JPMIM Open-End Fund Co-Investment No-Action Letter

J.P. Morgan Investment Management, Inc.

Investment Company Act of 1940

April 27, 2026

RESPONSE OF THE OFFICE OF CHIEF COUNSEL

DIVISION OF INVESTMENT MANAGEMENT

Dear Ms. Blass,

In your letter dated April 27, 2026, J.P. Morgan Investment Management, Inc. (“JPMIM”) requests our assurance that the staff of the Division of Investment Management (the “Staff”) will not recommend enforcement action to the Securities and Exchange Commission (the “Commission”) under Sections 17(d) and 57(a)(4) of the Investment Company Act of 1940 (the “1940 Act”) and Rule 17d-1 thereunder if:

1. an open-end investment company registered under the 1940 Act whose primary investment adviser or sub-adviser is an Adviser (an “Open-End Fund”) relies on a co-investment exemptive order (the “Order”) [1] as a Regulated Fund, [2] subject to compliance with the terms and conditions in the Order; and
2. the term “Required Majority” for purposes of conditions 2 and 6(b) of the Order is applied with respect to a committee of the board of directors as further described herein.

Open-End Fund Reliance on the Order

With respect to your first request, you:

• Contend that allowing Open-End Funds to rely on the Order as Regulated Funds would provide Open-End Funds access to transactions on potentially superior terms and expand the pool of more favorable investment opportunities available to Open-End Funds and their investors;
• Maintain that participation by Open-End Funds in co-investment transactions under the terms and conditions of the Order would not raise novel Section 17(d) and Rule 17d-1 concerns as compared to Regulated Funds covered under the Order; and
• Represent that those terms and conditions in the Order protect Open-End Funds in the same manner as the Regulated Funds. Unlike BDCs and registered closed-end funds, Open-End Funds must redeem their shareholders upon demand, but you note that such Open-End Funds are subject to Rule 22e-4 under the 1940 Act, which would limit the fund from participating in a Co-Investment Transaction involving illiquid securities if such participation would cause the Open-End Fund to exceed the 15% illiquid investment threshold in the rule. Based on your facts and representations, we would not recommend enforcement action to the Commission under Section 17(d) and Rule 17d-1 thereunder if an Open-End Fund with a primary investment adviser or sub-adviser that is an Adviser relies on a co-investment exemptive order as a Regulated Fund, subject to compliance with the terms and conditions of the exemptive order.

Committee of the Board as Required Majority

With respect to your second request, conditions 2 and 6(b) of the Order require – with certain specified exceptions – that, prior to a Regulated Fund acquiring in a Co-Investment Transaction a security in whose issuer an Affiliated Entity has an existing interest, or disposing of a security acquired in a Co-Investment Transaction, the Required Majority (as defined in Section 57(o) of the 1940 Act) take the steps described in Section 57(f) of the 1940 Act. [3]

You contend that this “Required Majority” standard creates burdens and logistical challenges for many Regulated Funds seeking to rely on the Order; in particular, you:

• Note that while BDCs – which are subject to Section 57(o) – typically tend to have small boards, many Open-End Funds, closed-end funds registered under the 1940 Act, and some BDCs have comparatively larger boards;
• State that larger boards increase the time and resources necessary for the investment company to obtain the approval of a majority of all disinterested directors and require lead time to schedule meetings, which may not necessarily align with transaction timelines;
• Request, to facilitate the ability of Regulated Funds (including Open-End Funds) with larger boards to rely on the Order, that boards of Regulated Funds be granted flexibility to delegate responsibilities under conditions 2 and 6(b) of the Order to a committee of the board; and
• Represent that such a committee would (i) consist of at least three disinterested directors, and (ii) provide a report on all Co-Investment Transactions considered, including the committee’s decision on each such transaction and the information described in Section 57(f)(3) that the committee has recorded with respect to each such transaction, at the next regular meeting of the full board of directors. Based on your facts and representations, the Staff would not recommend enforcement action to the Commission under Sections 17(d) and 57(a)(4) of the 1940 Act and Rule 17d-1 thereunder if a Regulated Fund meets the “Required Majority” definition for purposes of conditions 2 and 6(b) of the Order only with respect to a committee of the board consisting of at least three directors who both have no financial interest in the relevant transaction and are not interested persons of the Regulated Fund, a majority of whom vote to approve each proposed Co-Investment Transaction.

Our letter provides our position on enforcement action only and does not provide any legal conclusions on the issues presented. Because our position is based on all of the facts and representations made in your letter, you should note that any different facts and circumstances might require a different conclusion. This letter reflects the views of the Staff. It is not a rule, regulation, or statement of the Commission, and the Commission has neither approved nor disapproved its content. This letter, like all staff statements, has no legal force or effect; it does not alter or amend applicable law, and it creates no new or additional obligations for any person. [4]

Adam M. Large

Senior Special Counsel
Division of Investment Management

[1] JPMorgan Private Markets Fund, et. al., Investment Company Act Release No. 36015 (Mar. 11, 2026) (notice) and No. 36078 (Apr. 7, 2026) (order) (File No. 812-15950); see also Application of JPMorgan Private Markets Fund, et al., File No. 812-15950 (filed Dec. 12, 2025, amended on Mar. 2, 2026 and Mar. 6, 2026). The Order permits business development companies (“BDCs”) and closed-end management investment companies to participate in co-investment transactions with affiliated entities, which would otherwise be prohibited by Sections 17(d) and 57(a)(4) of the 1940 Act and Rule 17d-1 thereunder.

[2] Capitalized terms used but not defined herein shall have the respective meanings ascribed to them in the Order.

[3] Section 57(o) defines the term “required majority,” in relevant part, with respect to the approval of a proposed transaction, as both a majority of a BDC’s directors or general partners who have no financial interest in the transaction and a majority of such directors who are not interested persons of the BDC. Section 57(f) generally requires that in approving a proposed transaction, the “required majority” of the directors or general partners of a BDC determine that: (1) the terms of the transaction are reasonable and fair to the shareholders of the BDC; (2) the proposed transaction is consistent with the interests of the shareholders and with the BDC’s policies; and (3) the directors or general partners record and preserve a description of the transaction, their findings, the information or materials upon which those findings were based, and the basis therefor.

[4] In particular, the Staff’s no-action position provided herein is limited to orders that: (a) impose conditions substantially identical to those in the Order (i.e. conditions that are substantially identical to those in FS Credit Opportunities Corp., et al., Investment Company Act Release No. 35520 (Apr. 3, 2025) (notice) and No. 35561 (Apr. 29, 2025) (order) (File No. 812-15706); see also Application of FS Credit Opportunities Corp., et al., File No. 812-15706 (filed Feb. 21, 2025, amended Mar. 20, 2025 and Apr. 3, 2025)); and (b) were published for public notice by the Commission before May 4, 2026.

Last Reviewed or Updated: April 27, 2026

Resources

• Incoming Letter