Submission for OMB Review; Comment Request; Extension: Rule 18f-3, 5033-5034 [2024-01437]
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Federal Register / Vol. 89, No. 17 / Thursday, January 25, 2024 / Notices
submission, all subsequent
amendments, all written statements
with respect to the proposed rule
change that are filed with the
Commission, and all written
communications relating to the
proposed rule change between the
Commission and any person, other than
those that may be withheld from the
public in accordance with the
provisions of 5 U.S.C. 552, will be
available for website viewing and
printing in the Commission’s Public
Reference Room, 100 F Street NE,
Washington, DC 20549, on official
business days between the hours of 10
a.m. and 3 p.m. Copies of the filing also
will be available for inspection and
copying at the principal office of the
Exchange. Do not include personal
identifiable information in submissions;
you should submit only information
that you wish to make available
publicly. We may redact in part or
withhold entirely from publication
submitted material that is obscene or
subject to copyright protection. All
submissions should refer to file number
SR–NYSEARCA–2024–06 and should be
submitted on or before February 15,
2024.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.29
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2024–01391 Filed 1–24–24; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[SEC File No. 270–385, OMB Control No.
3235–0441]
Submission for OMB Review;
Comment Request; Extension: Rule
18f–3
Upon Written Request, Copies Available
From: Securities and Exchange
Commission, Office of FOIA
Services, 100 F Street NE,
Washington, DC 20549–2736
Notice is hereby given that, pursuant
to the Paperwork Reduction Act of 1995
(44 U.S.C. 3501 et seq.) (‘‘Paperwork
Reduction Act’’), the Securities and
Exchange Commission (‘‘the
Commission’’) has submitted to the
Office of Management and Budget
(‘‘OMB’’) a request for extension of the
previously approved collection of
information discussed below.
Rule 18f–3 (17 CFR 270.18f–3) under
the Investment Company Act of 1940
(15 U.S.C. 80a–1 et seq.) exempts from
section 18(f)(1) and 18 (f)(i) a fund that
issues multiple classes of shares
representing interests in the same
portfolio of securities (a ‘‘multiple class
fund’’) if the fund satisfies the
conditions of the rule. In general, each
class must differ in its arrangement for
shareholder services or distribution or
both, must pay the related expenses of
that different arrangement, and must
satisfy certain voting rights provisions.
The rule includes one requirement for
the collection of information. A
multiple class fund must prepare, and
fund directors must approve, a written
plan setting forth the separate
5033
arrangement and expense allocation of
each class, and any related conversion
features or exchange privileges (‘‘rule
18f–3 plan’’). Approval of the plan must
occur before the fund issues any shares
of multiple classes and whenever the
fund materially amends the plan. In
approving the plan, the fund board,
including a majority of the independent
directors, must determine that the plan
is in the best interests of each class and
the fund as a whole.
The requirement that the fund prepare
and directors approve a written rule
18f–3 plan is intended to ensure that the
fund compiles information relevant to
the fairness of the separate arrangement
and expense allocation for each class,
and that directors review and approve
the information. Without a blueprint
that highlights material differences
among classes, directors might not
perceive potential conflicts of interests
when they determine whether the plan
is in the best interests of each class and
the fund. In addition, the plan may be
useful to Commission staff in reviewing
the fund’s compliance with the rule.
The following estimates of average
burden hours are made solely for
purposes of the Paperwork Reduction
Act of 1995 1 and are not derived from
a comprehensive or even representative
survey or study of the cost of
Commission rules and forms.
Compliance with the information
collection requirements of rule 18f–3 is
necessary to obtain the benefit of the
rule’s exemption. The collection of
information under rule 18f–3 is
mandatory. Responses to the collection
of information requirements will not be
kept confidential.
TABLE 1—RULE 18f–3 PRA ESTIMATES
Internal annual
burden
Wage rate 1
Internal time costs
ESTIMATES FOR RULE 18F–3
Prepare and approve a written 18f–3 plan 2 ...
Average number of responses annually per
registrant.
Total number of hours per registrant per
year 4.
Total number of registrants .............................
khammond on DSKJM1Z7X2PROD with NOTICES
Total annual hour burden .........................
6 hours 3.
0.5 responses 3.
3 hours 3 ..................
$484 (in-house attorney). $4,770 (fund board
of directors) 6
$936,056 (in-house attorney). $4,612,590
(board of directors) 7.
..........................................................................
$5,548,646 8.
967 4.
2,901 hours 5 ...........
Notes:
1. The Commission’s estimates of the relevant wage rates are based on salary information for the securities industry compiled by the Securities Industry and Financial Markets Association’s Office Salaries in the Securities Industry 2013; the estimated figures are modified by firm size, employee benefits, overhead, and adjusted
to account for the effects of inflation; see Securities Industry and Financial Markets Association, Report on Management & Professional Earnings in the Securities Industry 2013.
2. The Commission estimates that each registrant prepares and approves a rule 18f–3 plan every two years when issuing a new fund or class or amending a plan
(or that 484 of all 967 registrants prepare and approve a plan each year).
3. This estimate assumes that each response will take 6 hours, requiring 3 hours per registrant per year (0.5 responses per registrant × 6 hours per response = 3
hours per registrant).
4. The Commission estimates that there are approximately 6,733 multiple class funds offered by 967 registrants.
5. 967 registrants × 3 hours = 2,901 hours.
6. The estimate for the cost of board time is derived from estimates made by the staff regarding typical board size and compensation that is based on information
received from fund representatives and publicly available sources; the $4,770 per hour estimate for a fund board of directors was last adjusted for inflation through
2019,and assumes an average of 9 board members per board.
29 17
CFR 200.30–3(a)(12).
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17:22 Jan 24, 2024
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5034
Federal Register / Vol. 89, No. 17 / Thursday, January 25, 2024 / Notices
7. This estimate assumes that two-thirds (1,934) of the internal hours are spent by in-house attorneys to prepare the plan (1,934 hours × $484 estimated hourly
rate = $936,056 per year) and that one-third (967) are spent by the fund’s board of directors to approve the plan (967 hours × $4,770 per hour = $4,612,590).
8. $936,056 + $4,612,590 = $5,548,646.
The information provided under rule
18f–3 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 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 by February 26, 2024 to (i)
MBX.OMB.OIRA.SEC_desk_officer@
omb.eop.gov and (ii) David Bottom,
Director/Chief Information Officer,
Securities and Exchange Commission, c/
o John Pezzullo, 100 F Street NE,
Washington, DC 20549, or by sending an
email to: PRA_Mailbox@sec.gov.
Dated: January 22, 2024.
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2024–01437 Filed 1–24–24; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–99404; File No. SR–FINRA–
2024–004]
Self-Regulatory Organizations;
Financial Industry Regulatory
Authority, Inc.; Notice of Filing of a
Proposed Rule Change To Amend
FINRA Rule 6730 (Transaction
Reporting) To Reduce the 15-Minute
TRACE Reporting Timeframe to One
Minute
khammond on DSKJM1Z7X2PROD with NOTICES
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’) 1 and Rule 19b–4 thereunder,2
notice is hereby given that on January
11, 2024, the Financial Industry
Regulatory Authority, Inc. (‘‘FINRA’’)
filed with the Securities and Exchange
Commission (‘‘SEC’’ or ‘‘Commission’’)
the proposed rule change as described
in Items I, II, and III below, which Items
have been prepared by FINRA. The
Commission is publishing this notice to
FINRA is proposing to amend FINRA
Rule 6730 to reduce the 15-minute
TRACE reporting timeframe to one
minute, with exceptions for member
firms with de minimis reporting activity
and for manual trades.
The text of the proposed rule change
is available on FINRA’s website at
https://www.finra.org, at the principal
office of FINRA 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,
FINRA 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. FINRA has prepared
summaries, set forth in sections A, B,
and C below, of the most significant
aspects of such statements.
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
FINRA has collected and
disseminated transaction information in
fixed income securities through TRACE
since 2002.3 Since the implementation
of TRACE, the fixed income markets
have changed dramatically, including a
significant increase in the use of
electronic trading platforms or other
electronic communication protocols to
facilitate the execution of transactions.
With these changes, FINRA has been
considering ways to modernize the
reporting rules and provide for more
timely, granular and informative data to
enhance the value of disseminated
transaction data.
FINRA rules specify the applicable
outer-limit reporting timeframe for
different types of TRACE-Eligible
3 See Securities Exchange Act Release No. 43873
(January 23, 2001), 66 FR 8131 (January 29, 2001)
(Order Approving File No. SR–NASD–99–65).
1 15
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
17:22 Jan 24, 2024
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
(i) Background
January 19, 2024.
VerDate Sep<11>2014
solicit comments on the proposed rule
change from interested persons.
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Securities,4 and these timeframes have
been adjusted over time in line with
changes in the markets. A 15-minute
outer-limit reporting timeframe
currently applies to most transactions 5
in corporate bonds, agency debt
securities,6 asset-backed securities
(ABS) 7 and agency pass-through
mortgage-backed securities (MBS)
traded to-be-announced (TBA) for good
delivery (GD).8 The 15-minute reporting
4 ‘‘TRACE-Eligible Security’’ means a debt
security that is United States (U.S.) dollardenominated and is: (1) issued by a U.S. or foreign
private issuer, and, if a ‘‘restricted security’’ as
defined in Securities Act Rule 144(a)(3), sold
pursuant to Securities Act Rule 144A; (2) issued or
guaranteed by an Agency as defined in paragraph
(k) or a Government-Sponsored Enterprise as
defined in paragraph (n); (3) a U.S. Treasury
Security as defined in paragraph (p); or (4) a
Foreign Sovereign Debt Security as defined in
paragraph (kk). ‘‘TRACE-Eligible Security’’ does not
include a debt security that is a Money Market
Instrument as defined in paragraph (o). See Rule
6710(a).
5 A ‘‘List or Fixed Offering Price Transaction,’’ as
defined in Rule 6710(q), and a ‘‘Takedown
Transaction,’’ as defined in Rule 6710(r) are
required to be reported to TRACE by the next
business day (T+1). See Rule 6730(a)(2).
6 ‘‘Agency Debt Security’’ means a debt security
(i) issued or guaranteed by an Agency as defined in
paragraph (k); (ii) issued or guaranteed by a
Government-Sponsored Enterprise as defined in
paragraph (n); or (iii) issued by a trust or other
entity that was established or sponsored by a
Government-Sponsored Enterprise for the purpose
of issuing debt securities, where such enterprise
provides collateral to the trust or other entity or
retains a material net economic interest in the
reference tranches associated with the securities
issued by the trust or other entity. The term
excludes a U.S. Treasury Security as defined in
paragraph (p) and a Securitized Product as defined
in paragraph (m), where an Agency or a
Government-Sponsored Enterprise is the Securitizer
as defined in paragraph (s) (or similar person), or
the guarantor of the Securitized Product. See Rule
6710(l).
7 ‘‘Asset-Backed Security’’ means a type of
Securitized Product where the Asset-Backed
Security is collateralized by any type of financial
asset, such as a consumer or student loan, a lease,
or a secured or unsecured receivable, and excludes:
(i) a Securitized Product that is backed by
residential or commercial mortgage loans, mortgagebacked securities, or other financial assets
derivative of mortgage-backed securities; (ii) an
SBA-Backed ABS as defined in paragraph (bb)
traded To Be Announced as defined in paragraph
(u) or in a Specified Pool Transaction as defined in
paragraph (x); and (iii) a collateralized debt
obligation. See Rule 6710(cc).
8 ‘‘Agency Pass-Through Mortgage-Backed
Security’’ means a type of Securitized Product
issued in conformity with a program of an Agency
as defined in paragraph (k) or a GovernmentSponsored Enterprise (GSE) as defined in paragraph
(n), for which the timely payment of principal and
interest is guaranteed by the Agency or GSE,
representing ownership interest in a pool (or pools)
of mortgage loans structured to ‘‘pass through’’ the
principal and interest payments to the holders of
the security on a pro rata basis. See Rule 6710(v).
‘‘To Be Announced’’ (TBA) means a transaction in
E:\FR\FM\25JAN1.SGM
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]]>Agencies
[Federal Register Volume 89, Number 17 (Thursday, January 25, 2024)]
[Notices]
[Pages 5033-5034]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-01437]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[SEC File No. 270-385, OMB Control No. 3235-0441]
Submission for OMB Review; Comment Request; Extension: Rule 18f-3
Upon Written Request, Copies Available From: Securities and Exchange
Commission, Office of FOIA Services, 100 F Street NE, Washington, DC
20549-2736
Notice is hereby given that, pursuant to the Paperwork Reduction
Act of 1995 (44 U.S.C. 3501 et seq.) (``Paperwork Reduction Act''), the
Securities and Exchange Commission (``the Commission'') has submitted
to the Office of Management and Budget (``OMB'') a request for
extension of the previously approved collection of information
discussed below.
Rule 18f-3 (17 CFR 270.18f-3) under the Investment Company Act of
1940 (15 U.S.C. 80a-1 et seq.) exempts from section 18(f)(1) and 18
(f)(i) a fund that issues multiple classes of shares representing
interests in the same portfolio of securities (a ``multiple class
fund'') if the fund satisfies the conditions of the rule. In general,
each class must differ in its arrangement for shareholder services or
distribution or both, must pay the related expenses of that different
arrangement, and must satisfy certain voting rights provisions. The
rule includes one requirement for the collection of information. A
multiple class fund must prepare, and fund directors must approve, a
written plan setting forth the separate arrangement and expense
allocation of each class, and any related conversion features or
exchange privileges (``rule 18f-3 plan''). Approval of the plan must
occur before the fund issues any shares of multiple classes and
whenever the fund materially amends the plan. In approving the plan,
the fund board, including a majority of the independent directors, must
determine that the plan is in the best interests of each class and the
fund as a whole.
The requirement that the fund prepare and directors approve a
written rule 18f-3 plan is intended to ensure that the fund compiles
information relevant to the fairness of the separate arrangement and
expense allocation for each class, and that directors review and
approve the information. Without a blueprint that highlights material
differences among classes, directors might not perceive potential
conflicts of interests when they determine whether the plan is in the
best interests of each class and the fund. In addition, the plan may be
useful to Commission staff in reviewing the fund's compliance with the
rule.
The following estimates of average burden hours are made solely for
purposes of the Paperwork Reduction Act of 1995 \1\ and are not derived
from a comprehensive or even representative survey or study of the cost
of Commission rules and forms. Compliance with the information
collection requirements of rule 18f-3 is necessary to obtain the
benefit of the rule's exemption. The collection of information under
rule 18f-3 is mandatory. Responses to the collection of information
requirements will not be kept confidential.
---------------------------------------------------------------------------
\1\ 44 U.S.C. 3501 et seq.
Table 1--Rule 18f-3 PRA Estimates
----------------------------------------------------------------------------------------------------------------
Internal annual burden Wage rate \1\ Internal time costs
----------------------------------------------------------------------------------------------------------------
ESTIMATES FOR RULE 18F-3
----------------------------------------------------------------------------------------------------------------
Prepare and approve a written 18f-3 6 hours \3\.................
plan \2\.
Average number of responses 0.5 responses \3\...........
annually per registrant.
Total number of hours per 3 hours \3\................. $484 (in-house $936,056 (in-house
registrant per year \4\. attorney). $4,770 attorney).
(fund board of $4,612,590 (board of
directors) \6\ directors) \7\.
Total number of registrants........ 967 \4\.....................
----------------------------------------------------------------------------
Total annual hour burden....... 2,901 hours \5\............. ...................... $5,548,646 \8\.
----------------------------------------------------------------------------------------------------------------
Notes:
1. The Commission's estimates of the relevant wage rates are based on salary information for the securities
industry compiled by the Securities Industry and Financial Markets Association's Office Salaries in the
Securities Industry 2013; the estimated figures are modified by firm size, employee benefits, overhead, and
adjusted to account for the effects of inflation; see Securities Industry and Financial Markets Association,
Report on Management & Professional Earnings in the Securities Industry 2013.
2. The Commission estimates that each registrant prepares and approves a rule 18f-3 plan every two years when
issuing a new fund or class or amending a plan (or that 484 of all 967 registrants prepare and approve a plan
each year).
3. This estimate assumes that each response will take 6 hours, requiring 3 hours per registrant per year (0.5
responses per registrant x 6 hours per response = 3 hours per registrant).
4. The Commission estimates that there are approximately 6,733 multiple class funds offered by 967 registrants.
5. 967 registrants x 3 hours = 2,901 hours.
6. The estimate for the cost of board time is derived from estimates made by the staff regarding typical board
size and compensation that is based on information received from fund representatives and publicly available
sources; the $4,770 per hour estimate for a fund board of directors was last adjusted for inflation through
2019,and assumes an average of 9 board members per board.
[[Page 5034]]
7. This estimate assumes that two-thirds (1,934) of the internal hours are spent by in-house attorneys to
prepare the plan (1,934 hours x $484 estimated hourly rate = $936,056 per year) and that one-third (967) are
spent by the fund's board of directors to approve the plan (967 hours x $4,770 per hour = $4,612,590).
8. $936,056 + $4,612,590 = $5,548,646.
The information provided under rule 18f-3 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 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
by February 26, 2024 to (i) [email protected]
and (ii) David Bottom, Director/Chief Information Officer, Securities
and Exchange Commission, c/o John Pezzullo, 100 F Street NE,
Washington, DC 20549, or by sending an email to: [email protected].
Dated: January 22, 2024.
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2024-01437 Filed 1-24-24; 8:45 am]
BILLING CODE 8011-01-P
