Proposed Collection; Comment Request, 54820-54821 [2011-22573]
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54820
Federal Register / Vol. 76, No. 171 / Friday, September 2, 2011 / Notices
plans to submit this existing collection
of information to the Office of
Management and Budget for extension
and approval.
Rule 24f–2 (17 CFR 270.24f–2) under
the Investment Company Act of 1940
(15 U.S.C. 80a) requires any open-end
management companies (‘‘mutual
funds’’), unit investment trusts (‘‘UITs’’)
or face-amount certificate companies
(collectively, ‘‘funds’’) deemed to have
registered an indefinite amount of
securities to file, not later than 90 days
after the end of any fiscal year in which
it has publicly offered such securities,
Form 24F–2 (17 CFR 274.24) with the
Commission. Form 24F–2 is the annual
notice of securities sold by funds that
accompanies the payment of registration
fees with respect to the securities sold
during the fiscal year.
The Commission estimates that 6120
funds file Form 24F–2 on the required
annual basis. The average annual
burden per respondent for Form 24F–2
is estimated to be two hours. The total
annual burden for all respondents to
Form 24F–2 is estimated to be 12,240
hours.
The estimate of average burden hours
is made solely for the purposes of the
Paperwork Reduction Act, and is not
derived from a comprehensive or even
a representative survey or study of the
costs of Commission rules.
Compliance with the collection of
information required by Form 24F–2 is
mandatory. The Form 24F–2 filing that
must be made to the Commission is
available to the public. An agency may
not conduct or sponsor, and a person is
not required to respond to, a collection
of information unless it displays a
currently valid control number.
The Commission requests written
comments on: (a) Whether the collection
of information is necessary for the
proper performance of the functions of
the Commission, including whether the
information has practical utility; (b) the
accuracy of the Commission’s estimate
of the burdens 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 Thomas Bayer, Director/Chief
Information Officer, Securities and
Exchange Commission, c/o Remi PavlikSimon, 6432 General Green Way,
VerDate Mar<15>2010
15:37 Sep 01, 2011
Jkt 223001
Alexandria, VA 22312; or send an
e-mail to: PRA_Mailbox@sec.gov.
Dated: August 29, 2011.
Elizabeth M. Murphy,
Secretary.
[FR Doc. 2011–22578 Filed 9–1–11; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
Proposed Collection; Comment
Request
Upon Written Request, Copies Available
From: Securities and Exchange
Commission, Office of Investor
Education and Advocacy,
Washington, DC 20549–0213.
Extension:
Rule 18f–3, SEC File No. 270–385, OMB
Control No. 3235–0441.
Notice is hereby given that, pursuant
to the Paperwork Reduction Act of 1995
(44 U.S.C. 3501–3520), the Securities
and Exchange Commission (the
‘‘Commission’’) is soliciting comments
on the collection of information
summarized below. The Commission
plans to submit this existing collection
of information to the Office of
Management and Budget for extension
and approval.
Section 18(f)(1) 1 of the Investment
Company Act of 1940 2 (the ‘‘Investment
Company Act’’ or ‘‘Act’’) prohibits
registered open-end management
investment companies (‘‘funds’’) from
issuing any senior security. Rule 18f–3
under the Act 3 exempts from section
18(f)(1) a fund that issues multiple
classes of shares representing interests
in the same portfolio of securities (a
‘‘multiple class fund’’) if the fund
satisfies the conditions of the rule. In
general, each class must differ in its
arrangement for shareholder services or
distribution or both, and must pay the
related expenses of that different
arrangement.
The rule includes one requirement for
the collection of information. A
multiple class fund must prepare, and
fund directors must approve, a written
plan setting forth the separate
arrangement and expense allocation of
each class, and any related conversion
features or exchange privileges (‘‘rule
18f–3 plan’’).4 Approval of the plan
must occur before the fund issues any
shares of multiple classes and whenever
the fund materially amends the plan. In
approving the plan, a majority of the
1 15
U.S.C. 80a–18(f)(1).
U.S.C. 80a.
3 17 CFR 270.18f–3.
4 Rule 18f–3(d).
2 15
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Frm 00091
Fmt 4703
Sfmt 4703
fund board, including a majority of the
fund’s independent directors, must
determine that the plan is in the best
interests of each class and the fund as
a whole.
The requirement that the fund prepare
and directors approve a written rule
18f–3 plan is intended to ensure that the
fund compiles information relevant to
the fairness of the separate arrangement
and expense allocation for each class,
and that directors review and approve
the information. Without a blueprint
that highlights material differences
among classes, directors might not
perceive potential conflicts of interests
when they determine whether the plan
is in the best interests of each class and
the fund. In addition, the plan may be
useful to Commission staff in reviewing
the fund’s compliance with the rule.
There are approximately 5655
multiple class funds offered by 1020
registrants.5 Based on a review of
typical rule 18f–3 plans, the
Commission’s staff estimates that the
1020 registrants together make an
average of 510 responses each year to
prepare and approve a written rule 18f–
3 plan, requiring approximately 8 hours
per response and a total of 4080 burden
hours per year in the aggregate.6 The
staff estimates that preparation of the
rule 18f–3 plan may require 5 hours of
the services of an attorney employed by
the fund, at a cost of approximately
$354 per hour for professional time,7
and approval of the plan may require 3
hours of the services of the board of
directors, at a cost of approximately
$4000 per hour.8 The staff therefore
estimates that the aggregate annual cost
of complying with the paperwork
requirements of the rule is
approximately $7,022,700 ((5 hours ×
5 This estimate is based on data from Form N–
SAR, the semi-annual report that funds file with the
Commission. In previous years, the staff estimated
that each multiple class fund prepared and
approved a rule 18f–3 plan. However, the staff has
revised this estimate to reflect its belief that most
registrants prepare and approve a single rule 18f–
3 plan for all series funds offered by the registrants.
6 The estimate reflects the assumption that each
registrant prepares and approves a rule 18f–3 plan
every two years when issuing a new fund or new
class or amending a plan (or that 510 of all 1020
registrants prepare and approve a plan each year).
The estimate assumes that the time required to
prepare a plan is 5 hours per plan (or 2550 hours
for 510 registrants annually), and the time required
to approve a plan is an additional 3 hours per plan
(or 1530 hours for 510 registrants annually).
7 This hourly rate estimate is derived from annual
salaries reported in: Securities Industry and
Financial Markets Association, Management and
Professional Earnings in the Securities Industry
(2010), modified by Commission staff to account for
an 1800-hour work year and multiplied by 5.35 to
account for bonuses, firm size, employee benefits
and overhead.
8 This hourly rate estimate is derived from fund
representatives.
E:\FR\FM\02SEN1.SGM
02SEN1
Federal Register / Vol. 76, No. 171 / Friday, September 2, 2011 / Notices
510 responses × $354 = $902,700) + (3
hours × 510 responses × $4000 =
$6,120,000)).
The estimated annual burden of 4080
hours represents a decrease of 1520
hours from the prior estimate of 5600
hours. The decrease in burden hours is
attributable to changes in the estimates
of the average hour burden per response
and the number of responses that are
submitted pursuant to the rule.
The estimate of average burden hours
is made solely for the purposes of the
Paperwork Reduction Act. The estimate
is not derived from a comprehensive or
even a representative survey or study of
the costs of Commission rules.
Complying with this collection of
information requirement is mandatory.
Responses will not be kept confidential.
An agency may not conduct or sponsor,
and a person is not required to respond
to, a collection of information unless it
displays a currently valid control
number.
Written comments are invited on: (a)
Whether the collections of information
are necessary for the proper
performance of the functions of the
Commission, including whether the
information has practical utility; (b) the
accuracy of the Commission’s estimate
of the burdens of the collections of
information; (c) ways to enhance the
quality, utility, and clarity of the
information collected; and (d) ways to
minimize the burdens of the collections
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 Thomas Bayer, Director/Chief
Information Officer, Securities and
Exchange Commission, c/o Remi PavlikSimon, 6432 General Green Way,
Alexandria, VA 22312; or send an
e-mail to: PRA_Mailbox@sec.gov.
Dated: August 29, 2011.
Elizabeth M. Murphy,
Secretary.
[FR Doc. 2011–22573 Filed 9–1–11; 8:45 am]
BILLING CODE 8011–01–P
erowe on DSK5CLS3C1PROD with NOTICES
SECURITIES AND EXCHANGE
COMMISSION
Proposed Collection; Comment
Request
Upon Written Request, Copies Available
From: Securities and Exchange
Commission, Office of Investor
Education and Advocacy,
Washington, DC 20549–0213.
VerDate Mar<15>2010
15:37 Sep 01, 2011
Jkt 223001
Extension:
Rule 17a–7, SEC File No. 270–238, OMB
Control No. 3235–0214.
Notice is hereby given that, pursuant
to the Paperwork Reduction Act of 1995
(44 U.S.C. 3501–3520), the Securities
and Exchange Commission
(‘‘Commission’’) is soliciting comments
on the collections of information
summarized below. The Commission
plans to submit the existing collection
of information to the Office of
Management and Budget for extension
and approval.
Rule 17a–7 (17 CFR 270.17a–7) (the
‘‘rule’’) under the Investment Company
Act of 1940 (15 U.S.C. 80a–1 et seq.)
(the ‘‘Act’’) is entitled ‘‘Exemption of
certain purchase or sale transactions
between an investment company and
certain affiliated persons thereof.’’ It
provides an exemption from section
17(a) of the Act for purchases and sales
of securities between registered
investment companies (‘‘funds’’), that
are affiliated persons (‘‘first-tier
affiliates’’) or affiliated persons of
affiliated persons (‘‘second-tier
affiliates’’), or between a fund and a
first- or second-tier affiliate other than
another fund, when the affiliation arises
solely because of a common investment
adviser, director, or officer. Rule 17a–7
requires funds to keep various records
in connection with purchase or sale
transactions effected in reliance on the
rule. The rule requires the fund’s board
of directors to establish procedures
reasonably designed to ensure that the
rule’s conditions have been satisfied.
The board is also required to determine,
at least on a quarterly basis, that all
affiliated transactions effected during
the preceding quarter in reliance on the
rule were made in compliance with
these established procedures. If a fund
enters into a purchase or sale
transaction with an affiliated person, the
rule requires the fund to compile and
maintain written records of the
transaction.1 The Commission’s
examination staff uses these records to
evaluate for compliance with the rule.
While most funds do not commonly
engage in transactions covered by rule
17a–7, the Commission staff estimates
that nearly all funds have adopted
procedures for complying with the
rule.2 Of the approximately 3318
1 The written records are required to set forth a
description of the security purchased or sold, the
identity of the person on the other side of the
transaction, and the information or materials upon
which the board of directors’ determination that the
transaction was in compliance with the procedures
was made.
2 Unless stated otherwise, these estimates are
based on conversations with the examination and
inspections staff of the Commission and fund
representatives.
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54821
currently active funds, the staff
estimates that virtually all have already
adopted procedures for compliance with
rule 17a–7. This is a one-time burden,
and the staff therefore does not estimate
an ongoing burden related to the
policies and procedures requirement of
the rule for funds.3 The staff estimates
that there are approximately 150 new
funds that register each year, and that
each of these funds adopts the relevant
policies and procedures. The staff
estimates that it takes approximately 4
hours to develop and adopt these
policies and procedures. Therefore, the
total annual burden related to
developing and adopting these policies
and procedures would be approximately
600 hours.4
Of the 3318 existing funds, the staff
assumes that approximately 25%, (or
830) enter into transactions affected by
rule 17a–7 each year (either by the fund
directly or through one of the fund’s
series), and that the same percentage
(25%, or 38 funds) of the estimated 150
funds that newly register each year will
also enter into these transactions, for a
total of 868 5 companies that are affected
by the recordkeeping requirements of
rule 17a–7. These funds must keep
records of each of these transactions,
and the board of directors must
quarterly determine that all relevant
transactions were made in compliance
with the company’s policies and
procedures. The rule generally imposes
a minimal burden of collecting and
storing records already generated for
other purposes.6 The staff estimates that
the burden related to making these
records and for the board to review all
transactions would be 3 hours annually
for each respondent, (2 hours spent by
compliance attorneys and 1 hour spent
3 Based on our reviews and conversations with
fund representatives, we understand that funds
rarely, if ever, need to make changes to these
policies and procedures once adopted, and
therefore we do not estimate a paperwork burden
for such updates.
4 This estimate is based on the following
calculations: (4 hours × 150 new funds = 600
hours).
5 This estimate is based on the following
calculation: (830 + 38 = 868).
6 Commission staff believes that rule 17a–7 does
not impose any costs associated with record
preservation in addition to the costs that funds
already incur to comply with the record
preservation requirements of rule 31a–2 under the
Act. Rule 31a–2 requires companies to preserve
certain records for specified periods of time.
E:\FR\FM\02SEN1.SGM
02SEN1
]]>Agencies
[Federal Register Volume 76, Number 171 (Friday, September 2, 2011)]
[Notices]
[Pages 54820-54821]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-22573]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Proposed Collection; Comment Request
Upon Written Request, Copies Available From: Securities and Exchange
Commission, Office of Investor Education and Advocacy, Washington, DC
20549-0213.
Extension:
Rule 18f-3, SEC File No. 270-385, OMB Control No. 3235-0441.
Notice is hereby given that, pursuant to the Paperwork Reduction
Act of 1995 (44 U.S.C. 3501-3520), the Securities and Exchange
Commission (the ``Commission'') is soliciting comments on the
collection of information summarized below. The Commission plans to
submit this existing collection of information to the Office of
Management and Budget for extension and approval.
Section 18(f)(1) \1\ of the Investment Company Act of 1940 \2\ (the
``Investment Company Act'' or ``Act'') prohibits registered open-end
management investment companies (``funds'') from issuing any senior
security. Rule 18f-3 under the Act \3\ exempts from section 18(f)(1) a
fund that issues multiple classes of shares representing interests in
the same portfolio of securities (a ``multiple class fund'') if the
fund satisfies the conditions of the rule. In general, each class must
differ in its arrangement for shareholder services or distribution or
both, and must pay the related expenses of that different arrangement.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 80a-18(f)(1).
\2\ 15 U.S.C. 80a.
\3\ 17 CFR 270.18f-3.
---------------------------------------------------------------------------
The rule includes one requirement for the collection of
information. A multiple class fund must prepare, and fund directors
must approve, a written plan setting forth the separate arrangement and
expense allocation of each class, and any related conversion features
or exchange privileges (``rule 18f-3 plan'').\4\ Approval of the plan
must occur before the fund issues any shares of multiple classes and
whenever the fund materially amends the plan. In approving the plan, a
majority of the fund board, including a majority of the fund's
independent directors, must determine that the plan is in the best
interests of each class and the fund as a whole.
---------------------------------------------------------------------------
\4\ Rule 18f-3(d).
---------------------------------------------------------------------------
The requirement that the fund prepare and directors approve a
written rule 18f-3 plan is intended to ensure that the fund compiles
information relevant to the fairness of the separate arrangement and
expense allocation for each class, and that directors review and
approve the information. Without a blueprint that highlights material
differences among classes, directors might not perceive potential
conflicts of interests when they determine whether the plan is in the
best interests of each class and the fund. In addition, the plan may be
useful to Commission staff in reviewing the fund's compliance with the
rule.
There are approximately 5655 multiple class funds offered by 1020
registrants.\5\ Based on a review of typical rule 18f-3 plans, the
Commission's staff estimates that the 1020 registrants together make an
average of 510 responses each year to prepare and approve a written
rule 18f-3 plan, requiring approximately 8 hours per response and a
total of 4080 burden hours per year in the aggregate.\6\ The staff
estimates that preparation of the rule 18f-3 plan may require 5 hours
of the services of an attorney employed by the fund, at a cost of
approximately $354 per hour for professional time,\7\ and approval of
the plan may require 3 hours of the services of the board of directors,
at a cost of approximately $4000 per hour.\8\ The staff therefore
estimates that the aggregate annual cost of complying with the
paperwork requirements of the rule is approximately $7,022,700 ((5
hours x
[[Page 54821]]
510 responses x $354 = $902,700) + (3 hours x 510 responses x $4000 =
$6,120,000)).
---------------------------------------------------------------------------
\5\ This estimate is based on data from Form N-SAR, the semi-
annual report that funds file with the Commission. In previous
years, the staff estimated that each multiple class fund prepared
and approved a rule 18f-3 plan. However, the staff has revised this
estimate to reflect its belief that most registrants prepare and
approve a single rule 18f-3 plan for all series funds offered by the
registrants.
\6\ The estimate reflects the assumption that each registrant
prepares and approves a rule 18f-3 plan every two years when issuing
a new fund or new class or amending a plan (or that 510 of all 1020
registrants prepare and approve a plan each year). The estimate
assumes that the time required to prepare a plan is 5 hours per plan
(or 2550 hours for 510 registrants annually), and the time required
to approve a plan is an additional 3 hours per plan (or 1530 hours
for 510 registrants annually).
\7\ This hourly rate estimate is derived from annual salaries
reported in: Securities Industry and Financial Markets Association,
Management and Professional Earnings in the Securities Industry
(2010), modified by Commission staff to account for an 1800-hour
work year and multiplied by 5.35 to account for bonuses, firm size,
employee benefits and overhead.
\8\ This hourly rate estimate is derived from fund
representatives.
---------------------------------------------------------------------------
The estimated annual burden of 4080 hours represents a decrease of
1520 hours from the prior estimate of 5600 hours. The decrease in
burden hours is attributable to changes in the estimates of the average
hour burden per response and the number of responses that are submitted
pursuant to the rule.
The estimate of average burden hours is made solely for the
purposes of the Paperwork Reduction Act. The estimate is not derived
from a comprehensive or even a representative survey or study of the
costs of Commission rules. Complying with this collection of
information requirement is mandatory. Responses will not be kept
confidential. An agency may not conduct or sponsor, and a person is not
required to respond to, a collection of information unless it displays
a currently valid control number.
Written comments are invited on: (a) Whether the collections of
information are necessary for the proper performance of the functions
of the Commission, including whether the information has practical
utility; (b) the accuracy of the Commission's estimate of the burdens
of the collections of information; (c) ways to enhance the quality,
utility, and clarity of the information collected; and (d) ways to
minimize the burdens of the collections 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 Thomas Bayer, Director/Chief
Information Officer, Securities and Exchange Commission, c/o Remi
Pavlik-Simon, 6432 General Green Way, Alexandria, VA 22312; or send an
e-mail to: PRA_Mailbox@sec.gov.
Dated: August 29, 2011.
Elizabeth M. Murphy,
Secretary.
[FR Doc. 2011-22573 Filed 9-1-11; 8:45 am]
BILLING CODE 8011-01-P
