Submission for OMB Review; Comment Request, 57925-57926 [2019-23599]
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Federal Register / Vol. 84, No. 209 / Tuesday, October 29, 2019 / Notices
average yearly cost to each fund that is
subject to rule 31a–2 is about
$36,510.28. The Commission estimates
total annual cost is therefore about
$115.4 million.
Estimates of average burden hours
and costs are made solely for purposes
of the Paperwork Reduction Act and are
not derived from a comprehensive or
even representative survey or study of
the costs of Commission rules and
forms. Compliance with the collection
of information requirements of the rule
is mandatory. Responses to the
disclosure requirements 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 website:
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:
Lindsay.M.Abate@omb.eop.gov; and (ii)
Charles Riddle, Acting Director and
Chief Information Officer, Securities
and Exchange Commission, c/o Candace
Kenner, 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: October 24, 2019.
Eduardo A. Aleman,
Deputy Secretary.
[FR Doc. 2019–23596 Filed 10–28–19; 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 FOIA Services,
100 F Street NE, Washington, DC
20549–2736
Extension:
Rule 17a–3, SEC File No. 270–026, OMB
Control No. 3235–0033
Notice is hereby given that pursuant
to the Paperwork Reduction Act of 1995
(‘‘PRA’’) (44 U.S.C. 3501 et seq.), the
Securities and Exchange Commission
(‘‘Commission’’) has submitted to the
Office of Management and Budget
(‘‘OMB’’) a request for extension of the
VerDate Sep<11>2014
17:05 Oct 28, 2019
Jkt 250001
previously approved collection of
information provided for in Rule 17a–3
(17 CFR 240.17a–3), under the
Securities Exchange Act of 1934 (15
U.S.C. 78a et seq.).
Rule 17a–3 under the Securities
Exchange Act of 1934 establishes
minimum standards with respect to
business records that broker-dealers
registered with the Commission must
make and keep current. These records
are maintained by the broker-dealer (in
accordance with a separate rule), so they
can be used by the broker-dealer and
reviewed by Commission examiners, as
well as other regulatory authority
examiners, during inspections of the
broker-dealer.
The collections of information
included in Rule 17a–3 are necessary to
provide Commission, self-regulatory
organization and state examiners to
conduct effective and efficient
examinations to determine whether
broker-dealers are complying with
relevant laws, rules, and regulations. If
broker-dealers were not required to
create these baseline, standardized
records, Commission, self-regulatory
organization and state examiners could
be unable to determine whether brokerdealers are in compliance with the
Commission’s antifraud and antimanipulation rules, financial
responsibility program, and other
Commission, SRO, and State laws, rules,
and regulations.
As of December 31, 2018 there were
3,764 broker-dealers registered with the
Commission. The Commission estimates
that these broker-dealer respondents
incur a total burden of 2,893,773 hours
per year to comply with Rule 17a–3.
In addition, Rule 17a–3 contains
ongoing operation and maintenance
costs for broker-dealers, including the
cost of postage to provide customers
with account information, and costs for
equipment and systems development.
The Commission estimates that under
Rule 17a–3(a)(17), approximately
45,633,482 customers will need to be
provided with information regarding
their account on a yearly basis. The
Commission estimates that the postage
costs associated with providing those
customers with copies of their account
record information would be
approximately $16,321,719 per year
(45,633,482 × $0.35).1 The staff
estimates that broker-dealers
establishing liquidity, credit, and
market risk management controls
pursuant to Rule 17a–3(a)(23) incur one1 Estimates of postage costs are derived from past
conversations with industry representatives and
have been adjusted to account for inflation and
increases in postage costs.
PO 00000
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Fmt 4703
Sfmt 4703
57925
time startup costs of $912,000, or
$304,000 amortized over a three-year
approval period, to hire outside counsel
to review the controls. The staff further
estimates that the ongoing equipment
and systems development costs relating
to Rule 17a–3 for the industry would be
about $37,446,686 per year.
Consequently, the total cost burden
associated with Rule 17a–3 would be
approximately $54,072,405 per year.
Rule 17a–3 does not contain record
retention requirements. Compliance
with the rule is mandatory. The
required records are available only to
the staffs of the Commission, selfregulatory organizations of which the
broker-dealer is a member, and the
states during examination, inspections
and investigations.
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 the background
documentation for this information
collection at the following website,
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) Charles
Riddle, Acting Director/Chief
Information Officer, Securities and
Exchange Commission, c/o Candace
Kenner, 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: October 24, 2019.
Eduardo A. Aleman,
Deputy Secretary.
[FR Doc. 2019–23598 Filed 10–28–19; 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 FOIA Services,
100 F Street NE, Washington, DC
20549–2736
Extension:
Rule 17a–10, OMB Control No. 3235–0563,
SEC File No. 270–507
Notice is hereby given that pursuant
to the Paperwork Reduction Act of 1995
E:\FR\FM\29OCN1.SGM
29OCN1
57926
Federal Register / Vol. 84, No. 209 / Tuesday, October 29, 2019 / Notices
(44 U.S.C. 3501 et seq.) (‘‘PRA’’) the
Securities and Exchange Commission
(‘‘Commission’’) has submitted to the
Office of Management and Budget
(‘‘OMB’’) a request for extension of the
previously approved collection of
information discussed below.
Section 17(a) of the Investment
Company Act of 1940 (15 U.S.C. 80a–1
et seq.) (the ‘‘Act’’), generally 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.1
Section 2(a)(3) of the Act defines
‘‘affiliated person’’ of a fund to include
its investment advisers.2 Rule 17a–10
(17 CFR 270.17a–10) permits (i) a
subadviser 3 of a fund to enter into
transactions with funds the subadviser
does not advise but that 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. In
addition, 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.4 This requirement regarding
the prohibitions and limitations in
advisory contracts of subadvisors
relying on the rule constitutes a
collection of information under the
PRA.5
The staff assumes that all existing
funds with subadvisory contracts
amended those contracts to comply with
the adoption of rule 17a–10 in 2003,
which conditioned certain exemptions
upon these contractual alterations, and
therefore there is no continuing burden
for those funds.6 However, the staff
1 15
U.S.C. 80a–17(a).
U.S.C. 80a–2(a)(3)(E).
3 As defined in rule 17a–10(b)(2). 17 CFR
270.17a–10(b)(2).
4 17 CFR 270.17a–10(a)(2).
5 44 U.S.C. 3501.
6 Transactions of Investment Companies With
Portfolio and Subadviser Affiliates, Investment
Company Act Release No. 25888 (Jan. 14, 2003) [68
FR 3153 (Jan. 22, 2003)]. We assume that funds
2 15
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17:05 Oct 28, 2019
Jkt 250001
assumes that all newly formed
subadvised funds, and funds that enter
into new contracts with subadvisers,
will incur the one-time burden by
amending their contracts to add the
terms required by the rule.
Based on an analysis of fund filings,
the staff estimates that approximately
221 funds enter into new subadvisory
agreements each year.7 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
17a–10. Because these additional
clauses are identical to the clauses that
a fund would need to insert in their
subadvisory contracts to rely on rules
10f–3 (17 CFR 270.10f–3), 12d3–1 (17
CFR 270.12d3–1), and 17e–1 (17 CFR
270.17e–1), 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 among all
four rules. Therefore, we estimate that
the burden allocated to rule 17a–10 for
this contract change would be 0.75
hours.8 Assuming that all 221 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
166 burden hours annually, with an
associated cost of approximately
$68,890.9
The estimate of average burden hours
is made solely for the purposes of the
formed after 2003 that intended to rely on rule 17a–
10 would have included the required provision as
a standard element in their initial subadvisory
contracts.
7 Based on data from Morningstar, as of March
2019, there are 12,407 registered funds (open-end
funds, closed-end funds (including interval funds),
and exchange-traded funds), 4,609 funds of which
have subadvisory relationships (approximately
37%). Based on data from the 2019 ICI publications,
597 new funds were established in 2018 (582 openend funds and exchange-traded funds (from the
2019 ICI Fact Book) + 15 closed-end funds (from the
ICI Research Perspective, April 2019)). 597 new
funds × 37% = 221 funds.
8 This estimate is based on the following
calculation: 3 hours ÷ 4 rules = 0.75 hours.
9 These estimates are based on the following
calculations: (0.75 hours × 221 portfolios = 166
burden hours); ($415 per hour × 166 hours =
$68,890 total cost). The Commission’s estimates
concerning the wage rates for attorney time are
based on salary information for the securities
industry compiled by the Securities Industry and
Financial Markets Association. The estimated wage
figure is based on published rates for in-house
attorneys, modified to account for a 1,800-hour
work-year and inflation, and multiplied by 5.35 to
account for bonuses, firm size, employee benefits,
and overhead, yielding an effective hourly rate of
$415. See Securities Industry and Financial Markets
Association, Report on Management & Professional
Earnings in the Securities Industry 2013.
PO 00000
Frm 00083
Fmt 4703
Sfmt 4703
PRA. 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 necessary to obtain the
benefit of relying on rule 17a–10.
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.
The public may view the background
documentation for this information
collection at the following website,
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:
Lindsay.M.Abate@omb.eop.gov; and (ii)
Charles Riddle, Acting Director/Chief
Information Officer, Securities and
Exchange Commission, c/o Candace
Kenner, 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: October 24, 2019.
Eduardo A. Aleman,
Deputy Secretary.
[FR Doc. 2019–23599 Filed 10–28–19; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Investment Company Act Release No.
33675; File No. 812–15052]
MassMutual Select Funds, et al.
October 23, 2019.
Securities and Exchange
Commission (the ‘‘Commission’’).
ACTION: Notice.
AGENCY:
Notice of an application for an order
under section 12(d)(1)(J) of the
Investment Company Act of 1940 (the
‘‘Act’’) for an exemption from sections
12(d)(1)(A), (B), and (C) of the Act, and
under sections 6(c) and 17(b) of the Act
for an exemption from section 17(a) of
the Act. The requested order would
permit certain registered open-end
investment companies to acquire shares
of certain registered open-end
investment companies, registered
closed-end investment companies, and
business development companies
(‘‘BDCs’’), as defined in section 2(a)(48)
of the Act, and registered unit
E:\FR\FM\29OCN1.SGM
29OCN1
]]>Agencies
[Federal Register Volume 84, Number 209 (Tuesday, October 29, 2019)]
[Notices]
[Pages 57925-57926]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-23599]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Submission for OMB Review; 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 17a-10, OMB Control No. 3235-0563, SEC File No. 270-507
Notice is hereby given that pursuant to the Paperwork Reduction Act
of 1995
[[Page 57926]]
(44 U.S.C. 3501 et seq.) (``PRA'') the Securities and Exchange
Commission (``Commission'') has submitted to the Office of Management
and Budget (``OMB'') a request for extension of the previously approved
collection of information discussed below.
Section 17(a) of the Investment Company Act of 1940 (15 U.S.C. 80a-
1 et seq.) (the ``Act''), generally 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.\1\ Section
2(a)(3) of the Act defines ``affiliated person'' of a fund to include
its investment advisers.\2\ Rule 17a-10 (17 CFR 270.17a-10) permits (i)
a subadviser \3\ of a fund to enter into transactions with funds the
subadviser does not advise but that 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.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 80a-17(a).
\2\ 15 U.S.C. 80a-2(a)(3)(E).
\3\ As defined in rule 17a-10(b)(2). 17 CFR 270.17a-10(b)(2).
---------------------------------------------------------------------------
To qualify for the exemptions in rule 17a-10, the subadvisory
relationship must be the sole reason why section 17(a) prohibits the
transaction. In addition, 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.\4\ This requirement
regarding the prohibitions and limitations in advisory contracts of
subadvisors relying on the rule constitutes a collection of information
under the PRA.\5\
---------------------------------------------------------------------------
\4\ 17 CFR 270.17a-10(a)(2).
\5\ 44 U.S.C. 3501.
---------------------------------------------------------------------------
The staff assumes that all existing funds with subadvisory
contracts amended those contracts to comply with the adoption of rule
17a-10 in 2003, which conditioned certain exemptions upon these
contractual alterations, and therefore there is no continuing burden
for those funds.\6\ However, the staff assumes that all newly formed
subadvised funds, and funds that enter into new contracts with
subadvisers, will incur the one-time burden by amending their contracts
to add the terms required by the rule.
---------------------------------------------------------------------------
\6\ Transactions of Investment Companies With Portfolio and
Subadviser Affiliates, Investment Company Act Release No. 25888
(Jan. 14, 2003) [68 FR 3153 (Jan. 22, 2003)]. We assume that funds
formed after 2003 that intended to rely on rule 17a-10 would have
included the required provision as a standard element in their
initial subadvisory contracts.
---------------------------------------------------------------------------
Based on an analysis of fund filings, the staff estimates that
approximately 221 funds enter into new subadvisory agreements each
year.\7\ 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
17a-10. Because these additional clauses are identical to the clauses
that a fund would need to insert in their subadvisory contracts to rely
on rules 10f-3 (17 CFR 270.10f-3), 12d3-1 (17 CFR 270.12d3-1), and 17e-
1 (17 CFR 270.17e-1), 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 among all four rules. Therefore, we estimate that
the burden allocated to rule 17a-10 for this contract change would be
0.75 hours.\8\ Assuming that all 221 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 166 burden hours annually, with an
associated cost of approximately $68,890.\9\
---------------------------------------------------------------------------
\7\ Based on data from Morningstar, as of March 2019, there are
12,407 registered funds (open-end funds, closed-end funds (including
interval funds), and exchange-traded funds), 4,609 funds of which
have subadvisory relationships (approximately 37%). Based on data
from the 2019 ICI publications, 597 new funds were established in
2018 (582 open-end funds and exchange-traded funds (from the 2019
ICI Fact Book) + 15 closed-end funds (from the ICI Research
Perspective, April 2019)). 597 new funds x 37% = 221 funds.
\8\ This estimate is based on the following calculation: 3 hours
/ 4 rules = 0.75 hours.
\9\ These estimates are based on the following calculations:
(0.75 hours x 221 portfolios = 166 burden hours); ($415 per hour x
166 hours = $68,890 total cost). The Commission's estimates
concerning the wage rates for attorney time are based on salary
information for the securities industry compiled by the Securities
Industry and Financial Markets Association. The estimated wage
figure is based on published rates for in-house attorneys, modified
to account for a 1,800-hour work-year and inflation, and multiplied
by 5.35 to account for bonuses, firm size, employee benefits, and
overhead, yielding an effective hourly rate of $415. See Securities
Industry and Financial Markets Association, Report on Management &
Professional Earnings in the Securities Industry 2013.
---------------------------------------------------------------------------
The estimate of average burden hours is made solely for the
purposes of the PRA. 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
necessary to obtain the benefit of relying on rule 17a-10. 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.
The public may view the background documentation for this
information collection at the following website, 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:
[email protected]; and (ii) Charles Riddle, Acting Director/
Chief Information Officer, Securities and Exchange Commission, c/o
Candace Kenner, 100 F Street NE, Washington, DC 20549 or send an email
to: [email protected]. Comments must be submitted to OMB within 30
days of this notice.
Dated: October 24, 2019.
Eduardo A. Aleman,
Deputy Secretary.
[FR Doc. 2019-23599 Filed 10-28-19; 8:45 am]
BILLING CODE 8011-01-P
