[Federal Register Volume 60, Number 152 (Tuesday, August 8, 1995)]
[Notices]
[Page 40401]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-19520]



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SECURITIES AND EXCHANGE COMMISSION


Request Under Review by Office of Management and Budget

    Agency Clearance Officer:  Michael E. Bartell, (202) 942-8800.
    Upon Written Request, Copy Available From: Securities and Exchange 
Commission, Office of Filings and Information Services, 450 Fifth 
Street, NW., Washington, DC 20549.
    [File No. 270-259]

Proposed Amendments

Rule 17f-5

    Notice is hereby given that, pursuant to the Paperwork Reduction 
Act of 1980 (44 U.S.C. 3501 et seq), the Securities and Exchange 
Commission (the ``Commission'') has submitted for OMB approval 
amendments to Rule 17f-5.
    Rule 17f-5 currently permits management investment companies 
(``funds'') to place their asserts with certain foreign banks and 
securities depositories, subject to numerous and highly detailed 
conditions. The amended rule would revise these conditions. The amended 
rule would require findings that the fund's foreign custody 
arrangements will provide reasonable protection for fund assets. 
Although foreign custodians would not have satisfy specific capital or 
other requirements, the custodian's ability to provide reasonable 
protection for the fund's asserts would have to be evaluated based on 
all relevant factors, including the custodian's financial strength. The 
amended rule would require the fund's foreign custody arrangements to 
be governed by a written contract, although it would not specify 
particular provisions that must be included in the contract. The 
amended rule also would require the fund's arrangements to be monitored 
for continuing appropriateness. If an arrangement no longer complies 
with the amended rule's requirements, a fund would have to withdraw its 
assets from the country or custodian as soon as reasonably practicable.
    In addition, the amended rule would allow fund directors to 
delegate their responsibilities under the current rule to the fund's 
adviser or officers or a U.S. or foreign bank. In selecting particular 
delegates for foreign custody decisions, the board would need to find 
that it is reasonable to rely on the delegate to perform the delegated 
responsibilities. The amended rule would require the delegate to 
provide the board with written reports notifying the board of the 
placement of the fund's assets in a particular country and with a 
particular custodian. The delegate also would be required to provide 
written reports of any material changes in the fund's arrangements. 
These reports would be provided to the board no later than the next 
regularly scheduled board meeting following the delegate's actions.
    It is estimated that 3,214 total respondents (2,600 fund portfolios 
and 614 delegates (representing 600 investment advisers and 14 U.S. 
bank custodians)) may expend an estimated 8,740 total burden hours in 
connection with the board's delegation of its responsibility for 
foreign custody matters, the delegate's monitoring of the arrangements, 
and the amended rule's periodic reporting requirements. The amendments 
may eliminate the need for the estimated 14 U.S. bank custodians to 
file exemptive applications with the Commission to maintain custody of 
fund assets with certain foreign custodians, resulting in savings 
estimated at 840 total burden hours.
    Direct general comments to the OMB Clearance Officer for the SEC at 
the address stated below. Direct any comments concerning the accuracy 
of the estimated average burden hours for compliance with Commission 
rules and forms to Michael E. Bartell, Associate Executive Director, 
Securities and Exchange Commission, 450 Fifth Street, NW., Washington, 
DC 20549, and OMB Clearance Officer for the Securities and Exchange 
Commission, Office of Information and Regulatory Affairs, Office of 
Management and Budget (Paperwork Reduction Act Project No. 3235-0269), 
Room 3208 New Executive Office Building, Washington, DC 20543.

    Dated: July 27, 1995.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 95-19520 Filed 8-7-95; 8:45 am]
BILLING CODE 8010-01-M