[Federal Register Volume 69, Number 64 (Friday, April 2, 2004)]
[Notices]
[Pages 17460-17463]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-7496]



[[Page 17460]]

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

SECURITIES AND EXCHANGE COMMISSION

[Investment Company Act Release No. 26406; 812-12827]


The Vanguard Group, Inc., et al.; Notice of Application

March 29, 2004.
AGENCY: Securities and Exchange Commission (``Commission'').

ACTION: Notice of application for an order under section 12(d)(1)(J) of 
the Investment Company Act of 1940 (``Act'') for an exemption from 
sections 12(d)(1)(A) and (B) of the Act, under sections 6(c) and 17(b) 
of the Act for an exemption from section 17(a) of the Act, and under 
section 17(d) of the Act and rule 17d-1 under the Act to permit certain 
joint transactions. The order would supersede a prior order.\1\ The 
order would also amend two prior orders.\2\

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

    \1\ Vanguard Municipal Bond Fund, Inc., et al., Investment 
Company Act Release Nos. 17655 (Aug. 7, 1990) (notice) and 17726 
(Sep. 5, 1990) (order).
    \2\ Vanguard STAR Fund, et al., Investment Company Act Release 
Nos. 21372 (Sep. 22, 1995) (notice) and 21426 (Oct. 18, 1995) 
(order) (the ``Amended STAR Order'') and The Vanguard Group, Inc., 
et al., Investment Company Act Release Nos. 21470 (Nov. 3, 1995) 
(notice) and 21555 (Nov. 29, 1995) (order) (the ``Fund of Index 
Funds Order'').

Applicants: The Vanguard Group, Inc. (``Vanguard''), Vanguard Admiral 
Funds, Vanguard Balanced Index Fund, Vanguard Bond Index Funds, 
Vanguard California Tax-Free Funds, Vanguard Convertible Securities 
Fund, Vanguard Explorer Fund, Vanguard Fenway Funds, Vanguard Fixed 
Income Securities Funds, Vanguard Florida Tax-Free Fund, Vanguard 
Horizon Funds, Vanguard Index Funds, Vanguard Institutional Index Fund, 
Vanguard International Equity Index Funds, Vanguard Malvern Funds, 
Vanguard Massachusetts Tax-Exempt Funds, Vanguard Money Market 
Reserves, Vanguard Morgan Growth Fund, Vanguard Municipal Bond Funds, 
Vanguard New Jersey Tax-Free Funds, Vanguard New York Tax-Free Funds, 
Vanguard Ohio Tax-Free Funds, Vanguard Pennsylvania Tax-Free Funds, 
Vanguard Chester Funds, Vanguard Quantitative Funds, Vanguard 
Specialized Funds, Vanguard STAR Fund, Vanguard Tax-Managed Funds, 
Vanguard Treasury Fund, Vanguard Trustees' Equity Fund, Vanguard 
Variable Insurance Fund, Vanguard Wellesley Income Fund, Vanguard 
Wellington Fund, Vanguard Whitehall Funds, Vanguard Windsor Funds, and 
Vanguard World Funds (each such fund, and any future registered 
investment companies or series thereof that are part of the same 
``group of investment companies'' as defined in section 12(d)(1)(G) of 
the Act and that are organized, managed, or advised by Vanguard or a 
person controlling, controlled by, or under common control with 
Vanguard, each a ``Vanguard Fund'' and, collectively, the ``Vanguard 
---------------------------------------------------------------------------
Funds'').

Summary of Application: Applicants request an order that would permit 
(a) certain registered open-end management investment companies to 
invest uninvested cash and cash collateral in one or more affiliated 
money market funds and/or short-term bond funds, and (b) the registered 
investment companies and certain affiliated entities to engage in 
purchase and sale transactions involving portfolio securities.

Filing Dates: The application was filed on May 17, 2002 and was amended 
on August 4, 2003, and March 22, 2004. Applicants have agreed to file 
an amendment to the application during the notice period, the substance 
of which is reflected in this notice.

Hearing or Notification of Hearing: An order granting the application 
will be issued unless the Commission orders a hearing. Interested 
persons may request a hearing by writing to the Commission's Secretary 
and serving applicants with a copy of the request, personally or by 
mail. Hearing requests should be received by the Commission by 5:30 
p.m. on April 22, 2004, and should be accompanied by proof of service 
on applicants, in the form of an affidavit or, for lawyers, a 
certificate of service. Hearing requests should state the nature of the 
writer's interest, the reason for the request, and the issues 
contested. Persons who wish to be notified of a hearing may request 
notification by writing to the Commission's Secretary.

ADDRESSES: Secretary, Securities and Exchange Commission, 450 Fifth 
Street, NW., Washington, DC 20549-0609. Applicants, c/o R. Gregory 
Barton, The Vanguard Group, Inc., P.O. Box 2600, Mail Stop V26, Valley 
Forge, PA 19482.

FOR FURTHER INFORMATION CONTACT: Todd F. Kuehl, Branch Chief, or 
Michael W. Mundt, Senior Special Counsel, at (202) 942-0564 (Division 
of Investment Management, Office of Investment Company Regulation).

SUPPLEMENTARY INFORMATION: The following is a summary of the 
application. The complete application may be obtained for a fee at the 
Commission's Public Reference Branch, 450 Fifth Street, NW., 
Washington, DC 20549-0102 (tel. 202-942-8090).

Applicants' Representations

    1. The Vanguard Group, Inc., a Pennsylvania corporation, is 
registered as an investment adviser under the Investment Advisers Act 
of 1940 and as a transfer agent under the Securities Exchange Act of 
1934. Vanguard is wholly and jointly owned by certain Vanguard Funds 
(the ``Member Funds''). Vanguard and the Member Funds operate under an 
``internalized'' management structure pursuant to exemptive orders 
issued by the Commission and in accordance with a common service 
agreement between Vanguard and the Member Funds (the ``Service 
Agreement''). Under this structure, Vanguard provides the Member Funds 
with corporate management, administrative, transfer agency, 
distribution, and investment advisory services on an at-cost basis. 
Vanguard Institutional Index Fund and Vanguard STAR Fund are not Member 
Funds. These two funds (together with any existing or future Vanguard 
Funds that are not Member Funds, the ``Non-Member Funds'') are not 
parties to the Service Agreement and do not make capital contributions 
to Vanguard. The Non-Member Funds receive all required services 
pursuant to separate management and shareholder services agreements 
with Vanguard. Each Vanguard Fund is a registered open-end management 
investment company organized as a Delaware statutory trust.\3\
---------------------------------------------------------------------------

    \3\ All Vanguard Funds that currently intend to rely on the 
requested order are named as Applicants. Any other existing or 
future Vanguard Fund will rely on the requested order only in 
accordance with the terms and conditions of the Application.
---------------------------------------------------------------------------

    2. Vanguard serves as the sole investment adviser of certain 
Vanguard Funds, while other Vanguard Funds are advised by Vanguard and 
one or more third party investment advisers. Vanguard or a person 
controlling, controlled by, or under common control with Vanguard, also 
serves, or may in the future serve, as investment adviser or as trustee 
exercising investment discretion for certain existing and future 
collective trust funds and managed accounts (the ``Other Vanguard 
Accounts''). The managed accounts are not pooled investment vehicles, 
and the Other Vanguard Accounts are not investment companies as defined 
in the Act. The Vanguard Funds and the Other Vanguard Accounts are 
collectively referred to herein as the ``Participating Accounts.''
    3. Each Participating Account holds uninvested cash derived from a 
variety

[[Page 17461]]

of sources (``Uninvested Cash''), such as dividends or interest 
received on portfolio securities, unsettled securities transactions, 
reserves held for investment or temporary defensive purposes, scheduled 
maturity of investments, proceeds from the liquidation of portfolio 
securities, and money received from investors. Participating Accounts 
may also receive cash collateral from borrowers (``Cash Collateral'' 
and, together with Uninvested Cash, ``Available Cash'') in connection 
with a securities lending program (the ``Securities Lending Program'')
    4. The Cash Management Trust will be organized as a Delaware 
statutory trust and will register as an open-end management investment 
company under the Act. The Cash Management Trust will be advised by 
Vanguard, and will be a series company with several different 
portfolios (each, a ``CMT Fund''). The CMT Funds will not be Member 
Funds and will not make capital contributions to Vanguard. Vanguard 
will provide corporate management, administrative, transfer agency, 
distribution, and investment advisory services to the CMT Funds on an 
at-cost basis pursuant to separate management and shareholder services 
agreements. The CMT Funds will have their own investment objectives, 
strategies, and policies, and will be separately managed by Vanguard 
generally to provide current income, preserve principal, and maintain 
liquidity through investments in repurchase agreements, money market 
instruments, and other fixed-income securities. Certain CMT Funds are 
expected to operate as money market funds in compliance with rule 2a-7 
under the Act. Those CMT Funds which do not operate as money market 
funds in compliance with rule 2a-7 under the Act will operate as short-
term bond funds and maintain a dollar-weighted average maturity of 
three years or less.
    5. Applicants request an order to permit: (i) any Participating 
Account to use its Available Cash to purchase shares issued by a CMT 
Fund and to redeem such shares; (ii) any CMT Fund to sell shares to and 
redeem shares from any Participating Account; and (iii) the 
Participating Accounts and the CMT Funds to engage in certain interfund 
purchase and sale transactions in portfolio securities (``Interfund 
Transactions''). The order would also amend the Amended STAR Order and 
the Fund of Index Funds Order by permitting Vanguard funds of funds 
operating in reliance on these orders to purchase and redeem shares of 
any underlying Vanguard Fund that, in turn, invests its Available Cash 
in the Cash Management Trust.

Applicants' Legal Analysis

I. Investment of Available Cash by the Participating Accounts in the 
CMT Funds

A. Section 12(d)(1) of the Act

    1. Section 12(d)(1)(A) of the Act, in relevant part, prohibits any 
registered investment company (the ``acquiring company'') from 
purchasing shares of another investment company (the ``acquired 
company'') if immediately after the purchase the acquiring company 
would own: (i) More than 3% of the outstanding voting stock of the 
acquired company; (ii) securities issued by the acquired company having 
an aggregate value greater than 5% of the value of the acquiring 
company's total assets; or (iii) securities issued by the acquired 
company and all other investment companies having an aggregate value 
greater than 10% of the value of the acquiring company's total assets.
    Section 12(d)(1)(B) of the Act, in relevant part, prohibits an 
open-end registered investment company from selling its securities to 
another investment company if immediately after the sale: (i) More than 
3% of the outstanding voting stock of the acquired company is owned by 
the acquiring company; or (ii) more than 10% of the outstanding voting 
stock of the acquired company is owned by the acquiring company and 
other investment companies.
    2. Section 12(d)(1)(J) provides that the Commission may provide 
exemptive relief from the provisions of Section 12(d)(1) if and to the 
extent that the relief requested is consistent with the public interest 
and the protection of investors. Applicants request relief under 
section 12(d)(1)(J) to permit the Vanguard Funds to use their Available 
Cash to acquire shares of the CMT Funds in excess of the percentage 
limitations in section 12(d)(1)(A), provided however, that in all cases 
a Vanguard Fund's aggregate investment of Uninvested Cash in shares of 
the CMT Funds will not exceed 25% of the Vanguard Fund's total assets 
at any time. Applicants also request relief to permit the CMT Funds to 
sell their securities to the Vanguard Funds in excess of the percentage 
limitations in section 12(d)(1)(B).
    3. Applicants state that the proposed arrangement will not result 
in the abuses that sections 12(d)(1)(A) and (B) were intended to 
prevent. Applicants state that because each CMT Fund will be managed 
specifically to maintain a highly liquid portfolio, CMT Funds will not 
be susceptible to undue influence due to the threat of large-scale 
redemptions. Applicants represent that the proposed arrangement will 
not result in an inappropriate layering of fees because the shares of 
the CMT Funds sold to and redeemed from Vanguard Funds will not be 
subject to a sales load, redemption fee, distribution fee under a plan 
adopted in accordance with rule 12b-1 under the Act, or service fee (as 
defined in rule 2830(b)(9) of the National Association of Securities 
Dealers (``NASD'') Conduct Rules) or, if such shares are subject to any 
such fees in the future, Vanguard will waive its advisory fee for each 
Vanguard Fund in an amount that offsets the amount of such fees 
incurred by the Vanguard Fund. If a CMT Fund offers more than one class 
of securities, each Vanguard Fund will invest only in the class with 
the lowest expense ratio (taking into account the expected impact of 
the Vanguard Fund's investment) at the time of the investment. In 
addition, condition 5 below (in the case of Member Funds) and condition 
6 below (in the case of Non-Member Funds) provide that the boards of 
trustees (``Boards'') of the Vanguard Funds, including trustees who are 
not ``interested persons'' of the Vanguard Funds, as defined in section 
2(a)(19) of the Act (``Independent Trustees''), will review and 
consider on an annual basis whether costs or fees for the Vanguard 
Funds should be reduced to account for reduced services to the Vanguard 
Funds as a result of Uninvested Cash being invested in the CMT Funds.

B. Section 17(a) of the Act

    1. Sections 17(a)(1) and (2) of the Act make it unlawful for any 
affiliated person of or a principal underwriter for a registered 
investment company, or an affiliated person of such a person or 
principal underwriter, acting as principal, to sell or purchase any 
security to or from the investment company. Section 2(a)(3) of the Act 
defines an affiliated person of an investment company to include (i) 
any person directly or indirectly owning, controlling, or holding with 
power to vote 5% or more of the outstanding voting securities of the 
other person, (ii) any person 5% or more of whose outstanding voting 
securities are directly or indirectly owned, controlled, or held with 
power to vote by such other person, (iii) any person directly or 
indirectly controlling, controlled by, or under common control with the 
other person, and (iv) any investment adviser to the investment 
company. Because

[[Page 17462]]

Vanguard may be viewed as controlling the Participating Accounts and 
the Cash Management Trust, they may be deemed to be under common 
control and therefore, affiliated persons of each other. In addition, 
if a Participating Account purchases more than 5% of the voting 
securities of the Cash Management Trust, the Cash Management Trust and 
the Participating Account may be affiliated persons of each other. As a 
result, section 17(a) would prohibit the sale of the shares of Cash 
Management Trust to the Vanguard Funds, and the redemption of the 
shares by the Vanguard Funds.
    2. Section 17(b) of the Act authorizes the Commission to exempt a 
transaction from section 17(a) of the Act if the terms of the proposed 
transaction, including the consideration to be paid or received, are 
reasonable and fair and do not involve overreaching on the part of any 
person concerned, and the proposed transaction is consistent with the 
policy of each registered investment company concerned and with the 
general purposes of the Act. Section 6(c) of the Act permits the 
Commission to exempt any person or transactions from any provision of 
the Act, if the exemption is necessary or appropriate in the public 
interest and consistent with the protection of investors and the 
purposes fairly intended by the policy and provisions of the Act.
    3. Applicants submit that their request for relief to permit the 
purchase and redemption of shares of the CMT Funds by the Vanguard 
Funds satisfies the standards in sections 6(c) and 17(b) of the Act. 
Applicants note that the consideration paid and received on the sale 
and redemption of shares of the Cash Management Trust will be based on 
the net asset value of such shares. Applicants state that the Vanguard 
Funds will retain their ability to invest Available Cash directly in 
short-term investments as authorized by their respective investment 
objectives, strategies and policies. Applicants represent that each CMT 
Fund reserves the right to discontinue selling shares to any of the 
Vanguard Funds if such sales would adversely affect the CMT Fund's 
portfolio management and operations.

C. Section 17(d) of the Act and Rule 17d-1 Under the Act

    1. Section 17(d) of the Act and rule 17d-1 under the Act prohibit 
an affiliated person of a registered investment company, acting as 
principal, from participating in or effecting any transaction in 
connection with any joint enterprise or joint arrangement in which the 
investment company participates, unless the Commission has approved the 
joint arrangement. Applicants state that by establishing and operating 
the Cash Management Trust as a vehicle for the collective investment of 
Available Cash, Vanguard, the Participating Accounts and the Cash 
Management Trust could be deemed to be participating in a joint 
arrangement within the meaning of section 17(d) and rule 17d-1.
    2. In considering whether to approve a joint transaction under rule 
17d-1, the Commission considers whether the investment company's 
participation in the joint transaction is consistent with the 
provisions, policies and purposes of the Act, and the extent to which 
the participation is on a basis different from or less advantageous 
than that of other participants. Applicants submit that the proposed 
transactions meet the standards for an order under rule 17d-1.

II. Interfund Transactions

    1. Applicants state that they currently rely on rule 17a-7 under 
the Act to conduct Interfund Transactions. Rule 17a-7 under the Act 
provides an exemption from section 17(a) for a purchase or sale of 
certain securities between a registered investment company and a person 
that is an affiliated person of such company (or an affiliated person 
of such person) solely by reason of having a common investment adviser, 
common officers and/or common directors or trustees. Applicants state 
that the Other Vanguard Accounts and CMT Funds or Vanguard Funds may 
not be able to rely on rule 17a-7 when purchasing or selling portfolio 
securities to each other because some of the Other Vanguard Accounts 
may own 5% or more of the outstanding voting securities of a CMT Fund 
and, therefore, an affiliation would not exist solely by reason of 
having a common investment adviser, common officers and/or common 
directors or trustees.
    2. Applicants request relief under sections 6(c) and 17(b) of the 
Act to permit the Interfund Transactions. Applicants submit that the 
requested relief satisfies the standards for relief in sections 6(c) 
and 17(b). Applicants state that the participating Other Vanguard 
Account and the participating CMT Fund or Vanguard Fund will comply 
with rule 17a-7 under the Act in all respects, other than the 
requirement that the participants be affiliated solely by reason of 
having a common investment adviser, common directors and/or common 
officers. Applicants state that by complying with the conditions of 
rule 17a-7, the Interfund Transactions do not raise any conflicts of 
interest or opportunities for abuse. Thus, the Applicants submit that 
the Interfund Transactions are reasonable and fair, do not involve 
overreaching, and will be consistent with the purposes of the Act.

Applicants' Conditions

    Applicants agree that any order granting the requested relief will 
be subject to the following conditions:
    1. The shares of the CMT Funds sold to and redeemed from Vanguard 
Funds will not be subject to a sales load, redemption fee, distribution 
fee under a plan adopted in accordance with rule 12b-1 under the Act, 
or service fee (as defined in rule 2830(b)(9) of the NASD Conduct 
Rules) or, if such shares are subject to any such fees in the future, 
Vanguard will waive its advisory fee for each Vanguard Fund in an 
amount that offsets the amount of such fees incurred by the Vanguard 
Fund.
    2. The Cash Management Trust, each CMT Fund, and each Vanguard Fund 
that may rely on the order will be part of the same group of investment 
companies (as defined in section 12(d)(1)(G) under the Act) and will be 
organized, managed, or advised by Vanguard or a person controlling, 
controlled by, or under common control with Vanguard. The Other 
Vanguard Accounts that may rely on the order will be advised by 
Vanguard or a person controlling, controlled by, or under common 
control with Vanguard.
    3. Investment by a Vanguard Fund in shares of the CMT Funds will be 
in accordance with the Vanguard Fund's investment restrictions and will 
be consistent with the Vanguard Fund's investment policies as set forth 
in its prospectus and statement of additional information. A Vanguard 
Fund that complies with rule 2a-7 under the Act will not invest its 
Available Cash in any CMT Fund that does not comply with the 
requirements of rule 2a-7.
    4. A CMT Fund will not acquire securities of any investment company 
or company relying on section 3(c)(1) or 3(c)(7) of the Act in excess 
of the limits contained in section 12(d)(1)(A) of the Act.
    5. Before the next meeting of the Boards of the Member Funds is 
held for the purpose of annually reviewing and approving the proposed 
allocation of the costs of the operation of Vanguard among the Member 
Funds, and, if applicable, for purposes of approving an investment 
advisory agreement with third party investment adviser(s) pursuant to 
section 15 of the Act, Vanguard and, if applicable, the third party 
investment adviser(s), will provide the Boards with specific 
information regarding the approximate

[[Page 17463]]

cost to Vanguard and/or the third party investment adviser(s) of, or 
the approximate portion of the total fee paid to Vanguard and/or the 
third party investment adviser by each Member Fund that is attributable 
to, managing the portion of the Member Fund's Uninvested Cash that can 
be expected to be invested in the CMT Funds. In connection with their 
annual review and approval of the proposed allocation of the costs of 
the operation of Vanguard among the Member Funds, and/or investment 
advisory agreements with the third party investment adviser(s), the 
Boards, including a majority of the Independent Trustees, shall 
consider to what extent, if any, such allocated costs and/or advisory 
fees should be reduced to account for reduced services provided to the 
Member Funds by Vanguard or a third party investment adviser as a 
result of Uninvested Cash being invested in the CMT Funds. The minute 
books of the Member Funds will record fully the Board's consideration 
in approving the allocated costs and/or advisory agreement(s), 
including the considerations related to fees referred to above.
    6. Before the next meeting of the Boards of the Non-Member Funds is 
held for the purpose of considering and approving the continuation for 
one year of the management agreement between the Non-Member Fund and 
Vanguard, and, if applicable, for purposes of approving an investment 
advisory agreement with third party investment adviser(s) pursuant to 
section 15 of the Act, Vanguard and, if applicable, the third party 
investment adviser(s), will provide the Boards with specific 
information regarding the approximate cost to Vanguard and/or the third 
party investment adviser(s) of, or the approximate portion of the total 
fee paid to Vanguard and/or the third party investment adviser by each 
Non-Member Fund that is attributable to, managing the portion of the 
Non-Member Fund's Uninvested Cash that can be expected to be invested 
in the CMT Funds. In connection with its consideration and approval of 
the continuation for one year of the management agreement between the 
Non-Member Fund and Vanguard, and, if applicable, the investment 
advisory agreement with the third party investment adviser(s), the 
Boards, including a majority of the Independent Trustees, shall 
consider to what extent, if any, such allocated costs and/or advisory 
fees should be reduced to account for reduced services provided to the 
Non-Member Funds by Vanguard or a third party investment adviser as a 
result of Uninvested Cash being invested in the CMT Funds. The minute 
books of the Non-Member Funds will record fully the Board's 
consideration in approving the allocated costs and/or advisory 
agreement(s), including the considerations related to fees referred to 
above.
    7. Before a Vanguard Fund that participates in the Securities 
Lending Program is permitted to invest Cash Collateral in the Cash 
Management Trust, a majority of the Board (including a majority of 
Independent Trustees) will approve such investment. No less frequently 
than annually, the Board also will evaluate, with respect to each 
Vanguard Fund, any securities lending arrangement and its results and 
determine that any investment of Cash Collateral in the CMT Funds is in 
the best interests of the Vanguard Fund.
    8. Each of the Vanguard Funds may invest in, and hold shares of, a 
CMT Fund only to the extent that the Vanguard Fund's aggregate 
investment of Uninvested Cash in the CMT Fund at the time the 
investment is made does not exceed 25% of the total assets of the 
Vanguard Fund.
    9. When engaging in Interfund Transactions, the participating Other 
Vanguard Account and the participating CMT Fund or Vanguard Fund will 
comply with rule 17a-7 under the Act in all respects other than the 
requirement that the parties to the transaction be affiliated persons 
(or affiliated persons of affiliated persons) of one another solely by 
reason of having a common investment adviser (or investment advisers 
that are affiliated persons of each other), common officers, and/or 
common directors, solely because the Other Vanguard Accounts and the 
CMT Funds might become affiliated persons within the meaning of section 
2(a)(3)(A) and (B) of the Act.
    Applicants agree that condition 2 of the Amended STAR Order shall 
be replaced with the following condition:

No acquired Vanguard Fund shall acquire securities of any other 
investment company or company relying on section 3(c)(1) or 3(c)(7) of 
the Act in excess of the limits contained in section 12(d)(1)(A) of the 
Act, except to the extent such acquired Vanguard Fund acquires 
securities of another investment company pursuant to exemptive relief 
from the Commission permitting such acquired Vanguard Fund to acquire 
securities of one or more registered open-end investment companies in 
the same group of investment companies as the acquired Vanguard Fund 
that are money market funds or short-term bond funds for short-term 
cash management purposes.

    Applicants agree that condition 2 of the Fund of Index Funds Order 
shall be replaced with the following condition:

No acquired underlying Index Portfolio shall acquire securities of any 
other investment company or any company relying on section 3(c)(1) or 
3(c)(7) of the Act in excess of the limits contained in section 
12(d)(1)(A) of the Act, except to the extent such acquired underlying 
Index Portfolio acquires securities of another investment company 
pursuant to exemptive relief from the Commission permitting such 
acquired underlying Index Portfolio to acquire securities of one or 
more registered open-end investment companies in the same group of 
investment companies as the acquired underlying Index Portfolio that 
are money market funds or short-term bond funds for short-term cash 
management purposes.

    For the Commission, by the Division of Investment Management, 
under delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 04-7496 Filed 4-1-04; 8:45 am]
BILLING CODE 8010-01-P