On December 11, 2015, the Securities and Exchange Commission proposed a new rule, Rule 18f-4, under the Investment Company Act (ICA), to regulate certain types of financial commitments made by investment companies, including mutual funds and exchange-traded funds, closed-end funds, and business development companies. The types of commitments covered in the proposed rule are "derivatives transactions" (swaps, futures and forwards) and "financial commitment transactions" (reverse repurchase agreements but not repos), short sale borrowings or any other firm or standby financial commitment). While presented as an "exemptive" rule, the proposed rule would materially restrict the manner in which many funds currently use derivatives based on existing guidance. Moreover, the proposed rule would impose many new risk management requirements on funds that use derivatives, as well as impose significant new obligations on the directors of such funds.