Proposed Collection; Comment Request, 17725-17726 [E5-1586]
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Federal Register / Vol. 70, No. 66 / Thursday, April 7, 2005 / Notices
Section 12(d)(3) of the Act generally
prohibits registered investment
companies (‘‘funds’’), and companies
controlled by funds, from purchasing
securities issued by a registered
investment adviser, broker, dealer, or
underwriter (‘‘securities-related
businesses’’). Rule 12d3–1 (‘‘Exemption
of acquisitions of securities issued by
persons engaged in securities related
businesses’’ [17 CFR 270.12d3–1])
permits a fund to invest up to five
percent of its assets in securities of an
issuer deriving more than fifteen
percent of its gross revenues from
securities-related businesses, but a fund
may not rely on rule 12d3–1 to acquire
securities of its own investment adviser
or any affiliated person of its own
investment adviser.
A fund may, however, rely on an
exemption in rule 12d3–1 to acquire
securities issued by its subadvisers in
circumstances in which the subadviser
would have little ability to take
advantage of the fund, because it is not
in a position to direct the fund’s
securities purchases. The exemption in
rule 12d3–1(c)(3) is available if (i) the
subadviser is not, and is not an affiliated
person of, an investment adviser that
provides advice with respect to the
portion of the fund that is acquiring the
securities, and (ii) the advisory contracts
of the subadviser, and any subadviser
that is advising the purchasing portion
of the fund, prohibit them from
consulting with each other concerning
securities transactions of the fund, and
limit their responsibility in providing
advice to providing advice with respect
to discrete portions of the fund’s
portfolio.
The Commission staff estimates that
3,028 portfolios of approximately 2,126
funds use the services of one or more
subadvisers. Based on an analysis of
investment company filings, the staff
estimates that approximately 200 funds
are registered annually. Assuming that
the number of these funds that will use
the services of subadvisers is
proportionate to the number of funds
that currently use the services of
subadvisers, then we estimate that 46
new funds will enter into subadvisory
agreements each year.1 The Commission
staff further estimates, based on analysis
of investment company filings, that 10
extant funds will employ the services of
subadvisers for the first time each year.
Thus, the staff estimates that a total of
56 funds, with a total of 78 portfolios
1 The Commission staff estimates that
approximately 23 percent of funds are advised by
subadvisers.
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18:22 Apr 06, 2005
Jkt 205001
(respondents),2 will enter into
subadvisory agreements each year.
Assuming that each of these funds
enters into a subadvisory contract that
permits it to rely on the exemptions in
rule 12d3–1(c)(3),3 we estimate that the
rule’s contract modification requirement
will result in 117 burden hours
annually.4
Written comments are invited on: (a)
Whether the proposed collection of
information is necessary for the proper
performance of the functions of the
agency, including whether the
information will have practical utility;
(b) the accuracy of the agency’s estimate
of the burden of the collection of
information; (c) ways to enhance the
quality, utility, and clarity of the
information collected; and (d) ways to
minimize the burden of the collection of
information on respondents, including
through the use of automated collection
techniques or other forms of information
technology. Consideration will be given
to comments and suggestions submitted
in writing within 60 days of this
publication.
Please direct your written comments
to R. Corey Booth, Director/Chief
Information Officer, Office of
Information Technology, Securities and
Exchange Commission, 450 5th Street,
NW., Washington, DC 20549.
Dated: March 28, 2005.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. E5–1585 Filed 4–6–05; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
Proposed Collection; Comment
Request
Upon written request, copies available
from: Securities and Exchange
Commission, Office of Filings and
Information Services, Washington, DC
20549.
Extension:
Rule 17a–10, SEC File No. 270–507, OMB
Control No. 3235–0563.
2 Based on existing statistics, we assume that each
fund has 1.4 portfolios advised by a subadviser.
3 Rules 12d3–1, 10f–3, 17a–10, and 17e–1 require
virtually identical modifications to fund advisory
contracts. The Commission staff assumes that funds
would rely equally on the exemptions in these
rules, and therefore the Commission has
apportioned the burden hours associated with the
required contract modifications equally among the
four rules.
4 This estimate is based on the following
calculations: (78 portfolios × 6 hours = 468 burden
hours for rules 12d3–1, 10f–3, 17a–10, and 17e–1;
468 total burden hours for all of the rules/four rules
= 117 annual burden hours per rule.)
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Fmt 4703
Sfmt 4703
17725
Notice is hereby given that pursuant
to the Paperwork Reduction Act of 1995
(44 U.S.C. 3501 et seq.) the Securities
and Exchange Commission (the
‘‘Commission’’) is soliciting comments
on the collections of information
summarized below. The Commission
plans to submit these existing
collections of information to the Office
of Management and Budget (‘‘OMB’’) for
extension and approval.
Section 17(a) of the Investment
Company Act of 1940 (the ‘‘Act’’),
prohibits affiliated persons of a
registered investment company (‘‘fund’’)
from borrowing money or other property
from, or selling or buying securities or
other property to or from the fund, or
any company that the fund controls.
Rule 17a–10 permits (i) a subadviser of
a fund to enter into transactions with
funds the subadviser does not advise
but which are affiliated persons of a
fund that it does advise (e.g., other
funds in the fund complex), and (ii) a
subadviser (and its affiliated persons) to
enter into transactions and
arrangements with funds the subadviser
does advise, but only with respect to
discrete portions of the subadvised fund
for which the subadviser does not
provide investment advice.
To qualify for the exemptions in rule
17a–10, the subadvisory relationship
must be the sole reason why section
17(a) prohibits the transaction; and the
advisory contracts of the subadviser
entering into the transaction, and any
subadviser that is advising the
purchasing portion of the fund, must
prohibit the subadvisers from consulting
with each other concerning securities
transactions of the fund, and limit their
responsibility to providing advice with
respect to discrete portions of the fund’s
portfolio.1
The Commission staff estimates that
3,028 portfolios of approximately 2,126
funds use the services of one or more
subadvisers. Based on discussions with
industry representatives, the staff
estimates that it will require
approximately 6 hours to draft and
execute revised subadvisory contracts (5
staff attorney hours, 1 supervisory
attorney hour), in order for funds and
subadvisers to be able to rely on the
exemptions in rule 17a–10. The staff
assumes that all of these funds amended
their advisory contracts following the
adoption of rule 17a–10 in 2002 that
conditioned certain exemptions upon
these contractual alterations.2
1 See
17 CFR 270.17a–10(a)(2).
12d3–1, 10f–3, 17a–10, and 17e–1 require
virtually identical modifications to fund advisory
contracts. The Commission staff assumes that funds
2 Rules
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Continued
07APN1
17726
Federal Register / Vol. 70, No. 66 / Thursday, April 7, 2005 / Notices
Based on an analysis of investment
company filings, the staff estimates that
approximately 200 new funds are
registered annually. Assuming that the
number of these funds that will use the
services of subadvisers is proportionate
to the number of funds that currently
use the services of subadvisers, then
approximately 46 new funds will enter
into subadvisory agreements each year.3
The Commission staff further estimates,
based on an analysis of investment
company filings, that 10 extant funds
will employ the services of subadvisers
for the first time each year. Thus, the
staff estimates that a total of 56 funds,
with a total of 78 portfolios,4 will enter
into subadvisory agreements each year.
Assuming that each of these funds
enters into a contract that permits it to
rely on the exemptions in rule 17a–10,
we estimate that the rule’s contract
modification requirement will result in
117 burden hours annually.5
Written comments are invited on: (a)
Whether the proposed collection of
information is necessary for the proper
performance of the functions of the
agency, including whether the
information will have practical utility;
(b) the accuracy of the agency’s estimate
of the burden of the collection of
information; (c) ways to enhance the
quality, utility, and clarity of the
information collected; and (d) ways to
minimize the burden of the collection of
information on respondents, including
through the use of automated collection
techniques or other forms of information
technology. Consideration will be given
to comments and suggestions submitted
in writing within 60 days of this
publication.
Please direct your written comments
to R. Corey Booth, Director/Chief
Information Officer, Office of
Information Technology, Securities and
Exchange Commission, 450 5th Street,
NW., Washington, DC 20549.
Dated: March 29, 2005.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. E5–1586 Filed 4–6–05; 8:45 am]
BILLING CODE 8010–01–P
would rely equally on the exemptions in these
rules, and therefore the Commission has
apportioned the burden hours associated with the
required contract modifications equally among the
four rules.
3 Based on information in Commission filings, we
estimate that 23 percent of funds are advised by
subadvisers.
4 Based on existing statistics, we assume that each
fund has 1.4 portfolios advised by a subadviser.
5 This estimate is based on the following
calculations: (78 portfolios × 6 hours = 468 burden
hours for rules 12d3–1, 10f–3, 17a–10, and 17e–1;
468 total burden hours for all of the rules/four rules
= 117 annual burden hours per rule).
VerDate jul<14>2003
18:22 Apr 06, 2005
Jkt 205001
SECURITIES AND EXCHANGE
COMMISSION
Proposed Collection; Comment
Request
Upon written request, copies available from:
Securities and Exchange Commission,
Office of Filings and Information Services,
Washington, DC 20549.
Extension:
Rule 27d–1 and Form N–27D–1; SEC File
No. 270–499; OMB Control No. 3235–
0560; Rule 27d–2; SEC File No. 270–500;
OMB Control No. 3235–0566.
Notice is hereby given that, pursuant
to the Paperwork Reduction Act of 1995
(44 U.S.C. 350l et seq.), the Securities
and Exchange Commission (the
‘‘Commission’’) is soliciting comments
on the collections of information under
the Investment Company Act of 1940
(‘‘Act’’) summarized below. The
Commission plans to submit these
collections of information to the Office
of Management and Budget for
approval.
Rule 27d–1 [17 CFR 270.27d–1] is
entitled ‘‘Reserve Requirements for
Principal Underwriters and Depositors
to Carry Out the Obligations to Refund
Charges Required by Section 27(d) and
Section 27(f) of the Act.’’ Form N–27D–
1 is entitled ‘‘Accounting of Segregated
Trust Account.’’ Rule 27d–2 [17 CFR
270.27d–2] is entitled ‘‘Insurance
Company Undertaking in Lieu of
Segregated Trust Account.’’ Rule 27d–1
requires the depositor or principal
underwriter for an issuer to deposit
funds into a segregated trust account to
provide assurance of its ability to fulfill
its refund obligations under sections
27(d) and 27(f). The rule sets forth
minimum reserve amounts and
guidelines for the management and
disbursement of the assets in the
account. A single account may be used
for the periodic payment plans of
multiple investment companies. Rule
27d–1(j) directs depositors and
principal underwriters to make an
accounting of their segregated trust
accounts on Form N–27D–1, which is
intended to facilitate the Commission’s
oversight of compliance with the reserve
requirements set forth in rule 27d–1.
The form requires depositors and
principal underwriters to report
deposits to a segregated trust account,
including those made pursuant to
paragraphs (c) and (e) of the rule.
Withdrawals pursuant to paragraph (f)
of the rule also must be reported. In
addition, the form solicits information
regarding the minimum amount
required to be maintained under
paragraphs (d) and (e) of rule 27d–1.
Depositors and principal underwriters
must file the form once a year on or
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Frm 00083
Fmt 4703
Sfmt 4703
before January 31 of the year following
the year for which information is
presented.
Instead of relying on rule 27d–1 and
filing Form N–27D–1, depositors or
principal underwriters for the issuers of
periodic payment plans may rely on the
exemption afforded by rule 27d–2. In
order to comply with the rule, (i) the
depositor or principal underwriter must
secure from an insurance company a
written guarantee of the refund
requirements, (ii) the insurance
company must satisfy certain financial
criteria, and (iii) the depositor or
principal underwriter must file as an
exhibit to the issuer’s registration
statement, a copy of the written
undertaking, an annual statement that
the insurance company has met the
requisite financial criteria on a monthly
basis, and an annual audited balance
sheet.
Rules 27d–1 and 27d–2, which were
explicitly authorized by statute, provide
assurance that depositors and principal
underwriters of issuers have access to
sufficient cash to meet the demands of
certificate holders who reconsider their
decisions to invest in a periodic
payment plan. The information
collection requirements in rules 27d–1
and 27d–2 enable the Commission to
monitor compliance with reserve rules.
Commission staff estimates that there
are four issuers of periodic payment
plan certificates. The depositor or
principal underwriter of each of these
issuers must file Form N–27D–1
annually or comply with the
requirements in rule 27d–2. On average,
the Commission receives two Form N–
27D–1 filings annually. The staff
estimates that a staff accountant spends
8 hours and an accounting manager
spends 3 hours preparing the form.
Therefore, the total annual hour burden
associated with rule 27d–1 and Form N–
27d–1 is estimated to be 22 hours.1 The
staff estimates that two depositors or
principal underwriters rely on rule 27d–
2 and that each of these respondents
makes three responses annually. We
estimate that each depositor or
underwriter expends approximately two
hours per year obtaining a written
guarantee from an insurance company
or negotiating changes to coverage with
the insurance company and five hours
per year filing the two required
documents from the insurance company
on EDGAR. Thus, we estimate that the
1 This estimate is based on the following
calculation: 2 funds × (8 hours of staff accountant
time + 3 hours of accounting manager time) = 22
hours.
E:\FR\FM\07APN1.SGM
07APN1
]]>Agencies
[Federal Register Volume 70, Number 66 (Thursday, April 7, 2005)]
[Notices]
[Pages 17725-17726]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E5-1586]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Proposed Collection; Comment Request
Upon written request, copies available from: Securities and Exchange
Commission, Office of Filings and Information Services, Washington, DC
20549.
Extension:
Rule 17a-10, SEC File No. 270-507, OMB Control No. 3235-0563.
Notice is hereby given that pursuant to the Paperwork Reduction Act
of 1995 (44 U.S.C. 3501 et seq.) the Securities and Exchange Commission
(the ``Commission'') is soliciting comments on the collections of
information summarized below. The Commission plans to submit these
existing collections of information to the Office of Management and
Budget (``OMB'') for extension and approval.
Section 17(a) of the Investment Company Act of 1940 (the ``Act''),
prohibits affiliated persons of a registered investment company
(``fund'') from borrowing money or other property from, or selling or
buying securities or other property to or from the fund, or any company
that the fund controls. Rule 17a-10 permits (i) a subadviser of a fund
to enter into transactions with funds the subadviser does not advise
but which are affiliated persons of a fund that it does advise (e.g.,
other funds in the fund complex), and (ii) a subadviser (and its
affiliated persons) to enter into transactions and arrangements with
funds the subadviser does advise, but only with respect to discrete
portions of the subadvised fund for which the subadviser does not
provide investment advice.
To qualify for the exemptions in rule 17a-10, the subadvisory
relationship must be the sole reason why section 17(a) prohibits the
transaction; and the advisory contracts of the subadviser entering into
the transaction, and any subadviser that is advising the purchasing
portion of the fund, must prohibit the subadvisers from consulting with
each other concerning securities transactions of the fund, and limit
their responsibility to providing advice with respect to discrete
portions of the fund's portfolio.\1\
The Commission staff estimates that 3,028 portfolios of
approximately 2,126 funds use the services of one or more subadvisers.
Based on discussions with industry representatives, the staff estimates
that it will require approximately 6 hours to draft and execute revised
subadvisory contracts (5 staff attorney hours, 1 supervisory attorney
hour), in order for funds and subadvisers to be able to rely on the
exemptions in rule 17a-10. The staff assumes that all of these funds
amended their advisory contracts following the adoption of rule 17a-10
in 2002 that conditioned certain exemptions upon these contractual
alterations.\2\
---------------------------------------------------------------------------
\1\ See 17 CFR 270.17a-10(a)(2).
\2\ Rules 12d3-1, 10f-3, 17a-10, and 17e-1 require virtually
identical modifications to fund advisory contracts. The Commission
staff assumes that funds would rely equally on the exemptions in
these rules, and therefore the Commission has apportioned the burden
hours associated with the required contract modifications equally
among the four rules.
---------------------------------------------------------------------------
[[Page 17726]]
Based on an analysis of investment company filings, the staff
estimates that approximately 200 new funds are registered annually.
Assuming that the number of these funds that will use the services of
subadvisers is proportionate to the number of funds that currently use
the services of subadvisers, then approximately 46 new funds will enter
into subadvisory agreements each year.\3\ The Commission staff further
estimates, based on an analysis of investment company filings, that 10
extant funds will employ the services of subadvisers for the first time
each year. Thus, the staff estimates that a total of 56 funds, with a
total of 78 portfolios,\4\ will enter into subadvisory agreements each
year. Assuming that each of these funds enters into a contract that
permits it to rely on the exemptions in rule 17a-10, we estimate that
the rule's contract modification requirement will result in 117 burden
hours annually.\5\
---------------------------------------------------------------------------
\3\ Based on information in Commission filings, we estimate that
23 percent of funds are advised by subadvisers.
\4\ Based on existing statistics, we assume that each fund has
1.4 portfolios advised by a subadviser.
\5\ This estimate is based on the following calculations: (78
portfolios x 6 hours = 468 burden hours for rules 12d3-1, 10f-3,
17a-10, and 17e-1; 468 total burden hours for all of the rules/four
rules = 117 annual burden hours per rule).
---------------------------------------------------------------------------
Written comments are invited on: (a) Whether the proposed
collection of information is necessary for the proper performance of
the functions of the agency, including whether the information will
have practical utility; (b) the accuracy of the agency's estimate of
the burden of the collection of information; (c) ways to enhance the
quality, utility, and clarity of the information collected; and (d)
ways to minimize the burden of the collection of information on
respondents, including through the use of automated collection
techniques or other forms of information technology. Consideration will
be given to comments and suggestions submitted in writing within 60
days of this publication.
Please direct your written comments to R. Corey Booth, Director/
Chief Information Officer, Office of Information Technology, Securities
and Exchange Commission, 450 5th Street, NW., Washington, DC 20549.
Dated: March 29, 2005.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. E5-1586 Filed 4-6-05; 8:45 am]
BILLING CODE 8010-01-P
