Proposed Collection; Comment Request, 42566-42567 [2017-19072]

Download as PDF 42566 Federal Register / Vol. 82, No. 173 / Friday, September 8, 2017 / Notices the requirement will take each respondent approximately four hours to complete. The Commission staff estimates that compliance staff work at registered transfer agents to comply with the third party disclosure requirement will result in an internal cost of compliance, at an estimated hourly wage of $283, of $1,128 per year per transfer agent (4 hours × $283 per hour = $1,128 per year). Therefore, the aggregate annual internal cost of compliance for the approximately one registered transfer agent each year to comply with Rule 17Ad–3(b) is also $1,128. There are no external labor costs associated with sending the notice to issuers. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information under the PRA unless it displays a currently valid OMB control number. The public may view 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) Pamela Dyson, Director/Chief Information Officer, Securities and Exchange Commission, c/o Remi Pavlik-Simon, 100 F Street NE., Washington, DC 20549, or by sending an email to: PRA_ Mailbox@sec.gov. Comments must be submitted to OMB within 30 days of this notice. Dated: September 5, 2017. Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2017–19071 Filed 9–7–17; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION sradovich on DSK3GMQ082PROD with NOTICES Proposed Collection; Comment Request 1 15 Extension: Rule 0–1, SEC File No. 270–472, OMB Control No. 3235–0531 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 17:18 Sep 07, 2017 Jkt 241001 U.S.C. 80a. example, fund directors must approve investment advisory and distribution contracts. See 15 U.S.C. 80a–15(a), (b), and (c). 3 Investment Company Act Release No. 4 (Oct. 29, 1940) (5 FR 4316 (Oct. 31, 1940)). Note that rule 0– 1 was originally adopted as rule N–1. 4 The relevant exemptive rules are: Rule 10f–3 (17 CFR 270.10f–3), rule 12b–1 (17 CFR 270.12b–1), rule 15a–4(b)(2) (17 CFR 270.15a–4(b)(2)), rule 17a– 7 (17 CFR 270.17a–7), rule 17a–8 (17 CFR 270.17a– 8), rule 17d–1(d)(7) (17 CFR 270.17d–1(d)(7)), rule 17e–1(c) (17 CFR 270.17e–1(c)), rule 17g–1 (17 CFR 270.17g–1), rule 18f–3 (17 CFR 270.18f–3), and rule 23c–3 (17 CFR 270.23c–3). 5 See Role of Independent Directors of Investment Companies, Investment Company Act Release No. 24816 (Jan. 2, 2001) (66 FR 3735 (Jan. 16, 2001)). 2 For Upon Written Request, Copies Available From: Securities and Exchange Commission, Office of FOIA Services, 100 F Street NE., Washington, DC 20549–2736. VerDate Sep<11>2014 (‘‘Commission’’) plans to submit to the Office of Management and Budget a request for extension of the previous approved collection of information discussed below. The Investment Company Act of 1940 (the ‘‘Act’’) 1 establishes a comprehensive framework for regulating the organization and operation of investment companies (‘‘funds’’). A principal objective of the Act is to protect fund investors by addressing the conflicts of interest that exist between funds and their investment advisers and other affiliated persons. The Act places significant responsibility on the fund board of directors in overseeing the operations of the fund and policing the relevant conflicts of interest.2 In one of its first releases, the Commission exercised its rulemaking authority pursuant to sections 38(a) and 40(b) of the Act by adopting rule 0–1 (17 CFR 270.0–1).3 Rule 0–1, as subsequently amended on numerous occasions, provides definitions for the terms used by the Commission in the rules and regulations it has adopted pursuant to the Act. The rule also contains a number of rules of construction for terms that are defined either in the Act itself or elsewhere in the Commission’s rules and regulations. Finally, rule 0–1 defines terms that serve as conditions to the availability of certain of the Commission’s exemptive rules. More specifically, the term ‘‘independent legal counsel,’’ as defined in rule 0–1, sets out conditions that funds must meet in order to rely on any of ten exemptive rules (‘‘exemptive rules’’) under the Act.4 The Commission amended rule 0–1 to include the definition of the term ‘‘independent legal counsel’’ in 2001.5 This amendment was designed to enhance the effectiveness of fund boards of directors and to better enable investors to assess the independence of those directors. The Commission also amended the exemptive rules to require that any person who serves as legal counsel to the independent directors of PO 00000 Frm 00027 Fmt 4703 Sfmt 4703 any fund that relies on any of the exemptive rules must be an ‘‘independent legal counsel.’’ This requirement was added because independent directors can better perform the responsibilities assigned to them under the Act and the rules if they have the assistance of truly independent legal counsel. If the board’s counsel has represented the fund’s investment adviser, principal underwriter, administrator (collectively, ‘‘management organizations’’) or their ‘‘control persons’’ 6 during the past two years, rule 0–1 requires that the board’s independent directors make a determination about the adequacy of the counsel’s independence. A majority of the board’s independent directors are required to reasonably determine, in the exercise of their judgment, that the counsel’s prior or current representation of the management organizations or their control persons was sufficiently limited to conclude that it is unlikely to adversely affect the counsel’s professional judgment and legal representation. Rule 0–1 also requires that a record for the basis of this determination is made in the minutes of the directors’ meeting. In addition, the independent directors must have obtained an undertaking from the counsel to provide them with the information necessary to make their determination and to update promptly that information when the person begins to represent a management organization or control person, or when he or she materially increases his or her representation. Generally, the independent directors must re-evaluate their determination no less frequently than annually. Any fund that relies on one of the exemptive rules must comply with the requirements in the definition of ‘‘independent legal counsel’’ under rule 0–1. We assume that approximately 3,108 funds rely on at least one of the exemptive rules annually.7 We further assume that the independent directors of approximately one-third (1,036) of those funds would need to make the required determination in order for their counsel to meet the definition of 6 A ‘‘control person’’ is any person—other than a fund—directly or indirectly controlling, controlled by, or under common control, with any of the fund’s management organizations. See 17 CFR 270.01(a)(6)(iv)(B). 7 Based on statistics compiled by Commission staff, we estimate that there are approximately 3,453 funds that could rely on one or more of the exemptive rules (this figure reflects the three-year average of open-end and closed-end funds (3,349) and business development companies (104)). Of those funds, we assume that approximately 90 percent (3,108) actually rely on at least one exemptive rules annually. E:\FR\FM\08SEN1.SGM 08SEN1 Federal Register / Vol. 82, No. 173 / Friday, September 8, 2017 / Notices sradovich on DSK3GMQ082PROD with NOTICES independent legal counsel.8 We estimate that each of these 1,036 funds would be required to spend, on average, 0.75 hours annually to comply with the recordkeeping requirement associated with this determination, for a total annual burden of approximately 777 hours. Based on this estimate, the total annual cost for all funds’ compliance with this rule is approximately $168,350. To calculate this total annual cost, the Commission staff assumed that approximately two-thirds of the total annual hour burden (518 hours) would be incurred by a compliance manager with an average hourly wage rate of $292 per hour,9 and one-third of the annual hour burden (259 hours) would be incurred by compliance clerk with an average hourly wage rate of $66 per hour.10 These burden hour estimates are based upon the Commission staff’s experience and discussions with the fund industry. The estimates of average burden hours are made solely for the purposes of the Paperwork Reduction Act. These estimates are not derived from a comprehensive or even a representative survey or study of the costs of Commission rules. Written comments are invited 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 burdens 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 8 We assume that the independent directors of the remaining two-thirds of those funds will choose not to have counsel, or will rely on counsel who has not recently represented the fund’s management organizations or control persons. In both circumstances, it would not be necessary for the fund’s independent directors to make a determination about their counsel’s independence. 9 The estimated hourly wages used in this PRA analysis were derived from the Securities Industry and Financial Markets Association’s Reports on Management and Professional Earnings in the Securities Industry (2013) (modified to account for an 1800-hour work year and multiplied by 5.35 to account for bonuses, firm size, employee benefits and overhead) (adjusted for inflation), and Office Salaries in the Securities Industry (2013) (modified to account for an 1800-hour work year and multiplied by 2.93 to account for bonuses, firm size, employee benefits and overhead) (adjusted for inflation). 10 (518 × $292/hour) + (259 × $66/hour) = $168,350. VerDate Sep<11>2014 17:18 Sep 07, 2017 Jkt 241001 writing within 60 days of this publication. Please direct your written comments to Pamela Dyson, 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. Dated: September 5, 2017. Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2017–19072 Filed 9–7–17; 8:45 am] BILLING CODE 8011–01–P SMALL BUSINESS ADMINISTRATION [Disaster Declaration #15276; California Disaster Number CA–00276 Declaration of Economic Injury] Administrative Declaration of an Economic Injury Disaster for the State of California PO 00000 Frm 00028 Fmt 4703 Sfmt 4703 Businesses and Small Agricultural Cooperatives without Credit Available Elsewhere .................. Non-Profit Organizations without Credit Available Elsewhere ....... 3.215 2.500 The number assigned to this disaster for economic injury is 152760. The State which received an EIDL Declaration # is California. (Catalog of Federal Domestic Assistance Number 59008) Dated: August 30, 2017. Linda E. McMahon, Administrator. [FR Doc. 2017–19079 Filed 9–7–17; 8:45 am] BILLING CODE 8025–01–P SMALL BUSINESS ADMINISTRATION [Disaster Declaration #15274 and #15275; Texas Disaster Number TX–00487] U.S. Small Business Administration. ACTION: Amendment 2. AGENCY: This is a notice of an Economic Injury Disaster Loan (EIDL) declaration for the State of California, dated 08/30/2017. Incident: Flooding Due to Extreme Snow Melt. Incident Period: 06/17/2017 through 06/29/2017. DATES: Issued on 08/30/2017. Economic Injury (EIDL) Loan Application Deadline Date: 05/30/2018. ADDRESSES: Submit completed loan applications to: U.S. Small Business Administration, Processing and Disbursement Center, 14925 Kingsport Road, Fort Worth, TX 76155. FOR FURTHER INFORMATION CONTACT: A. Escobar, Office of Disaster Assistance, U.S. Small Business Administration, 409 3rd Street SW., Suite 6050, Washington, DC 20416, (202) 205–6734. SUPPLEMENTARY INFORMATION: Notice is hereby given that as a result of the Administrator’s EIDL declaration, applications for economic injury disaster loans may be filed at the address listed above or other locally announced locations. The following areas have been determined to be adversely affected by the disaster: Primary Counties: Fresno, Tulare Contiguous Counties: California: Inyo, Kern, Kings, Madera, Merced, Mono, Monterey, San Benito The Interest Rates are: Percent Presidential Declaration Amendment of a Major Disaster for the State of Texas U.S. Small Business Administration. ACTION: Notice. AGENCY: SUMMARY: 42567 This is an amendment of the Presidential declaration of a major disaster for the State of Texas (FEMA– 4332–DR), dated 08/25/2017. Incident: Hurricane Harvey. Incident Period: 08/23/2017 and continuing. SUMMARY: Issued on 08/30/2017. Physical Loan Application Deadline Date: 10/24/2017. Economic Injury (EIDL) Loan Application Deadline Date: 05/25/2018. ADDRESSES: Submit completed loan applications to: U.S. Small Business Administration, Processing and Disbursement Center, 14925 Kingsport Road, Fort Worth, TX 76155. FOR FURTHER INFORMATION CONTACT: A. Escobar, Office of Disaster Assistance, U.S. Small Business Administration, 409 3rd Street SW., Suite 6050, Washington, DC 20416, (202) 205–6734. SUPPLEMENTARY INFORMATION: The notice of the President’s major disaster declaration for the State of Texas, dated 08/25/2017, is hereby amended to include the following areas as adversely affected by the disaster: Primary Counties (Physical Damage and Economic Injury Loans): Colorado, Fayette, Hardin, Jasper, Jefferson, Montgomery, Newton, Orange, Sabine, San Jacinto, Waller Contiguous Counties (Economic Injury Loans Only): DATES: E:\FR\FM\08SEN1.SGM 08SEN1

Agencies

[Federal Register Volume 82, Number 173 (Friday, September 8, 2017)]
[Notices]
[Pages 42566-42567]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-19072]


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SECURITIES AND EXCHANGE COMMISSION


Proposed Collection; Comment Request

Upon Written Request, Copies Available From: Securities and Exchange 
Commission, Office of FOIA Services, 100 F Street NE., Washington, DC 
20549-2736.

Extension:
    Rule 0-1, SEC File No. 270-472, OMB Control No. 3235-0531

    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 (``Commission'') plans to submit to the Office of Management 
and Budget a request for extension of the previous approved collection 
of information discussed below.
    The Investment Company Act of 1940 (the ``Act'') \1\ establishes a 
comprehensive framework for regulating the organization and operation 
of investment companies (``funds''). A principal objective of the Act 
is to protect fund investors by addressing the conflicts of interest 
that exist between funds and their investment advisers and other 
affiliated persons. The Act places significant responsibility on the 
fund board of directors in overseeing the operations of the fund and 
policing the relevant conflicts of interest.\2\
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 80a.
    \2\ For example, fund directors must approve investment advisory 
and distribution contracts. See 15 U.S.C. 80a-15(a), (b), and (c).
---------------------------------------------------------------------------

    In one of its first releases, the Commission exercised its 
rulemaking authority pursuant to sections 38(a) and 40(b) of the Act by 
adopting rule 0-1 (17 CFR 270.0-1).\3\ Rule 0-1, as subsequently 
amended on numerous occasions, provides definitions for the terms used 
by the Commission in the rules and regulations it has adopted pursuant 
to the Act. The rule also contains a number of rules of construction 
for terms that are defined either in the Act itself or elsewhere in the 
Commission's rules and regulations. Finally, rule 0-1 defines terms 
that serve as conditions to the availability of certain of the 
Commission's exemptive rules. More specifically, the term ``independent 
legal counsel,'' as defined in rule 0-1, sets out conditions that funds 
must meet in order to rely on any of ten exemptive rules (``exemptive 
rules'') under the Act.\4\
---------------------------------------------------------------------------

    \3\ Investment Company Act Release No. 4 (Oct. 29, 1940) (5 FR 
4316 (Oct. 31, 1940)). Note that rule 0-1 was originally adopted as 
rule N-1.
    \4\ The relevant exemptive rules are: Rule 10f-3 (17 CFR 
270.10f-3), rule 12b-1 (17 CFR 270.12b-1), rule 15a-4(b)(2) (17 CFR 
270.15a-4(b)(2)), rule 17a-7 (17 CFR 270.17a-7), rule 17a-8 (17 CFR 
270.17a-8), rule 17d-1(d)(7) (17 CFR 270.17d-1(d)(7)), rule 17e-1(c) 
(17 CFR 270.17e-1(c)), rule 17g-1 (17 CFR 270.17g-1), rule 18f-3 (17 
CFR 270.18f-3), and rule 23c-3 (17 CFR 270.23c-3).
---------------------------------------------------------------------------

    The Commission amended rule 0-1 to include the definition of the 
term ``independent legal counsel'' in 2001.\5\ This amendment was 
designed to enhance the effectiveness of fund boards of directors and 
to better enable investors to assess the independence of those 
directors. The Commission also amended the exemptive rules to require 
that any person who serves as legal counsel to the independent 
directors of any fund that relies on any of the exemptive rules must be 
an ``independent legal counsel.'' This requirement was added because 
independent directors can better perform the responsibilities assigned 
to them under the Act and the rules if they have the assistance of 
truly independent legal counsel.
---------------------------------------------------------------------------

    \5\ See Role of Independent Directors of Investment Companies, 
Investment Company Act Release No. 24816 (Jan. 2, 2001) (66 FR 3735 
(Jan. 16, 2001)).
---------------------------------------------------------------------------

    If the board's counsel has represented the fund's investment 
adviser, principal underwriter, administrator (collectively, 
``management organizations'') or their ``control persons'' \6\ during 
the past two years, rule 0-1 requires that the board's independent 
directors make a determination about the adequacy of the counsel's 
independence. A majority of the board's independent directors are 
required to reasonably determine, in the exercise of their judgment, 
that the counsel's prior or current representation of the management 
organizations or their control persons was sufficiently limited to 
conclude that it is unlikely to adversely affect the counsel's 
professional judgment and legal representation. Rule 0-1 also requires 
that a record for the basis of this determination is made in the 
minutes of the directors' meeting. In addition, the independent 
directors must have obtained an undertaking from the counsel to provide 
them with the information necessary to make their determination and to 
update promptly that information when the person begins to represent a 
management organization or control person, or when he or she materially 
increases his or her representation. Generally, the independent 
directors must re-evaluate their determination no less frequently than 
annually.
---------------------------------------------------------------------------

    \6\ A ``control person'' is any person--other than a fund--
directly or indirectly controlling, controlled by, or under common 
control, with any of the fund's management organizations. See 17 CFR 
270.01(a)(6)(iv)(B).
---------------------------------------------------------------------------

    Any fund that relies on one of the exemptive rules must comply with 
the requirements in the definition of ``independent legal counsel'' 
under rule 0-1. We assume that approximately 3,108 funds rely on at 
least one of the exemptive rules annually.\7\ We further assume that 
the independent directors of approximately one-third (1,036) of those 
funds would need to make the required determination in order for their 
counsel to meet the definition of

[[Page 42567]]

independent legal counsel.\8\ We estimate that each of these 1,036 
funds would be required to spend, on average, 0.75 hours annually to 
comply with the recordkeeping requirement associated with this 
determination, for a total annual burden of approximately 777 hours. 
Based on this estimate, the total annual cost for all funds' compliance 
with this rule is approximately $168,350. To calculate this total 
annual cost, the Commission staff assumed that approximately two-thirds 
of the total annual hour burden (518 hours) would be incurred by a 
compliance manager with an average hourly wage rate of $292 per 
hour,\9\ and one-third of the annual hour burden (259 hours) would be 
incurred by compliance clerk with an average hourly wage rate of $66 
per hour.\10\
---------------------------------------------------------------------------

    \7\ Based on statistics compiled by Commission staff, we 
estimate that there are approximately 3,453 funds that could rely on 
one or more of the exemptive rules (this figure reflects the three-
year average of open-end and closed-end funds (3,349) and business 
development companies (104)). Of those funds, we assume that 
approximately 90 percent (3,108) actually rely on at least one 
exemptive rules annually.
    \8\ We assume that the independent directors of the remaining 
two-thirds of those funds will choose not to have counsel, or will 
rely on counsel who has not recently represented the fund's 
management organizations or control persons. In both circumstances, 
it would not be necessary for the fund's independent directors to 
make a determination about their counsel's independence.
    \9\ The estimated hourly wages used in this PRA analysis were 
derived from the Securities Industry and Financial Markets 
Association's Reports on Management and Professional Earnings in the 
Securities Industry (2013) (modified to account for an 1800-hour 
work year and multiplied by 5.35 to account for bonuses, firm size, 
employee benefits and overhead) (adjusted for inflation), and Office 
Salaries in the Securities Industry (2013) (modified to account for 
an 1800-hour work year and multiplied by 2.93 to account for 
bonuses, firm size, employee benefits and overhead) (adjusted for 
inflation).
    \10\ (518 x $292/hour) + (259 x $66/hour) = $168,350.
---------------------------------------------------------------------------

    These burden hour estimates are based upon the Commission staff's 
experience and discussions with the fund industry. The estimates of 
average burden hours are made solely for the purposes of the Paperwork 
Reduction Act. These estimates are not derived from a comprehensive or 
even a representative survey or study of the costs of Commission rules.
    Written comments are invited 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 burdens 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 Pamela Dyson, 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.

    Dated: September 5, 2017.
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-19072 Filed 9-7-17; 8:45 am]
 BILLING CODE 8011-01-P