Securities Act of 1933; Securities Exchange Act of 1934; Order Regarding Review of FASB Accounting Support Fee for 2014 Under Section 109 of the Sarbanes-Oxley Act of 2002, 19675-19676 [2014-07882]

Download as PDF TKELLEY on DSK3SPTVN1PROD with NOTICES Federal Register / Vol. 79, No. 68 / Wednesday, April 9, 2014 / Notices purchases of securities in Affiliated Underwritings are in the best interests of shareholders. 7. Each Unaffiliated Investment Company shall maintain and preserve permanently in an easily accessible place a written copy of the procedures described in the preceding condition, and any modifications to such procedures, and shall maintain and preserve for a period not less than six years from the end of the fiscal year in which any purchase in an Affiliated Underwriting occurred, the first two years in an easily accessible place, a written record of each purchase of securities in an Affiliated Underwriting once an investment by a Fund of Funds in the securities of an Unaffiliated Investment Company exceeds the limit of section 12(d)(1)(A)(i) of the Act, setting forth: (a) The party from whom the securities were acquired, (b) the identity of the underwriting syndicate’s members, (c) the terms of the purchase, and (d) the information or materials upon which the determinations of the Board of the Unaffiliated Investment Company were made. 8. Prior to its investment in shares of an Unaffiliated Investment Company in excess of the limit in section 12(d)(1)(A)(i) of the Act, the Fund of Funds and the Unaffiliated Investment Company will execute a Participation Agreement stating, without limitation, that their Boards and their investment advisers understand the terms and conditions of the order and agree to fulfill their responsibilities under the order. At the time of its investment in shares of an Unaffiliated Investment Company in excess of the limit in section 12(d)(1)(A)(i), a Fund of Funds will notify the Unaffiliated Investment Company of the investment. At such time, the Fund of Funds will also transmit to the Unaffiliated Investment Company a list of the names of each Fund of Funds Affiliate and Underwriting Affiliate. The Fund of Funds will notify the Unaffiliated Investment Company of any changes to the list of the names as soon as reasonably practicable after a change occurs. The Unaffiliated Investment Company and the Fund of Funds will maintain and preserve a copy of the order, the Participation Agreement, and the list with any updated information for the duration of the investment and for a period of not less than six years thereafter, the first two years in an easily accessible place. 9. Before approving any advisory contract under section 15 of the Act, the Board of each Fund of Funds, including a majority of the Independent Trustees, shall find that the advisory fees charged VerDate Mar<15>2010 17:54 Apr 08, 2014 Jkt 232001 under such advisory contract are based on services provided that are in addition to, rather than duplicative of, services provided under the advisory contract(s) of any Underlying Fund in which the Fund of Funds may invest. Such finding and the basis upon which the finding was made will be recorded fully in the minute books of the appropriate Fund of Funds. 10. A Fund of Funds Adviser will waive fees otherwise payable to it by a Fund of Funds in an amount at least equal to any compensation (including fees received pursuant to any plan adopted by an Unaffiliated Investment Company under rule 12b–1 under the Act) received from an Unaffiliated Fund by the Fund of Funds Adviser, or an affiliated person of the Fund of Funds Adviser, other than any advisory fees paid to the Fund of Funds Adviser or its affiliated person by an Unaffiliated Investment Company, in connection with the investment by the Fund of Funds in the Unaffiliated Fund. Any Subadviser will waive fees otherwise payable to the Subadviser, directly or indirectly, by the Fund of Funds in an amount at least equal to any compensation received by the Subadviser, or an affiliated person of the Subadviser, from an Unaffiliated Fund, other than any advisory fees paid to the Subadviser or its affiliated person by an Unaffiliated Investment Company, in connection with the investment by the Fund of Funds in the Unaffiliated Fund made at the direction of the Subadviser. In the event that a Subadviser waives fees, the benefit of the waiver will be passed through to the applicable Fund of Funds. 11. No Underlying Fund will acquire securities of any other investment company or company relying on section 3(c)(1) or 3(c)(7) of the Act in excess of the limits contained in section 12(d)(1)(A) of the Act, except to the extent that such Underlying Fund: (a) Acquires such securities in compliance with section 12(d)(1)(E) of the Act and either is an Affiliated Fund or is in the same ‘‘group of investment companies,’’ as defined in section 12(d)(1)(G)(ii) of the Act, as its corresponding master fund; (b) receives securities of another investment company as a dividend or as a result of a plan of reorganization of a company (other than a plan devised for the purpose of evading section 12(d)(1) of the Act); or (c) acquires (or is deemed to have acquired) securities of another investment company pursuant to exemptive relief from the Commission permitting such Underlying Fund to (i) acquire securities of one or more investment companies for short-term cash management purposes, or (ii) PO 00000 Frm 00100 Fmt 4703 Sfmt 4703 19675 engage in interfund borrowing and lending transactions. 12. Any sales charges and/or service fees charged with respect to shares of a Fund of Funds will not exceed the limits applicable to fund of funds set forth in NASD Conduct Rule 2830. Other Investments by Same Group Investing Funds Applicants agree that the relief to permit Same Group Investing Funds to invest in Other Investments shall be subject to the following condition: 13. Applicants will comply with all provisions of rule 12d1–2 under the Act, except for paragraph (a)(2) to the extent that it restricts any Same Group Investing Fund from investing in Other Investments as described in the application. For the Commission, by the Division of Investment Management, pursuant to delegated authority. Kevin M. O’Neill, Deputy Secretary. [FR Doc. 2014–07894 Filed 4–8–14; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 33–9569; Release No. 34– 71852] Securities Act of 1933; Securities Exchange Act of 1934; Order Regarding Review of FASB Accounting Support Fee for 2014 Under Section 109 of the Sarbanes-Oxley Act of 2002 April 3, 2014. The Sarbanes-Oxley Act of 2002 (the ‘‘Act’’) provides that the Securities and Exchange Commission (the ‘‘Commission’’) may recognize, as generally accepted for purposes of the securities laws, any accounting principles established by a standard setting body that meets certain criteria. Consequently, Section 109 of the Act provides that all of the budget of such a standard setting body shall be payable from an annual accounting support fee assessed and collected against each issuer, as may be necessary or appropriate to pay for the budget and provide for the expenses of the standard setting body, and to provide for an independent, stable source of funding, subject to review by the Commission. Under Section 109(f) of the Act, the amount of fees collected for a fiscal year shall not exceed the ‘‘recoverable budget expenses’’ of the standard setting body. Section 109(h) amends Section 13(b)(2) of the Securities Exchange Act of 1934 to require issuers to pay the allocable E:\FR\FM\09APN1.SGM 09APN1 TKELLEY on DSK3SPTVN1PROD with NOTICES 19676 Federal Register / Vol. 79, No. 68 / Wednesday, April 9, 2014 / Notices share of a reasonable annual accounting support fee or fees, determined in accordance with Section 109 of the Act. On April 25, 2003, the Commission issued a policy statement concluding that the Financial Accounting Standards Board (‘‘FASB’’) and its parent organization, the Financial Accounting Foundation (‘‘FAF’’), satisfied the criteria for an accounting standardsetting body under the Act, and recognizing the FASB’s financial accounting and reporting standards as ‘‘generally accepted’’ under Section 108 of the Act.1 As a consequence of that recognition, the Commission undertook a review of the FASB’s accounting support fee for calendar year 2014. In connection with its review, the Commission also reviewed the budget for the FAF and the FASB for calendar year 2014. Section 109 of the Act also provides that the standard setting body can have additional sources of revenue for its activities, such as earnings from sales of publications, provided that each additional source of revenue shall not jeopardize, in the judgment of the Commission, the actual or perceived independence of the standard setter. In this regard, the Commission also considered the interrelation of the operating budgets of the FAF, the FASB, and the Governmental Accounting Standards Board (‘‘GASB’’), the FASB’s sister organization, which sets accounting standards used by state and local government entities. The Commission has been advised by the FAF that neither the FAF, the FASB, nor the GASB accept contributions from the accounting profession. The Commission understands that the Office of Management and Budget (‘‘OMB’’) has determined the FASB’s spending of the 2014 accounting support fee is sequestrable under the Budget Control Act of 2011.2 So long as sequestration is applicable, we anticipate that the FAF will work with the Commission and Commission staff as appropriate regarding its implementation of sequestration. After its review, the Commission determined that the 2014 annual accounting support fee for the FASB is consistent with Section 109 of the Act. Accordingly, It is ordered, pursuant to Section 109 of the Act, that the FASB may act in accordance with this determination of the Commission. Financial Reporting Release No. 70. See ‘‘OMB Report Pursuant to the Sequestration Transparency Act of 2012’’ (Pub. L. 112–155), page 222 of 224 at: https://www.whitehouse.gov/sites/ default/files/omb/assets/legislative_reports/ stareport.pdf. 1 2 VerDate Mar<15>2010 17:54 Apr 08, 2014 Jkt 232001 By the Commission. Kevin M. O’Neill, Deputy Secretary. [FR Doc. 2014–07882 Filed 4–8–14; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–71856; File No. SR–C2– 2014–008] Self-Regulatory Organizations; C2 Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to Exchange Rule 6.15 April 3, 2014. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the ‘‘Act’’),1 and Rule 19b–4 thereunder,2 notice is hereby given that, on April 1, 2014, C2 Options Exchange, Incorporated (the ‘‘Exchange’’ or ‘‘C2’’) filed with the Securities and Exchange Commission (the ‘‘Commission’’) the proposed rule change as described in Items I and II below, which Items have been prepared by the Exchange. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to extend a pilot program related to Rule 6.15 (Obvious Error and Catastrophic Errors). The text of the proposed rule change is available on the Exchange’s Web site (https://www.cboe.com/AboutCBOE/ CBOELegalRegulatoryHome.aspx), at the Exchange’s Office of the Secretary, and at the Commission’s Public Reference Room. II. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements. 1 15 2 17 PO 00000 U.S.C. 78s(b)(1). CFR 240.19b–4. Frm 00101 Fmt 4703 Sfmt 4703 A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The purpose of this filing is to extend the effectiveness of the Exchange’s current rule applicable to obvious errors. Interpretation and Policy .08 to Rule 6.15, explained in further detail below, is currently operating on a pilot program set to expire on April 8, 2014. The Exchange proposes to extend the pilot program to February 20, 2015. On April 8, 2013, the Commission approved, on a pilot basis, amendments to Exchange Rule 6.15 that stated that options executions will not be adjusted or nullified if the execution occurs while the underlying security is in a limit or straddle state as defined by the Plan.3 Under the terms of this current pilot program, though options executions will generally not be adjusted or nullified while the underlying security is in a limit or straddle state, such executions may be reviewed by the Exchange should the Exchange decide to do so under its own motion.4 Pursuant to a comment letter filed in connection with the order approving the establishment of the pilot, the Exchange committed to submit monthly data regarding the program.5 In addition, the Exchange agreed to submit an overall analysis of the pilot in conjunction with the data submitted under the Plan and any other data as requested by the Commission.6 The Exchange now notes that each month, the Exchange shall provide to the Commission, and the public, a dataset containing the data for each straddle and limit state in optionable stocks that had at least one trade on the Exchange.7 For each trade on the Exchange, the Exchange will provide (a) the stock symbol, option symbol, time at the start of the straddle or limit state, an indicator for whether it is a straddle or limit state, and (b) for the trades on the Exchange, the executed volume, time-weighted quoted bid-ask spread, time-weighted average quoted depth at the bid, time-weighted 3 Securities Exchange Act Release No. 69345 (April 8, 2013), 78 FR 21985 (April 12, 2013) (SR– C2–2013–013). See also Exchange Rule 6.15.08 4 Id. 5 See letter from Angelo Evangelou, Associate General Counsel, Chicago Board Options Exchange, Incorporated, date April 4, 2013. 6 Id. 7 The Exchange also notes that it will be supplying the Commission this data retroactively from April 2013–March 2014 as soon as practicable. The Exchange will also provide the Commission with this data on a monthly basis from March 2014 through the end of the pilot. E:\FR\FM\09APN1.SGM 09APN1

Agencies

[Federal Register Volume 79, Number 68 (Wednesday, April 9, 2014)]
[Notices]
[Pages 19675-19676]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-07882]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 33-9569; Release No. 34-71852]


Securities Act of 1933; Securities Exchange Act of 1934; Order 
Regarding Review of FASB Accounting Support Fee for 2014 Under Section 
109 of the Sarbanes-Oxley Act of 2002

April 3, 2014.
    The Sarbanes-Oxley Act of 2002 (the ``Act'') provides that the 
Securities and Exchange Commission (the ``Commission'') may recognize, 
as generally accepted for purposes of the securities laws, any 
accounting principles established by a standard setting body that meets 
certain criteria. Consequently, Section 109 of the Act provides that 
all of the budget of such a standard setting body shall be payable from 
an annual accounting support fee assessed and collected against each 
issuer, as may be necessary or appropriate to pay for the budget and 
provide for the expenses of the standard setting body, and to provide 
for an independent, stable source of funding, subject to review by the 
Commission. Under Section 109(f) of the Act, the amount of fees 
collected for a fiscal year shall not exceed the ``recoverable budget 
expenses'' of the standard setting body. Section 109(h) amends Section 
13(b)(2) of the Securities Exchange Act of 1934 to require issuers to 
pay the allocable

[[Page 19676]]

share of a reasonable annual accounting support fee or fees, determined 
in accordance with Section 109 of the Act.
    On April 25, 2003, the Commission issued a policy statement 
concluding that the Financial Accounting Standards Board (``FASB'') and 
its parent organization, the Financial Accounting Foundation (``FAF''), 
satisfied the criteria for an accounting standard-setting body under 
the Act, and recognizing the FASB's financial accounting and reporting 
standards as ``generally accepted'' under Section 108 of the Act.\1\ As 
a consequence of that recognition, the Commission undertook a review of 
the FASB's accounting support fee for calendar year 2014. In connection 
with its review, the Commission also reviewed the budget for the FAF 
and the FASB for calendar year 2014.
---------------------------------------------------------------------------

    \1\ Financial Reporting Release No. 70.
---------------------------------------------------------------------------

    Section 109 of the Act also provides that the standard setting body 
can have additional sources of revenue for its activities, such as 
earnings from sales of publications, provided that each additional 
source of revenue shall not jeopardize, in the judgment of the 
Commission, the actual or perceived independence of the standard 
setter. In this regard, the Commission also considered the 
interrelation of the operating budgets of the FAF, the FASB, and the 
Governmental Accounting Standards Board (``GASB''), the FASB's sister 
organization, which sets accounting standards used by state and local 
government entities. The Commission has been advised by the FAF that 
neither the FAF, the FASB, nor the GASB accept contributions from the 
accounting profession.
    The Commission understands that the Office of Management and Budget 
(``OMB'') has determined the FASB's spending of the 2014 accounting 
support fee is sequestrable under the Budget Control Act of 2011.\2\ So 
long as sequestration is applicable, we anticipate that the FAF will 
work with the Commission and Commission staff as appropriate regarding 
its implementation of sequestration.
---------------------------------------------------------------------------

    \2\ See ``OMB Report Pursuant to the Sequestration Transparency 
Act of 2012'' (Pub. L. 112-155), page 222 of 224 at: https://www.whitehouse.gov/sites/default/files/omb/assets/legislative_reports/stareport.pdf.
---------------------------------------------------------------------------

    After its review, the Commission determined that the 2014 annual 
accounting support fee for the FASB is consistent with Section 109 of 
the Act. Accordingly,
    It is ordered, pursuant to Section 109 of the Act, that the FASB 
may act in accordance with this determination of the Commission.

    By the Commission.
Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2014-07882 Filed 4-8-14; 8:45 am]
BILLING CODE 8011-01-P
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