Submission for OMB Review; Comment Request, 41130-41131 [2013-16366]

Download as PDF 41130 Federal Register / Vol. 78, No. 131 / Tuesday, July 9, 2013 / Notices Commission, Office of Investor Education and Advocacy, Washington, DC 20549–0213. mstockstill on DSK4VPTVN1PROD with NOTICES Extension: Rule 204A–1, OMB Control No. 3235– 0596, SEC File No. 270–536. 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’’) has submitted to the Office of Management and Budget a request for extension of the previously approved collection of information discussed below. The title for the collection of information is ‘‘Rule 204A–1 (17 CFR 275.204A–1) under the Investment Advisers Act of 1940.’’ (15 U.S.C. 80b– 1 et seq.) Rule 204A–1 (the ‘‘Code of Ethics Rule’’) requires investment advisers registered with the SEC to (i) Set forth standards of conduct expected of advisory personnel (including compliance with the federal securities laws); (ii) safeguard material nonpublic information about client transactions; and (iii) require the adviser’s ‘‘access persons’’ to report their personal securities transactions, including transactions in any mutual fund managed by the adviser. The Code of Ethics Rule requires access persons to obtain the adviser’s approval before investing in an initial public offering (‘‘IPO’’) or private placement. The Code of Ethics Rule also requires prompt reporting, to the adviser’s chief compliance officer or another person designated in the code of ethics, of any violations of the code. Finally, the Code of Ethics Rule requires the adviser to provide each supervised person with a copy of the code of ethics and any amendments, and require the supervised persons to acknowledge, in writing, their receipt of these copies. The purposes of the information collection requirements are to (i) Ensure that advisers maintain codes of ethics applicable to their supervised persons; (ii) provide advisers with information about the personal securities transactions of their access persons for purposes of monitoring such transactions; (iii) provide advisory clients with information with which to evaluate advisers’ codes of ethics; and (iv) assist the Commission’s examination staff in assessing the adequacy of advisers’ codes of ethics and assessing personal trading activity by advisers’ supervised persons. The respondents to this information collection are investment advisers registered with the Commission. The Commission has estimated that compliance with rule 204A–1 imposes a VerDate Mar<15>2010 17:44 Jul 08, 2013 Jkt 229001 burden of approximately 118 hours per adviser annually based on an average adviser having 84 access persons. Our latest data indicate that there were 10,643 advisers registered with the Commission. Based on this figure, the Commission estimates a total annual burden of 1,255,342 hours for this collection of information. Rule 204A–1 does not require recordkeeping or record retention. The collection of information requirements under the rule is mandatory. The information collected pursuant to the rule is not filed with the Commission, but rather takes the form of communications between advisers and their supervised persons. Investment advisers use the information collected to control and assess the personal trading activities of their supervised persons. Responses to the reporting requirements will be kept confidential to the extent each investment adviser provides confidentiality under its particular practices and procedures. 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 public may view the background documentation for this information collection at the following Web site, www.reginfo.gov. Please direct general comments regarding the above information to the following persons: (i) Desk Officer for the Securities and Exchange Commission, Office of Information and Regulatory Affairs, Office of Management and Budget, Room 10102, New Executive Office Building, Washington, DC 20503, or by sending an email to: Shagufta_Ahmed@omb.eop.gov; and (ii) Thomas Bayer, Director/Chief Information Officer, Securities and Exchange Commission, c/o Remi PavlikSimon, 100 F Street NE., Washington, DC 20549 or send an email to: PRA_Mailbox@sec.gov. Comments must be submitted to OMB within 30 days of this notice. Dated: July 2, 2013. Elizabeth M. Murphy, Secretary. [FR Doc. 2013–16364 Filed 7–8–13; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION Submission for OMB Review; Comment Request Upon Written Request, Copies Available From: Securities and Exchange Commission, Office of Investor PO 00000 Frm 00106 Fmt 4703 Sfmt 4703 Education and Advocacy, Washington, DC 20549–0213. Extension: Rule 17e–1; OMB Control No. 3235–0217, SEC File No. 270–224. Notice is hereby given that, pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.) (‘‘Paperwork Reduction Act’’), the Securities and Exchange Commission (the ‘‘Commission’’) has submitted to the Office of Management and Budget (‘‘OMB’’) a request for extension of the previously approved collection of information described below. Rule 17e–1 (17 CFR 270.17e–1) under the Investment Company Act of 1940 (15 U.S.C. 80a–1 et seq.) (the ‘‘Investment Company Act’’) deems a remuneration as ‘‘not exceeding the usual and customary broker’s commission’’ for purposes of Section 17(e)(2)(A) if, among other things, a registered investment company’s (‘‘fund’s’’) board of directors has adopted procedures reasonably designed to provide that the remuneration to an affiliated broker is a reasonable and fair amount compared to that received by other brokers in connection with comparable transactions involving similar securities being purchased or sold on a securities exchange during a comparable period of time and the board makes and approves such changes as it deems necessary. In addition, each quarter, the board must determine that all transactions effected under the rule during the preceding quarter complied with the established procedures. Rule 17e–1 also requires the fund to (i) maintain permanently a written copy of the procedures adopted by the board for complying with the requirements of the rule; and (ii) maintain for a period of six years, the first two in an easily accessible place, a written record of each transaction subject to the rule, setting forth the amount and source of the commission, fee, or other remuneration received; the identity of the broker; the terms of the transaction; and the materials used to determine that the transactions were effected in compliance with the procedures adopted by the board. The recordkeeping requirements under rule 17e–1 enable the Commission to ensure that affiliated brokers receive compensation that does not exceed the usual and customary broker’s commission. Without the recordkeeping requirements, Commission inspectors would have difficulty ascertaining whether funds were complying with rule 17e–1. E:\FR\FM\09JYN1.SGM 09JYN1 mstockstill on DSK4VPTVN1PROD with NOTICES Federal Register / Vol. 78, No. 131 / Tuesday, July 9, 2013 / Notices Based on an analysis of fund filings, the staff estimates that approximately 775 fund portfolios enter into subadvisory agreements each year.1 Based on discussions with industry representatives, the staff estimates that it will require approximately 3 attorney hours to draft and execute additional clauses in new subadvisory contracts in order for funds and subadvisers to be able to rely on the exemptions in rule 17e–1. Because these additional clauses are identical to the clauses that a fund would need to insert in their subadvisory contracts to rely on rules 12d3–1, 10f–3, and 17a–10, and because we believe that funds that use one such rule generally use all of these rules, we apportion this 3 hour time burden equally to all four rules. Therefore, we estimate that the burden allocated to rule 17e-1 for this contract change would be 0.75 hours.2 Assuming that all 775 funds that enter into new subadvisory contracts each year make the modification to their contract required by the rule, we estimate that the rule’s contract modification requirement will result in 581 burden hours annually. Based on an analysis of fund filings, the staff estimates that approximately 1,768 funds use at least one affiliated broker. Based on conversations with fund representatives, the staff estimates approximately 40 percent of transactions that occur under rule 17e1 would be exempt from its recordkeeping and review requirements. This would leave approximately 1,061 funds 3 still subject to the rule’s recordkeeping and review requirements. Based on conversations with fund representatives, we estimate that the burden of compliance with the review and recordkeeping requirements of rule 17e–1 is approximately 40 hours per fund per year. This time is spent, for example, reviewing the applicable transactions and maintaining records. Accordingly, we calculate the total estimated annual internal burden of complying with the review and recordkeeping requirements of rule 17e– 1 to be approximately 42,440 hours,4 and the total annual burden of the rule’s paperwork requirements is 43,021 hours.5 Estimates of the average burden hours are made solely for the purposes of the Paperwork Reduction Act and are not derived from a comprehensive or even 1 Based on information in Commission filings, we estimate that 44.4 percent of funds are advised by subadvisers. 2 3 hours ÷ 4 rules = 0.75 hours. 3 1,768 funds × 0.6 = 1,061 funds. 4 1,061 funds × 40 hours per fund = 42,440 hours. 5 581 hours + 42,440 hours = 43,021 hours. VerDate Mar<15>2010 17:44 Jul 08, 2013 Jkt 229001 a representative survey or study of the costs of Commission rules and forms. The collection of information under rule 17e–1 is mandatory. The information provided under rule 17e–1 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 OMB control number. The public may view the background documentation for this information collection at the following Web site: www.reginfo.gov. Comments should be directed to: (i) Desk Officer for the Securities and Exchange Commission, Office of Information and Regulatory Affairs, Office of Management and Budget, Room 10102, New Executive Office Building, Washington, DC 20503, or by sending an email to: Shagufta_Ahmed@omb.eop.gov; and (ii) Thomas Bayer, Director/Chief Information Officer, Securities and Exchange Commission, c/o Remi PavlikSimon, 100 F Street, NE., Washington, DC 20549; or send an email to: PRA_Mailbox@sec.gov. Comments must be submitted to OMB within 30 days of this notice. Dated: July 2, 2013. Elizabeth M. Murphy, Secretary. [FR Doc. 2013–16366 Filed 7–8–13; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION Submission for OMB Review; Comment Request Upon Written Request, Copies Available From: Securities and Exchange Commission, Office of Investor Education and Advocacy, Washington, DC 20549–0213. Extension: Rule 0–2; OMB Control No. 3235–0636, SEC File No. 270–572. 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’’) has submitted to the Office of Management and Budget a request for extension of the previously approved collection of information discussed below. Several sections of the Investment Company Act of 1940 (‘‘Act’’ or ‘‘Investment Company Act’’) 1 give the Commission the authority to issue orders granting exemptions from the Act’s provisions. The section that grants PO 00000 broadest authority is section 6(c), which provides the Commission with authority to conditionally or unconditionally exempt persons, securities or transactions from any provision of the Investment Company Act, or the rules or regulations thereunder, if and to the extent that such exemption is necessary or appropriate in the public interest and consistent with the protection of investors and the purposes fairly intended by the policy and provisions of the Act.2 Rule 0–2 under the Investment Company Act,3 entitled ‘‘General Requirements of Papers and Applications,’’ prescribes general instructions for filing an application seeking exemptive relief with the Commission for which a form is not specifically prescribed. Rule 0–2 requires that each application filed with the commission have (a) a statement of authorization to file and sign the application on behalf of the applicant, (b) a verification of application and statements of fact, (c) a brief statement of the grounds for application, and (d) the name and address of each applicant and of any person to whom questions should be directed. The Commission uses the information required by rule 0– 2 to decide whether the applicant should be deemed to be entitled to the action requested by the application. Applicants for orders can include registered investment companies, affiliated persons of registered investment companies, and issuers seeking to avoid investment company status, among other entities. Commission staff estimates that it receives approximately 110 applications per year under the Act. Although each application typically is submitted on behalf of multiple entities, the entities in the vast majority of cases are related companies and are treated as a single respondent for purposes of this analysis. The time to prepare an application depends on the complexity and/or novelty of the issues covered by the application. We estimate that the Commission receives 15 of the most time-consuming applications annually, 75 applications of medium difficulty, and 20 of the least difficult applications. Based on conversations with applicants, we estimate that in-house counsel would spend from ten to fifty hours helping to draft and review an application. We estimate a total annual hour burden to all respondents of 3,200 hours [(50 hours × 15 applications) + (30 hours × 75 applications) + (10 hours × 20 applications)]. 2 15 1 15 U.S.C. 80a–1 et seq. Frm 00107 Fmt 4703 3 17 Sfmt 4703 41131 E:\FR\FM\09JYN1.SGM U.S.C. 80a–6(c). CFR 270.0–2. 09JYN1

Agencies

[Federal Register Volume 78, Number 131 (Tuesday, July 9, 2013)]
[Notices]
[Pages 41130-41131]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-16366]


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SECURITIES AND EXCHANGE COMMISSION


Submission for OMB Review; Comment Request

Upon Written Request, Copies Available From: Securities and Exchange 
Commission, Office of Investor Education and Advocacy, Washington, DC 
20549-0213.

Extension:
    Rule 17e-1;
    OMB Control No. 3235-0217, SEC File No. 270-224.

    Notice is hereby given that, pursuant to the Paperwork Reduction 
Act of 1995 (44 U.S.C. 3501 et seq.) (``Paperwork Reduction Act''), the 
Securities and Exchange Commission (the ``Commission'') has submitted 
to the Office of Management and Budget (``OMB'') a request for 
extension of the previously approved collection of information 
described below.
    Rule 17e-1 (17 CFR 270.17e-1) under the Investment Company Act of 
1940 (15 U.S.C. 80a-1 et seq.) (the ``Investment Company Act'') deems a 
remuneration as ``not exceeding the usual and customary broker's 
commission'' for purposes of Section 17(e)(2)(A) if, among other 
things, a registered investment company's (``fund's'') board of 
directors has adopted procedures reasonably designed to provide that 
the remuneration to an affiliated broker is a reasonable and fair 
amount compared to that received by other brokers in connection with 
comparable transactions involving similar securities being purchased or 
sold on a securities exchange during a comparable period of time and 
the board makes and approves such changes as it deems necessary. In 
addition, each quarter, the board must determine that all transactions 
effected under the rule during the preceding quarter complied with the 
established procedures. Rule 17e-1 also requires the fund to (i) 
maintain permanently a written copy of the procedures adopted by the 
board for complying with the requirements of the rule; and (ii) 
maintain for a period of six years, the first two in an easily 
accessible place, a written record of each transaction subject to the 
rule, setting forth the amount and source of the commission, fee, or 
other remuneration received; the identity of the broker; the terms of 
the transaction; and the materials used to determine that the 
transactions were effected in compliance with the procedures adopted by 
the board. The recordkeeping requirements under rule 17e-1 enable the 
Commission to ensure that affiliated brokers receive compensation that 
does not exceed the usual and customary broker's commission. Without 
the recordkeeping requirements, Commission inspectors would have 
difficulty ascertaining whether funds were complying with rule 17e-1.

[[Page 41131]]

    Based on an analysis of fund filings, the staff estimates that 
approximately 775 fund portfolios enter into subadvisory agreements 
each year.\1\ Based on discussions with industry representatives, the 
staff estimates that it will require approximately 3 attorney hours to 
draft and execute additional clauses in new subadvisory contracts in 
order for funds and subadvisers to be able to rely on the exemptions in 
rule 17e-1. Because these additional clauses are identical to the 
clauses that a fund would need to insert in their subadvisory contracts 
to rely on rules 12d3-1, 10f-3, and 17a-10, and because we believe that 
funds that use one such rule generally use all of these rules, we 
apportion this 3 hour time burden equally to all four rules. Therefore, 
we estimate that the burden allocated to rule 17e-1 for this contract 
change would be 0.75 hours.\2\ Assuming that all 775 funds that enter 
into new subadvisory contracts each year make the modification to their 
contract required by the rule, we estimate that the rule's contract 
modification requirement will result in 581 burden hours annually.
---------------------------------------------------------------------------

    \1\ Based on information in Commission filings, we estimate that 
44.4 percent of funds are advised by subadvisers.
    \2\ 3 hours / 4 rules = 0.75 hours.
---------------------------------------------------------------------------

    Based on an analysis of fund filings, the staff estimates that 
approximately 1,768 funds use at least one affiliated broker. Based on 
conversations with fund representatives, the staff estimates 
approximately 40 percent of transactions that occur under rule 17e-1 
would be exempt from its recordkeeping and review requirements. This 
would leave approximately 1,061 funds \3\ still subject to the rule's 
recordkeeping and review requirements. Based on conversations with fund 
representatives, we estimate that the burden of compliance with the 
review and recordkeeping requirements of rule 17e-1 is approximately 40 
hours per fund per year. This time is spent, for example, reviewing the 
applicable transactions and maintaining records. Accordingly, we 
calculate the total estimated annual internal burden of complying with 
the review and recordkeeping requirements of rule 17e-1 to be 
approximately 42,440 hours,\4\ and the total annual burden of the 
rule's paperwork requirements is 43,021 hours.\5\
---------------------------------------------------------------------------

    \3\ 1,768 funds x 0.6 = 1,061 funds.
    \4\ 1,061 funds x 40 hours per fund = 42,440 hours.
    \5\ 581 hours + 42,440 hours = 43,021 hours.
---------------------------------------------------------------------------

    Estimates of the average burden hours are made solely for the 
purposes of the Paperwork Reduction Act and are not derived from a 
comprehensive or even a representative survey or study of the costs of 
Commission rules and forms. The collection of information under rule 
17e-1 is mandatory. The information provided under rule 17e-1 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 OMB control number.
    The public may view the background documentation for this 
information collection at the following Web site: www.reginfo.gov. 
Comments should be directed to: (i) Desk Officer for the Securities and 
Exchange Commission, Office of Information and Regulatory Affairs, 
Office of Management and Budget, Room 10102, New Executive Office 
Building, Washington, DC 20503, or by sending an email to: Shagufta_Ahmed@omb.eop.gov; and (ii) Thomas Bayer, Director/Chief Information 
Officer, Securities and Exchange Commission, c/o Remi Pavlik-Simon, 100 
F Street, NE., Washington, DC 20549; or send an email to: PRA_Mailbox@sec.gov. Comments must be submitted to OMB within 30 days of 
this notice.

     Dated: July 2, 2013.
Elizabeth M. Murphy,
Secretary.
[FR Doc. 2013-16366 Filed 7-8-13; 8:45 am]
BILLING CODE 8011-01-P
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