[Federal Register Volume 70, Number 66 (Thursday, April 7, 2005)]
[Notices]
[Page 17728]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E5-1590]


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SECURITIES AND EXCHANGE COMMISSION


Proposed Collection; Comment Request

Upon written request, copies available from: Securities and Exchange 
Commission, Office of Filings and Information Services, Washington, DC 
20549.

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

    Notice is hereby given that pursuant to the Paperwork Reduction Act 
of 1995 (44 U.S.C. 3501 et seq.) the Securities and Exchange Commission 
(the ``Commission'') is soliciting comments on the collections of 
information summarized below. The Commission plans to submit these 
existing collections of information to the Office of Management and 
Budget (``OMB'') for extension and approval.
    Section 17(a) of the Investment Company Act of 1940 (the ``Act''), 
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. Rule 17a-6 permits a fund and its ``portfolio 
affiliates'' (an issuer of which a fund owns more than five percent of 
the voting securities) to engage in principal transactions with if no 
prohibited participants (e.g., directors, officers, employees, or 
investment advisers of the fund contain persons controlling and under 
common control with the fund, and their affiliates) are parties to the 
transaction or have a direct or indirect financial interest in the 
transaction. Rule 17a-6 specifies certain interests that are not 
``financial interests.'' The rule also provides that the term 
``financial interest'' does not include 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, as long as 
the board records the basis for the findings in its meeting minutes.
    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 a prohibited 
participant in a party to a transaction with a portfolio affiliate is 
not material.
    Based on analysis of past filings, the Commission's staff estimates 
that 148 funds are affiliated persons of 668 issuers as a result of the 
fund's ownership or control of the issuer's voting securities, and that 
there are approximately 1,000 such affiliate relationships. Staff 
discussions with mutual fund representatives have suggested that no 
funds currently rely on rule 17a-6 exemptions. We do not know 
definitively the reasons for this change in transactional behavior, but 
differing market conditions from year to year may offer some 
explanation for the current lack of fund interest in the exemptions 
under rule 17a-6. 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 reliance on rule 17a-6 increase in the 
coming years.
    The estimate of average 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.
    Written comments are invited on: (a) Whether the proposed 
collection of information is necessary for the proper performance of 
the functions of the agency, including whether the information will 
have practical utility; (b) the accuracy of the agency's estimate of 
the burden of the collection of information; (c) ways to enhance the 
quality, utility, and clarity of the information collected; and (d) 
ways to minimize the burden of the collection 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 R. Corey Booth, Director/
Chief Information Officer, Office of Information Technology, Securities 
and Exchange Commission, 450 5th Street, NW., Washington, DC 20549.

    Dated: March 28, 2005.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. E5-1590 Filed 4-6-05; 8:45 am]
BILLING CODE 8010-01-P