The SEC's October 9 proposal would restore wider affiliated-fund cross-trading eligibility for fixed-income assets affected by the interaction with its 2020 valuation rule. This is a proposed amendment to Rule 17a-7, not permission already in effect.
The useful distinction is between monitoring aggregate activity and observing actual transaction prices. Commissioner Mark Uyeda asks whether TRACE or RTRS should receive cross prices: a bond crossing at 98 after a previous Level 2 valuation of 98.5 could supply information to other holders, as well as a compliance backstop. That is his comment-stage argument, not an adopted reporting obligation.
The pricing convention also matters. NAV pricing uses the security's valuation in the next fund NAV, and both participating funds must assign it the same value. If one uses mid and the other bid, that route is unavailable; current-market pricing would be required. If both use bid, the seller receives less than a mid execution. The adviser must still assess each fund's best interest against reasonably available alternatives, and periodically review unaffiliated current-market pricing sources for reliability and independence.
The SEC estimates $173.0 million in annual transaction-cost savings, versus $13.7 million annual ongoing compliance costs and $15.9 million initial costs. These are modelled amounts in 2026 dollars. Its higher stress-spread savings scenario assumes crossing volume stays unchanged. Comments run for 60 days after Federal Register publication; a fixed closing date has not been verified.