
[Federal Register: November 5, 2008 (Volume 73, Number 215)]
[Notices]               
[Page 65900-65901]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr05no08-100]                         

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

SECURITIES AND EXCHANGE COMMISSION

[Release No. IA-2806]

 
Approval of Investment Adviser Registration Depository Filing 
Fees

AGENCY: Securities and Exchange Commission.

ACTION: Order.

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

SUMMARY: The Securities and Exchange Commission (``Commission'' or 
``SEC'') is, for nine months, waiving Investment Adviser Registration 
Depository annual and initial filing fees for all advisers.

DATES: Effective Date: The order will become effective on November 1, 
2008.

FOR FURTHER INFORMATION CONTACT: Keith Kanyan, IARD System Manager, at 
202-551-6737, Daniel S. Kahl, Branch Chief, at 202-551-6730, or 
Iarules@sec.gov, Office of Investment Adviser Regulation, Division of 
Investment Management, Securities and Exchange Commission, 100 F 
Street, NE., Washington, DC 20549-5041.

Discusson

    Section 204(b) of the Investment Advisers Act of 1940 (``Advisers 
Act'') authorizes the Commission to require investment advisers to file 
applications and other documents through an entity designated by the 
Commission, and to pay reasonable costs associated with such 
filings.\1\ In 2000, the Commission designated the Financial Industry 
Regulatory Authority Regulation (``FINRA'') as the operator of the 
Investment Adviser Registration Depository (``IARD'') system. At the 
same time, the Commission approved, as reasonable, filing fees.\2\ The 
Commission later required advisers registered or registering with the 
SEC to file Form ADV through the IARD.\3\ Over 11,000 advisers now use 
the IARD to register with the SEC and make state notice filings 
electronically through the Internet.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 80b-4(b).
    \2\ Designation of NASD Regulation, Inc., to Establish and 
Maintain the Investment Adviser Registration Depository; Approval of 
IARD Fees, Investment Advisers Act Release No. 1888 (July 28, 2000) 
[65 FR 47807 (Aug. 3, 2000)]. FINRA is formerly known as NASD.
    \3\ Electronic Filing by Investment Advisers; Amendments to Form 
ADV, Investment Advisers Act Release No. 1897 (Sept. 12, 2000) [65 
FR 57438 (Sept. 22, 2000)].
---------------------------------------------------------------------------

    Commission staff, representatives of the North American Securities 
Administrators Association, Inc. (``NASAA''),\4\ and representatives of 
FINRA periodically hold discussions on IARD system finances. In the 
early years of operations, SEC-associated IARD revenues exceeded 
projections while SEC-associated IARD expenses were lower than 
estimated, resulting in a surplus. In 2005, FINRA wrote a letter to SEC 
staff recommending a waiver of annual fees for a one year period. The 
Commission concluded that this was

[[Page 65901]]

appropriate and waived annual fees.\5\ In 2006, FINRA wrote to the 
staff again, this time recommending a two-year waiver of all fees to 
continue to reduce the surplus. The Commission agreed and issued 
another order waiving all IARD fees.\6\ As a result of these two 
waivers, the surplus was reduced from  million in 2005 to $5 
million.
---------------------------------------------------------------------------

    \4\ The IARD system is used by both advisers registering or 
registered with the SEC and advisers registered or registering with 
one or more state securities authorities. NASAA represents the state 
securities administrators in setting IARD filing fees for state-
registered advisers.
    \5\ Approval of Investment Adviser Registration Depository 
Filing Fees, Investment Advisers Act Release No. 2439 (Oct. 7, 2005)
    \6\ Approval of Investment Adviser Registration Depository 
Filing Fees, Investment Advisers Act Release No. 2564 (Oct. 26, 
2006).
---------------------------------------------------------------------------

    FINRA has again written to Commission staff, recommending that the 
waiver of annual IARD fees and the waiver of initial IARD filing fees 
for SEC-registered advisers be extended for an additional nine months 
to July 31, 2009.\7\ Based on projections of expected SEC-associated 
IARD revenues and SEC-associated IARD expenses for the next nine 
months, the Commission believes that the current SEC-associated surplus 
exceeds the amount needed for operations and system enhancements during 
this period, and accordingly believes that an extension of the current 
waiver of both annual and initial filing fees through July 31, 2009 is 
appropriate in order to continue reducing the SEC-associated surplus. 
This action is expected to waive approximately $4 million in IARD 
system fees that SEC-registered advisers would incur, and should reduce 
the SEC-associated surplus to approximately $3.7 million. The fee 
waiver will apply to all annual updating amendments filed by SEC-
registered advisers from November 1, 2008 through July 31, 2009 and to 
all initial applications for registration filed by advisers applying 
for SEC registration from November 1, 2008 through July 31, 2009.
---------------------------------------------------------------------------

    \7\ The recommendation to waive fees through July 2009 
corresponds to the expiration of the SEC's contract with FINRA to 
operate the IARD.
---------------------------------------------------------------------------

    It is therefore ordered, pursuant to sections 204(b) and 206(A) of 
the Investment Advisers Act of 1940, that:
    For annual updating amendments to Form ADV filed from November 1, 
2008 through July 31, 2009, the fee otherwise due from SEC-registered 
advisers is waived, and for initial applications to register as an 
investment adviser with the SEC filed from November 1, 2008 through 
July 31, 2009, the fee otherwise due from the applicant is waived.

    By the Commission.

    Dated: October 30, 2008.
Florence E. Harmon,
Acting Secretary.
[FR Doc. E8-26307 Filed 11-4-08; 8:45 am]

BILLING CODE 8011-01-P
