return summary information, we are in the process of 

153	 The EDGAR Filer Manual is available at: 

http://www.sec.gov/info/edgar/edmanuals.htm. 

154	 As previously noted, the EDGAR Filer Manual is currently being updated to incorporate 

changes to the tagging requirements applicable to financial data and to fund risk/return 

summary information. See supra note 17. 

155 See letters of ICI, Oppenheimer, Schnase, Starkman, and Vanguard. 

156 See letter of Starkman. 

157 See letter of Vanguard. 

158 See letter of ICI. 

43
 
 

 

 

 

implementing changes to develop a more advanced tool that should address many of 

these concerns. The upgraded viewer will permit filers to conduct test filings and view 

rendered documents prior to submitting their exhibits. We expect these upgrades to be 

completed during mid-2009. 

Further evaluation will be useful with respect to the availability of inexpensive 

and sophisticated interactive data viewers. Currently software providers are developing 

interactive data viewers, and we anticipate that these will become widely available and 

increasingly useful to investors. 

As noted previously, commenters also expressed concern about the potential risks 

to investors of providing them with only the risk/return summary without a reference to 

the additional information that is contained in the registration statement.159 In order to 

avoid confusion, three of these commenters suggested that the viewable interactive data 

be accompanied by a cautionary legend encouraging investors to read and consider the 

full prospectus or other filing from which the information is taken.160 Specifically, one 

commenter suggested that the viewable interactive data be accompanied by a cautionary 

legend similar to that required to be included in fund advertisements by rule 482 under 

the Securities Act.161 We agree that it is appropriate to place context on the information 

presented in the viewer, and to encourage investors to review a fund’s prospectus. 

159	 See letters of ABA, Federated, ICI, Oppenheimer, and Schnase. See also discussion at 

Section II.B. supra, note 104 and accompanying text. 

160	 See letters of ABA, ICI, and Schnase. 

161	 See letter of ICI. See also rule 482(b)(1) under the Securities Act [17 CFR 230.482]. 

Rule 482(b)(1) requires a mutual fund advertisement to include a statement that 

“[a]dvises an investor to consider the investment objectives, risks, and charges and 

expenses of the investment company carefully before investing; explains that the 

prospectus contains this and other information about the investment company; identifies a 

source from which an investor may obtain a prospectus; and states that the prospectus 

should be read carefully before investing.” 

44
 
 

 

 

Accordingly, we will include language within any rendered risk/return summary 

information on the Commission’s upgraded mutual fund viewer to: (1) inform users that 

the information is derived from a portion of the fund’s prospectus; (2) explain that the 

prospectus contains additional information about the mutual fund; and (3) state that a 

fund’s prospectus should be read carefully before investing. 

Commenters also raised concerns about potential liability under the federal 

securities laws relating to rendered interactive data filings.162 These concerns are 

addressed in Section II.F., below. 

F. Application of Federal Securities Laws 

Complete, accurate, and reliable disclosures are essential to investors and the 

proper functioning of the securities markets. Our requirement to submit interactive data 

with mutual fund registration statements is designed to provide investors with new tools 

to obtain, review, and analyze information from mutual funds more efficiently and 

effectively. To satisfy these goals, interactive data must meet investor expectations of 

reliability and accuracy. Many factors, including mutual fund policies and procedures 

buttressed by incentives provided by the Commission’s application of technology, market 

forces, and the liability provisions of the federal securities laws, help further those goals. 

New rule 406T of Regulation S-T163 addresses the liability for an interactive data 

file and provides that an interactive data file is: 

162	 See letters of ABA, ICI, Oppenheimer, and Schnase. 

163	 See Interactive Data Adopting Release, supra note 6 (adopting rule 406T of Regulation 

S-T). 

45
 
 

 

•	 Subject to the anti-fraud provisions of Section 17(a)(1) of the Securities Act, 

Section 10(b) of and rule 10b-5 under the Exchange Act, and Section 206(1) of 

the Investment Advisers Act except as provided below; 

•	 Deemed not filed or part of a registration statement or prospectus for purposes of 

Sections 11 or 12 of the Securities Act, is deemed not filed for purposes of 

Section 18 of the Exchange Act or Section 34(b) of the Investment Company Act, 

and otherwise is not subject to liability under these sections; 

•	 Deemed filed for purposes of rule 103 of Regulation S-T; and 

•	 Subject to liability for a failure to comply with rule 405 of Regulation S-T, but 

shall be deemed to have complied with rule 405 and would not be subject to 

liability under the anti-fraud provisions set forth above or under any other liability 

provision if the electronic filer: 

o	 makes a good faith attempt to comply with rule 405; and 

o	 after the electronic filer becomes aware that the interactive data file fails to 

comply with rule 405, promptly amends the interactive data file to comply 

with rule 405. 

In regard to correcting an interactive data file, the Commission added the term 

“promptly” to the list of defined terms in Rule 11 under Regulation S-T.164 Rule 11 

defines “promptly” as “as soon as reasonably practicable under the facts and 

circumstances at the time.” The definition is followed by a non-exclusive safe harbor. 

The safe harbor generally provides that a correction made by the later of 24 hours or 9:30 

a.m. on the next business day after the filer becomes aware of the need for the correction 

See Interactive Data Adopting Release, supra note 6 (amending Rule 11). 

46
 

164 
 

 

 

 

is deemed promptly made. If a fund fails to comply with the safe harbor, the fund still 

may have corrected promptly depending on the applicable facts and circumstances. 

As adopted, the liability provisions of new Rule 406T will apply only until 

October 31, 2014. We believe that limiting the modified application of the federal 

securities laws to a specified period improves the balance between avoiding unnecessary 

cost and expense and encouraging accuracy in regard to interactive data because it 

recognizes that issuers and service providers likely will grow increasingly skilled at and 

comfortable with the tagging requirements. 

Except for the period limitation, this provision is substantially the same as the 

proposed treatment of interactive data files under the proposed rules.165 In the Proposing 

Release, the Commission sought comment on this topic, and commenters generally 

supported limiting the liability of mutual funds for good faith errors in tagging or 

formatting interactive data submissions.166 As adopted, however, we include a provision 

that, after October 31, 2014, these liability provisions will no longer apply and an 

interactive data file will be subject to the same liability provisions as the related official 

filing.167 We adopt this provision because we believe, over time, information in 

interactive data should be subject to the same liability as all other information in a fund’s 

filing. The provision, however, provides funds with protections over a substantial period 

to become comfortable with ensuring the accuracy of their interactive data files. 

As proposed, rule 406 of Regulation S-T also provided that the usual liability 

provisions of the federal securities laws would apply to human-readable interactive data 

165 See Proposing Release, supra note 9 (proposing rule 406). 

166 See letters of ABA, Angel, ICI, and Schnase. 

167 See rule 406T(d) of Regulation S-T. 

47
 
 

 

 

 

 

 

 

 

that is identical in all material respects to the corresponding data in the traditional format 

filing168 as displayed by a viewer that the Commission provides. Commenters raised 

substantial concerns over this proposal, including: (1) seeking clarification of the liability 

applicable to situations not intended to be addressed explicitly by the proposed rules, 

such as for errors arising as a result of the Commission’s interactive data rendering 

software,169 or as a result of comparative applications provided by either the Commission 

or a third party;170 (2) requesting clarifications that funds should not be held responsible 

for information converted into viewable form by non-Commission viewers,171 or for 

interactive data posted on fund Web sites;172 and (3) requesting that a mutual fund be able 

to incorporate by reference the fund’s full prospectus and SAI into the viewable 

interactive data exhibit.173 

In response to commenters’ concerns we believe that interactive data in viewable 

form are best addressed in relation to interactive data files and traditional concepts of 

liability. Interactive data in viewable form that are displayed on the Commission’s Web 

site will reflect the related interactive data file and, as a result, such interactive data in 

viewable form should be treated in the same manner as the related interactive data file in 

168	 As proposed, the human-readable interactive data would have been identical to the 

corresponding data in the traditional format filing if the mutual fund complied with the 

interactive data tagging requirements of proposed rule 405. 

169	 See letter of ABA. 

170	 See letter of Oppenheimer. 

171	 See letters of ABA, ICI, and Oppenheimer. 

172	 See letters of ABA and ICI. 

173	 See letters of Federated, ICI, and Schnase. One commenter noted that the risk/return 

summary information in a prospectus is subject to liability under Sections 11 or 12 of the 

Securities Act, but only in connection with the full prospectus in which it is contained, 

and the SAI that is typically incorporated therein. See letter of ICI. The commenter 

asserted that it would not be appropriate to isolate the risk/return summary information 

from the context of the entire registration statement and impose liability. 

48
 
 

 

 

regard to a fund’s failure to correctly tag an interactive data file that results in a failure of 

the interactive data in viewable form to reflect the related official filing. Interactive data 

in viewable form that are displayed on other Web sites would be subject to general antifraud principles applicable to republication of another person’s statements.174 Consistent 

with traditional concepts of liability, a fund could not be liable twice for a failure that 

occurs in both an interactive data file and the related interactive data in viewable form. 

We believe that this change is appropriate to address commenters’ concerns and 

provide certainty as to the parameters of their liability related to interactive data. We also 

believe that it is appropriate given other protections that investors will receive related to 

the interactive data, including that the risk/return summary information and other 

disclosures in the traditional format related official filing to which the interactive data 

relate would continue to be subject to the usual liability provisions of the federal 

securities laws. For example, the traditional format related official filing would continue 

to be subject to Section 10(b) and rule 10b-5 of the Exchange Act and, in the appropriate 

circumstance, to Section 11 of the Securities Act. 

In the Interactive Data Adopting Release, we elaborate further upon interactive 

data in viewable form and our decision not to impose any separate liability for such 

data.175 Given that the rules do not include such provisions, we do not address further 

commenters’ requests for clarification related to liability for rendered documents. 

Further, we do not believe it is needed to provide funds with the ability to incorporate by 

174	 These general anti-fraud principles relate to, among other areas, aiding and abetting, 

control persons, entanglement, and adoption. 

175	 See Interactive Data Adopting Release, supra note 6. 

49
 
 

 

 

reference into rendered documents, given that liability is not imposed separately upon 

interactive data in viewable form. 

In the Proposing Release, we did not propose to permit or require cautionary 

legends for interactive risk/return summary information. Several commenters expressed 

concern about the potential consequences of investor reliance on incomplete 

information.176 Two commenters suggested that the Commission require viewable 

interactive risk/return disclosures to include a cautionary disclosure similar to the legend 

we recently required for the new mutual fund summary prospectus, which advises 

investors where to locate additional information about the fund in the fund’s prospectus 

and SAI, and permits a fund to incorporate certain information by reference into the 

summary prospectus.177 As noted in Section II.E. above, we agree with commenters that 

it is appropriate to alert investors about the availability of additional information in a 

fund’s prospectus. Therefore, we will include cautionary language on the Commission’s 

mutual fund viewer encouraging investors to review a fund’s full prospectus. 

We believe, however, that attempting to place in interactive data legends of the 

type suggested would be impracticable because interactive data will often be accessed in 

its machine-readable form and, even if it were accessed in viewable form, might not be 

accessed in a place where the legend would appear. As to a legend that states people 

should not rely on the interactive data in particular, such a legend would be inappropriate 

176	 See letters of ABA, Federated, ICI, Oppenheimer, and Schnase. 

177	 See letters of ICI and Schnase; see also Summary Prospectus Adopting Release, supra 

note 28. 

50
 
 

 

 

 

 

 

because there is no reason the data should not be reliable and, were it not reliable, it 

would have little value.178 

We are adopting, as proposed, the requirement that an interactive data file consist 

of “no more and no less” than the corresponding risk/return summary information in the 

related official filing.179 One commenter expressed concern that submitting interactive 

risk/return summary information for multiple funds may confuse some investors who 

seek data about only a single fund.180 However, as a result of our Summary Prospectus 

Initiative, multiple fund prospectuses must present the summary information for each 

fund sequentially and not integrate the information for more than one fund.181 Since 

risk/return summary information for multiple funds will no longer be permitted to be 

combined in the prospectus, this information will also, in accordance with rule 405, be 

presented separately in interactive format. In view of this requirement, interactive 

risk/return summary information for multiple funds should be as easy for investors to 

locate and understand as similar information for a single-fund prospectus. 

To assist mutual funds in ensuring the accuracy of their XBRL filings, we plan, in 

the future, to make available to mutual funds the opportunity to make a test submission 

with the Commission to create viewable interactive data.182 If the validation system finds 

an error, it will advise the filer of the nature of the error and whether the error was major 

178	 We reach a different conclusion regarding a tagged legend in the voluntary program and 

continue to require such legends to provide investors with limited additional notice 

because that information is not part of the official filing and was intended for 

experimental submissions. 

179	 Rule 405(b)(2) of Regulation S-T. 

180	 See letter of ICI. 

181	 See Summary Prospectus Adopting Release, supra note 28. 

182	 The EDGAR Filer Manual addresses test submissions primarily at Section 6.6.5 of 

Volume II. 

51
 
 

 

or minor. As occurs in the voluntary program, a major error in an interactive data exhibit 

that is part of a live filing will cause the exhibit to be held in suspense in the electronic 

filing system. The rest of the filing will be accepted and disseminated if there are no 

major errors outside of the interactive data exhibit. If that happens, the filer will need to 

revise the interactive data exhibit to eliminate the major error and submit the exhibit as an 

amendment to the filing to which it is intended to appear as an exhibit. A minor error in 

an interactive data exhibit that is part of a live filing will not prevent the interactive data 

exhibit from being accepted and disseminated together with the rest of the filing if there 

are no major errors in the rest of the filing. We believe it is appropriate to accept and 

disseminate a filing without the interactive data exhibit submitted with it if only the 

exhibit has a major error, in order to disseminate at least as much information at least as 

timely as would have been disseminated were there no interactive data requirement. 

The rule does not require mutual funds to involve third parties, such as auditors or 

consultants, in the creation of the interactive data provided as an exhibit to a mutual 

fund’s Form N-1A filing, including assurance.183 We are taking this approach after 

considering various factors, including: 

•	 commenters’ views; 

•	 the availability of a comprehensive list of tags for risk/return summary 

information from which appropriate tags can be selected, thus reducing a 

mutual fund’s need to develop new elements; 

With respect to registration statements, SAS 37 (AU Section 711) was issued in April 

1981 to address the auditor’s responsibilities in connection with filings under the federal 

securities statutes. With respect to our rule, an auditor will not be required to apply AU 

Section 711 to the interactive data provided as an exhibit in a fund’s registration 

statement, or to the viewable interactive data. 

52
 

183 
 

 

 

•	 the availability of user-friendly software with which to create the interactive 

data file; 

•	 the delayed compliance date, prior to which mutual funds may become 

familiar with the tagging of risk/return summary information; 

•	 the availability of interactive data technology specifications, and of other 

XBRL U.S., XBRL International, and Commission resources for preparers of 

tagged data;184 

•	 the advances in rendering/presentation software and validation tools for use by 

preparers of tagged data that can identify the existence of certain tagging 

errors; 

•	 the expectation that preparers of tagged data will take the initiative to develop 

practices to promote accurate and consistent tagging; and 

•	 the mutual fund’s and preparer’s liability for the accuracy of the traditional 

format version of the risk/return summary information. 

G. Changes to the Voluntary Program 

Mutual funds will no longer be able to submit risk/return summary information in 

interactive data format through the voluntary program after the compliance date for the 

mandatory rules. We are amending rule 401 of Regulation S-T to remove risk/return 

summary information as a category of information permitted to be submitted under the 

voluntary program effective after the compliance date for the mandatory rules.185 This 

amendment differs from our proposal which would have removed the option to file 

184 An example of Commission resources includes the EDGAR Filer Manual. 

185 See rule 401(b)(iv). 

53
 
 

 

 

risk/return summary information under the voluntary program altogether. This change 

makes explicitly clear that mutual funds may continue to experiment with the submission 

of risk/return summary information in interactive data format up until the compliance 

date for these rule amendments. For this same reason, we are not adopting proposed 

changes to rule 8b-33 under the Investment Company Act and certain technical 

amendments to rule 401 of Regulation S-T.186 

Further, in order to encourage participation in the voluntary program for tagging 

investment company financial information, we are adopting, substantially as proposed, 

amendments to enable investment companies that are registered under the Investment 

Company Act, business development companies, and other entities that report under the 

Exchange Act and prepare their financial statements in accordance with Article 6 of 

Regulation S-X to submit exhibits containing a tagged schedule of portfolio holdings 

without having to submit other financial information in interactive data format.187 As 

with the current voluntary program, volunteers will be able to participate merely by 

submitting a tagged Schedule I - Investments in Securities of Unaffiliated Issuers 

(“Schedule I”).188 To facilitate this, XBRL U.S. developed a list of tags that could be 

used to tag portfolio holdings. On October 21, 2008, XBRL U.S. issued its Schedule of 

186	 See proposed rule 8b-33; proposed rule 401(b)(1)(iv); proposed rule 401(d)(1)(i); and 

proposed rule 401(d)(2)(i) in the Proposing Release, supra note 9. 

187	 Rule 401(b)(1)(v) (designating Schedule I - Investments in securities of unaffiliated 

issuers as mandatory content under the voluntary program). The voluntary program will 

be modified to permit participation only by registered investment companies, business 

development companies, and other entities that report under the Exchange Act and 

prepare their financial statements in accordance with Article 6 of Regulation S-X. See 

Interactive Data Adopting Release, supra note 6 (rule 401(a)). 

188	 Rule 12-12 of Regulation S-X [17 CFR 210.12-12]. 

54
 
 

 

 

 

 

 

 

Investments Taxonomy for public comment.189 The taxonomy is expected to be finalized 

by XBRL U.S. by the end of January 2009. 

Currently, the interactive data furnished under the voluntary program must consist 

of at least one item from a list of enumerated mandatory content (“Mandatory Content”), 

including financial statements, earnings information, and, for registered management 

investment companies, financial highlights or condensed financial information and 

risk/return summary information set forth in Form N-1A. 190 We are adding Schedule I 

information as a separate item of Mandatory Content that participants can submit in order 

to give volunteers greater flexibility in tagging fund data. 

Several commenters asserted that expanding the voluntary program to include 

fund portfolio holdings information was premature.191 These commenters stated that 

(1) the information would not be meaningful to individual investors;192 (2) the taxonomy 

does not yet exist;193 and (3) more experience with the technology is necessary before 

expansion of the program.194 Given that participants may already provide portfolio 

holdings information as part of their financial statements under the voluntary program, 

we disagree with these comments. The expansion of the voluntary program to permit the 

submission of portfolio holdings information simply provides volunteers with an 

alternative to submitting complete financial statement information and increases the 

options for participation in the program. Investors, financial intermediaries, and third189 See supra note 51. 

190 Rule 401(b)(1) of Regulation S-T [17 CFR 232.401(b)(1)]. 

191 See letters of Data Communiqué, ICI, and Vanguard. 

192 See letter of Data Communiqué. 

193 See letter of ICI. 

194 See letter of Vanguard. 

55
 
 

 

 

party information providers, among others, use the portfolio holdings data contained in 

Schedule I to make decisions concerning the purchase and continued holding of funds 

and for other purposes. Portfolio holdings data may be even more useful to these various 

stakeholders if such data is interactive. 

Under the current voluntary program, any official filing with which tagged 

exhibits are submitted must disclose that the financial information is “unaudited” or 

“unreviewed,” as applicable and that the purpose of submitting the tagged exhibits is to 

test the related format and technology and, as a result, investors should not rely on the 

exhibits in making investment decisions.195 We believe that this cautionary disclosure 

should also be tagged and included within each interactive data exhibit, in order to help 

alert investors and other users that the exhibits should not be relied on in making 

investment decisions. Accordingly, we are requiring, as proposed, that this disclosure be 

included in the exhibits submitted pursuant to the voluntary program as a tagged data 

element,196 consistent with how the cautionary disclosure is presented in risk/return 

summary exhibits under the current voluntary program. 

H. Compliance Date 

The rules require all mutual funds to submit interactive data with any registration 

statement or post-effective amendment on Form N-1A that includes or amends risk/return 

summary information and with any form of prospectus filed pursuant to rule 497(c) or (e) 

under the Securities Act that contains risk/return summary information that varies from 

the registration statement.197 The first required submissions will be for initial registration 

195 Rule 401(d)(1)(ii) of Regulation S-T [17 CFR 232.401(d)(1)(ii)].
 

196 See rule 401(d)(2). 

197 See General Instruction C.3.(g) to Form N-1A. 

56
 
 

 

 

 

 

 

 

statements and post-effective amendments that are annual updates to effective registration 

statements198 and that become effective after January 1, 2011. Further, no mutual fund is 

required to comply with the provision to submit a tagged risk/return summary exhibit 

with any form of prospectus filed pursuant to rule 497(c) or (e) under the Securities Act 

until that fund has first submitted an exhibit with its registration statement. 

In the Proposing Release, we asked for comment on an anticipated compliance 

date that would require submissions for initial registration statements and post-effective 

amendments that are annual updates to effective registration statements and that become 

effective after December 31, 2009. Commenters generally objected to this compliance 

date, asserting that adoption of the requirement to tag risk/return summary information is 

premature, given that the Commission’s pending Summary Prospectus Initiative and ETF 

Initiative would change the required information in the risk/return summary.199 

Commenters also asserted that the proposed schedule for implementation of 

interactive data tagging should be delayed because it did not allow mutual funds 

sufficient time to resolve outstanding technical issues or to review the various options for 

compliance with the rule.200 Others asserted that more information is needed to be 

collected from the current voluntary program, including costs and benefits.201 Two 

commenters supported phasing in the interactive data requirements based on the size of a 

mutual fund’s total net assets, with larger funds becoming subject to the rules first.202 

Finally, commenters also noted that implementing tagging of the current risk/return 

198 See supra note 11 and accompanying text. 

199 See supra note 69 and accompanying text. 

200 See letters of Federated, ICI, and Oppenheimer. 

201 See letters of Federated, ICI, and Schnase. 

202 See letters of Data Communiqué and Schnase. 

57
 
 

 

 

 

summary is premature given that the risk/return summary and the taxonomy could 

potentially change as a result of the Summary Prospectus Initiative and the ETF 

Initiative.203 

While we believe that these comments warrant a change in the compliance date to 

ensure funds have sufficient time to prepare their first risk/return summary submissions 

in interactive data format, they do not justify a substantial delay in implementation of this 

initiative. First, as we discussed above, we recently adopted final amendments to Form 

N-1A in the Summary Prospectus Adopting Release,204 and, therefore, do not believe 

those commenter concerns warrant delaying implementation of this tagged risk/return 

summary information.205 

Second, for the reasons we discussed in Section II.A., we believe that the 

compliance date we are adopting will allow mutual funds sufficient time to prepare 

risk/return summary information in interactive data format. As we noted previously, 

XBRL U.S. has updated the list of tags to reflect our most recent revisions to mutual fund 

risk/return disclosure requirements, and has submitted this list for public comment, after 

which it will be submitted for acknowledgment to XBRL International. This process 

should be completed by the end of January 2009. Therefore, we believe that the list of 

tags for risk/return summary information is now sufficiently advanced, to require that 

mutual funds provide their risk/return summary information in interactive data format. 

Further, as discussed above, over the last three years the Commission has gained 

203 See letter of ICI, Oppenheimer, T. Rowe Price, and Vanguard. 

204 See supra notes 69 and 70 and accompanying text. 

205 These amendments were adopted on November 19, 2008. See supra note 69, and 

Summary Prospectus Adopting Release, supra note 28. 

58
 
experience with interactive data in the voluntary program covering both mutual fund 

risk/return and financial statement information. 

We do, however, recognize that requiring mutual funds to tag their risk/return 

summary information at the same time that they are revising their prospectuses for the 

recent amendments to Form N-1A in the Summary Prospectus Adopting Release could 

result in an unnecessary burden. For that reason, we are making a modification to the 

compliance date so that mutual funds have an additional year before they are required to 

submit tagged risk/return summary information. This period of almost two years should 

provide funds with sufficient time to prepare the amended disclosures and interactive data 

submissions based on those disclosures. 

While the requirements we recently adopted for interactive submission of 

financial data include a schedule of tiered implementation, we believe that mutual fund 

investors have an important interest in having access to interactive risk/return data from 

all funds concurrently. Therefore, we are adopting, as proposed, a single compliance date 

for all mutual funds. We expect that most mutual funds that are part of smaller fund 

families, which generally are disproportionately affected by regulatory costs, will be able 

to provide their risk/return summary information in interactive data format without undue 

effort or expense. While interactive data reporting involves changes in reporting 

procedures mostly in the initial reporting periods, we expect that these changes will 

provide efficiencies in future periods. As a result, there may be potential future net 

savings to the mutual fund, particularly if interactive data become integrated into the 

mutual fund’s disclosure process. While we recognize that requiring interactive data 

risk/return summary information will likely result in start-up expenses for all mutual fund 

59
 
 

 

families, we expect that both software and third-party services will be available to help 

meet the needs of mutual fund families, including meeting the unique needs of smaller 

mutual fund families. 

We are sensitive to concerns expressed by some commenters that undue expense 

and burden may accompany the adoption of required interactive data reporting.206 We 

believe that the extended compliance date and the proposed 15-business day period for 

making interactive data submissions seem to alleviate these concerns.207 

Under the rules we are adopting, the voluntary program is being modified to allow 

for participation by mutual funds with respect to risk/return summary information up 

until January 1, 2011, but continue to permit investment companies to participate with 

respect to financial statement information thereafter. Investment companies may submit 

their tagged portfolio holdings information, pursuant to the rules we are adopting, at any 

time after the effective date of these rules, July 15, 2009. This effective date was chosen 

to coincide with the release of an updated EDGAR Filer Manual which will incorporate 

the new list of tags for portfolio holdings information. 

We intend to monitor implementation and, if necessary, make appropriate 

adjustments to the adopted amendments. 

III.	 PAPERWORK REDUCTION ACT 

A. Reporting and Burden Estimate 

Certain provisions of the rule and form amendments contain “collection of 

information” requirements within the meaning of the Paperwork Reduction Act of 1995 

206	 See letters of ICI, Schnase, and Starkman. 

207	 We discuss more fully supra at Section II.F liability related to required submissions of 

interactive data. 

60
 
 

 

 

(“PRA”).208 The titles for the collections of information are: (1) “Mutual Fund 

Interactive Data” (OMB Control No. 3235-0642) and (2) “Voluntary XBRL-Related 

Documents” (OMB Control No. 3235-0611). We published notice soliciting comments 

on the collection of information requirements in the release proposing the amendments209 

and submitted the proposed collections of information to the Office of Management and 

Budget (“OMB”) for review and approval in accordance with 44 U.S.C. 3507(d) and 

5 CFR 1320.11.210 OMB has assigned a control number to the collection of information 

for mutual fund interactive data. We received four comments on the collection of 

information requirements211 and have revised the estimated reporting and cost burdens of 

the rule and form amendments, as discussed below. An agency may not conduct or 

sponsor, and a person is not required to respond to, an information collection unless it 

displays a currently valid OMB control number. Because we have modified our 

proposals as described above, we are revising the burden estimate for the Mutual Fund 

Interactive Data collection of information. We have submitted a revised request to OMB. 

The title for the new collection of information for submitting risk/return summary 

information in interactive data format that the amendments establish is “Mutual Fund 

Interactive Data”. This collection of information relates to already existing regulations 

and forms adopted under the Securities Act, the Exchange Act, and the Investment 

Company Act that set forth disclosure requirements for mutual funds and other issuers. 

The amendments require mutual funds to submit their risk/return summary information in 

208 44 U.S.C. 3501 et seq. 

209 See Proposing Release, supra note 9, 73 FR at 35459. 

210 See Proposing Release, supra note 9, 73 FR at 35457-59. 

211 See letters of Confluence, ICI, Schnase, and Starkman. 

61
 
 

 

 

interactive data format and post it on their Web sites, if any, in interactive data form. The 

specified risk/return summary information already is and will continue to be required to 

be submitted to the Commission in traditional format under existing disclosure 

requirements. Compliance with the amendments is mandatory beginning with initial 

registration statements and post-effective amendments that are annual updates to effective 

registration statements that become effective after January 1, 2011.212 

The title for the collection of information for submitting portfolio holdings in 

interactive data format is “Voluntary XBRL-Related Documents”. The amendments will 

permit investment companies that are registered under the Investment Company Act, 

business development companies, and other entities that report under the Exchange Act 

and prepare their financial statements in accordance with Article 6 of Regulation S-X to 

submit exhibits containing a tagged schedule of portfolio holdings without having to 

submit other financial information in interactive data format. Compliance with these 

amendments is voluntary. 

B.	 Submission of Risk/Return Summary Information Using Interactive 

Data 

Form N-1A (OMB Control No. 3235-0307) under the Securities Act and the 

Investment Company Act213 is used by mutual funds to register under the Investment 

Company Act and to offer their securities under the Securities Act. The information 

required by the new collection of information, corresponds to the risk/return summary 

information now required by Form N-1A and is required to appear in exhibits to Form 

N-1A, exhibits to prospectuses with risk/return summary information that varies from the 

212 See supra Section II.H. 

213 17 CFR 239.15A; 17 CFR 274.11A. 

62
 
 

 

 

 

 

 

 

 

 

registration statement, and on mutual funds’ Web sites. 

In the Proposing Release, we estimated that each mutual fund would submit one 

interactive data document as an exhibit to a registration statement or a post-effective 

amendment thereto on Form N-1A that includes or amends information provided in 

response to Items 2 or 3.214 We estimated in the Proposing Release that interactive data 

filers would require an average of approximately 13 burden hours to tag risk/return 

summary information in the first year, and the same task in subsequent years would 

require an average of approximately 11 hours.215 Therefore, we estimated the average 

annual burden over a three-year period to be approximately 12 hours.216 

In response to commenters’ concerns, however, we are modifying our rules to 

include changes to risk/return summary information that mutual funds are permitted to 

make pursuant to rule 497 under the Securities Act.217 Based on a limited, random, nonstatistical survey by Commission staff of filings made pursuant to rule 497, we estimate 

that 5% of mutual funds, or approximately 443 funds,218 will make changes to risk/return 

summary information in filings submitted pursuant to rule 497. Based on estimates of 

8,856 mutual funds each submitting one interactive data document as an exhibit to a 

registration statement or post-effective amendment thereto219 and 443 mutual funds 

submitting an additional interactive data document as an exhibit to a filing pursuant to 

214 This information is now contained in Items 2, 3, and 4. See supra note 61. 

215 The average burden hours for the first and subsequent submissions were calculated using 

data collected from a voluntary program participant questionnaire. See infra Section IV. 

216 (13.33 hours for the first submission + 11.275 hours for the second submission + 11.275 

hours for the third submission) ÷ 3 years = approximately 12 hours. 

217 See supra notes 90 through 95 and accompanying text. 

218 5% x 8,856 mutual funds = approximately 443 mutual funds. 

219 This estimate is based on an analysis by the Division of Investment Management staff of 

publicly available data. 

63
 
 

 

 

 

 

 

rule 497, each incurring 12 hours per year on average, we estimate that, in the aggregate, 

interactive data adoption will result in an additional 111,588 burden hours for all mutual 

funds for each of the first three years.220 Converted into dollars, this amounts to 

approximately $23,768,244.221 

One commenter challenged the estimates provided in the Proposing Release, 

asserting that the sample of voluntary program participants is too small and consists 

mostly of large fund complexes.222 We note that the 22 participants in the voluntary 

program at that time included both larger and smaller funds, and, therefore, the estimates 

derived from our experiences with this program reflect burdens incurred by funds of 

varying sizes.223 Of these 22 funds, six funds, representing a range of fund complex 

sizes, provided data in response to the voluntary program questionnaire concerning 

internal and external costs of preparing and submitting interactive risk/return summary 

220	 (8,856 mutual funds + 443 mutual funds) x 12 incremental burden hours per mutual fund 

= 111,588 burden hours. 

221	 This cost increase is estimated using an estimated hourly wage rate of $213.00 ((111,588 

burden hours) x ($213.00 hourly wage rate) = $23,768,244 total incremental internal 

cost). The estimated wage figure is based on published rates for compliance attorneys 

and programmer analysts, modified to account for an 1800-hour work-year and 

multiplied by 5.35 to account for bonuses, firm size, employee benefits, and overhead, 

yielding effective hourly rates of $270 and $194, respectively. See Securities Industry 

and Financial Markets Association, Report on Management & Professional Earnings in 

the Securities Industry 2007 (Sept. 2007) (“SIFMA Report”). The estimated wage rate 

was further based on the estimate that compliance attorneys would account for one 

quarter of the hours worked and senior system analysts would account for the remaining 

three quarters, resulting in a weighted wage rate of $213.00 per hour (($270 x .25) + 

($194 x .75)). 

222	 See letter of Schnase. 

223	 As we noted above in Section I.A., to date 25 funds have participated in the voluntary 

program. However, at the time of our Proposing Release, only 22 funds had submitted 

interactive data risk/return summary information. 

64
 
 

 

 

 

 

 

 

information.224 

We further estimate, as we did in the Proposing Release, that mutual funds will 

require an average of approximately 1 burden hour to post interactive data to their Web 

sites. Based on estimates of 8,856 mutual funds posting interactive data, each incurring 1 

burden hour per year on average, we estimate that, in the aggregate, adoption of Web site 

posting requirements will result in an additional 8,856 burden hours for all mutual 

funds.225 Converted into dollars, this amounts to approximately $2,214,000.226 

One commenter asserted that the Commission’s cost estimates may be vastly 

understated because they omit the much larger cost of converting fund Web sites to 

XBRL compatibility.227 This commenter did not provide any specific cost estimates to 

support this assertion. Complying with the Web site posting requirement, however, does 

not require conversion of the fund’s Web site infrastructure. 

We also estimate, as we did in the Proposing Release, that software and 

consulting services will be used by mutual funds for an increase of approximately $802 

per mutual fund.228 Based on the estimate of 8,856 mutual funds using software and 

224	 The average burden hours for the first and subsequent submissions were calculated using 

data collected from six responses to a voluntary program participant questionnaire from 

mutual funds that participated in the voluntary program. See infra Section IV.A. 

225	 8,856 mutual funds x 1 burden hour per mutual fund = 8,856 burden hours. 

226	 ($250 x 1 hour x 8,856 mutual funds). This cost estimate is based on informal 

discussions with a limited number of persons believed to be generally knowledgeable 

about preparing, submitting, and posting interactive data. See infra Section IV.A. 

227	 See letter of Starkman. 

228	 For purposes of this estimate, we assumed that the largest 50 fund complexes will 

develop software in-house incurring costs of $125,000 in the first year. Assuming that 

the largest 50 fund complexes will develop software for use in all of their funds, and that 

their funds encompass 80% of the number of funds (7,085), then the average first year 

cost for those funds will be ($125,000 x 50)/7,085 = $882. Therefore, for those funds 

using software developed internally, the average 3 year cost will be approximately $827 

($882 in the first year + $800 in the second year + $800 in the third year) ÷ 3 years = 

65
 
 

 

 

 

consulting services at an annual cost of $802 we estimate that, in the aggregate, the total 

external costs to the industry will be approximately $7,098,970.229 While one commenter 

asserted that these estimates do not include professional costs from outside accountants 

and lawyers,230 we note that this estimate does reflect the external cost data provided in 

response to the voluntary program questionnaire. Respondents to the questionnaire 

universally indicated that they did not use the services of outside accountants in preparing 

their interactive data submissions. A few of the respondents indicated that they used the 

services of an outside attorney in preparing their interactive data submissions, however, 

only one respondent indicated a de minimis expense for such services. A few 

respondents who did not use the services of an outside attorney for their voluntary filing 

did indicate they would work with an outside attorney to prepare their interactive data 

submission upon adoption of our rule amendments. These costs were reflected in our 

estimates in the Proposing Release. 

One commenter also stated that costs for the voluntary program participants were 

low because many fund groups received tagging software and services at no cost, which 

the commenter anticipated would not be the case upon the adoption of our rule 

amendments.231 We note, however, that our survey data included information from funds 

that used no-cost software and from one fund that created its own software in-house at 

approximately $827. The average 3 year cost for those funds that use commercial 

software will be $700 ($500 in the first year + $800 in the second year + $800 in the third 

year) ÷ 3 years = $700. Assuming 80% of funds incurred costs of $827 and 20% of funds 

incurred costs of $700, the average software and consulting cost per mutual fund will be 

approximately $802. These estimates were derived from responses to a voluntary 

program questionnaire. See infra Section IV.A. 

229 8,856 mutual funds x $802 = approximately $7,098,970. 

230 See letter of Schnase. 

231 See letter of ICI. 

66
 
 

 

 

 

great expense.232 We believe our cost estimates provide an adequate picture of the initial 

software expenditures for funds to comply with our rule amendments. 

One commenter asserted that automated tagging and filing processes would 

reduce the risk and cost associated with manual processes.233 We agree that such 

software tools may help minimize both the burden on respondents and the risk of errors 

in the collection process. While this commenter noted that additional software tools 

would need to be introduced in order to allow data to be identified and tagged at its 

source, thereby automating the processing of the risk/return data, we expect that the 

development of such tools is likely to be hastened by mutual fund disclosure using 

interactive data. As noted previously,234 there is a growing number of software 

applications available to preparers and consumers that are designed to help make 

interactive data increasingly useful to both retail and institutional investors. 

Regulation C and Regulation S-T 

Regulation C (OMB Control No. 3235-0074) describes the procedures to be 

followed in preparing and filing registration statements with the Commission. Regulation 

S-T (OMB Control No. 3235-0424) specifies the requirements that govern the electronic 

submission of documents. The changes to these items that we are adopting will add and 

revise rules under Regulations C and S-T. As we explained in the Proposing Release, the 

additional collection of information burden that will result from these changes, however, 

are included in Form N-1A, and we have reflected the burden for these new requirements 

in the burden estimate for the new collection of information “Mutual Fund Interactive 

232 See infra note 252. 

233 See letter of Confluence. 

234 See supra Section II.E. 

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Data.” The rules in Regulations C and S-T do not impose any separate burden. 

C.	 Changes to the Voluntary Program 

We are decreasing the burden associated with the existing collection of 

information for Voluntary XBRL-Related Documents to reflect the amendments. Mutual 

funds will no longer be able to submit risk/return summary information in interactive data 

format through the voluntary program after the compliance date for the mandatory rules. 

When we adopted the amendments to expand the voluntary program to enable 

mutual funds voluntarily to submit risk/return summary information in interactive data 

format, we estimated an increase to the existing collection of information for Voluntary 

XBRL-Related Documents.235 We estimated that 10% of the approximately 545 fund 

complexes that have mutual funds, or 55 fund complexes, would each submit documents 

containing tagged risk/return summary information for one mutual fund.236 We further 

estimated that the initial creation of tagged documents containing risk/return summary 

information would require, on average, approximately 110 burden hours per mutual fund, 

and the creation of such tagged documents in subsequent years would require an average 

10 burden hours per mutual fund. Because the PRA estimates represent the average 

burden over a three-year period, we estimated the average hour burden for the submission 

of tagged documents containing risk/return summary information for one mutual fund to 

be approximately 43 hours.237 

235	 See Risk/Return Voluntary Program Adopting Release, supra note 32. 

236	 In the case of a mutual fund with multiple series, our estimate treated each series as a 

separate mutual fund. 

237	 (110 hours in the first year + 10 hours in the second year + 10 hours in the third year) ÷ 3 

years = 43 hours. 

68
 
 

 

 

 

Based on our previous estimates of 55 participants submitting tagged documents 

containing risk/return summary information for one mutual fund once per year and 

incurring 43 hours per submission, we estimated that, in the aggregate, the industry 

would incur an additional 2,365 burden hours associated with the amendments.238 We 

further estimated that 75% of this burden increase, or approximately 1,774 hours, would 

be borne internally by the mutual fund complexes. We estimated that this internal burden 

increase converted to dollars would amount to a total annual increase of internal costs of 

approximately $393,828.239 

We also estimated that 25% of the burden, or approximately 591 hours, would be 

outsourced to external professionals and consultants retained by the mutual fund complex 

at an average cost of $256.00 per hour for a total annual increase of approximately 

$151,296.240 In addition, we estimated that the cost of licensing software would be $333 

per participant per year, for a total annual increase of $18,315.241 Altogether, we 

estimated the total annual increase in external costs related to the amendments would be 

$169,611.242 

Given that mutual funds will no longer be able to submit risk/return summary 

information in interactive data format through the voluntary program some time after 

adoption of the amendments, we will reduce the internal hour burden associated with the 

238 55 documents per year x 43 hours per submission = 2,365 hours. 

239 See note 82 of the Risk/Return Voluntary Program Adopting Release, supra note 32. 

240 See note 83 of the Risk/Return Voluntary Program Adopting Release, supra note 32. 

241 $333 per participant x 55 participants = $18,315. 

242 This annual total consisted of $151,296 in outside professional costs plus $18,315 in 

software costs. 

69
 
 

 

 

 

voluntary program by 1,774 hours and the internal cost burden by $393,828. We will 

also reduce the external cost burden by $169,611. 

The amendments to the voluntary program also enable investment companies that 

are registered under the Investment Company Act, business development companies, and 

other entities that report under the Exchange Act and prepare their financial statements in 

accordance with Article 6 of Regulation S-X to submit exhibits containing a tagged 

schedule of portfolio holdings without having to submit other financial information in 

interactive data format. As with the current voluntary program, volunteers can 

participate, without pre-approval, merely by submitting Schedule I in interactive data 

format. 

One commenter stated that the cost estimates from the voluntary program did not 

include many, or any, costs associated with tagging data other than the risk/return 

summary, such as portfolio holdings information.243 We note, however, that the hour and 

cost burdens for voluntary interactive data submissions of portfolio holdings information 

were discussed separately from the hour and cost burdens for the submission of 

risk/return summary information in interactive data format in the Proposing Release and 

also are discussed below. 

We estimate that 20 registrants will choose to submit a schedule of portfolio 

holdings in interactive data format.244 We believe that investment companies that are 

registered under the Investment Company Act, business development companies, and 

other entities that report under the Exchange Act and prepare their financial statements in 

243	 See letter of Schnase. 

244	 This estimate is based on the current level of participation in the voluntary program, in 

which 25 funds have submitted interactive risk/return summary information. 

70
 
 

 

 

 

accordance with Article 6 of Regulation S-X will participate, given the flexibility 

provided by a new option to submit exhibits containing just portfolio holdings 

information in interactive data format. 

Submission of portfolio holdings information in interactive data format will not 

affect the burden of preparing the registrants’ traditional format filings. In order to 

provide portfolio holdings information in interactive data format, a participating 

registrant will have to tag Schedule I and submit the resulting interactive data file as an 

exhibit to its filing on Form N-CSR or Form N-Q.245 A list of tags that could be used to 

tag portfolio holdings is expected to be finalized by the end of January 2009. Based on 

our experience with mutual funds that have submitted risk/return summary information in 

the current voluntary program, we estimate that the initial creation of portfolio holdings 

information in interactive data format will require, on average, approximately 12 burden 

hours per registrant,246 and the creation of such information in interactive data format in 

subsequent years will require an average of 10 burden hours per registrant.247 Because 

the PRA estimates represent the average burden over a three-year period, we estimate the 

245	 Form N-CSR [17 CFR 249.331; 17 CFR 274.128]; Form N-Q [17 CFR 249.332; 17 CFR 

274.130]. 

246	 Mutual funds submitting risk/return summary information in our voluntary program 

indicated that an initial submission in the voluntary program took approximately 13 hours 

of labor. Given that the submission of portfolio holdings in interactive data format is less 

complex than the submission of risk/return summary information in interactive data 

format but potentially requires the tagging of many more individual items, we estimate 

that the initial creation of interactive data files containing portfolio holdings information 

will require, on average, approximately 12 burden hours per volunteer. 

247	 Mutual funds submitting risk/return summary information in the current voluntary 

program indicated that each set of submissions, after the initial set, would take 

approximately 11 burden hours, or 2 hours less than the initial submission. We estimate 

that the reduction in burden hours for subsequent submissions of portfolio holdings 

information in interactive data format will be a similar 2 hour reduction, or approximately 

10 burden hours per volunteer. 

71
 
 

 

 

 

 

average hour burden for the submission of portfolio holdings information in interactive 

data format for one registrant to be approximately 11 hours.248 

Based on the estimate of 20 registrants submitting interactive data files containing 

portfolio holdings information once each year and incurring 11 hours per submission we 

estimate that, in the aggregate, the industry will incur an additional 220 burden hours 

associated with the proposed amendments.249 We estimate that this internal burden 

increase converted to dollars will amount to approximately $47,000.250 

We also estimate that external professionals and consultants will be retained by 

the registrant for an increase of approximately $600.00.251 It is our understanding that 

annual software licensing costs generally would be included in the cost of hiring external 

professionals and consultants.252 Based on the estimate of 20 registrants retaining 

248	 (12 hours in the first year + 10 hours in the second year + 10 hours in the third year) ÷ 3 

years = approximately 11 hours. While the PRA requires an estimate based on a 

hypothetical three years of participation, a registrant, as noted earlier, could participate in 

the voluntary program by submitting portfolio holdings information in interactive data 

format over a shorter period or even just once as the registrant chooses. 

249	 20 documents per year x 11 hours per submission = 220 hours. We note that mutual 

funds submit portfolio holdings information to the Commission four times per year. 

However, for purposes of our analysis, we estimate that mutual funds choosing to 

participate in the voluntary program will submit portfolio holdings information in 

interactive data format once each year. 

250	 This cost increase is estimated by multiplying the increase in annual internal hour burden 

(220) by the estimated hourly wage rate of $213.00. See supra note 221. 

251	 ($100.00 in the first year + $800.00 in the second year + $800.00 in the third year) ÷ 3 

years = approximately $600.00. Mutual funds participating in our voluntary program for 

the submission of risk/return summary information in interactive data format indicated an 

initial external cost of $100.00 for the hiring of external professionals and consultants and 

projected an annual cost of $800.00 for external service providers going forward. The 

increase going forward was due to the fact that two of the participants indicated that each 

of their external service providers had waived its fee for the initial submission. 

252	 We note that one respondent spent over $100,000 internally to develop software to 

submit risk/return summary information in interactive data format. We did not include 

this number in our calculations as this software was developed solely for purposes of 

submitting risk/return summary information and not for submitting financial information 

in interactive data format. See infra note 270. 

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external professionals and consultants at an annual cost of $600.00 we estimate that, in 

the aggregate, the total external cost to the industry will be $12,000.253 

As a result of the changes to the voluntary program, we therefore estimate a total 

decrease in internal burden hours of approximately 1,600254 and a total decrease in 

internal costs of approximately $347,000.255 We further estimate a total decrease in 

external costs of approximately $158,000.256 

IV. COST/BENEFIT ANALYSIS 

A. Submission of Risk/Return Summary Information 

Using Interactive Data
 

The interactive data framework that we are adopting has the potential to remove a 

barrier in the flow of information between mutual funds and users of information that is 

conveyed through mutual fund disclosures. This should enable less costly dissemination 

of information and thereby improve the allocation of capital. The cost of implementation 

will depend primarily on the costs of transition by mutual funds to the new mode of 

reporting. The magnitudes of these benefits and costs from any individual mutual fund’s 

adoption of interactive data reporting will depend on the number of other mutual funds 

We also note that one commenter stated that our estimated costs for interactive data 

software and services were low because many fund groups received tagging software and 

services at no cost. See supra note 231 and accompanying text. 

253	 20 registrants submitting interactive data files under the voluntary program x $600.00 = 

$12,000. 

254	 (1,774 hours for the removal of risk/return summary information from the voluntary 

program – 220 hours for the submission of schedule of portfolio holdings in interactive 

data format = approximately 1,600 hours.) 

255	 ($393,828 for the removal of risk/return summary information from the voluntary 

program – $47,000 for the submission of schedule of portfolio holdings in interactive 

data format = approximately $347,000.) 

256	 ($169,611 for the removal of risk/return summary information from the voluntary 

program – $12,000 for the submission of schedule of portfolio holdings in interactive 

data format = approximately $158,000.) 

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that also adopt and on the availability of supporting software and other infrastructures 

that enable analysis of the information. To the extent that submitted information allows 

investors to make investment decisions based on market-wide comparison and analysis, 

the value to the investors of the reported information tends to increase with the total 

number of mutual funds adopting the regime. Likewise, mutual funds’ incentives to 

report their information using interactive data depends on the interest level of the 

investors in this mode of reporting. By mandating implementation, the rule will expand 

the network of adopters and thereby create positive network externalities of reported 

information for the investors. 

In the Proposing Release, we requested public comment and empirical data 

regarding the costs and benefits of the amendments. Three commenters generally 

expressed concern about the costs of implementing the Commission’s proposal and the 

uncertain nature of any cost efficiencies or cost savings.257 One commenter stated that 

investors will not be helped by the additional costs incurred by mutual funds as a result of 

the proposal and that the required interactive disclosure will be static and quickly 

outdated.258 None of these commenters provided any specific quantitative data relating to 

cost estimates. 

1. Benefits of Interactive Data Submissions and Web Site Posting 

The rules have the potential to benefit investors both directly and by facilitating 

the exchange of information between mutual funds and the third party information 

providers and other intermediaries who receive and process mutual fund disclosures. 

Information Access 

257 See letters of Gilmore, ICI, and Schnase. 

258 See letter of Federated. 

74
 
 

 

Benefits of the rulemaking accrue from the acceleration of market-wide adoption 

of interactive data format reporting. The magnitudes of the benefits thus depend on the 

value to investors of the new reporting regime relative to the old reporting regime and on 

the extent to which the mandated adoption speeds up the market-wide implementation. 

Requiring mutual funds to file their risk/return summary information using the 

interactive data format enables investors, third-party information providers, and the 

Commission staff to capture and analyze that information more quickly and at a lower 

cost than is possible using the same information provided in a static format.259 Even 

though the new regime does not require any new information to be disclosed or reported, 

certain benefits accrue when mutual funds use an interactive data format to report their 

risk/return summary information. These include the following. Through interactive data, 

what is currently static, text-based information can be dynamically searched and 

analyzed, facilitating the comparison of mutual fund cost, performance, and other 

information across multiple classes of the same fund and across the more than 8,000 

funds currently available. Any investor with a computer has the ability to acquire and 

download data that have generally been available only to intermediaries and third-party 

analysts. For example, users of risk/return summary information can download it directly 

into spreadsheets, analyze it using commercial off-the-shelf software, or use it within 

investment models in other software formats. Also, to the extent investors currently are 

required to pay for access to mutual fund risk/return summary information that has been 

extracted and reformatted into an interactive data format by third-party sources, the 

availability of interactive data in Commission filings will allow investors to avoid 

See supra Section II.A. 

75
 

259 
 

 

additional costs associated with third-party sources. 

The magnitude of this informational benefit varies, however, with the availability 

of sophisticated tools that will allow investors to analyze the information. The growing 

development of software products for users of interactive data is helping to make 

interactive data increasingly useful to both institutional and retail investors.260 For 

example, currently there are many software providers and financial printers that are 

developing interactive data viewers. We anticipate that these will become widely 

available and increasingly accessible to investors. We expect that the open standard 

feature of the interactive data format will facilitate the development of applications, and 

software, and that some of these applications may be made available to the public for free 

or at a relatively low cost. The continued improvement in this software will allow 

increasingly useful ways to view and analyze mutual fund risk/return summary 

information to help investors make more well-informed investment decisions. 

Interactive data also provides a significant opportunity for mutual funds to 

automate their regulatory filings and business information processing, with the potential 

to increase the speed, accuracy, and usability of mutual fund disclosure. This reporting 

regime may in turn reduce filing and processing costs. 

By enabling mutual funds to further automate their disclosure processes, 

interactive data may eventually help funds improve the timeliness of, and speed at which 

they generate information. For example, with standardized interactive data tags, 

registration statements may require less time for information gathering and review. One 

See SEC's Office of Interactive Disclosure Urges Public Comment as Interactive Data 

Moves Closer to Reality for Investors, Securities and Exchange Commission Press 

Release, Dec. 5, 2007, available at: http://www.sec.gov/news/press/2007/2007-253.htm. 

76
 

260 
 

 

 

 

commenter expressed some skepticism about the ability of interactive data to create 

internal efficiencies that may ultimately result in cost savings.261 We continue to believe, 

however, that internal efficiencies may be one of several possible benefits of interactive 

data tagging. 

A mutual fund that uses a standardized interactive data format at earlier stages of 

its reporting cycle may also increase the accuracy of its disclosure by reducing the need 

for repetitive data entry that could introduce errors and enhancing the ability of a mutual 

fund’s in-house professionals to identify and correct errors in the fund’s registration 

statements filed in traditional electronic format. There has been a growing development 

in both the number and capabilities of software products and applications to assist mutual 

funds to tag their risk/return summary information using interactive data helping make 

interactive data increasingly useful.262 

Mutual funds that automate their regulatory filings and business information 

processing in a manner that facilitates their generation and analysis of disclosures should, 

as a result, realize a reduction in costs. 

Market Efficiency 

The requirements may benefit investors by making financial markets more 

efficient in regard to the following:263 

261 See letter of ICI. 

262 Id. 

263	 We believe the benefits will stem primarily from the requirement to submit interactive 

data to the Commission and the Commission’s disseminating that data. We also believe, 

however, that the requirement that mutual funds with Web sites post the interactive data 

required to be submitted would encourage its widespread dissemination thereby 

contributing to lower access costs for users and the related benefits described. 

77
 
 

 

•	 capital formation as a result of mutual funds being in a better position to 

attract shareholders because of greater (less costly) awareness on the part of 

investors of mutual fund risk/return summary information; and 

•	 capital allocation as a result of investors’ being better able to allocate capital 

among those mutual funds seeking it because of interactive data reporting’s 

facilitating innovations in efficient communication of mutual fund risk/return 

summary information. 

More Efficient Capital Formation 

An increase in the efficiency of capital formation is a benefit that may accrue to 

the extent that interactive data reduces some of the information barriers that make it 

costly for mutual funds to find appropriate sources of new investors. In particular, 

smaller mutual fund complexes are expected to benefit from enhanced exposure to 

investors. If interactive data risk/return summary reporting increases the availability, or 

reduces the cost of collecting and analyzing, mutual fund risk/return summary data, as 

anticipated, then there could be improved coverage of mutual funds in smaller fund 

complexes by third party information providers and commercial data vendors. 

At present, some mutual funds in smaller fund complexes do not provide their 

data to third party information providers.264 This may reduce the likelihood that their 

data is readily available to investors who use commercially available products to assess 

mutual fund performance. If interactive data reporting increases coverage of mutual 

funds in smaller fund complexes by third-party information providers, and this increases 

their exposure to investors, then lower search costs for shareholders could result. 

Analysis by Division of Investment Management staff based on publicly available data. 

78
 

264 
 

 

More Efficient Capital Allocation 

An increase in the efficiency of capital allocation may accrue to the extent that 

interactive data increase the quality of information by reducing the cost to access, collect, 

and analyze mutual fund risk/return summary information or improve the content of 

mutual fund-reported information.265 An increase in quality and improvement in content 

should enable investors to better allocate their capital among mutual funds. 

Information quality in mutual fund markets is likely to be higher as a result of 

interactive data reporting, leading to more efficient capital allocation. As a result of the 

improved utility of information, investors may be able to evaluate various mutual funds, 

thereby facilitating capital flow into their favored investment prospects. 

We believe that requiring mutual funds to provide interactive data is likely to 

improve the quality of risk/return summary information available to end users, and helps 

spur interactive data-related innovation in the supply of mutual fund comparative 

products, resulting from a potential increased competition among suppliers of such 

products due to lower entry barriers as a result of lower data collection costs. 

However, we have considered competing views of the informational 

consequences of interactive data. For example, a requirement to submit interactive data 

information could decrease the marginal benefit of collecting information and thus reduce 

the information quality to the extent it reduces third-party incentives to facilitate access 

to, collect, or analyze information. Assuming that markets efficiently price the value of 

information, the amount of information accessed, collected (or enhanced), and analyzed 

In the context of the discussion below, quality refers to the ease with which end-users of 

risk/return summary information can access, collect, and analyze the data. This issue is 

separate from the content of mutual fund-reported information. 

79
 

265 
 

 

 

will be determined by the marginal benefit of doing so.266 Lowering information 

collection costs (through a requirement to submit interactive data information) should 

increase this benefit. If this is so, then there should be no degradation in the level of 

information quality as a result of changes in third-party provider behavior under an 

interactive data reporting regime. However, if one competitor in the industry can 

subsidize its operations through an alternative revenue stream, both quality and 

competition may suffer.267 

Another potential information consequence of the requirements is how the 

precision and comparability of the information disseminated by data service providers 

may change because the interactive data requirements will shift the source of data 

formatting that allows aggregation and facilitates comparison and analysis from end-users 

to mutual funds submitting interactive data. At present, data service providers manually 

key risk/return summary information into a format that allows aggregation. As a result, 

the data service provider makes interpretive decisions on how to aggregate reported items 

so that they can be compared across all mutual funds. Consequently, when a subscriber 

of the commercial product offered by a data service provider uses this aggregated data, it 

266	 Also, we expect that because the rules require the use of the XBRL interactive data 

standard, the open standard nature of XBRL will facilitate the development of related 

software, some of which may, as a result, be made available to the public for free or at a 

relatively low cost and provide the public alternative ways to view and analyze 

interactive data information. 

267	 For illustration purposes only, assume that an Internet service company develops an 

interactive data-based tool that easily provides mutual fund risk/return summary 

information for free to all subscribers, and it uses this product as a loss leader to increase 

viewership and advertising revenue. If the data provided is of the same quality as data 

provided through subscription to other available commercial products, then there should 

be no informational efficiency loss. However, if a data aggregator’s providing 

information that improves investor interpretation and goes beyond risk/return summary 

information is possible, but no longer profitable to produce for competitors without the 

subsidy, then valuable information production may be lost. 

80
 
can expect consistent interpretation of the reported items. In contrast, the requirement for 

mutual funds to submit interactive data information will require mutual funds to 

independently decide within the confines of applicable requirements which “tag” best 

describes each item within the risk/return summary – lessening the amount of 

interpretation required by data service providers or end-users of the data. Once a 

standard tag is chosen, comparison to other funds is straightforward. However, because 

mutual funds have some discretion in how to select tags, and can extend the taxonomy 

(create new tags) when an appropriate tag does not exist, unique interpretations by each 

fund could result in reporting differences from what current data service providers and 

other end-users would have chosen. This view suggests that the fund-submitted 

information disseminated by data service providers may be, on the one hand, less 

comparable because they have not normalized it across mutual funds but, on the other 

hand, more accurate because the risk of human error in the manual keying and 

interpretation of filed information will be eliminated and more precise because it will 

reflect decisions by the mutual funds themselves. Replicating prior methods still will be 

possible, however, because mutual funds continue to be required to file risk/return 

summary information in traditional format. As a result, nothing prohibits data service 

providers from continuing to provide data in the same manner that they did before. 

Nonetheless, interactive data benefits could diminish if other reporting formats are 

required for clarification in data aggregation. 

The content of mutual fund-reported information may improve because, as 

previously discussed, a mutual fund that uses a standardized interactive data format at 

earlier stages of its disclosure cycle may increase the accuracy of its disclosure. In 

81
 
contrast, the content of mutual fund-reported information may improve or decline to the 

extent that the interactive data process influences what mutual funds disclose. While the 

requirements to submit and post interactive data information are designed to be disclosure 

neutral, it is possible they may affect what is disclosed. 

2. Costs of Interactive Data Submissions and Web Site Posting 

The primary cost of the rule amendments is the cost of mutual funds’ 

implementation of the rule, which includes the costs of submitting and posting interactive 

data. We discuss this cost element extensively below. In addition, because the rules 

allow an increase in the flow of risk/return summary information being reported directly 

to third party information providers and investors, there will be a cost of learning on the 

part of the investors in using and analyzing risk/return summary information at the 

interactive data level. 

As for the cost of implementation of the rule, based on currently available data, 

we estimate the average direct costs of submitting and posting interactive data-formatted 

risk/return summary information for all mutual funds under the proposed rules will, based 

on certain assumptions, be as follows: 

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Table. Estimated direct costs to individual funds of submitting interactive data-formatted 

risk/return summary information 

Subsequent 

 First submission submissions 

Preparation268 $2,600 $2,300 

Software and consulting 

services269 $20,600 270 $800 

Web site posting271 $250 $250 

Total cost $23,450 $3,350 

268	 Estimates based on risk/return summary voluntary program questionnaire responses. The 

voluntary program questionnaire responses indicated that different filers use different 

personnel to prepare interactive data submissions. We calculated costs for each 

participant based upon the personnel each individual respondent to the voluntary program 

questionnaire indicated it used and the length of time it indicated the personnel spent on 

the preparation. The numbers in the table represent the average of all of these 

calculations. The following wage rates were assumed for preparation cost estimates: 

operations specialist -- $129; paralegal -- $168; senior compliance examiner -- $180; 

intermediate business analyst -- $183; senior accountant -- $185; programmer analyst -- 

$194; financial reporting manager -- $268; and attorney -- $295. These estimated wage 

figures are based on published rates for the personnel above, modified to account for 

bonuses, firm size, employee benefits, and overhead, yielding the effectively hourly rates 

above. See SIFMA Report, supra note 221. 

269	 Software licensing and the use of a consultant can be substitutionary – mutual funds can 

choose to do one or the other, or do both – and are thus aggregated. 

270	 We note that one volunteer expended over $100,000 in information technology to 

develop internal software that applies interactive data tags to risk/return summary 

information. This one expenditure by one fund resulted in a higher average software and 

consulting services cost per fund of $20,600 for the first submission. Excluding this data, 

the average software and consulting services costs per fund would have been 

approximately $500. 

While our averages imply that the costs of internally developing software is allocated to 

one fund in the sample, in reality the complex that developed the software will likely use 

that software for all of its funds. Thus the development cost could be allocated across all 

funds within that complex rather than to one fund. 

271	 Voluntary program participants were not required to post on their Web sites, if any, the 

interactive data information they submitted. Consequently, the costs of the requirement 

to post interactive data information are not derived from the voluntary program 

participant questionnaire responses or discussed in our analysis of those responses. 

Those costs are, instead, derived from informal discussions with a limited number of 

persons believed to be generally knowledgeable about preparing, submitting, and posting 

interactive data. 

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The above estimates are generated from a limited number of voluntary program 

participant questionnaire responses. In particular, these responses provided detail on the 

actual and projected costs of preparing risk/return summary information in interactive 

data format and for purchasing software or related filing agent services. A detailed 

analysis of the costs associated with voluntary program participation suggests that the 

estimated direct cost of submitting risk/return summary information in interactive data 

format falls within the range of $735.50 to $127,500 per fund for the first submission.272 

This cost reflects expenditures on interactive data-related software, consulting or filing 

agent services used, and the market rate for all internal labor hours spent (including 

training) to prepare, review, and submit the first interactive data format risk/return 

summary information. The future experiences of individual mutual funds regarding 

risk/return summary information filed in an interactive data format still may vary 

according to the mutual funds’ size, complexity, and other factors not apparent from the 

voluntary program participant responses and commenters’ responses. The discussion 

below summarizes the direct cost estimates of compliance regarding risk/return summary 

submissions based on voluntary program participant questionnaire responses and the 

specified assumptions.273 

•	 Average cost of first submission, excluding the costs of Web site posting, 

from voluntary program questionnaire data is $23,200. 

272 See supra note 270 with respect to the high end of the range. 

273 The details of this analysis regarding risk/return summary information, including the 

underlying assumptions and other considerations related to both the costs and benefits of 

requiring submission of interactive data, are provided following the summary. 

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• Projected average cost of subsequent submissions, excluding the costs of Web 

site posting, from voluntary program questionnaire data is $3,100. 

This analysis attempts to quantify some of the direct costs that mutual funds will 

incur to submit and post interactive data. Whether mutual funds choose to purchase and 

learn how to use software packages designed for interactive data submissions or 

outsource this task to a third party, internal (labor) resources will be required to complete 

the task. The cost estimates provided here using voluntary program participant 

questionnaire responses shed light on the potential dollar magnitude of the costs of 

requiring interactive data submissions. 

At the time the Commission proposed these amendments, 22 mutual funds had 

participated in the voluntary program for interactive risk/return summaries. Of these, 

nine were provided questionnaires on the details of their cost experience, and six 

responses were collected representing the cost data for ten funds.274 The table below 

summarizes the aggregate costs per mutual fund, including software and filing agent 

service costs and an estimated cost for the internal labor hours required to prepare and 

submit the interactive data format information. The low and high estimates of the cost 

for internal labor hours were calculated using a variety of billing rates corresponding to 

the job descriptions of internal personnel involved in preparing the tagged risk/return 

summaries.275 The reported costs are calculated using responses from the 6 voluntary 

program participants that provided responses. Those six respondents represent mutual 

274	 The questionnaires requested data for one fund; however, several questionnaire 

respondents voluntarily submitted cost information for more than one fund. 

275	 See supra note 221. These estimates are from the 2007 SIFMA Report, modified to 

account for an 1800-hour work-year and multiplied by 5.35 to account for bonuses, firm 

size, employee benefits, and overhead. Questionnaire respondents apportioned time 

spent tagging risk/return summaries among various job types. 

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fund complexes whose assets comprise a range of approximately .01% to 12.00% of all 

the assets of the mutual funds that will be required to submit interactive data.276 

Table. Summary of illustrative survey data on the direct cost estimates for voluntary 

program participants 

All voluntary 

program participants 

respondents 

Low High 

First submission 

Estimated costs $735.50 $127,500277 

Subsequent submissions 

Estimated costs $555.00 $5,640 

Average reduction in cost 

from first to second submission 24.54% 95.58%278 

Scalability of Interactive Data-Related Support Services and Technology 

The final cost consideration in this section is the scalability of interactive datarelated support services and technology. In particular, it is unclear how the market for 

interactive data support services and technology will change in light of the adoption of 

the rule amendments. 

The roles of each potential kind of service provider within the interactive data 

market are likely to develop further and are not yet clear, and there are many potential 

participants to consider, including the software vendors, print/filing agents, and 

consultants, as well as the Commission.279 Until the market of mutual funds that submit 

276	 Based on total mutual fund assets of $10.6 trillion. Lipper-Directors’ Analytical Data, 

Reuters Sept. 2008. 

277	 We note that these costs are higher due to one questionnaire respondent who spent 

significantly more than all other respondents to create its own interactive data software 

in-house. See supra note 270. 

278	 Id. 

279	 In addition, mutual fund complexes with a large number of funds may consider 

developing software in-house since that cost could be allocated across all of their funds. 

86
 
 

 

interactive data information grows substantially larger, it is difficult to predict how 

standard solutions will evolve. For example, we do not know whether mutual funds will 

adopt solutions that create interactive data submissions using third party software, a socalled “bolt-on” approach, or will seek integrated solutions that enable funds to prepare 

interactive data submissions from their existing software. Moreover, filing agents may 

maintain their role as an intermediary by offering interactive data technology or other 

service providers may cause that role to change. Others with technical expertise may 

participate in the technology with unpredictable results. 

Combining the uncertainty over the source of future interactive data services with 

increased demand for these services could result in a new equilibrium market price that is 

different from what is currently reported by voluntary program participants. This price 

will be higher if the demand for interactive data services increases (from 15 mutual fund 

complexes currently participating in the voluntary program to approximately 683 mutual 

fund complexes280 participating) at a faster rate than the supply for these same services. 

More broadly, if the interactive data requirement results in clients subscribing for 

interactive data services faster than the rate at which these services can be supplied, then 

a price increase is the natural discriminator in how to allocate limited resources. 

The submission costs discussed in this section suggest that if interactive data is 

implemented too quickly it could result in higher than necessary submission costs if the 

supply of interactive data-related resources is constrained, but the effect will likely 

diminish as a market place for interactive data services develops. Hence, this concern is 

mitigated by delaying the requirement that mutual funds submit interactive data until 

See ICI 2008 Investment Company Fact Book, supra note 63, at 14 (683 fund sponsors). 

87
 

280 
 

January 1, 2011. This delay is designed to allow interactive data service suppliers to 

keep pace with demand. 

B. Changes to Voluntary Program 

In order to facilitate further evaluation of data tagging, the rule amendments will 

enable investment companies that are registered under the Investment Company Act, 

business development companies, and other entities that report under the Exchange Act 

and prepare their financial statements in accordance with Article 6 of Regulation S-X to 

submit exhibits containing a tagged schedule of portfolio holdings without having to 

submit other financial information in interactive data format. 

1. Benefits 

We believe that portfolio holdings information in interactive data format will 

allow more efficient and effective retrieval, research, and analysis of registrants’ portfolio 

holdings through automated means. The proposed amendments to the voluntary program 

will assist us in assessing whether using interactive data tags enhances users’ ability to 

analyze and compare portfolio holdings information included in filings with the 

Commission. 

Currently, a number of companies use computers and data entry staff to mine 

portfolio holdings information provided by mutual funds and others in order to populate 

databases that are used to package information for sale to analysts, funds, investors, and 

others. Permitting funds and other entities to tag portfolio holdings information in 

Commission filings will aid this data-mining process in that it will identify points of data 

at the source, which will reduce the cost to populate databases and improve the accuracy 

of that data. Additionally, the changes to the voluntary program will benefit funds and 

88
 
the public by permitting experimentation with data tagging using the new portfolio 

holdings list of tags when it is created. 

In the future, the availability of potentially more accurate information about 

mutual funds and other entities will also reduce the cost of research and analysis and 

create new opportunities for companies that compile, provide, and analyze data to 

produce more value added services. Enhanced access to information submitted in 

interactive data format also will allow retail investors (or financial advisers assisting such 

investors) to perform more personalized and sophisticated analyses and comparisons of 

mutual funds and other investment options, which will result in investors making better 

informed investment decisions, and therefore in a more efficient distribution of assets by 

investors among different funds. This may, in turn, also contribute to increased 

competition among mutual funds and other entities and result in a more efficient 

allocation of resources among competing investment products. Although it is not 

possible to quantify precisely the beneficial effects of more efficient allocation of 

investors’ assets and increased competition, they may be significant, given the size of the 

mutual fund industry. 

Other benefits resulting from the inclusion of portfolio holdings information as a 

stand-alone item in the voluntary program will include an increase in the accuracy of 

information and the potential for increased timeliness of data that investors use to make 

informed investment decisions. Another benefit is that portfolio holdings information 

submitted in interactive data format will allow automated, instantaneous extraction of 

every investment disclosed in the schedule of portfolio holdings. Finally, the investment 

analysis process may become more efficient and effective through the increased use of 

89
 
 

 

 

automation and reduced human intervention that should result from the use of interactive 

data. 

2. Costs 

The amendments to the voluntary program will lead to some costs for filers 

choosing to submit portfolio holdings information in interactive data format. For 

purposes of the PRA, we estimated that the increase in annual internal burden hours to 

the industry will be approximately 220 hours, which will amount to an increase in costs 

of approximately $47,000 and that the increase in annual external costs per filer will 

amount to approximately $600 per year for a total estimated increase to the industry of 

approximately $12,000 on an annual basis.281 

We based these cost estimates upon, among other things, experience with mutual 

funds who have submitted risk/return summary information in interactive data format in 

the current voluntary program.282 Due to the fact that no mutual fund has submitted 

portfolio holdings information through the voluntary program, however, we have limited 

data to quantify the cost of implementing the use of interactive data tags applied to 

portfolio holdings information. In the future, there may be additional costs to current 

users of EDGAR data. For example, companies that currently provide tagging and 

dissemination of EDGAR data may experience decreased demand for their services. 

These entities have developed certain products and services based on data in EDGAR; 

many entities disseminate, repackage, analyze, and sell the information. Allowing filers 

to submit tagged portfolio holdings information, even voluntarily, may have an impact on 

entities providing EDGAR-based services and products. Because the Commission does 

281 See infra Section III.A.2. 

282 See supra note 268. 

90
 
 

 

 

 

 

 

 

not regulate all these entities, it is currently not feasible to accurately estimate the number 

or size of these potentially affected entities. The limited, voluntary nature of the program 

will help the Commission assess the effect, if any, on these entities. Additionally, the 

availability of interactive data on EDGAR may provide these companies with alternative 

business opportunities. 

Combined with the removal of risk/return summary information from the 

voluntary program, we estimated for PRA purposes that there will be a total decrease of 

1,600 burden hours which will amount to approximately $347,000, and a total decrease in 

external costs of approximately $158,000. Therefore, the total cost decrease to the 

industry for purposes of the PRA for the rule amendments related to the voluntary 

program is $505,000.283 

V. CONSIDERATION OF BURDEN ON COMPETITION AND 

PROMOTION OF EFFICIENCY, COMPETITION, AND CAPITAL 

FORMATION 

Section 23(a)(2) of the Exchange Act284 requires us, when adopting rules under 

the Exchange Act, to consider the impact that any new rule would have on competition. 

In addition, Section 23(a)(2) prohibits us from adopting any rule that would impose a 

burden on competition not necessary or appropriate in furtherance of the purposes of the 

Exchange Act. Furthermore, Section 2(b)285 of the Securities Act, Section 3(f) 286 of the 

Exchange Act, and Section 2(c)287 of the Investment Company Act require the 

283	 This estimate was derived from previously reported costs estimates from the voluntary 

program. 

284 15 U.S.C. 78w(a)(2). 

285 15 U.S.C. 77b(b). 

286 15 U.S.C. 78c(f). 

287 15 U.S.C. 80a-2(c). 

91
 
 

 

Commission, when engaging in rulemaking that requires it to consider or determine 

whether an action is necessary or appropriate in the public interest, to consider, in 

addition to the protection of investors, whether the action will promote efficiency, 

competition, and capital formation. 

A. Submission of Risk/Return Summary Information 

Using Interactive Data
 

The rule amendments to require mutual funds to submit interactive data to the 

Commission and post it on their Web sites are intended to make risk/return summary 

information easier for investors to analyze while assisting in automating regulatory 

filings and business information processing. As discussed previously,288 we believe that 

these amendments are likely to benefit investors by making financial markets more 

efficient in regard to capital formation by reducing some of the information barriers that 

make it costly for mutual funds to find appropriate sources of new investors. Similarly, 

these requirements may enable investors to better allocate their capital among mutual 

funds by reducing the cost to access, collect, and analyze mutual fund risk/return 

summary information and by improving the content of fund-reported information 

available to investors. Since lower data collection costs would lower entry barriers for 

suppliers of interactive-data-related fund comparative products, these requirements also 

may result in increased competition among these suppliers, which, in turn, would help 

spur innovation with respect to such products. 

We requested comment on whether the proposed amendments would promote 

efficiency, competition, and capital formation. One commenter asserted that requiring 

funds to utilize the current list of tags when revisions are likely in the near term would be 

See supra Section IV.A.1. 

92
 

288 
 

 

 

 

 

 

inefficient and costly.289 As noted above, however, revisions to the list of tags for 

risk/return summary information have been issued for public comment and are expected 

to be finalized by the end of January 2009. Again, this will provide mutual funds with 

substantial time to prepare to tag their risk/return summary information. This commenter 

also stated that its members were skeptical that using XBRL for risk/return summary 

information will create internal efficiencies that would ultimately result in cost savings.290 

While the internal efficiencies of interactive data for mutual funds are currently 

unquantified, we continue to believe that they may be available to mutual funds. Further, 

as discussed in detail above, we anticipate that the rules may lead to more efficient capital 

formation and allocation.291 

We understand that private sector businesses such as those that access mutual 

fund information and aggregate, analyze, compare, or convert it into interactive format 

have business models and, as a result, competitive strategies that the adopted interactive 

data requirements might affect. Since interactive data technology is designed to remove 

an informational barrier, business models within the mutual fund services industry that 

are currently adapted to traditional format document reporting may change, with possible 

consequences for the revenue stream of current product offerings due to the competitive 

effects of such a change. The competitive effects may relate to changes in the 

accessibility of risk/return summary information to investors, the nature of the 

information that investors receive, and the potential from new entry or innovation in the 

markets through which mutual fund disclosures are transmitted from mutual funds to 

289 See letter of ICI. 

290 Id. 

291 See supra Section IV.A.1. 

93
 
investors. For example, lower entry barriers that result from lower data collection costs 

may increase competition among third party information providers and help spur 

interactive data-related innovation. It is also possible, however, that increased 

competition from new market entrants could reduce industry profit margins, and, as a 

result, the quality of services may suffer. For example, and illustration purposes only, 

assume that an Internet service company develops and interactive data-based tool that 

easily provides risk/return summary information for free to all subscribers, and it uses 

this product as a loss leader to increase viewership and advertising revenue. If the data 

provided is of the same quality as data provided through subscription to other available 

commercial products, then there should be no informational efficiency loss and the 

quality of services should not be impaired. However, if the incumbent service providers 

provide a higher quality of information that improves investor interpretation beyond 

risk/return summary information, but they find that it is no longer profitable to produce 

this information as a result of subsidized products from inferior providers, then valuable 

information production may be lost. 

For the reasons described more fully above, we believe the liability protections 

for interactive data are necessary or appropriate in the public interest and consistent with 

the protection of investors. Moreover, the protections are also consistent with the 

purposes fairly intended by the policy and provisions of the Investment Company Act. 

B. Changes to the Voluntary Program 

The amendments no longer allow mutual funds to submit risk/return summary 

information in interactive data format through the voluntary program after the 

compliance date for the mandatory rules and enable investment companies that are 

94
 
registered under the Investment Company Act, business development companies, and 

other entities that report under the Exchange Act and prepare their financial statements in 

accordance with Article 6 of Regulation S-X to submit exhibits containing a tagged 

schedule of portfolio holdings without having to submit other financial information in 

interactive data format. The changes to the voluntary program are intended to help 

further evaluate the usefulness to investors, third-party information providers, investment 

companies, the Commission, and the marketplace of interactive data and, in particular, of 

submitting portfolio holdings information in interactive data format. Because compliance 

with the amendments is voluntary, the Commission estimates that the impact of the 

amendments will be limited. However, because the submission of portfolio holdings 

information in interactive data format has the potential to facilitate analysis of that 

information, we believe that the amendments could promote efficiency by allowing us 

and others to gain experience with portfolio holdings information in interactive data 

format. 

Further, submitting portfolio holdings information in interactive data format has 

the potential to help streamline the delivery of portfolio holdings information, and 

provide investors and others with improved tools to compare funds and other entities. As 

with the filing of risk/return summary information in interactive data format, we believe 

that the potential to streamline the delivery of portfolio holdings information and to 

provide investors and others with improved comparison tools could promote efficiency 

and competition through more efficient allocation of investments by investors and more 

efficient allocation of assets among competing funds and other investment products. 

95
 
 

 

In the future, companies that currently provide tagging and dissemination of 

EDGAR data may experience decreased demand for their services. The availability of 

interactive data on the Commission’s electronic filing system however, may provide 

these companies with alternative business opportunities. We do not anticipate that the 

amendments will have a significant impact on capital formation. Finally, because the 

amendments are designed to permit mutual funds and other entities to provide 

information in a format that we believe will be more useful to investors, we believe that 

the amendments are appropriate in the public interest and for the protection of investors. 

VI. FINAL REGULATORY FLEXIBILITY ANALYSIS 

This Final Regulatory Flexibility Analysis has been prepared in accordance with 

the Regulatory Flexibility Act.292 It relates to the amendments we are adopting that will 

require mutual funds to provide risk/return summary information to the Commission and 

on their Web sites in interactive data format and enable investment companies and other 

entities to submit exhibits through the voluntary program containing a tagged schedule of 

portfolio holdings without having to submit other financial information in interactive data 

format. 

A. Need for the Rule 

1. Submission of Risk/Return Summary Information Using 

Interactive Data 

The main purpose of the amendments is to make risk/return summary information 

easier for investors to analyze while assisting in automating regulatory filings and 

business information processing. Currently, mutual funds are required to file their 

registration statements in a traditional format that provides static text-based information. 

5 U.S.C. 604. 

96
 

292 
We believe that providing the risk/return summary information these filings contain in 

interactive data format will: 

•	 enable investors and others to search and analyze the information 

dynamically; 

•	 facilitate comparison of mutual fund performance; and 

•	 provide an opportunity to automate regulatory filings and business 

information processing with the potential to increase the speed, accuracy, and 

usability of risk/return summary disclosure. 

2. Changes to the Voluntary Program 

The main purpose of the amendments to the voluntary program is to help us 

evaluate the usefulness to investors, third party information providers, funds, the 

Commission, and the marketplace of interactive data and, in particular, of submitting 

portfolio holdings information in interactive data format. We believe the changes to the 

voluntary program will enable us to further study the extent to which interactive data 

enhance the comparability of portfolio holdings information, the usefulness of interactive 

data for dissemination, and our staff's ability to review and assess the accuracy and 

adequacy of that data. The changes to the voluntary program also will help us assess the 

effect of interactive data on the quality and transparency of portfolio holdings 

information, as well as the compatibility of interactive data with the Commission's 

disclosure requirements. 

More specifically, we believe that the changes to the voluntary program will 

better enable us to study the extent to which interactive data will: 

97
 
 

 

 

•	 enable investors and others to search and analyze the information 

dynamically; 

•	 facilitate comparison of portfolio holdings among funds and other entities; and 

•	 possibly provide a significant opportunity to reduce the resources needed for 

data analysis. 

In addition, we believe the changes to the voluntary program will enhance our ability to 

evaluate the: 

•	 impact on the staff's ability to review filings on a more timely and efficient 

basis; 

•	 use of interactive data for risk assessment and surveillance procedures; and 

•	 compatibility of interactive data with reporting quality, transparency, and 

other Commission reporting requirements. 

B. Significant Issues Raised by Public Comment 

In the Proposing Release, we requested comment on the number of small entity 

issuers that may be affected, the existence or nature of the potential impact and how to 

quantify the impact of the amendments. Commenters generally supported both the use of 

technology to better inform mutual fund investors and the Commission’s goal of 

providing risk/return summary information in an interactive data format, but most 

commenters stated that requiring mutual funds to provide tagged risk/return summary 

information at this time is premature.293 Two commenters suggested that funds should be 

phased into the mandatory interactive data program based on fund size.294 As discussed 

293 See supra notes 55 and 56 and accompanying text. 

294 See letters of Data Communiqué and Schnase. 

98
 
 

 

 

more extensively below, however, we do not believe a phase-in or alternate procedures 

for small entities are warranted as such a phase-in would detract from the completeness 

and uniformity of tagged risk/return summary information. We continue to believe that 

the potential of interactive data for enhancing investors’ access to mutual fund 

information justifies implementation of this initiative at this time. 

C. Small Entities Subject to the Rules 

For purposes of the Regulatory Flexibility Act, an investment company is a small 

entity if it, together with other investment companies in the same group of related 

investment companies, has net assets of $50 million or less as of the end of its most 

recent fiscal year.295 Approximately 127 mutual funds registered on Form N-1A meet 

this definition.296 All of these mutual funds will become subject to the rules to require 

submission of risk/return summary information using interactive data. A smaller subset 

of these mutual funds may voluntarily submit tagged portfolio holdings information, but, 

because submitting portfolio holdings information will be voluntary, we anticipate that 

only mutual fund complexes with sufficient resources would elect to participate. To date, 

no small entity mutual funds have elected to participate in the current voluntary program. 

D. Projected Reporting, Recordkeeping and Other Compliance 

Requirements 

1. Submission of Risk/Return Summary Information Using 

Interactive Data 

All mutual funds subject to the amendments are required to submit risk/return 

summary information to the Commission in interactive data format and, if they have a 

295	 17 CFR 270.0-10. 

296	 This estimate is based on analysis by the Division of Investment Management staff of 

publicly available data as of December 2007. 

99
 
 

 

Web site, post the interactive data on their Web site. We believe that, in order to submit 

risk/return summary information in interactive data format, mutual funds in general and 

small entities in particular likely will need to prepare and then submit the interactive data 

by expending internal labor hours in connection with either or both of: 

•	 purchasing, learning, and using software packages designed to prepare 

risk/return summary information in interactive format; and 

• hiring and working with a consultant or filing agent. 

We believe that mutual funds will incur relatively little cost in connection with the 

requirement to post the interactive data on their Web site because the requirement applies 

only to mutual funds that already have a Web site.297 

2. Changes to the Voluntary Program 

The voluntary program is designed to assist us in assessing the feasibility of using 

interactive data on a broader basis. Experience with the current voluntary program 

indicates that the cost of submitting portfolio holdings information in interactive data 

format, the associated burden on the Commission’s electronic filing system, and the 

possible effect of the proposed changes to the voluntary program on those entities that 

use the data from the Commission’s electronic filing system will be minimal. 

No registrant will be required to submit documents in interactive data format 

under the changes we are adopting to the voluntary program. The submission of portfolio 

holdings information in interactive data format will require a participant to tag the 

portfolio holdings information already provided in required disclosures and to submit 

The internal labor and external costs required to comply with the rules we are adopting 

are discussed more fully in Sections III and IV above. 

100
 

297 
 

 

exhibits to its filing. Volunteers may also need to purchase software or retain a 

consultant to assist in creating interactive data exhibits.298 

E. Agency Action to Minimize the Effect on Small Entities 

The Regulatory Flexibility Act directs us to consider significant alternatives that 

would accomplish the stated objective, while minimizing any significant adverse impact 

on small entities. In connection with the amendments, the Commission considered the 

following alternatives: (1) the establishment of different compliance or reporting 

requirements or timetables that take into account the resources available to small entities; 

(2) the clarification, consolidation, or simplification of compliance and reporting 

requirements under the amendments for small entities; (3) the use of performance rather 

than design standards; and (4) an exemption from coverage of the amendments, or any 

part thereof, for small entities. 

1. Submission of Risk/Return Summary Information Using 

Interactive Data 

We believe that, as to small entities, differing compliance, reporting or timetable 

requirements, a partial or complete exemption from the requirements, or the use of 

performance rather than design standards would be inappropriate because these 

approaches would detract from the long-term completeness and uniformity of the 

interactive data format risk/return summary information database. Less long-term 

completeness and uniformity would reduce the extent to which the amendments will 

enable investors and others to search and analyze the information dynamically; facilitate 

comparison of mutual fund information; and, possibly, provide an opportunity to 

automate regulatory filings and business information processing with the potential to 

298	 Id. 

101
 
 

 

increase the speed, accuracy, and usability of risk/return summary information disclosure. 

We note that all mutual funds, including small entities, are not required to comply with 

the new requirements until after January 1, 2011.299 

2. Changes to the Voluntary Program 

The purpose of the amendments is to help us evaluate the usefulness to investors, 

third-party information providers, mutual funds and other entities, the Commission, and 

the marketplace of interactive data and, in particular, of submitting portfolio holdings 

information in interactive data format. Submitting documents containing portfolio 

holdings information in interactive data format is entirely voluntary. 

We have considered different or simpler procedures for small entities, but for 

interactive data to provide benefits such as ready comparability there cannot be 

alternative procedures in place for different entities. Similarly, in order to achieve the 

benefits of interactive data, use of a single technology is necessary. If we determine to 

require the filing of portfolio holdings information in interactive data format in the future, 

we will look to the results of the voluntary program to find alternatives to minimize any 

burden on small entities. 

VII. STATUTORY AUTHORITY 

The Commission is adopting the amendments outlined above under Sections 5, 6, 

7, 10, 19(a), and 28 of the Securities Act [15 U.S.C. 77e, 77f, 77g, 77j, 77s(a), and 77z3]; Sections 3, 12, 13, 14, 15(d), 23(a), 35A, and 36 of the Exchange Act [15 U.S.C. 78c, 

78l, 78m, 78n, 78o(d), 78w(a), 78ll, and 78mm]; Sections 314 and 319 of the Trust 

In this regard, in Section II.H. of this release we note that the additional time is intended 

to permit mutual funds to plan for and implement the interactive data reporting process 

after having the opportunity to experiment with the voluntary program. 

102
 

299 
 

Indenture Act [15 U.S.C. 77nnn and 77sss]; and Sections 6(c), 8, 24, 30, and 38 of the 

Investment Company Act [15 U.S.C. 80a-6(c), 80a-8, 80a-24, 80a-29, and 80a-37]. 

List of Subjects 

17 CFR Parts 232 and 239 

Reporting and recordkeeping requirements, Securities. 

17 CFR Parts 230 and 274 

Investment Companies, Reporting and recordkeeping requirements, Securities. 

TEXT OF RULE AND FORM AMENDMENTS 

For the reasons set forth above, the Commission amends Title 17, Chapter II of 

the Code of Federal Regulations as follows: 

PART 230 – GENERAL RULES AND REGULATIONS, SECURITES ACT OF 

1933 

1. The authority citation for Part 230 continues to read in part as follows: 

Authority: 15 U.S.C. 77b, 77c, 77d, 77f, 77g, 77h, 77j, 77r, 77s, 77z–3, 77sss, 

78c, 78d, 78j, 78l , 78m, 78n, 78o, 78t, 78w, 78ll(d), 78mm, 80a-8, 80a-24, 80a-28, 

80a-29, 80a-30, and 80a-37, unless otherwise noted. 

* * * * * 

2. Amend § 230.485 by adding paragraph (c)(3) to read as follows: 

§ 230.485 Effective date of post-effective amendments filed by certain registered 

investment companies. 

* * * * * 

(c) * * * 

(3) A registrant’s ability to file a post-effective amendment, other than an 

amendment filed solely for purposes of submitting an Interactive Data File, under 

103
 
paragraph (b) of this section is automatically suspended if a registrant fails to submit and 

post on its Web site any Interactive Data File exhibit as required by General Instruction 

C.3.(g) of Form N-1A (§§239.15A and 274.11A of this chapter). A suspension under this 

paragraph (c)(3) shall become effective at such time as the registrant fails to submit or 

post an Interactive Data File as required by General Instruction C.3.(g) of Form N-1A. 

Any such suspension, so long as it is in effect, shall apply to any post-effective 

amendment that is filed after the suspension becomes effective, but shall not apply to any 

post-effective amendment that was filed before the suspension became effective. Any 

suspension shall apply only to the ability to file a post-effective amendment pursuant to 

paragraph (b) of this section and shall not otherwise affect any post-effective amendment. 

Any suspension under this paragraph (c)(3) shall terminate as soon as a registrant has 

submitted and posted to its Web site the Interactive Data File as required by General 

Instruction C.3.(g) of Form N-1A. 

* * * * * 

3. Amend § 230.497 by adding a sentence at the end of paragraphs (c) and 

(e) to read as follows: 

§ 230.497 Filing of investment company prospectuses – number of copies. 

* * * * * 

(c) * * * Investment companies filing on Form N-1A must, if 

applicable pursuant to General Instruction C.3.(g) of Form N-1A, include an Interactive 

Data File (§ 232.11 of this chapter). 

* * * * * 

104
 
(e) * * * Investment companies filing on Form N-1A must, if 

applicable pursuant to General Instruction C.3.(g) of Form N-1A, include an Interactive 

Data File (§ 232.11 of this chapter). 

* * * * * 

PART 232 – REGULATION S-T – GENERAL RULES AND REGULATIONS 

FOR ELECTRONIC FILINGS 

4. The authority citation for Part 232 continues to read in part as follows: 

Authority: 15 U.S.C. 77f, 77g, 77h, 77j, 77s(a), 77z-3, 77sss(a), 78c(b), 78l, 78m, 

78n, 78o(d), 78w(a), 78ll, 80a-6(c), 80a-8, 80a-29, 80a-30, 80a-37, and 7201 et seq.; and 

18 U.S.C. 1350. 

* * * * * 

5. Further amend § 232.11 as published at 74 FR 6813, February 10, 2009, 

by revising the definition of “Related Official Filing” to read as follows: 

§ 232.11 Definition of terms used in part 232. 

* * * * * 

Related Official Filing. The term Related Official Filing means the ASCII or 

HTML format part of the official filing with which an Interactive Data File appears as an 

exhibit or, in the case of a filing on Form N-1A, the ASCII or HTML format part of an 

official filing that contains the information to which an Interactive Data File corresponds. 

* * * * * 

6. Further amend § 232.202 as published beginning at 74 FR 6813, February 

10, 2009, by revising Note 4 to § 232.202 to read as follows: 

§ 232.202 Continuing hardship exemption. 

* * * * * 

105
 
 

Note 4 to § 232.202: Failure to submit or post, as applicable, the Interactive Data 

File as required by Rule 405 by the end of the continuing hardship exemption if granted 

for a limited period of time, will result in ineligibility to use Forms S-3, S-8, and F-3 

(§§ 239.13, 239.16b and 239.33 of this chapter), constitute a failure to have filed all 

required reports for purposes of the current public information requirements of Rule 

144(c)(1) (§ 230.144(c)(1) of this chapter), and, pursuant to Rule 485(c)(3), suspend the 

ability to file post-effective amendments under Rule 485(b) (§ 230.485 of this chapter). 

7. Further amend § 232.401 as published at 74 FR 6814, February 10, 2009, 

by revising paragraph (a) to read as follows: 

§ 232.401 XBRL-Related Document submissions. 

(a) Only an electronic filer that is an investment company registered under the 

Investment Company Act of 1940 (15 U.S.C. 80a-1 et seq.), a “business development 

company” as defined in section 2(a)(48) of that Act, or an entity that reports under the 

Exchange Act and prepares its financial statements in accordance with Article 6 of 

Regulation S-X (17 CFR 210.6-01 et seq.) is permitted to participate in the voluntary 

XBRL (eXtensible Business Reporting Language) program. An electronic filer that 

participates in the voluntary XBRL program may submit XBRL-Related Documents 

(§232.11) in electronic format as an exhibit to: the filing (other than a Form N-1A 

(§239.15A and §274.11A of this chapter) to which the XBRL-Related Documents relate; 

an amendment to such filing, but, in the case of a Form N-1A filing, an amendment made 

only after the effective date of the Form N-1A filing to which the XBRL-Related 

Documents relate; or, if the electronic filer is eligible to file a Form 8-K (§249.308 of this 

chapter) or a Form 6-K (§249.306 of this chapter), a Form 8-K or a Form 6-K, as 

106
 
applicable, that references the filing to which the XBRL-Related Documents relate if 

such Form 8-K or Form 6-K is submitted no earlier than the date of that filing. The 

XBRL-Related Documents must comply with the content and format requirements of this 

section, be submitted as an exhibit to a form that contains the disclosure required by this 

section and be submitted in accordance with the EDGAR Filer Manual and, as applicable, 

one of Item 601(b)(100) of Regulation S-K (§229.601(b)(100) of this chapter), Item 

601(b)(100) of Regulation S-B (§228.601(b)(100) of this chapter), Form 20-F (§249.220f 

of this chapter), Form 6-K or §270.8b-33 of this chapter. 

* * * * * 

8. Amend § 232.401 by: 

a. Removing “or” at the end of paragraph (b)(1)(iii); 

b. Revising paragraph (b)(1)(iv); 

c. Adding paragraph (b)(1)(v); and 

d. Revising paragraph (d)(2), introductory text. 

The addition and revisions read as follows: 

§ 232.401 XBRL-Related Document submissions. 

* * * * * 

(b) * * * 

(1) * * * 

(iv) The risk/return summary information set forth in Items 2, 3, and 4 of Form 

N-1A provided that the filing is submitted prior to January 1, 2011, and, in the case of a 

Form N-1A filing that includes more than one series (as that term is used in rule 18f-2(a) 

under the Investment Company Act (§270.18f-2(a) of this chapter), a filer may include in 

107
 
 

mandatory content complete risk/return summary information for any one or more of 

those series; or 

(v) If the electronic filer is an investment company registered under the 

Investment Company Act of 1940 (15 U.S.C. 80a-1 et seq.), a “business development 

company” as defined in section 2(a)(48) of that Act, or an entity that reports under the 

Exchange Act and prepares its financial statements in accordance with Article 6 of 

Regulation S-X (17 CFR 210.6-01 et seq.), Schedule I – Investments in Securities of 

Unaffiliated Issuers (§ 210.12-12 of this chapter). 

* * * * * 

(d) * * * 

(2) The disclosures required by paragraph (d)(1) of this section must appear 

within the XBRL-Related Documents as a tagged data element and, as applicable, in: 

* * * * * 

9. Further amend § 232.405 as published beginning at 74 FR 6814, February 

10, 2009, by: 

a. Revising Preliminary Note 1; 

b. Revising paragraphs (a), (b) and (g); and 

c. Adding a sentence at the end of the Note to § 232.405. 

The revisions and addition read as follows: 

§ 232.405 Interactive Data File submissions and postings. 

Preliminary Note 1. Sections 405 and 406T of Regulation S-T (§§232.405 and 

232.406T) apply to electronic filers that submit or post Interactive Data Files. Item 

601(b)(101) of Regulation S-K (§229.601(b)(101) of this chapter), paragraph 101 of the 

108
 
Information Not Required to be Delivered to Offerees or Purchasers of both Form F-9 

(§239.39 of this chapter) and Form F-10 (§239.40 of this chapter), Item 101 of the 

Instructions as to Exhibits of Form 20-F (§249.220f of this chapter), paragraph B.7 of the 

General Instructions to Form 40-F (§249.240f of this chapter), paragraph C.6 of the 

General Instructions to Form 6-K (§249.306 of this chapter), and General Instruction 

C.3.(g) of Form N-1A (§§ 239.15A and 274.11A of this chapter) specify when electronic 

filers are required or permitted to submit or post an Interactive Data File (§232.11), as 

further described in the Note to § 232.405. 

* * * * * 

(a) Content, format, submission and posting requirements – General. An 

Interactive Data File must: 

(1) Comply with the content, format, submission and Web site posting 

requirements of this section; 

(2) Be submitted only by an electronic filer either required or permitted to 

submit an Interactive Data File as specified by Item 601(b)(101) of Regulation S-K, 

paragraph 101 of the Information Not Required to be Delivered to Offerees or Purchasers 

of either Form F-9 or Form F-10, Item 101 of the Instructions as to Exhibits of Form 

20-F, paragraph B.7 of the General Instructions to Form 40-F, paragraph C.6 of the 

General Instructions to Form 6-K, or General Instruction C.3.(g) of Form N-1A, as 

applicable, as an exhibit to: 

(i) A form that contains the disclosure required by this section; or 

(ii) If the electronic filer is not an open-end management investment company 

registered under the Investment Company Act, an amendment to a form that contains the 

109
 
disclosure required by this section if the amendment is filed no more than 30 days after 

the earlier of the due date or filing date of the form and the Interactive Data File is the 

first Interactive Data File the electronic filer submits or the first Interactive Data File the 

electronic filer submits that complies or is required to comply, whichever occurs first, 

with paragraphs (d)(1) through (d)(4), (e)(1), and (e)(2) of this section; 

(3) Be submitted in accordance with the EDGAR Filer Manual and, as 

applicable, Item 601(b)(101) of Regulation S-K, paragraph 101 of the Information Not 

Required to be Delivered to Offerees or Purchasers of either Form F-9 or Form F-10, 

Item 101 of the Instructions as to Exhibits of Form 20-F, paragraph B.7 of the General 

Instructions to Form 40-F, paragraph C.6 of the General Instructions to Form 6-K, or 

General Instruction C.3.(g) of Form N-1A; and 

(4) Be posted on the electronic filer’s corporate Web site, if any, in 

accordance with, as applicable, Item 601(b)(101) of Regulation S-K, paragraph 101 of 

the Information Not Required to be Delivered to Offerees or Purchasers of either Form F9 or Form F-10, Item 101 of the Instructions as to Exhibits of Form 20-F, paragraph B.7 

of the General Instructions to Form 40-F, paragraph C.6 of the General Instructions to 

Form 6-K, or General Instruction C.3.(g) of Form N-1A. 

(b)(1) Content - categories of information presented. If the electronic filer is not 

an open-end management investment company registered under the Investment Company 

Act of 1940, an Interactive Data File must consist of only a complete set of information 

for all periods required to be presented in the corresponding data in the Related Official 

Filing, no more and no less, from all of the following categories: 

(i) The complete set of the electronic filer’s financial statements (which 

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includes the face of the financial statements and all footnotes); and 

(ii) All schedules set forth in Article 12 of Regulation S-X (§§ 210.12-01 – 

210.12-29) related to the electronic filer’s financial statements. 

Note to paragraph (b)(1): It is not permissible for the Interactive Data File to 

present only partial face financial statements, such as by excluding comparative financial 

information for prior periods. 

(2) If the electronic filer is an open-end management investment company 

registered under the Investment Company Act of 1940, an Interactive Data File must 

consist of only a complete set of information for all periods required to be presented in 

the corresponding data in the Related Official Filing, no more and no less, from the 

risk/return summary information set forth in Items 2, 3, and 4 of Form N-1A. 

* * * * * 

(g) Posting. Any electronic filer that maintains a corporate Web site and is 

required to submit an Interactive Data File must post that Interactive Data File on that 

Web site by the end of the calendar day on the earlier of the date the Interactive Data File 

is submitted or is required to be submitted, and, if the electronic filer is not an open-end 

management company registered under the Investment Company Act of 1940, the 

Interactive Data File must remain accessible on that Web site for at least a 12-month 

period. For an electronic filer that is an open-end management investment company 

registered under the Investment Company Act of 1940, General Instruction C.3.(g) of 

Form N-1A specifies the period of time for which an Interactive Data File must remain 

accessible on a company’s Web site. 

Note to §232.405: * * * For an issuer that is an open-end 

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management investment company registered under the Investment Company Act of 1940, 

General Instruction C.3.(g) of Form N-1A specifies the circumstances under which an 

Interactive Data File must be submitted as an exhibit and be posted to the company’s 

Web site, if any. 

PART 239 – FORMS PRESCRIBED UNDER THE SECURITIES ACT OF 1933 

10. The authority citation for Part 239 continues to read in part as follows: 

Authority: 15 U.S.C. 77f, 77g, 77h, 77j, 77s, 77z-2, 77z-3, 77sss, 78c, 78l, 78m, 

78n, 78o(d), 78u-5, 78w(a), 78ll, 78mm, 80a-2(a), 80a-3, 80a-8, 80a-9, 80a-10, 80a-13, 

80a-24, 80a-26, 80a-29, 80a-30, and 80a-37, unless otherwise noted. 

* * * * * 

PART 239 – FORMS PRESCRIBED UNDER THE SECURITIES ACT OF 1933 

PART 274 – FORMS PRESCRIBED UNDER THE INVESTMENT COMPANY 

ACT OF 1940 

11. The authority citation for Part 274 continues to read in part as follows: 

Authority: 15 U.S.C. 77f, 77g, 77h, 77j, 77s, 78c(b), 78l, 78m, 78n, 78o(d), 

80a-8, 80a-24, 80a-26, and 80a-29, unless otherwise noted. 

* * * * * 

12. Amend Form N-1A (referenced in §§ 239.15A and 274.11A) by adding a 

paragraph (g) to General Instruction C.3. to read as follows: 

Note: The text of Form N-1A does not, and these amendments will not, appear in 

the Code of Federal Regulations. 

FORM N-1A 

* * * * * 

GENERAL INSTRUCTIONS 

112
 
 

* * * * * 

C. 

* * * * * 

3. 

* * * * * 

(g) Interactive Data File. 

(i) An Interactive Data File (§ 232.11 of this chapter) is required to be 

submitted to the Commission and posted on the Fund’s Web site, if any, in the manner 

provided by Rule 405 of Regulation S-T (§ 232.405 of this chapter) for any registration 

statement or post-effective amendment thereto on Form N-1A that includes or amends 

information provided in response to Items 2, 3, or 4. The Interactive Data File must be 

submitted as an amendment to the registration statement to which the Interactive Data 

File relates. The amendment must be submitted after the registration statement or posteffective amendment that contains the related information becomes effective but not later 

than 15 business days after the effective date of that registration statement or posteffective amendment. 

(ii) An Interactive Data File is required to be submitted to the Commission 

and posted on the Fund’s Web site, if any, in the manner provided by Rule 405 of 

Regulation S-T for any form of prospectus filed pursuant to rule 497(c) or (e) under the 

Securities Act [17 CFR 230.497(c) or (e)] that includes information provided in response 

to Items 2, 3, or 4 that varies from the registration statement. The Interactive Data File 

may be submitted with or up to 15 business days subsequent to the filing made pursuant 

to rule 497. 

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(iii) An Interactive Data File is required to be posted on the Fund’s Web site 

for as long as the registration statement or post-effective amendment to which the 

Interactive Data File relates remains current. 

(iv) An Interactive Data File must be submitted as an exhibit to Form N-1A, 

under paragraph (i) of this Instruction, or as an exhibit to the filing made pursuant to rule 

497, under paragraph (ii) of this Instruction. The Interactive Data File must be submitted 

in such a manner that will permit the information for each series and, for any information 

that does not relate to all of the classes in a filing, each class of the Fund to be separately 

identified. 

By the Commission. 

 Elizabeth M. Murphy 

Secretary 

February 11, 2009 

114