A recent Reuters column discusses the current status of IRS private letter rulings (PLRs) that allow mutual funds to invest in commodity derivatives through Cayman Island subsidiaries. After issuing 72 of these PLRs, the IRS announced last year that it would not respond to any more PLR requests of this nature pending a review of its policies. This moratorium has left at least 28 PLR requests unanswered. According to the column, two funds are reported to have pressed ahead without securing a PLR. Some critics in Congress, notably Senator Carl Levin (D-MI), have questioned whether the PLRs are appropriate. Senator Levin has stated that he believes the PLRs allow funds to “end run around the legal restrictions on commodity investments by mutual funds.” However, many argue that the PLRs are clearly permitted by tax law and that reversing the PLRs could have serious effects on the industry and those investors who have chosen to gain exposure to commodities through mutual funds. The Reuters column provides a very thorough summary of the legislative and regulatory history surrounding this issue.