
[Federal Register Volume 79, Number 248 (Monday, December 29, 2014)]
[Proposed Rules]
[Pages 77975-77981]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-30265]


=======================================================================
-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

17 CFR Chapter II

[Release Nos. 33-9694, 34-73891, 39-2500, IC-31389; IA-3986; File No. 
S7-13-14]


List of Rules To Be Reviewed Pursuant to the Regulatory 
Flexibility Act

AGENCY: Securities and Exchange Commission.

ACTION: Publication of list of rules scheduled for review.

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

SUMMARY: The Securities and Exchange Commission is publishing a list of 
rules to be reviewed pursuant to Section 610 of the Regulatory 
Flexibility Act. The list is published to provide the public with 
notice that these rules are scheduled for review by the agency and to 
invite public comment on whether the rules should be continued without 
change, or should be amended or rescinded to minimize any significant 
economic impact of the rules upon a substantial number of such small 
entities.

DATES: Comments should be submitted by January 28, 2015.

ADDRESSES: Comments may be submitted by any of the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/other.shtml); or
     Send an email to rule-comments@sec.gov. Please include 
File Number S7-13-14 on the subject line; or
     Use the Federal eRulemaking Portal (http://www.regulations.gov). Follow the instructions for submitting comments.

Paper Comments

     Send paper comments to Brent Fields, Secretary, Securities 
and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.

All submissions should refer to File No. S7-13-14. This file number 
should be included on the subject line if email is used. To help us 
process and review your comments more efficiently, please use only one 
method. The Commission will post all comments on the Commission's 
Internet Web site (http://www.sec.gov/rules/other.shtml). Comments also 
are available for Web site viewing and printing in the Commission's 
Public Reference Room, 100 F Street NE., Washington, DC 20549 on 
official business days between the hours of 10:00 a.m. and 3:00 p.m. 
All comments received will be posted without change; we do not edit 
personal

[[Page 77976]]

identifying information from submissions. You should submit only 
information that you wish to make available publicly.

FOR FURTHER INFORMATION CONTACT: Anne Sullivan, Office of the General 
Counsel, 202-551-5019.

SUPPLEMENTARY INFORMATION: The Regulatory Flexibility Act (``RFA''), 
codified at 5 U.S.C. 600-611, requires an agency to review its rules 
that have a significant economic impact upon a substantial number of 
small entities within ten years of the publication of such rules as 
final rules. 5 U.S.C. 610(a). The purpose of the review is ``to 
determine whether such rules should be continued without change, or 
should be amended or rescinded . . . to minimize any significant 
economic impact of the rules upon a substantial number of such small 
entities.'' 5 U.S.C. 610(a). The RFA sets forth specific considerations 
that must be addressed in the review of each rule:
     The continued need for the rule;
     the nature of complaints or comments received concerning 
the rule from the public;
     the complexity of the rule;
     the extent to which the rule overlaps, duplicates or 
conflicts with other federal rules, and, to the extent feasible, with 
state and local governmental rules; and
     the length of time since the rule has been evaluated or 
the degree to which technology, economic conditions, or other factors 
have changed in the area affected by the rule. 5 U.S.C. 610(c).
    The Securities and Exchange Commission, as a matter of policy, 
reviews all final rules that it published for notice and comment to 
assess not only their continued compliance with the RFA, but also to 
assess generally their continued utility. When the Commission 
implemented the Act in 1980, it stated that it ``intend[ed] to conduct 
a broader review [than that required by the RFA], with a view to 
identifying those rules in need of modification or even rescission.'' 
Securities Act Release No. 6302 (Mar. 20, 1981), 46 FR 19251 (Mar. 30, 
1981). The list below is therefore broader than that required by the 
RFA, and may include rules that do not have a significant economic 
impact on a substantial number of small entities. Where the Commission 
has previously made a determination of a rule's impact on small 
businesses, the determination is noted on the list.
    The Commission particularly solicits public comment on whether the 
rules listed below affect small businesses in new or different ways 
than when they were first adopted.\1\ The rules and forms listed below 
are scheduled for review by staff of the Commission during the next 12 
months. The list includes 25 rules adopted by the Commission in 2003.
---------------------------------------------------------------------------

    \1\ Several of the rulemakings identified below included non-
substantive rule amendments, such as conforming cross references. 
The Commission requests that commenters focus on the substantive 
aspects of the rulemakings indicated in the list.
---------------------------------------------------------------------------

    Title: Transactions of Investment Companies With Portfolio and 
Subadviser Affiliates
    Citation: 17 CFR 270.10f-3; 17 CFR 270.12d3-1; 17 CFR 270.17a-6; 17 
CFR 270.17a-10; 17 CFR 270.17d-1; 17 CFR 270.17e-1
    Authority: 15 U.S.C. 80a-1 et seq., 80a-34(d), 80a-37, 80a-39.
    Description: The rule and rule amendments (i) expand the exemptions 
for investment companies (``funds'') to engage in transactions with 
``portfolio affiliates''--companies that are affiliated with the fund 
solely as a result of the fund (or an affiliated fund) controlling them 
or owning more than five percent of their voting securities and (ii) 
permit funds to engage in transactions with subadvisers of affiliated 
funds.
    Prior Commission Determination Under 5 U.S.C. 601: A Final 
Regulatory Flexibility Analysis was prepared in accordance with Section 
604 of the Regulatory Flexibility Act in conjunction with the adoption 
of Release No. IC-25888 (January 14, 2003). The Commission considered 
comments to the proposing release and to the Initial Regulatory 
Flexibility Analysis prepared in Release No. IC-25557 (Apr. 30, 2002) 
at that time.
* * * * *
    Title: Conditions for Use of Non-GAAP Financial Measures
    Citation: 17 CFR 244.100, 17 CFR 244.101, 17 CFR 244.102, and 17 
CFR 229.10.
    Authority: 15 U.S.C. 77b(b), 15 U.S.C. 77f, 15 U.S.C. 77g, 15 
U.S.C. 77h, 15 U.S.C. 77s(a), 15 U.S.C. 77z-3, 15 U.S.C. 78c, 15 U.S.C. 
78d, 15 U.S.C. 78j, 15 U.S.C. 78l, 15 U.S.C. 78m, 15 U.S.C. 78o, 15 
U.S.C. 78w, 15 U.S.C. 78mm, 15 U.S.C. 7202(a), and 15 U.S.C. 7261.
    Description: The Commission adopted rules and amendments requiring 
public companies that disclose or release financial information that is 
calculated or presented on the basis of methodologies other than in 
accordance with Generally Accepted Accounting Principles (GAAP) to 
include, in that disclosure or release, a presentation of the most 
directly comparable GAAP financial measure and a reconciliation of the 
disclosed non-GAAP financial measure to that measure. The amendments 
also provide additional guidance to registrants that include non-GAAP 
financial measures in Commission filings and require registrants to 
furnish to the Commission earnings releases or similar announcements on 
Form 8-K.
    Prior Commission Determination Under 5 U.S.C. 610: Pursuant to 
Section 605(b) of the Regulatory Flexibility Act, the Chairman of the 
Commission certified that the rules and amendments would not have a 
significant economic impact on a substantial number of small entities 
in Release No. 33-8145 (November 5, 2002). The Commission solicited 
comments concerning the impact on small entities and the RFA 
certification, but received no comments. The final rule was adopted by 
the Commission in Release No. 33-8176 (January 22, 2003).
* * * * *
    Title: Insider Trades During Pension Fund Blackout Periods
    Citation: 17 CFR 240.13a-11, 17 CFR 240.15d-11, 17 CFR 245.100, 17 
CFR 245.101, 17 CFR 245.102, 17 CFR 245.103, and 17 CFR 245.104.
    Authority: 15 U.S.C. 78c, 15 U.S.C. 78m, 15 U.S.C. 78w(a), 15 
U.S.C. 78mm, 15 U.S.C. 80a-29, 15 U.S.C. 80a-37, 15 U.S.C. 7202(a), and 
15 U.S.C. 7244(a).
    Description: The Commission adopted rules and amendments to clarify 
the application and prevent the evasion of Section 306(a) of the 
Sarbanes-Oxley Act of 2002, which prohibits any director or executive 
officer of an equity security issuer from acquiring or transferring any 
equity security of the issuer during a pension plan blackout period 
that temporarily prevents plan participants or beneficiaries from 
engaging in equity securities transactions through their plan accounts, 
if the director or executive officer acquired the equity security in 
connection with his or her service or employment as a director or 
executive officer. In addition, the rules specify the content and 
timing of the notice that issuers must provide to their directors and 
executive officers, and to the Commission about the imposition of a 
pension plan blackout period.
    Prior Commission Determination Under 5 U.S.C. 610: A Final 
Regulatory Flexibility Analysis was prepared in accordance with Section 
604 of the Regulatory Flexibility Act in conjunction with the adoption 
of Release No. 34-47225 (January 22, 2003). The Commission considered 
comments received on the proposing release and the Initial Regulatory 
Flexibility Analysis prepared in Release

[[Page 77977]]

No. 34-46778 (November 6, 2002) at that time.
* * * * *
    Title: Disclosure Required by Sections 406 and 407 of the Sarbanes-
Oxley Act of 2002.
    Citation: 17 CFR 229.401 and 17 CFR 229.406.
    Authority: 15 U.S.C. 77e, 15 U.S.C. 77f, 15 U.S.C. 77g, 15 U.S.C. 
77j, 15 U.S.C. 77q, 15 U.S.C. 77s, 15 U.S.C. 77z-3, 15 U.S.C. 78l, 15 
U.S.C. 78m, 15 U.S.C. 78o, 15 U.S.C. 78w, 15 U.S.C. 78mm, 15 U.S.C. 
7202(a), 15 U.S.C. 7264, and 15 U.S.C. 7265.
    Description: The Commission adopted amendments to require 
companies, other than registered investment companies, to disclose 
information relating to whether an audit committee financial expert 
serves on the company's audit committee and the adoption and 
implementation of a code of ethics that applies to its principal 
executive officer, principal financial officer, principal accounting 
officer or controller, or persons performing similar functions.
    Prior Commission Determination Under 5 U.S.C. 610: A Final 
Regulatory Flexibility Analysis was prepared in accordance with Section 
604 of the Regulatory Flexibility Act in conjunction with the adoption 
of Release No. 33-8177 (January 23, 2003). The Commission considered 
comments received on the proposing release and the Initial Regulatory 
Flexibility Analysis prepared in Release No. 33-8138 (October 22, 2002) 
at that time.
* * * * *
    Title: Retention of Records Relevant to Audits and Reviews
    Citation: 17 CFR 210 2-06
    Authority: 15 U.S.C. 7202(a), 18 U.S.C. 1519, 15 U.S.C. 77g, 15 
U.S.C. 77h, 15 U.S.C. 77j, 15 U.S.C. 77s, 15 U.S.C. 77z-3, 15 U.S.C. 
78c, 15 U.S.C. 78j-1, 15 U.S.C. 78l, 15 U.S.C. 78m, 15 U.S.C. 78n, 15 
U.S.C. 78q, 15 U.S.C. 78w, 15 U.S.C. 78mm, 15 U.S.C. 80a-8, 15 U.S.C. 
80a-29, 15 U.S.C. 80a-30, 15 U.S.C. 80a-31, and 15 U.S.C. 80a-37.
    Description: The rules were adopted pursuant to Section 802 of the 
Sarbanes-Oxley Act of 2002 to require accounting firms to retain for 
seven years certain records relevant to their audits and reviews of 
issuers' financial statements. Records to be retained include an 
accounting firm's workpapers and certain other documents that contain 
conclusions, opinions, analyses, or financial data related to the audit 
or review.
    Prior Commission Determination Under 5 U.S.C. 601: A Final 
Regulatory Flexibility Act Analysis was prepared in accordance with 
Section 604 of the Regulatory Flexibility Act in conjunction with the 
adoption of Release No. 33-8189 (January 24, 2003). The Commission 
considered comments to the proposing release and to the Initial 
Regulatory Flexibility Analysis prepared in Release No. 33-8151 
(November 21, 2002) at that time.
* * * * *
    Title: Certification of Management Investment Company Shareholder 
Reports and Designation of Certified Shareholder Reports as Exchange 
Act Periodic Reporting Forms; Disclosure Required by Sections 406 and 
407 of the Sarbanes-Oxley Act of 2002.
    Citation: 17 CFR 270.8b-15; 17 CFR 270.30a-1; 17 CFR 270.30a-2; 17 
CFR 270.30a-3; 17 CFR 270.30b1-1; 17 CFR 270.30b1-3; 17 CFR 270.30b2-1; 
17 CFR 270.30d-1; 17 CFR 274.101; 17 CFR 274.128.
    Authority: 15 U.S.C. 77f, 77g, 77h, 77j, 77s, 78c(b), 78l, 78m, 
78n, 78o(d), 80a-1 et seq., 80a-8, 80a-24, 80a-26, 80a-29, 80a-34(d), 
80a-37, 80a-39, secs. 3(a) and 302, Pub. L. 107-204, 116 Stat. 745.
    Description: The Commission adopted rule and form amendments to 
require registered management investment companies to file certified 
shareholder reports on new Form N-CSR in accordance with Section 302 of 
the Sarbanes-Oxley Act. The Commission also adopted new rules to 
require registered investment management companies to maintain 
disclosure controls and procedures, to disclose whether they had 
adopted a code of ethics for their principal executive and senior 
financial officers, and to disclose whether they have at least one 
``audit committee financial expert'' serving on their audit committees, 
as required by that Act.
    Determination Under 5 U.S.C. 601: A Final Regulatory Flexibility 
Analysis was prepared in accordance with Section 604 of the Regulatory 
Flexibility Act in conjunction with the adoption of Release No. IC-
25914 (January 27, 2003). The Commission considered comments to the 
proposing release and to the Initial Regulatory Flexibility Analysis 
prepared in Release Nos. IC-25723 (Aug. 30, 2002) and 25775 (Oct. 22, 
2002) at that time.
* * * * *
    Title: Disclosure in Management's Discussion and Analysis about 
Off-Balance Sheet Arrangements and Aggregate Contractual Obligations.
    Citation: 17 CFR 229.303.
    Authority: 15 U.S.C. 77g, 15 U.S.C. 77j, 15 U.S.C. 77s, 15 U.S.C. 
77z-2, 15 U.S.C. 77z-3, 15 U.S.C. 78l, 15 U.S.C. 78m, 15 U.S.C. 78n, 15 
U.S.C. 78u-5, 15 U.S.C. 78w, 15 U.S.C. 78mm, 15 U.S.C. 7202(a), and 15 
U.S.C. 7261(a).
    Description: The Commission adopted the amendments to require 
disclosure of off-balance sheet arrangements in a separately captioned 
subsection of the Management's Discussion and Analysis section of a 
registrant's disclosure documents. The amendments also require 
registrants, other than smaller reporting companies, to provide tabular 
disclosure of aggregate contractual obligations as of the latest fiscal 
year-end balance sheet date.
    Prior Commission Determination Under 5 U.S.C. 610: A Final 
Regulatory Flexibility Analysis was prepared in accordance with Section 
604 of the Regulatory Flexibility Act in conjunction with the adoption 
of Release No. 33-8182 (January 28, 2003). The Commission solicited 
comments concerning the impact on small entities and the Initial 
Regulatory Flexibility Analysis prepared in Release No. 33-8144 
(November 4, 2002), but received no comments.
* * * * *
    Title: Implementation of Standards of Professional Conduct for 
Attorneys
    Citation: 17 CFR part 205.
    Authority: 15 U.S.C. 7202, 7245, 7262.
    Description: The Commission adopted a rule establishing standards 
of professional conduct for attorneys who appear and practice before 
the Commission on behalf of issuers. Section 307 of the Sarbanes-Oxley 
Act of 2002 requires the Commission to prescribe minimum standards of 
professional conduct for attorneys appearing and practicing before the 
Commission in any way in the representation of issuers. The rule 
requires an attorney to report evidence of a material violation of 
securities laws or breach of fiduciary duty or similar violation by the 
issuer up-the-ladder within the company.
    Prior Commission Determination Under 5 U.S.C. 610: A Final 
Regulatory Flexibility Analysis was prepared in accordance with Section 
604 of the Regulatory Flexibility Act in conjunction with the adoption 
of Release No. 33-8185 (January 29, 2003). The Commission solicited 
comments concerning the impact on small entities and the Initial 
Regulatory Flexibility Analysis prepared in Release No. 33-8150 (Nov. 
21, 2002), but received no comments.
* * * * *
    Title: Proxy Voting by Investment Advisers
    Citation: 17 CFR 275.204-2; 17 CFR 275.206(4)-6.

[[Page 77978]]

    Authority: 15 U.S.C. 80b-2(a)(11)(F), 80b-2(a)(17), 80b-3, 80b-4, 
80b-6(4), 80b-6a, 80b-11.
    Description: The rule and rule amendments require investment 
advisers that exercise voting authority over client securities to adopt 
written policies and procedures that are reasonably designed to ensure 
the adviser votes proxies in the best interest of clients, disclose to 
clients information about those policies and procedures and how clients 
may obtain information on how the adviser has voted their proxies, and 
retain certain records relating to proxy voting.
    Prior Commission Determination Under 5 U.S.C. 601: A Final 
Regulatory Flexibility Analysis was prepared in accordance with Section 
604 of the Regulatory Flexibility Act regarding rule 206(4)-6 and rule 
204-2 under the Investment Advisers Act of 1940 in conjunction with the 
adoption of Release No. IA-2106 (January 31, 2003). The Commission 
considered comments to the proposing release and to the Initial 
Regulatory Flexibility Analysis prepared in Release No. IA-2059 
(September 20, 2002) at that time.
* * * * *
    Title: Disclosure of Proxy Voting Policies and Proxy Voting Records 
by Registered Management Investment Companies
    Citation: 17 CFR 270.30b1-4; 17 CFR 274.11A; 17 CFR 274.11a-1; 17 
CFR 274.11b; 17 CFR 274.128; 17 CFR 274.130.
    Authority: 15 U.S.C. 77f, 77g, 77h, 77j, 77s, 78c(b), 78l, 78m, 
78n, 78o(d), 80a-1 et seq., 80a-24, 80a-26, and 80a-29, 80a-34(d), 80a-
37, 80a-39.
    Description: The rule and rule amendments require registered 
management investment companies (i) to provide disclosure about how 
they vote proxies relating to portfolio securities they hold, (ii) to 
disclose the policies and procedures that they use to determine how to 
vote proxies relating to portfolio securities, and (iii) to file with 
the Commission and to make available to shareholders the specific proxy 
votes that they cast in shareholder meetings of issuers of portfolio 
securities.
    Determination Under 5 U.S.C. 601: A Final Regulatory Flexibility 
Analysis was prepared in accordance with Section 604 of the Regulatory 
Flexibility Act in conjunction with the adoption of Release No. IC-
25922 (January 31, 2003). The Commission considered comments to the 
proposing release and to the Initial Regulatory Flexibility Analysis 
prepared in Release No. IC-25739 (Sept. 20, 2002) at that time.
* * * * *
    Title: Custody of Investment Company Assets with a Securities 
Depository
    Citation: 17 CFR 270.17f-4.
    Authority: 15 U.S.C. 80a-1 et seq., 80a-34(d), 80a-37, 80a-39.
    Description: The rule amendments expand the types of investment 
companies that may maintain assets with a depository, and update the 
conditions they must follow to use a depository. The amendments respond 
to developments in securities depository practices and commercial law 
since the rule was adopted.
    Prior Commission Determination Under 5 U.S.C. 601: A Final 
Regulatory Flexibility Analysis was prepared in accordance with Section 
604 of the Regulatory Flexibility Act in conjunction with the adoption 
of Release No. IC-25934 (February 13, 2003). The Commission considered 
comments to the proposing release and to the Initial Regulatory 
Flexibility Analysis prepared in Release No. IC-25266 (Nov. 15, 2001) 
at that time.
* * * * *
    Title: Definition of Terms in and Specific Exemptions for Banks, 
Savings Associations, and Savings Banks Under Sections 3(a)(4) and 
3(a)(5) of the Securities Exchange Act of 1934
    Citation: 17 CFR 240.3a5-1, 17 CFR 240.3b-18, 17 CFR 240.15a-8, and 
17 CFR 240.15a-11
    Authority: 15 U.S.C. 77c, 77d, 77g, 77j, 77s, 77z-2, 77z-3, 77eee, 
77ggg, 77nnn, 77sss, 77ttt, 78c, 78d, 78e, 78f, 78g, 78i, 78j, 78j-1, 
78k, 78k-1, 78l, 78m, 78n, 78o, 78p, 78q, 78s, 78u-5, 78w, 78x, 78ll, 
78mm, 79q, 79t, 80a-20, 80a-23, 80a-29, 80a-37, 80b-3, 80b-4, and 80b-
11.
    Description: The Commission adopted amendments to its rule granting 
an exemption to banks from dealer registration for a de minimis number 
of riskless principal transactions, and to its rule that defines terms 
used in the bank exception to dealer registration for asset-backed 
transactions. The Commission also adopted a new exemption for banks 
from the definition of broker and dealer under the Securities Exchange 
Act of 1934 for certain securities lending transactions. In addition, 
the Commission extended the exemption from rescission liability under 
Exchange Act Section 29 to contracts entered into by banks acting in a 
dealer capacity before March 31, 2005. These rules addressed certain of 
the exceptions for banks from the definitions of ``broker'' and 
``dealer'' that were added to the Securities Exchange Act by the Gramm-
Leach-Bliley Act.
    Prior Commission Determination Under 5 U.S.C. 610: Pursuant to 
Section 605(b) of the Regulatory Flexibility Act, the Commission 
certified that the amendment to the rule would not have a significant 
economic impact on a substantial number of small entities. This 
certification was incorporated into the proposing release, Release No. 
34-46745 (November 5, 2002). As stated in the adopting release, No. 34-
47364 (February 14, 2003), the Commission received no comments 
concerning the impact on small entities or the Regulatory Flexibility 
Act Certification.
* * * * *
    Title: Regulation Analyst Certification
    Citation: 17 CFR 242.500 through 505.
    Authority: 15 U.S.C. 77g, 77q(a), 77s(a), 78b, 78c, 78g(c)(2), 
78i(a), 78j, 78k-1(c), 78l, 78m, 78mm, 78n, 78o(b), 78o(c), 78o(g), 
78q(a), 78q(b), 78q(h), 78w(a), 78dd-1, 80a-23, 80a-29, and 80a-37.
    Description: Regulation Analyst Certification (``Regulation AC'') 
requires that brokers, dealers, and certain persons associated with a 
broker or dealer include in research reports certifications by the 
research analyst that the views expressed in the report accurately 
reflect his or her personal views, and disclose whether or not the 
analyst received compensation or other payments in connection with his 
or her specific recommendations or views. Broker-dealers are also 
required to obtain periodic certifications by research analysts in 
connection with the analyst's public appearances.
    Prior Commission Determination Under 5 U.S.C. 610: Pursuant to 
Section 605(b) of the Regulatory Flexibility Act, the Commission 
certified that Regulation AC would not have a significant economic 
impact on a substantial number of small entities. This certification, 
including the reasons supporting the certification, was set forth in 
the proposing release, Release No. 33-8119 (August 2, 2002). The 
Commission solicited comments on the potential impact of Regulation AC 
on small entities in the proposing release. No comments were received 
that discussed the Regulatory Flexibility Act Certification. However, 
in the adopting release, Release No. 33-8193 (February 20, 2003), in 
response to other comments, the Commission revised its estimates and 
concluded that the total burden in hours required to comply with 
proposed Regulation AC would be approximately 5.78 hours per year, per 
small firm, as compared to the original estimate of two hours and two 
minutes per year, per small firm.
* * * * *

[[Page 77979]]

    Title: Standards Relating to Listed Company Audit Committees
    Citation: 17 CFR 229.401 and 17 CFR 240.10A-3.
    Authority: 15 U.S.C. 77b, 15 U.S.C. 77f, 15 U.S.C. 77g, 15 U.S.C. 
77h, 15 U.S.C. 77j, 15 U.S.C. 77q, 15 U.S.C. 77s, 15 U.S.C. 78c(b), 15 
U.S.C. 78j-1, 15 U.S.C. 78l, 15 U.S.C. 78m, 15 U.S.C. 78n, 15 U.S.C. 
78o, 15 U.S.C. 78w, 15 U.S.C. 78mm, 15 U.S.C. 80a-8, 15 U.S.C. 80a-20, 
15 U.S.C. 80a-24(a), 15 U.S.C. 80a-29, 15 U.S.C. 80a-37, and 15 U.S.C. 
7202.
    Description: The Commission adopted rules to direct the national 
securities exchanges and national securities associations to prohibit 
the listing of any security of an issuer that is not in compliance with 
the audit committee requirements mandated by the Sarbanes-Oxley Act of 
2002. In addition, the Commission adopted amendments changing its 
disclosure requirements regarding audit committees.
    Prior Commission Determination Under 5 U.S.C. 610: A Final 
Regulatory Flexibility Analysis was prepared in accordance with Section 
604 of the Regulatory Flexibility Act in conjunction with the adoption 
of Release No. 33-8220 (April 9, 2003). The Commission solicited 
comments concerning the impact on small entities and the Initial 
Regulatory Flexibility Analysis prepared in Release No. 33-8173 
(January 8, 2003), but received no comments.
* * * * *
    Title: Customer Identification Programs for Mutual Funds
    Citation: 17 CFR 270.0-11
    Authority: 15 U.S.C. 80a-1 et seq., 80a-34(d), 80a-37, 80a-39.
    Description: The rule implements section 326 of the USA PATRIOT Act 
of 2001 and requires investment companies (i) to implement procedures 
to verify the identity of any person seeking to open an account, (ii) 
to the extent reasonable and practicable, to maintain records of the 
information used to verify the person's identity, and (iii) to 
determine whether the person appears on any lists of known or suspected 
terrorists or terrorist organizations provided to investment companies 
by any government agency.
    Prior Commission Determination Under 5 U.S.C. 601: A Final 
Regulatory Flexibility Analysis was prepared in accordance with Section 
604 of the Regulatory Flexibility Act in conjunction with the adoption 
of Release No. IC-26031 (April 29, 2003). The Commission considered 
comments to the proposing release and to the Initial Regulatory 
Flexibility Analysis prepared in Release No. 34-46192 (July 12, 2002) 
at that time.
* * * * *
    Title: Improper Influence on Conduct of Audits
    Citation: 17 CFR 240 13b2-2.
    Authority: 15 U.S.C. 7202(a), 15 U.S.C. 7242, 15 U.S.C. 77e, 15 
U.S.C. 77f, 15 U.S.C. 77g, 15 U.S.C. 77h, 15 U.S.C. 77j, 15 U.S.C. 77s, 
15 U.S.C. 78c, 15 U.S.C. 78j-1, 15 U.S.C 78l, 15 U.S.C. 78m, 15 U.S.C. 
78n, 15 U.S.C. 78o, 15 U.S.C. 78q, 15 U.S.C. 78w, 15 U.S.C. 80a-6, 15 
U.S.C. 80a-8, 15 U.S.C 80a-20, 15 U.S.C. 80a-29, 15 U.S.C 80a-30, and 
15 U.S.C. 80a-37.
    Description: The rules were adopted pursuant to the requirements of 
Section 303 of the Sarbanes-Oxley Act of 2002 to prohibit officers and 
directors of an issuer, and persons acting under the direction of an 
officer or director, from taking any action to coerce, manipulate, 
mislead, or fraudulently influence the auditor of the issuer's 
financial statements if that person knew or should have known that such 
action, if successful, could result in rendering the financial 
statements materially misleading.
    Prior Commission Determination Under 5 U.S.C. 601: A Final 
Regulatory Flexibility Act Analysis was prepared in accordance with 
Section 604 of the Regulatory Flexibility Act in conjunction with the 
adoption of Release No. 34-47890 (May 20, 2003). The Commission 
considered comments to the proposing release and to the Initial 
Regulatory Flexibility Analysis prepared in Release No. 34-46685 
(October 18, 2002) at that time.
* * * * *

    Title: Management's Reports on Internal Control Over Financial 
Reporting and Certification of Disclosure in Exchange Act Periodic 
Reports
    Citation: 17 CFR 210.1-02, 17 CFR 210.2-02, 17 CFR 229.307, 17 CFR 
229.308, 17 CFR 240.12b-15, 17 CFR 240.13a-14, 17 CFR 240.13a-15, 17 
CFR 240.15d-14, 17 CFR 240.15d-15.
    Authority: 15 U.S.C. 77e, 15 U.S.C. 77f, 15 U.S.C. 77g, 15 U.S.C. 
77j, 15 U.S.C. 77q, 15 U.S.C. 77s, 15 U.S.C. 78l, 15 U.S.C. 78m, 15 
U.S.C. 78o, 15 U.S.C. 78w, 15 U.S.C. 78mm, 15 U.S.C. 80a-8, 15 U.S.C. 
80a-29, 15 U.S.C. 80a-30, 15 U.S.C. 80a-37, 15 U.S.C. 7202(a), 15 
U.S.C. 7241, 15 U.S.C. 7262, 15 U.S.C. 7263, and 18 U.S.C. 1350.
    Description: The rules and amendments were adopted in light of 
Congress' directive in Section 404 of the Sarbanes-Oxley Act of 2002 to 
require reporting companies, other than registered investment 
companies, to include in their annual reports a report of management on 
the company's internal control over financial reporting. The internal 
control report must include management's assessment of the 
effectiveness of the company's internal control over financial 
reporting as of the end of its most recent fiscal year, as well as a 
statement that the registered public accounting firm that audited the 
company's financial statements included in the annual report has issued 
an attestation report on management's assessment. The rules also 
require companies to file the registered public accounting firm's 
attestation report as part of its annual report. Further, the rules 
require that management evaluate any change in the company's internal 
control over financial reporting that occurred during a fiscal quarter 
that has or is reasonably likely to materially affect the company's 
internal control over financial reporting. In addition, the amendments 
require companies to provide the certifications required by Sections 
302 and 906 of the Sarbanes-Oxley Act as exhibits to certain periodic 
reports.
    In 2010, the Dodd-Frank Wall Street Reform and Consumer Protection 
Act amended Section 404 of the Sarbanes-Oxley Act to provide that 
Section 404(b) shall not apply with respect to any audit report 
prepared for an issuer that is neither an accelerated filer, nor a 
large accelerated filer, as defined in Exchange Act Rule 12b-2. In 
2010, the Commission adopted conforming amendments to its rules.
    Prior Commission Determination Under 5 U.S.C. 610: A Final 
Regulatory Flexibility Analysis was prepared in accordance with Section 
604 of the Regulatory Flexibility Act in conjunction with the adoption 
of Release No. 33-8238 (June 5, 2003). The Commission solicited 
comments with respect to the rules and amendments in two separate 
proposing releases, Release Nos. 33-8138 (October 22, 2002) and 33-8212 
(March 21, 2003). The Commission also solicited comments concerning the 
impact on small entities and the Initial Regulatory Flexibility 
Analysis, but received no comments on the impact on small entities of 
the new certification requirements.
* * * * *
    Title: Certain Research and Development Companies
    Citation: 17 CFR 270.3a-8
    Authority: 15 U.S.C. 80a-1 et seq., 80a-34(d), 80a-37, 80a-39.
    Description: The rule provides a nonexclusive safe harbor from the 
definition of an investment company for

[[Page 77980]]

certain bona fide research and development companies.
    Prior Commission Determination Under 5 U.S.C. 601: A Final 
Regulatory Flexibility Analysis was prepared in accordance with Section 
604 of the Regulatory Flexibility Act in conjunction with the adoption 
of Release No. IC-26077 (June 16, 2003). The Commission solicited 
comments concerning the impact on small entities and the Initial 
Regulatory Flexibility Analysis prepared in Release No. IC-25835 (Nov. 
26, 2002) but received no comments.
* * * * *
    Title: Custody of Funds or Securities of Clients by Investment 
Advisers
    Citation: 17 CFR 275.206(4)-2; 17 CFR 279.1
    Authority: 15 U.S.C. 80b-1 et seq., 80b-2(a)(11)(F), 80b-2(a)(17), 
80b-3, 80b-4, 80b-6(4), 80b-6a, 80b-11
    Description: The amendments to the custody rule conformed the rule 
to modern custodial practices and required advisers that have custody 
of client funds or securities to maintain those assets with broker-
dealers, banks, or other qualified custodians. The amendments were 
designed to enhance protections for client assets while reducing 
burdens on advisers that have custody of client assets.
    Prior Commission Determination Under 5 U.S.C. 601: A Final 
Regulatory Flexibility Analysis was prepared in accordance with Section 
604 of the Regulatory Flexibility Act with respect to amended rule 
206(4)-2 under the Advisers Act and to amended Part 1A, Item 9 and Part 
II, Item 14 of Form ADV in conjunction with the adoption of Release No. 
IA- 2176 (September 25, 2003). The Commission solicited comments 
concerning the impact on small entities and the Initial Regulatory 
Flexibility Analysis prepared in Release No. IA-2044 (July 18, 2002), 
but received no comments.
* * * * *
    Title: Amendments to Investment Company Advertising Rules
    Citation: 17 CFR 270.34b-1
    Authority: 15 U.S.C. 80a-1 et seq., 80a-34(d), 80a-37, 80a-39.
    Description: The rule amendments (i) require enhanced disclosure in 
investment company advertisements to encourage advertisements that 
convey balanced information to prospective investors, particularly with 
respect to past performance, and (ii) implement section 24(g) of the 
Investment Company Act by permitting the use of a prospectus under 
section 10(b) of the Securities Act with respect to securities issued 
by an investment company that includes information the substance of 
which is not included in the investment company's statutory prospectus.
    Prior Commission Determination Under 5 U.S.C. 601: A Final 
Regulatory Flexibility Analysis was prepared in accordance with Section 
604 of the Regulatory Flexibility Act in conjunction with the adoption 
of Release No. IC-26195 (September 29, 2003). The Commission considered 
comments to the proposing release and to the Initial Regulatory 
Flexibility Analysis prepared in Release No. IC-25575 (May 17, 2002) at 
that time.
* * * * *
    Title: Purchases of Certain Equity Securities by the Issuer and 
Others
    Citation: 17 CFR 228.703; 17 CFR 229.703; 17 CFR 240.10b-18; 17 CFR 
249.220f; 17 CFR 249.308a; 17 CFR 249.308b; 17 CFR 249.310; 17 CFR 
249.310b; 17 CFR 249.33117 CFR 270.23c-1; 17 CFR 274.128; 17 CFR 
274.201
    Authority: 15 U.S.C. 77f, 77g, 77h, 77j, 77K, 77s, 77z-2, 77z-3, 
77aa(25), 77aa(26), 77ddd, 77eee, 77ggg, 77hhh, 77iii, 77jjj, 77nnn, 
77sss, 77ttt, 78c, 78c(b),), 78d, 78i, 78j, 78j-1, 78k, 78k-1, 78l, 
78l, 78m, 78n, 78o, 78p, 78q, 78s, 78l, 78m, 78n, 78o(d), 78u-5, 78w, 
78x, 78ll, 78mm, 79e, 79j, 79n, 79q, 79t, 80a-1 et seq., 80a-8, 80a-9, 
80a-20, 80a-23, 80a-24, 80a-26, 80a-29, 80a-30, 80a-24, 80a-26, 80a-29, 
80a-34(d), 80a-38(a), 80a-37, 80a-39, 80b-3, 80b-4, 80b-11, 7201 et 
seq., 18 U.S.C. 1350.
    Description: The rule amendments provide issuers with a ``safe 
harbor'' from liability for manipulation when they repurchase their 
common stock in the market in accordance with the rule's manner, 
timing, price, and volume conditions. The amendments are intended to 
simplify and update the safe harbor provisions in light of market 
developments since the rule's adoption. To enhance the transparency of 
issuer repurchases, the Commission also adopted amendments to a number 
of regulations and forms regarding disclosure of repurchases of equity 
securities by the issuer and affiliated purchasers (both open market 
and private transactions), regardless of whether the repurchases are 
effected in accordance with the issuer repurchase safe harbor rule.
    Prior Commission Determination Under 5 U.S.C. 601: A Final 
Regulatory Flexibility Analysis was prepared in accordance with Section 
604 of the Regulatory Flexibility Act in conjunction with the adoption 
of Release No. 33-8335 (November 10, 2003). The Commission solicited 
comments concerning the impact on small entities and the Initial 
Regulatory Flexibility Analysis prepared in Release No. 34-46980 
(December 10, 2002), but received no comments.
* * * * *
    Title: Disclosure Regarding Nominating Committee Functions and 
Communications Between Security Holders and Boards of Directors
    Citation: 17 CFR 270.30a-2; 17 CFR 274.128
    Authority: 15 U.S.C. 80a-1 et seq., 80a-34(d), 80a-37, 80a-39.
    Description: The rule amendments impose new disclosure requirements 
and amendments to existing disclosure requirements to enhance the 
transparency of the operations of boards of directors. Specifically, 
the Commission adopted enhancements to existing disclosure requirements 
regarding the operations of board nominating committees and a new 
disclosure requirement concerning the means, if any, by which security 
holders may communicate with directors. These rules require disclosure 
but do not mandate any particular action by a company or its board of 
directors; rather, the new disclosure requirements are intended to make 
more transparent to security holders the operation of the boards of 
directors of the companies in which they invest.
    Prior Commission Determination Under 5 U.S.C. 601: A Final 
Regulatory Flexibility Analysis was prepared in accordance with Section 
604 of the Regulatory Flexibility Act in conjunction with the adoption 
of Release No. IC-26262 (November 24, 2003). The Commission solicited 
comments on the proposing release and on the Initial Regulatory 
Flexibility Analysis prepared in Release No. 34-48301 (August 8, 2003). 
The Commission received no comments on the Initial Regulatory 
Flexibility Analysis, but it did receive comments on the impact of the 
proposed rules on small business issuers. The Commission considered 
those comments in the adopting release.
* * * * *
    Title: Processing Requirements for Cancelled Security Certificates
    Citation: 17 CFR 240.17f-1, 17 CFR 240.17Ad-7, 17 CFR 240.17Ad-12, 
and 17 CFR 240.17Ad-19
    Authority: 15 U.S.C. 77c, 77d, 77g, 77j, 77s, 77z-2, 77z-3, 77eee, 
77ggg, 77nnn, 77sss, 77ttt, 78c, 78d, 78e, 78f, 78g, 78i, 78j, 78j-1, 
78k, 78k-1, 78l, 78m, 78n, 78o, 78p, 78q, 78s, 78u-5, 78w, 78x, 78ll, 
78mm, 79q, 79t, 80a-20, 80a-23, 80a-29, 80a-37, 80b-3, 80b-4, 80b-11, 
7202, 7241, 7262, and 7263, and 18 U.S.C. 1350.

[[Page 77981]]

    Description: This rule requires every transfer agent to establish 
and implement written procedures for the cancellation, storage, 
transportation, destruction, or other disposition of securities 
certificates. The rule requires transfer agents to mark each cancelled 
securities certificate with the word ``cancelled''; maintain a secure 
storage area for cancelled certificates; maintain a retrievable 
database of all cancelled, destroyed, or otherwise disposed of 
certificates; and have specific procedures for the destruction of 
cancelled certificates. Additionally, the Commission amended its lost 
and stolen securities rule and its transfer agent safekeeping rule to 
make it clear that these rules apply to unissued and cancelled 
certificates.
    Prior Commission Determination Under 5 U.S.C. 610: A Final 
Regulatory Flexibility Analysis was prepared in accordance with Section 
604 of the Regulatory Flexibility Act in conjunction with the adoption 
of Release No. 34-48931 (December 16, 2003). The Commission solicited 
comment on the Initial Regulatory Flexibility Analysis prepared in the 
proposing release, Release No. 34-43401 (October 2, 2000), but received 
no comment on that analysis. The Commission did receive comments 
related to small business, and considered those comments in the 
adopting release.
* * * * *
    Title: Compliance Programs of Investment Companies and Investment 
Advisers
    Citation: 17 CFR 270.38a-1; 17 CFR 275.204-2; 17 CFR 275.206(4)-7
    Authority: 15 U.S.C. 80a-1 et seq., 80a-34(d), 80a-37, 80a-39, 80b-
1 et seq., 80b-2(a)(11)(F), 80b-2(a)(17), 80b-3, 80b-4, 80b-6(4), 80b-
6a, 80b-11
    Description: The rules require each investment company and 
investment adviser registered with the Commission and each business 
development company to (i) adopt and implement written compliance 
policies and procedures, (ii) review those policies and procedures 
annually, and (iii) appoint a compliance officer to be responsible for 
administering the policies and procedures. The rules also impose a new 
recordkeeping requirement.
    Prior Commission Determination Under 5 U.S.C. 601: A Final 
Regulatory Flexibility Analysis was prepared in accordance with Section 
604 of the Regulatory Flexibility Act regarding rule 38a-1 under the 
Investment Company Act of 1940, new rule 206(4)-7 under the Investment 
Advisers Act, and amendments to rule 204-2 under the Investment 
Advisers Act, and to Part 1, Schedule A, Item 2(a) of Form ADV in 
conjunction with the Commission's adoption of Release No. IA-2204 
(December 17, 2003). The Commission considered comments on the 
proposing release and on the Initial Regulatory Flexibility Analysis 
prepared in Release No. IC-25925 (Feb. 5, 2003) at that time.
* * * * *
    Title: Recordkeeping Requirements for Registered Transfer Agents
    Citation: 17 CFR 240. 240.17Ad-7
    Authority: 15 U.S.C. 77c, 77d, 77g, 77j, 77s, 77z-2, 77z-3, 77eee, 
77ggg, 77nnn, 77sss, 77ttt, 78c, 78d, 78e, 78f, 78g, 78i, 78j, 78j-1, 
78k, 78k-1, 78l, 78m, 78n, 78o, 78p, 78q, 78s, 78u-5, 78w, 78x, 78ll, 
78mm, 79q, 79t, 80a-20, 80a-23, 80a-29, 80a-37, 80b-3, 80b-4, 80b-11, 
7202, 7241, 7262, and 7263, and 18 U.S.C. 1350.
    Description: The Commission amended its rule concerning 
recordkeeping requirements for registered transfer agents. The 
amendments made it clear that registered transfer agents may use 
electronic, microfilm, and microfiche media as a substitute for hard 
copy records, including cancelled stock certificates, for purposes of 
complying with the Commission's transfer agent recordkeeping rules and 
that a third party on behalf of a registered transfer agent may place 
into escrow the required software information.
    Prior Commission Determination Under 5 U.S.C. 610: A Final 
Regulatory Flexibility Analysis was prepared in accordance with Section 
604 of the Regulatory Flexibility Act in conjunction with Release No. 
34-48949 (December 18, 2003). The Commission received comment letters 
in response to the Initial Regulatory Flexibility Analysis in the 
proposing release, Release No. 34-48036 (June 16, 2003), that did not 
address the issues presented in the proposing release.

    By the Commission.

    Dated: December 19, 2014.
Brent J. Fields,
Secretary.
[FR Doc. 2014-30265 Filed 12-24-14; 8:45 am]
BILLING CODE 8011-01-P


