ICI Statement on SEC’s ETF Share Class Application Notice

Washington, DC; September 29, 2025—The Investment Company Institute (ICI) President and CEO Eric J. Pan released the following statement following the Securities and Exchange Commission’s notice that they intend to grant exemptive relief to offer dual share class funds.

“We applaud the SEC’s indication of its intent to grant exemptive relief to allow asset managers to offer mutual funds and ETFs as separate share classes under the same portfolio. This decision is an important step to expanding investor choice and fostering a more competitive marketplace,” shared Eric J. Pan, ICI President & CEO. “ICI previously called on the SEC to prioritize approval of such exemptive relief, and we have been working closely with our members, intermediaries, service providers, and other key stakeholders to prepare the industry for this moment. ICI will work close with the industry in implementing the soon-to-be granted relief of this first application and the nearly 80 remaining applications.”

Background:
ICI’s March 2025 paper, “Reimagining the 1940 Act,” encourages the SEC to foster ETF innovation by enabling new or existing funds to offer both mutual fund and ETF share classes. Permitting a single fund to offer both mutual fund and ETF share classes would promote efficiency and economies of scale and provide optionality for fund investors.

In remarks at ICI’s Investment Management Conference in March 2025, then-Acting SEC Chairman Mark Uyeda shared that the SEC staff were directed to "prioritize their careful review of the many applications filed for ETF share class relief."

At ICI’s ETF Conference in September, Kaitlin Bottock, Assistant Director in the Division of Investment Management at the Securities and Exchange Commission, shared that the SEC was “on the one-yard line” on its approval of exemptive relief.