
[Federal Register Volume 79, Number 33 (Wednesday, February 19, 2014)]
[Notices]
[Page 9503]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-03576]


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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 Investor Education and Advocacy, Washington, DC 
20549-0213.

Extension:
    Rule 17a-6 OMB Control No. 3235-0564, SEC File No. 270-506

    Notice is hereby given that, pursuant to the Paperwork Reduction 
Act of 1995 (44 U.S.C. 3501), the Securities and Exchange Commission 
(``Commission'') has submitted to the Office of Management and Budget 
(``OMB'') a request for extension of the previously approved collection 
of information discussed below.
    Section 17(a) of the Investment Company Act of 1940 (the ``Act'') 
generally prohibits affiliated persons of a registered investment 
company (``fund'') from borrowing money or other property from, or 
selling or buying securities or other property to or from, the fund or 
any company that the fund controls. \1\ Rule 17a-6 (17 CFR 270.17a-6) 
permits a fund and a ``portfolio affiliate'' (a company that is an 
affiliated person of the fund because the fund controls the company, or 
holds five percent or more of the company's outstanding voting 
securities) to engage in principal transactions that would otherwise be 
prohibited under section 17(a) of the Act under certain conditions. A 
fund may not rely on the exemption in the rule to enter into a 
principal transaction with a portfolio affiliate if certain prohibited 
participants (e.g., directors, officers, employees, or investment 
advisers of the fund) have a financial interest in a party to the 
transaction. Rule 17a-6 specifies certain interests that are not 
``financial interests,'' including any interest that the fund's board 
of directors (including a majority of the directors who are not 
interested persons of the fund) finds to be not material. A board 
making this finding is required to record the basis for the finding in 
its meeting minutes. This recordkeeping requirement is a collection of 
information under the Paperwork Reduction Act of 1995 (``PRA'').\2\
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    \1\ 15 U.S.C. 80a-17(a).
    \2\ 44 U.S.C. 3501.
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    The rule is designed to permit transactions between funds and their 
portfolio affiliates in circumstances in which it is unlikely that the 
affiliate would be in a position to take advantage of the fund. In 
determining whether a financial interest is ``material,'' the board of 
the fund should consider whether the nature and extent of the interest 
in the transaction is sufficiently small that a reasonable person would 
not believe that the interest affected the determination of whether to 
enter into the transaction or arrangement or the terms of the 
transaction or arrangement. The information collection requirements in 
rule 17a-6 are intended to ensure that Commission staff can review, in 
the course of its compliance and examination functions, the basis for a 
board of director's finding that the financial interest of an otherwise 
prohibited participant in a party to a transaction with a portfolio 
affiliate is not material.
    Based on staff discussions with fund representatives, we estimate 
that funds currently do not rely on the exemption from the term 
``financial interest'' with respect to any interest that the fund's 
board of directors (including a majority of the directors who are not 
interested persons of the fund) finds to be not material. Accordingly, 
we estimate that annually there will be no principal transactions under 
rule 17a-6 that will result in a collection of information.
    The Commission requests authorization to maintain an inventory of 
one burden hour to ease future renewals of rule 17a-6's collection of 
information analysis should funds rely on this exemption to the term 
``financial interest'' as defined in rule 17a-6.
    The estimate of burden hours is made solely for the purposes of the 
Paperwork Reduction Act. The estimate is not derived from a 
comprehensive or even a representative survey or study of the costs of 
Commission rules. Complying with this collection of information 
requirement is necessary to obtain the benefit of relying on rule 17a-
6. 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 Web site, 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: Shagufta_Ahmed@omb.eop.gov; and (ii) Thomas Bayer, Chief Information Officer, 
Securities and Exchange Commission, c/o Remi Pavlik-Simon, 100 F St, 
NE., Washington DC 20549 or send an email to: PRA_Mailbox@sec.gov. 
Comments must be submitted to OMB within 30 days of this notice.

    February 12, 2014.
Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2014-03576 Filed 2-18-14; 8:45 am]
BILLING CODE 8011-01-P


