On August 16, 2018, the inline XBRL final rule was published to the Federal Register, confirming a phase in of the rule, which became effective on September 17, 2018, over a three-year period.
Open-end management investment companies and ETFs that are currently subject to Risk/Return Summary XBRL requirements will be required to comply with the rule, beginning with any initial registration statement or post-effective amendment that is an annual update to an effective registration statement that becomes effective on or after the compliance dates below
Large mutual funds, with $1 billion in net assets will need to begin compliance with the Rule September 17, 2020
Smaller funds, with less than $1 billion in net assets will need to begin compliance with the Rule September 17, 2021
Additional Rule elements:
As of September 17, 2018 funds are no longer required to post the Interactive Data Files (XBRL format) on their websites.
Eliminated the 15-business day filing period funds currently have between submitting the information in HTML and submitting the tagged XBRL version.
XBRL will no longer file as a separate exhibit.
Redline Tagging for Inline XBRL Submissions
In preparation for the new rule, Toppan Merrill routinely creates test submissions via EDGAR for our clients as part of our quality control compliance and readiness procedures. In several test filing submissions, we noticed submissions with redline tagging were incurring errors and not being accepted by EDGAR.
In our inquiry with the SEC, we were notified that there is no current feature within EDGAR that will accept redline tagging for inline XBRL documents and filers should skip redlining and submit their inline XBRL submissions, as the filer wants it to be disseminated, until there is an EDGAR feature for it. When inquiring when a feature may be available for redline tagging, we were told that there are no proposed dates at this time.
For large mutual fund firms with a compliance date of September 17, 2020 or smaller mutual fund firms looking to incorporate Inline XBRL requirements prior to its compliance date of September 17, 2021, firms should immediately consult with their legal, compliance or regulatory teams as soon as possible to provide awareness on potential redline tagging errors that may incur with firm submissions via EDGAR and address any potential disruption in compliance workflows and processes to ensure compliance.
We encourage filers to contact their SEC Reviewer in the Division of Investment Management’s Disclosure Office to confirm that a non-redline is the only option until EDGAR is updated, as well as to confirm they would be able to e-mail a redline to the Division, if requested.
Toppan Merrill will continue to provide updates as we are made aware. Should you have any questions or would like to speak to one of our compliance consultants regarding the rule and underlying redlining issues, please contact your local sales representative or email us at firstname.lastname@example.org.
Note: This information is intended as a service to our clients and is not intended to provide legal guidance. You should check with your legal counsel to determine any information applicable to your particular situation.