[Federal Register Volume 67, Number 212 (Friday, November 1, 2002)]
[Notices]
[Page 66677]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-27775]


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SECURITIES AND EXCHANGE COMMISSION


Existing Collection; Comment Request

    Notice is hereby given that, pursuant to the Paperwork Reduction 
Act of 1995 (44 U.S.C. 3501-3520), 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 17a-7 [17 CFR 270.17a-7] under the Investment Company Act of 
1940 (the ``Act'') is entitled ``Exemption of certain purchase or sale 
transactions between an investment company and certain affiliated 
persons thereof.'' It provides an exemption from section 17(a) of the 
Act for purchases and sales of securities between registered investment 
companies, which are affiliated persons or affiliated persons of 
affiliated persons of each other, or between a registered investment 
company and an affiliated person or an affiliated person of an 
affiliated person, when the affiliation arises solely because of a 
common adviser, director, or officer. Rule 17a-7 requires investment 
companies to keep various records in connection with purchase or sale 
transactions affected by the rule. The rule requires the board of 
directors of an investment company to establish procedures reasonably 
designed to ensure that all conditions of the rule have been satisfied. 
If an investment company enters into a purchase or sale transaction 
with an affiliated person, the rule requires the investment company to 
compile and maintain written records of the transaction.\1\ In 
addition, under the rule, the board is required to determine, at least 
on a quarterly basis, that all affiliated transactions made during the 
preceding quarter were made in compliance with these established 
procedures. The Commission's examination staff uses these records to 
evaluate transactions between affiliated investment companies for 
compliance with the rule.
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    \1\ The written records are required to set forth a description 
of the security purchased or sold, the identity of the person on the 
other side of the transaction, and the information or materials upon 
which the board of directors' determination that the transaction was 
in compliance with the procedures was made.
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    The Commission estimates that approximately 1,000 investment 
companies enter into transactions affected by rule 17a-7 each year and, 
therefore, are subject to the rule's information collection 
requirements.\2\ The average annual burden for rule 17a-7 is estimated 
to be approximately two burden hours per respondent, for an annual 
total of 2,000 burden hours for all respondents. The estimates of 
burden hours are made solely for the purposes of the Paperwork 
Reduction Act, and are not derived from a comprehensive or even a 
representative survey or study of the costs of Commission rules.
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    \2\ These estimates are based on conversations with the 
examination and inspections staff of the Commission and fund 
representatives. Based on these conversations, the Commission staff 
estimates that most investment companies (4,000 of the estimated 
4,500 registered investment companies) have adopted procedures for 
compliance with rule 17a-7. Of these 4,000 investment companies, the 
Commission staff estimates that each year approximately 25% (1,000) 
enter into transactions affected by rule 17a-7.
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    Written comments are invited on: (a) Whether the collections of 
information are necessary for the proper performance of the functions 
of the Commission, including whether the information has practical 
utility; (b) the accuracy of the Commission'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 Kenneth A. Fogash, Acting 
Associate Executive Director, Office of Information Technology, 
Securities and Exchange Commission, 450 5th Street, NW., Washington, DC 
20549.

    Dated: October 24, 2002.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 02-27775 Filed 10-31-02; 8:45 am]
BILLING CODE 8010-01-P