[Federal Register Volume 77, Number 167 (Tuesday, August 28, 2012)]
[Notices]
[Page 52076]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-21113]
[[Page 52076]]
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SECURITIES AND EXCHANGE COMMISSION
Proposed Collection; Comment Request
Upon Written Request, Copies Available From: Securities and Exchange
Commission, Office of Investor Education and Advocacy, Washington, DC
20549-0213.
Extension:
Rule 23c-3 and Form N-23c-3; SEC File No. 270-373; OMB Control
No. 3235-0422.
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 (the ``Commission'') is soliciting comments on the
collection of information summarized below. The Commission plans to
submit this existing collection of information to the Office of
Management and Budget (``OMB'') for extension and approval.
Rule 23c-3 (17 CFR 270.23c-3) under the Investment Company Act of
1940 (15 U.S.C. 80a-1 et seq.) permits a registered closed-end
investment company (``closed-end fund'' or ``fund'') that meets certain
requirements to repurchase common stock of which it is the issuer from
shareholders at periodic intervals, pursuant to repurchase offers made
to all holders of the stock. The rule enables these funds to offer
their shareholders a limited ability to resell their shares in a manner
that previously was available only to open-end investment company
shareholders. To protect shareholders, a closed-end fund that relies on
rule 23c-3 must send shareholders a notification that contains
specified information each time the fund makes a repurchase offer (on a
quarterly, semi-annual, or annual basis, or, for certain funds, on a
discretionary basis not more often than every two years). The fund also
must file copies of the shareholder notification with the Commission
(electronically through the Commission's Electronic Data Gathering,
Analysis, and Retrieval System (``EDGAR'')) on Form N-23c-3, a filing
that provides certain information about the fund and the type of offer
the fund is making.\1\ The fund must describe in its annual report to
shareholders the fund's policy concerning repurchase offers and the
results of any repurchase offers made during the reporting period. The
fund's board of directors must adopt written procedures designed to
ensure that the fund's investment portfolio is sufficiently liquid to
meet its repurchase obligations and other obligations under the rule.
The board periodically must review the composition of the fund's
portfolio and change the liquidity procedures as necessary. The fund
also must file copies of advertisements and other sales literature with
the Commission as if it were an open-end investment company subject to
section 24 of the Investment Company Act (15 U.S.C. 80a-24) and the
rules that implement section 24. Rule 24b-3 under the Investment
Company Act (17 CFR 270.24b-3), however, exempts the fund from that
requirement if the materials are filed instead with the Financial
Industry Regulatory Authority (``FINRA'').
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\1\ Form N-23c-3, entitled ``Notification of Repurchase Offer
Pursuant to Rule 23c-3,'' requires the fund to state its
registration number, its full name and address, the date of the
accompanying shareholder notification, and the type of offer being
made (periodic, discretionary, or both).
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The requirement that the fund send a notification to shareholders
of each offer is intended to ensure that a fund provides material
information to shareholders about the terms of each offer. The
requirement that copies be sent to the Commission is intended to enable
the Commission to monitor the fund's compliance with the notification
requirement. The requirement that the shareholder notification be
attached to Form N-23c-3 is intended to ensure that the fund provides
basic information necessary for the Commission to process the
notification and to monitor the fund's use of repurchase offers. The
requirement that the fund describe its current policy on repurchase
offers and the results of recent offers in the annual shareholder
report is intended to provide shareholders current information about
the fund's repurchase policies and its recent experience. The
requirement that the board approve and review written procedures
designed to maintain portfolio liquidity is intended to ensure that the
fund has enough cash or liquid securities to meet its repurchase
obligations, and that written procedures are available for review by
shareholders and examination by the Commission. The requirement that
the fund file advertisements and sales literature as if it were an
open-end fund is intended to facilitate the review of these materials
by the Commission or FINRA to prevent incomplete, inaccurate, or
misleading disclosure about the special characteristics of a closed-end
fund that makes periodic repurchase offers.
Based on staff experience, the Commission staff estimates that 20
funds make use of rule 23c-3 annually, including two funds that are
relying upon rule 23c-3 for the first time. The Commission staff
estimates that on average a fund spends 89 hours annually in complying
with the requirements of the rule and Form N-23c-3, with funds relying
upon rule 23c-3 for the first time incurring an additional one-time
burden of 28 hours. The Commission therefore estimates the total annual
burden of the rule's and form's paperwork requirements to be 1,836
hours. In addition to the burden hours, the Commission estimates that
the average yearly cost to each fund that relies on rule 23c-3 to print
and mail repurchase offers to shareholders is approximately $29,966.50.
The Commission estimates total annual cost is therefore approximately
$599,330.
Estimates of average burden hours and costs are made solely for the
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 and form is mandatory only for
those funds that rely on the rule in order to repurchase shares of the
fund. The information provided to the Commission on Form N-23c-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.
Written comments are invited on: (a) Whether the proposed
collections of information are necessary for the proper performance of
the functions of the agency, including whether the information has
practical utility; (b) the accuracy of the agency's estimate of the
burdens of the collections of information; (c) ways to enhance the
quality, utility, and clarity of the information collected; and (d)
ways to minimize the burdens of the collections 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 Thomas Bayer, Director/Chief
Information Officer, Securities and Exchange Commission, c/o Remi
Pavlik-Simon, 6432 General Green Way, Alexandria, VA 22312; or send an
email to: [email protected].
Dated: August 22, 2012.
Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-21113 Filed 8-27-12; 8:45 am]
BILLING CODE 8011-01-P