83 FR 13158 - Submission for OMB Review; Comment Request

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 83, Issue 59 (March 27, 2018)

Page Range		13158-13159
FR Document		2018-06121
Federal Register, Volume 83 Issue 59 (Tuesday, March 27, 2018)
[Federal Register Volume 83, Number 59 (Tuesday, March 27, 2018)]
[Notices]
[Pages 13158-13159]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2018-06121]


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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 11a-3, SEC File No. 270-321, OMB Control No. 3235-0358

    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 1,606 active open-
end investment companies registered with the Commission as of September 
2017. The staff estimates that 25 percent (or 402) of these 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 per fund, for a total of 
402 hours for all funds.
    The staff estimates that 5 percent of these 1,606 funds (or 80) 
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 and 2 hours of clerical time per fund, for a total of 
approximately 240 hours for all funds to comply with the notice 
requirement. 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 therefore impose a 
total burden of 642 hours on all funds. The total number of respondents 
is 482, each responding once a year. The burdens associated

[[Page 13159]]

with the disclosure requirement of the rule are accounted for in the 
burdens associated with the Form N-1A registration statement for funds.
    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 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) 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: [email protected]. Comments must be submitted to OMB within 30 
days of this notice.

     Dated: March 22, 2018.
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-06121 Filed 3-26-18; 8:45 am]
 BILLING CODE 8011-01-P
13158 Federal Register / Vol. 83, No. 59 / Tuesday, March 27, 2018 / Notices

takes such action, the Commission shall should be submitted on or before April companies. The rule requires a fund,
institute proceedings under Section 17, 2018. among other things, (i) to disclose in its
19(b)(2)(B) 10 of the Act to determine For the Commission, by the Division of prospectus and advertising literature the
whether the proposed rule change Trading and Markets, pursuant to delegated amount of any administrative or
should be approved or disapproved. authority.11 redemption fee imposed on an exchange
Eduardo A. Aleman, transaction, (ii) if the fund imposes an
IV. Solicitation of Comments
Assistant Secretary. administrative fee on exchange
Interested persons are invited to transactions, other than a nominal one,
[FR Doc. 2018–06101 Filed 3–26–18; 8:45 am]
submit written data, views, and to maintain and preserve records with
BILLING CODE 8011–01–P
arguments concerning the foregoing, respect to the actual costs incurred in
including whether the proposed rule connection with exchanges for at least
change is consistent with the Act. six years, and (iii) give the fund’s
SECURITIES AND EXCHANGE
Comments may be submitted by any of shareholders a sixty day notice of a
COMMISSION
the following methods: termination of an exchange offer or any
Electronic Comments Submission for OMB Review; material amendment to the terms of an
Comment Request exchange offer (unless the only material
• Use the Commission’s internet effect of an amendment is to reduce or
comment form (http://www.sec.gov/ Upon Written Request, Copies Available eliminate an administrative fee, sales
rules/sro.shtml); or From: Securities and Exchange load or redemption fee payable at the
• Send an email to rule-comments@ Commission, Office of FOIA Services, time of an exchange).
sec.gov. Please include File Number SR– 100 F Street NE, Washington, DC The rule’s requirements are designed
NYSE–2018–09 on the subject line. 20549–2736 to protect investors against abuses
Paper Comments Extension: associated with exchange offers, provide
Rule 11a–3, SEC File No. 270–321, OMB fund shareholders with information
• Send paper comments in triplicate Control No. 3235–0358 necessary to evaluate exchange offers
to Secretary, Securities and Exchange
Notice is hereby given that pursuant and certain material changes in the
Commission, 100 F Street NE,
to the Paperwork Reduction Act of 1995 terms of exchange offers, and enable the
Washington, DC 20549–1090.
(44 U.S.C. 3501–3520), the Securities Commission staff to monitor funds’ use
All submissions should refer to File of administrative fees charged in
and Exchange Commission (the
Number SR–NYSE–2018–09. This file connection with exchange transactions.
‘‘Commission’’) has submitted to the
number should be included on the The staff estimates that there are
Office of Management and Budget a
subject line if email is used. To help the approximately 1,606 active open-end
request for extension of the previously
Commission process and review your investment companies registered with
approved collection of information
comments more efficiently, please use the Commission as of September 2017.
discussed below.
only one method. The Commission will Section 11(a) of the Investment The staff estimates that 25 percent (or
post all comments on the Commission’s Company Act of 1940 (‘‘Act’’) (15 U.S.C. 402) of these funds impose a non-
internet website (http://www.sec.gov/ 80a–11(a)) provides that it is unlawful nominal administrative fee on exchange
rules/sro.shtml). Copies of the for a registered open-end investment transactions. The staff estimates that the
submission, all subsequent company (‘‘fund’’) or its underwriter to recordkeeping requirement of the rule
amendments, all written statements make an offer to the fund’s shareholders requires approximately 1 hour annually
with respect to the proposed rule or the shareholders of any other fund to of clerical time per fund, for a total of
change that are filed with the exchange the fund’s securities for 402 hours for all funds.
Commission, and all written securities of the same or another fund The staff estimates that 5 percent of
communications relating to the on any basis other than the relative net these 1,606 funds (or 80) terminate an
proposed rule change between the asset values (‘‘NAVs’’) of the respective exchange offer or make a material
Commission and any person, other than securities to be exchanged, ‘‘unless the change to the terms of their exchange
those that may be withheld from the terms of the offer have first been offer each year, requiring the fund to
public in accordance with the submitted to and approved by the comply with the notice requirement of
provisions of 5 U.S.C. 552, will be Commission or are in accordance with the rule. The staff estimates that
available for website viewing and such rules and regulations as the complying with the notice requirement
printing in the Commission’s Public Commission may have prescribed in of the rule requires approximately 1
Reference Room, 100 F Street NE, respect of such offers.’’ Section 11(a) hour of attorney time and 2 hours of
Washington, DC 20549, on official was designed to prevent ‘‘switching,’’ clerical time per fund, for a total of
business days between the hours of the practice of inducing shareholders of approximately 240 hours for all funds to
10:00 a.m. and 3:00 p.m. Copies of the one fund to exchange their shares for comply with the notice requirement.
filing also will be available for the shares of another fund for the The staff estimates that such notices
inspection and copying at the principal purpose of exacting additional sales will be enclosed with other written
office of the Exchange. All comments charges. materials sent to shareholders, such as
received will be posted without change. Rule 11a–3 (17 CFR 270.11a–3) under annual shareholder reports or account
Persons submitting comments are the Act of 1940 is an exemptive rule that statements, and therefore any burdens
cautioned that we do not redact or edit permits open-end investment associated with mailing required notices
personal identifying information from companies (‘‘funds’’), other than are accounted for in the burdens
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comment submissions. You should insurance company separate accounts, associated with Form N–1A registration
submit only information that you wish and funds’ principal underwriters, to statements for funds. The recordkeeping
to make available publicly. All make certain exchange offers to fund and notice requirements together
submissions should refer to File shareholders and shareholders of other therefore impose a total burden of 642
Number SR–NYSE–2018–09, and funds in the same group of investment hours on all funds. The total number of
respondents is 482, each responding
10 15 U.S.C. 78s(b)(2)(B). 11 17 CFR 200.30–3(a)(12). once a year. The burdens associated

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Federal Register / Vol. 83, No. 59 / Tuesday, March 27, 2018 / Notices 13159

with the disclosure requirement of the II, below, which Items have been the proposed rule change and discussed
rule are accounted for in the burdens prepared by the Exchange. The any comments it received on the
associated with the Form N–1A Commission is publishing this notice to proposed rule change. The text of these
registration statement for funds. solicit comments on the proposed rule statements may be examined at the
The estimate of average burden hours change from interested persons. places specified in Item IV below. The
is made solely for the purposes of the Exchange has prepared summaries, set
I. Self-Regulatory Organization’s
Paperwork Reduction Act, and is not forth in sections A, B, and C below, of
Statement of the Terms of Substance of
derived from a comprehensive or even the most significant aspects of such
the Proposed Rule Change
a representative survey or study of the statements.
costs of Commission rules and forms. The Exchange proposes to amend
Rule 4370 regarding the requirements A. Self-Regulatory Organization’s
An agency may not conduct or sponsor,
for the listing of securities that are Statement of the Purpose of, and
and a person is not required to respond
issued by the Exchange or any of its Statutory Basis for, the Proposed Rule
to, a collection of information unless it
affiliates. Change
displays a currently valid control
number. The text of the proposed rule change 1. Purpose
The public may view the background is set forth below. Proposed new
The Exchange proposes to amend
documentation for this information language is italicized; deleted text is in
Rule 4370 (Additional Requirements for
collection at the following website, brackets.
Nasdaq-Listed Securities Issued by
www.reginfo.gov. Comments should be * * * * * Nasdaq or its Affiliates) regarding the
directed to: (i) Desk Officer for the requirements for the listing of securities
Securities and Exchange Commission, 4370. Additional Requirements for
Nasdaq-Listed Securities Issued by that are issued by the Exchange or any
Office of Information and Regulatory of its affiliates.
Affairs, Office of Management and Nasdaq or Its Affiliates
Rule 4370 sets forth certain
Budget, Room 10102, New Executive (a) For purposes of this Rule 4370, the monitoring requirements that must be
Office Building, Washington, DC 20503, terms below are defined as follows: met throughout the continued listing of
or by sending an email to: Shagufta_ (1) No change. securities issued by Nasdaq or its
Ahmed@omb.eop.gov; and (ii) Pamela (2) ‘‘Affiliate Security’’ means any affiliates. More specifically, Rule 4370
Dyson, Director/Chief Information security issued by a Nasdaq Affiliate or provides that, upon initial and
Officer, Securities and Exchange any Exchange-listed option on any such throughout continued listing of the
Commission, c/o Remi Pavlik-Simon, security, with the exception of Portfolio Affiliate Security 3 on The Nasdaq Stock
100 F Street NE, Washington, DC 20549 Depository Receipts as defined in Rule Market, Nasdaq shall:
or send an email to: PRA_Mailbox@ 5705(a)(1)(A) and Index Fund Shares as • File a report quarterly (‘‘Quarterly
sec.gov. Comments must be submitted to defined in Rule 5705(b)(1)(A). Report’’) with the Commission detailing
OMB within 30 days of this notice. (b) Upon initial and throughout Nasdaq’s monitoring of (a) the Nasdaq
Dated: March 22, 2018. continued listing and trading of the Affiliate’s compliance with the listing
Eduardo A. Aleman,
Affiliate Security on The Nasdaq Stock requirements; and (b) the trading of the
Market, Nasdaq shall: Affiliate Security; and
Assistant Secretary.
(1) [file a report quarterly with the • engage an independent accounting
[FR Doc. 2018–06121 Filed 3–26–18; 8:45 am] Commission]provide a quarterly report
BILLING CODE 8011–01–P
firm once a year to review and prepare
to Nasdaq’s Regulatory Oversight a report on the Affiliate Security to
Committee detailing Nasdaq’s ensure that the Nasdaq Affiliate is in
monitoring of: compliance with the listing
SECURITIES AND EXCHANGE (A)–(B) No change.
COMMISSION requirements (‘‘Annual Report’’) and
(2) engage an independent accounting promptly forward to the Commission a
[Release No. 34–82921; File No. SR– firm once a year to review and prepare copy of the report prepared by the
NASDAQ–2018–020] a report on the Affiliate Security to independent accounting firm.
ensure that the Nasdaq Affiliate is in In discussions with the Commission
Self-Regulatory Organizations; The compliance with the listing
Nasdaq Stock Market LLC; Notice of Staff regarding the Exchange’s Rule
requirements contained in the Rule 4370, it was determined that the
Filing and Immediate Effectiveness of 5000, 5100, 5200, 5300, 5400, 5500, and
Proposed Rule Change To Amend Rule Exchange no longer needs to provide to
5600 Series and promptly [forward to the Commission copies of the reports
4370 Regarding the Requirements for the Commission]provide Nasdaq’s
the Listing of Securities That Are specified in paragraphs (b)(1) and (b)(2)
Regulatory Oversight Committee with a thereunder; instead, the Exchange must
Issued by the Exchange or Any of Its copy of the report prepared by the
Affiliates provide these reports to the Exchange’s
independent accounting firm.
March 22, 2018. (c) No change. 3 Pursuant to Rule 4370(a)(2), ‘‘Affiliate Security’’

Pursuant to Section 19(b)(1) of the * * * * * means any security issued by a Nasdaq Affiliate,
(b) Not applicable. with the exception of Portfolio Depository Receipts
Securities Exchange Act of 1934 as defined in Rule 5705(a)(1)(A) and Index Fund
(‘‘Act’’),1 and Rule 19b–4 thereunder,2 (c) Not applicable. Shares as defined in Rule 5705(b)(1)(A), and
notice is hereby given that on March 20, * * * * * pursuant to Rule 4370(a)(1), ‘‘Nasdaq Affiliate’’
means The Nasdaq Stock Market, Inc. and any
2018, The Nasdaq Stock Market LLC II. Self-Regulatory Organization’s entity that directly or indirectly, through one or
amozie on DSK30RV082PROD with NOTICES

(‘‘Nasdaq’’ or ‘‘Exchange’’) filed with the Statement of the Purpose of, and more intermediaries, controls, is controlled by, or
Securities and Exchange Commission Statutory Basis for, the Proposed Rule is under common control with The Nasdaq Stock
(‘‘SEC’’ or ‘‘Commission’’) the proposed Market, Inc., where ‘‘control’’ means that the one
Change entity possesses, directly or indirectly, voting
rule change as described in Items I and control of the other entity either through ownership
In its filing with the Commission, the of capital stock or other equity securities or through
1 15 U.S.C. 78s(b)(1). Exchange included statements majority representation on the board of directors or
2 17 CFR 240.19b–4. concerning the purpose of and basis for other management body of such entity.

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Document Created: 2018-03-27 01:26:50
Document Modified: 2018-03-27 01:26:50
Category		Regulatory Information
Collection		Federal Register
sudoc Class		AE 2.7: GS 4.107: AE 2.106:
Publisher		Office of the Federal Register, National Archives and Records Administration
Section		Notices
FR Citation		83 FR 13158