Submission for OMB Review; Comment Request, 31000-31001 [2021-12101]

Download as PDF 31000 Federal Register / Vol. 86, No. 110 / Thursday, June 10, 2021 / Notices SECURITIES AND EXCHANGE COMMISSION [SEC File No. 270–321, OMB Control No. 3235–0358] 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 11a–3 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. Section 11(a) of the Investment Company Act of 1940 (‘‘Act’’) (15 U.S.C. 80a–11(a)) provides that it is unlawful for a registered open-end investment company (‘‘fund’’) or its underwriter to make an offer to the fund’s shareholders or the shareholders of any other fund to exchange the fund’s securities for securities of the same or another fund on any basis other than the relative net asset values (‘‘NAVs’’) of the respective securities to be exchanged, ‘‘unless the terms of the offer have first been submitted to and approved by the Commission or are in accordance with such rules and regulations as the Commission may have prescribed in respect of such offers.’’ Section 11(a) was designed to prevent ‘‘switching,’’ the practice of inducing shareholders of one fund to exchange their shares for the shares of another fund for the purpose of exacting additional sales charges. Rule 11a–3 (17 CFR 270.11a–3) under the Act of 1940 is an exemptive rule that permits open-end investment companies (‘‘funds’’), other than insurance company separate accounts, and funds’ principal underwriters, to make certain exchange offers to fund shareholders and shareholders of other funds in the same group of investment companies. The rule requires a fund, among other things, (i) to disclose in its prospectus and advertising literature the amount of any administrative or redemption fee imposed on an exchange transaction, (ii) if the fund imposes an administrative fee on exchange transactions, other than a nominal one, to maintain and preserve records with respect to the actual costs incurred in connection with exchanges for at least six years, and (iii) give the fund’s shareholders a sixty day notice of a termination of an exchange offer or any material amendment to the terms of an exchange offer (unless the only material effect of an amendment is to reduce or eliminate an administrative fee, sales load or redemption fee payable at the time of an exchange). The rule’s requirements are designed to protect investors against abuses associated with exchange offers, provide fund shareholders with information necessary to evaluate exchange offers and certain material changes in the terms of exchange offers, and enable the Commission staff to monitor funds’ use of administrative fees charged in connection with exchange transactions. The staff estimates that there are approximately 1,397 active open-end investment companies registered with the Commission as of October 2020. The staff estimates that 25 percent of these funds (349 funds) impose a non- nominal administrative fee on exchange transactions. The staff estimates that the recordkeeping requirement of the rule requires approximately 1 hour annually of clerical time (at an estimated $63 per hour) 1 per fund, for a total of 349 hours for all funds (at a total annual cost of $21,987).2 The staff estimates that 5 percent of these 1,397 funds (or 70 funds) terminate an exchange offer or make a material change to the terms of their exchange offer each year, requiring the fund to comply with the notice requirement of the rule. The staff estimates that complying with the notice requirement of the rule requires approximately 1 hour of attorney time (at an estimated $419 per hour) 3 and 2 hours of clerical time (at an estimated $63 per hour) per fund, for a total of approximately 210 hours for all funds to comply with the notice requirement (at a total annual cost of $38,150).4 The staff estimates that such notices will be enclosed with other written materials sent to shareholders, such as annual shareholder reports or account statements, and therefore any burdens associated with mailing required notices are accounted for in the burdens associated with Form N–1A registration statements for funds. The recordkeeping and notice requirements together impose an estimated total burden of 559 hours on all funds (at a total annual cost of $60,137).5 The total number of respondents is 419, each responding once a year.6 The burdens associated with the disclosure requirement of the rule are accounted for in the burdens associated with the Form N–1A registration statement for funds. Table 1 below summarizes the currently-approved and updated burdens associated with rule 11a–3. TABLE 1—SUMMARY OF BURDEN ESTIMATES FOR RULE 11a–3 Internal burden Wage rate Cost of internal burden Currently-Approved Burden Estimates khammond on DSKJM1Z7X2PROD with NOTICES Recordkeeping Requirement .................... Respondents ............................................. 1 hour ....................................................... 402 funds ................................................. 1 This estimate of $63 per hour for clerical work and the other estimated wage rates below are derived from the Securities Industry and Financial Markets Association’s (‘‘SIFMA’’) Office Salaries in the Securities Industry 2013, modified to account for an 1,800-hour work-year and multiplied by 5.35 to account for bonuses, firm size, employee benefits and overhead (updated for inflation). 2 This estimate is based on the following calculations: (1,397 funds × 25% = 349 funds); (349 × 1 (clerical hour) = 349 clerical hours); (349 × $ 63 = $21,987 total annual cost for recordkeeping requirement). VerDate Sep<11>2014 19:43 Jun 09, 2021 Jkt 253001 $59/hr. (clerk) ........................................... .................................................................. 3 The estimate of $419 per hour for an Attorney is derived from SIFMA’s Management & Professional Earnings in the Securities Industry 2013, modified to account for an 1,800-hour workyear and multiplied by 5.35 to account for bonuses, firm size, employee benefits and overhead (adjusted for inflation). 4 This estimate is based on the following calculations: (1,397 (funds) × 5% = 70 funds); (70 × 1 (attorney hour) = 70 total attorney hours); (70 (funds) × 2 (clerical hours) = 140 total clerical hours); (70 (attorney hours) + 140 (clerical hours) = 210 total hours); (70 (attorney hours) × $419 = PO 00000 Frm 00091 Fmt 4703 Sfmt 4703 $59. 402 funds. $29,330 total attorney cost); (140 (clerical hours) × $63 = $8,820 clerical cost); ($29,330 + $8,820 = $38,150 total annual cost). 5 This estimate is based on the following calculations: (210 (notice hours) + 349 (recordkeeping hours) = 559 total hours); ($38,150 (notice costs) + $21,987 (recordkeeping costs) = $60,137 total annual costs). 6 This estimate is based on the following calculation: (349 funds responding to recordkeeping requirement + 70 funds responding to notice requirement = 419 total respondents). E:\FR\FM\10JNN1.SGM 10JNN1 Federal Register / Vol. 86, No. 110 / Thursday, June 10, 2021 / Notices 31001 TABLE 1—SUMMARY OF BURDEN ESTIMATES FOR RULE 11a–3—Continued Cost of internal burden Internal burden Wage rate Total ................................................... 402 hours ................................................. .................................................................. $23,718. Notice Requirement .................................. 1 hour ....................................................... 2 hours ..................................................... 80 funds ................................................... 240 hours ................................................. $392/hr. (attorney) ................................... $59/hr. (clerk) ........................................... .................................................................. .................................................................. $392. $118. 80 funds. $40,800. .................................................................. $64,518. Respondents ............................................. Total ................................................... Total Responses (Recordkeeping + Notice). Total Burden (Recordkeeping + Notice) ... 482. 642 hours ................................................. Updated Burden Estimates Recordkeeping Requirement .................... Respondents ............................................. Total ................................................... 1 hour ....................................................... 349 funds ................................................. 349 hours ................................................. $63/hr. (clerk) ........................................... .................................................................. .................................................................. $63. 349 funds. $21,987. Notice Requirement .................................. 1 hour ....................................................... 2 hours ..................................................... 70 funds ................................................... 210 hours ................................................. $419/hr. (attorney) ................................... $63/hr. (clerk) ........................................... .................................................................. .................................................................. $419. $126. 70 funds. $38,150. .................................................................. $60,137. Respondents ............................................. Total ................................................... khammond on DSKJM1Z7X2PROD with NOTICES Total Responses (Recordkeeping + Notice). Total Burden (Recordkeeping + Notice) ... 419. 559 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 and forms. 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 background documentation for this information collection at the following website: www.reginfo.gov. Find this particular information collection by selecting ‘‘Currently under 30-day Review—Open for Public Comments’’ or by using the search function. Written comments and recommendations for the proposed information collection should be sent within 30 days of publication of this notice to (i) www.reginfo.gov/public/do/ PRAMain and (ii) David Bottom, Director/Chief Information Officer, Securities and Exchange Commission, c/ o Cynthia Roscoe, 100 F Street NE, Washington, DC 20549, or by sending an email to: PRA_Mailbox@sec.gov. Dated: June 4, 2021. J. Matthew DeLesDernier, Assistant Secretary. [FR Doc. 2021–12101 Filed 6–9–21; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [SEC File No. 270–563, OMB Control No. 3235–0694] 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 17g–10 and Form ABS Due Diligence—15E 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 (‘‘Commission’’) has submitted to the Office of Management and Budget (‘‘OMB’’) a request for approval of extension of the previously approved collection of information provided for in Rule 17g–10 under the Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.).1 Rule 17g–10 contains certain certification requirements for thirdparty due diligence service providers that are employed by an NRSRO, an issuer, or an underwriter, which must be made on Form ABS Due Diligence— 15E. The Commission estimates that the 1 See VerDate Sep<11>2014 17:15 Jun 09, 2021 Jkt 253001 PO 00000 total burden for respondents to comply with Rule 17g–10 is 330 hours. An agency may not conduct or sponsor a collection of information unless it displays a currently valid OMB control number. No person shall be subject to any penalty for failing to comply with a collection of information subject to the PRA that does not display a valid OMB control number. The public may view background documentation for this information collection at the following website: >www.reginfo.gov<. Find this particular information collection by selecting ‘‘Currently under 30-day Review—Open for Public Comments’’ or by using the search function. Written comments and recommendations for the proposed information collection should be sent within 30 days of publication of this notice to (i) >www.reginfo.gov/public/ do/PRAMain< and (ii) David Bottom, Director/Chief Information Officer, Securities and Exchange Commission, c/ o Cynthia Roscoe, 100 F Street NE, Washington, DC 20549, or by sending an email to: PRA_Mailbox@sec.gov. Dated: June 4, 2021. J. Matthew DeLesDernier, Assistant Secretary. [FR Doc. 2021–12112 Filed 6–9–21; 8:45 am] BILLING CODE 8011–01–P 17 CFR 240.17g–1 and 17 CFR 249b.300. Frm 00092 Fmt 4703 Sfmt 4703 E:\FR\FM\10JNN1.SGM 10JNN1

Agencies

[Federal Register Volume 86, Number 110 (Thursday, June 10, 2021)]
[Notices]
[Pages 31000-31001]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-12101]



[[Page 31000]]

-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[SEC File No. 270-321, OMB Control No. 3235-0358]


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 11a-3

    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.
    Section 11(a) of the Investment Company Act of 1940 (``Act'') (15 
U.S.C. 80a-11(a)) provides that it is unlawful for a registered open-
end investment company (``fund'') or its underwriter to make an offer 
to the fund's shareholders or the shareholders of any other fund to 
exchange the fund's securities for securities of the same or another 
fund on any basis other than the relative net asset values (``NAVs'') 
of the respective securities to be exchanged, ``unless the terms of the 
offer have first been submitted to and approved by the Commission or 
are in accordance with such rules and regulations as the Commission may 
have prescribed in respect of such offers.'' Section 11(a) was designed 
to prevent ``switching,'' the practice of inducing shareholders of one 
fund to exchange their shares for the shares of another fund for the 
purpose of exacting additional sales charges.
    Rule 11a-3 (17 CFR 270.11a-3) under the Act of 1940 is an exemptive 
rule that permits open-end investment companies (``funds''), other than 
insurance company separate accounts, and funds' principal underwriters, 
to make certain exchange offers to fund shareholders and shareholders 
of other funds in the same group of investment companies. The rule 
requires a fund, among other things, (i) to disclose in its prospectus 
and advertising literature the amount of any administrative or 
redemption fee imposed on an exchange transaction, (ii) if the fund 
imposes an administrative fee on exchange transactions, other than a 
nominal one, to maintain and preserve records with respect to the 
actual costs incurred in connection with exchanges for at least six 
years, and (iii) give the fund's shareholders a sixty day notice of a 
termination of an exchange offer or any material amendment to the terms 
of an exchange offer (unless the only material effect of an amendment 
is to reduce or eliminate an administrative fee, sales load or 
redemption fee payable at the time of an exchange).
    The rule's requirements are designed to protect investors against 
abuses associated with exchange offers, provide fund shareholders with 
information necessary to evaluate exchange offers and certain material 
changes in the terms of exchange offers, and enable the Commission 
staff to monitor funds' use of administrative fees charged in 
connection with exchange transactions.
    The staff estimates that there are approximately 1,397 active open-
end investment companies registered with the Commission as of October 
2020. The staff estimates that 25 percent of these funds (349 funds) 
impose a non-nominal administrative fee on exchange transactions. The 
staff estimates that the recordkeeping requirement of the rule requires 
approximately 1 hour annually of clerical time (at an estimated $63 per 
hour) \1\ per fund, for a total of 349 hours for all funds (at a total 
annual cost of $21,987).\2\
---------------------------------------------------------------------------

    \1\ This estimate of $63 per hour for clerical work and the 
other estimated wage rates below are derived from the Securities 
Industry and Financial Markets Association's (``SIFMA'') Office 
Salaries in the Securities Industry 2013, modified to account for an 
1,800-hour work-year and multiplied by 5.35 to account for bonuses, 
firm size, employee benefits and overhead (updated for inflation).
    \2\ This estimate is based on the following calculations: (1,397 
funds x 25% = 349 funds); (349 x 1 (clerical hour) = 349 clerical 
hours); (349 x $ 63 = $21,987 total annual cost for recordkeeping 
requirement).
---------------------------------------------------------------------------

    The staff estimates that 5 percent of these 1,397 funds (or 70 
funds) terminate an exchange offer or make a material change to the 
terms of their exchange offer each year, requiring the fund to comply 
with the notice requirement of the rule. The staff estimates that 
complying with the notice requirement of the rule requires 
approximately 1 hour of attorney time (at an estimated $419 per hour) 
\3\ and 2 hours of clerical time (at an estimated $63 per hour) per 
fund, for a total of approximately 210 hours for all funds to comply 
with the notice requirement (at a total annual cost of $38,150).\4\ The 
staff estimates that such notices will be enclosed with other written 
materials sent to shareholders, such as annual shareholder reports or 
account statements, and therefore any burdens associated with mailing 
required notices are accounted for in the burdens associated with Form 
N-1A registration statements for funds.
---------------------------------------------------------------------------

    \3\ The estimate of $419 per hour for an Attorney is derived 
from SIFMA's Management & Professional Earnings in the Securities 
Industry 2013, modified to account for an 1,800-hour work-year and 
multiplied by 5.35 to account for bonuses, firm size, employee 
benefits and overhead (adjusted for inflation).
    \4\ This estimate is based on the following calculations: (1,397 
(funds) x 5% = 70 funds); (70 x 1 (attorney hour) = 70 total 
attorney hours); (70 (funds) x 2 (clerical hours) = 140 total 
clerical hours); (70 (attorney hours) + 140 (clerical hours) = 210 
total hours); (70 (attorney hours) x $419 = $29,330 total attorney 
cost); (140 (clerical hours) x $63 = $8,820 clerical cost); ($29,330 
+ $8,820 = $38,150 total annual cost).
---------------------------------------------------------------------------

    The recordkeeping and notice requirements together impose an 
estimated total burden of 559 hours on all funds (at a total annual 
cost of $60,137).\5\ The total number of respondents is 419, each 
responding once a year.\6\ The burdens associated with the disclosure 
requirement of the rule are accounted for in the burdens associated 
with the Form N-1A registration statement for funds.
---------------------------------------------------------------------------

    \5\ This estimate is based on the following calculations: (210 
(notice hours) + 349 (recordkeeping hours) = 559 total hours); 
($38,150 (notice costs) + $21,987 (recordkeeping costs) = $60,137 
total annual costs).
    \6\ This estimate is based on the following calculation: (349 
funds responding to recordkeeping requirement + 70 funds responding 
to notice requirement = 419 total respondents).
---------------------------------------------------------------------------

    Table 1 below summarizes the currently-approved and updated burdens 
associated with rule 11a-3.

                               Table 1--Summary of Burden Estimates for Rule 11a-3
----------------------------------------------------------------------------------------------------------------
                                          Internal burden             Wage rate         Cost of internal  burden
----------------------------------------------------------------------------------------------------------------
                                       Currently-Approved Burden Estimates
----------------------------------------------------------------------------------------------------------------
Recordkeeping Requirement...........  1 hour.................  $59/hr. (clerk)........  $59.
Respondents.........................  402 funds..............  .......................  402 funds.

[[Page 31001]]

 
    Total...........................  402 hours..............  .......................  $23,718.
----------------------------------------------------------------------------------------------------------------
Notice Requirement..................  1 hour.................  $392/hr. (attorney)....  $392.
                                      2 hours................  $59/hr. (clerk)........  $118.
Respondents.........................  80 funds...............  .......................  80 funds.
    Total...........................  240 hours..............  .......................  $40,800.
----------------------------------------------------------------------------------------------------------------
Total Responses (Recordkeeping +      482....................
 Notice).
Total Burden (Recordkeeping +         642 hours..............  .......................  $64,518.
 Notice).
----------------------------------------------------------------------------------------------------------------
                                            Updated Burden Estimates
----------------------------------------------------------------------------------------------------------------
Recordkeeping Requirement...........  1 hour.................  $63/hr. (clerk)........  $63.
Respondents.........................  349 funds..............  .......................  349 funds.
    Total...........................  349 hours..............  .......................  $21,987.
----------------------------------------------------------------------------------------------------------------
Notice Requirement..................  1 hour.................  $419/hr. (attorney)....  $419.
                                      2 hours................  $63/hr. (clerk)........  $126.
Respondents.........................  70 funds...............  .......................  70 funds.
    Total...........................  210 hours..............  .......................  $38,150.
----------------------------------------------------------------------------------------------------------------
Total Responses (Recordkeeping +      419....................
 Notice).
Total Burden (Recordkeeping +         559 hours..............  .......................  $60,137.
 Notice).
----------------------------------------------------------------------------------------------------------------

    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 and forms. 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 background documentation for this information 
collection at the following website: www.reginfo.gov. Find this 
particular information collection by selecting ``Currently under 30-day 
Review--Open for Public Comments'' or by using the search function. 
Written comments and recommendations for the proposed information 
collection should be sent within 30 days of publication of this notice 
to (i) www.reginfo.gov/public/do/PRAMain and (ii) David Bottom, 
Director/Chief Information Officer, Securities and Exchange Commission, 
c/o Cynthia Roscoe, 100 F Street NE, Washington, DC 20549, or by 
sending an email to: [email protected].

    Dated: June 4, 2021.
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2021-12101 Filed 6-9-21; 8:45 am]
BILLING CODE 8011-01-P
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