[Federal Register Volume 68, Number 138 (Friday, July 18, 2003)]
[Notices]
[Pages 42788-42789]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-18188]


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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 Filings and Information Services Washington, 
DC 20549.

Extension:
    Rule 11a-3 [17 CFR 270.11a-3]--SEC File No. 270-321, OMB Control 
No. 3235-0358.

    Notice is hereby given that pursuant to the Paperwork Reduction Act 
of 1995 [44 U.S.C. 3501-3520], 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.
    Rule 11a-3 under the Investment Company Act of 1940 [17 CFR 
270.11a-3] is an exemptive rule that permits open-end investment 
companies (``funds''), other than insurance company separate accounts, 
and funds' principal underwriters, to make certain exchange offers to 
fund shareholders and shareholders of other funds in the same group of 
investment companies. The rule requires a fund, among other things, (i) 
to disclose in its prospectus and advertising literature the amount of 
any administrative or redemption fee imposed on an exchange 
transaction, (ii) if the fund imposes an administrative fee on exchange 
transactions, other than a nominal one, to maintain and preserve 
records with respect to the actual costs incurred in connection with 
exchanges for at least six years, and (iii) give the fund's 
shareholders a sixty day notice of a termination of an exchange offer 
or any material amendment to the terms of an exchange offer (unless the 
only material effect of an amendment is to reduce or eliminate an 
administrative fee, sales load or redemption fee payable at the time of 
an exchange).
    The rule's requirements are designed to protect investors against 
abuses associated with exchange offers, provide fund shareholders with 
information necessary to evaluate exchange offers and certain material 
changes in the terms of exchange offers, and enable the Commission 
staff to monitor funds' use of administrative fees charged in 
connection with exchange transactions.
    There are approximately 3,075 funds registered with the Commission 
as of December 31, 2002. The staff estimates that one-quarter of these 
funds imposes a non-nominal administrative fee on exchange 
transactions, and that the recordkeeping requirement of the rule 
requires approximately one hour annually of clerical time (at an 
estimated $16 per hour) per fund, for a total of 768.75 hours for all 
funds (at a total annual cost of $12,300). The staff estimates that 
one-quarter of the 3,075 funds terminates an exchange offer or makes a 
material change to its terms once each year, and that the notice 
requirement of the rule requires approximately one hour of professional 
time (at an estimated $60 per hour) and two hours of clerical time (at 
an estimated $16 per hour) per fund, for a total of approximately 
2306.25 hours for all funds (at a total annual cost of $70,725). The 
burdens associated with the disclosure requirement of the rule are 
accounted for in the burdens associated with the Form N-1A registration 
statement for funds.
    The estimate of average burden hours is made solely for the 
purposes of the Paperwork Reduction Act, and is not derived from a 
comprehensive or even a representative survey or study of the costs of 
Commission rules and forms.
    The rule provides that if a fund imposes an administrative fee in 
connection with exchanges that is reasonably intended to cover the 
costs incurred in processing the exchanges, the fund must maintain and 
preserve records of any determination of the costs incurred in 
connection with exchanges for a period of not less than

[[Page 42789]]

six years, the first two years in an easily accessible place. Keeping 
these records is necessary for any fund that wishes to obtain the 
benefit of relying on the rule. Although these records are subject to 
inspection by the Commission, they are not made public.
    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.
    Please direct general comments regarding the above information to 
the following persons: (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; and (ii) Kenneth A. Fogash, Acting Associate 
Executive Director/CIO, Office of Information Technology, Securities 
and Exchange Commission, 450 5th Street, NW., Washington, DC 20549. 
Comments must be submitted to OMB within 30 days of this notice.

    Dated: July 7, 2003.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 03-18188 Filed 7-17-03; 8:45 am]
BILLING CODE 8010-01-P