[Federal Register Volume 78, Number 238 (Wednesday, December 11, 2013)]
[Notices]
[Pages 75390-75391]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-29501]


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SECURITIES AND EXCHANGE COMMISSION


Proposed Collection; Comment Request

Upon Written Request, Copies Available From: Securities and Exchange 
Commission, Office of Investor Education and Advocacy, Washington, DC 
20549-0213.

Extension:
    Rule 482, OMB Control No. 3235-0565, SEC File No. 270-508.

    Notice is hereby given that, pursuant to the Paperwork Reduction 
Act of 1995 (44 U.S.C. 3501 et seq.) (``Paperwork Reduction Act''), 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.
    Like most issuers of securities, when an investment company 
(``fund'') \1\ offers its shares to the public, its promotional efforts 
become subject to the advertising restrictions of the Securities Act of 
1933 (15 U.S.C. 77) (the ``Securities Act''). In recognition of the 
particular problems faced by funds that continually offer securities 
and wish to advertise their securities, the Commission has previously 
adopted advertising safe harbor rules. The most important of these is 
rule 482 (17 CFR 230.482) under the Securities Act, which, under 
certain circumstances, permits funds to advertise investment 
performance data, as well as other information. Rule 482 advertisements 
are deemed to be ``prospectuses'' under Section 10(b) of the Securities 
Act.\2\
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    \1\ ``Investment company'' refers to both investment companies 
registered under the Investment Company Act of 1940 (``Investment 
Company Act'') (15 U.S.C. 80a-1 et seq.) and business development 
companies.
    \2\ 15 U.S.C. 77j(b).
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    Rule 482 contains certain requirements regarding the disclosure 
that funds are required to provide in qualifying advertisements. These 
requirements are intended to encourage the provision to investors of 
information that is balanced and informative, particularly in the area 
of investment performance. For example, a fund is required to include 
disclosure advising investors to consider the fund's investment 
objectives, risks, charges and expenses, and other information 
described in the fund's prospectus, and highlighting the availability 
of the fund's prospectus and, if applicable, its summary prospectus. In 
addition, rule

[[Page 75391]]

482 advertisements that include performance data of open-end funds or 
insurance company separate accounts offering variable annuity contracts 
are required to include certain standardized performance information, 
information about any sales loads or other nonrecurring fees, and a 
legend warning that past performance does not guarantee future results. 
Such funds including performance information in rule 482 advertisements 
are also required to make available to investors month-end performance 
figures via Web site disclosure or by a toll-free telephone number, and 
to disclose the availability of the month-end performance data in the 
advertisement. The rule also sets forth requirements regarding the 
prominence of certain disclosures, requirements regarding 
advertisements that make tax representations, requirements regarding 
advertisements used prior to the effectiveness of the fund's 
registration statement, requirements regarding the timeliness of 
performance data, and certain required disclosures by money market 
funds.
    Rule 482 advertisements must be filed with the Commission or, in 
the alternative, with the Financial Industry Regulatory Authority 
(``FINRA'').\3\ This information collection differs from many other 
federal information collections that are primarily for the use and 
benefit of the collecting agency.
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    \3\ See rule 24b-3 under the Investment Company Act (17 CFR 
270.24b-3), which provides that any sales material, including rule 
482 advertisements, shall be deemed filed with the Commission for 
purposes of Section 24(b) of the Investment Company Act upon filing 
with FINRA.
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    Rule 482 contains requirements that are intended to encourage the 
provision to investors of information that is balanced and informative, 
particularly in the area of investment performance. The Commission is 
concerned that in the absence of such provisions fund investors may be 
misled by deceptive rule 482 advertisements and may rely on less-than-
adequate information when determining in which funds they should invest 
money. As a result, the Commission believes it is beneficial for funds 
to provide investors with balanced information in fund advertisements 
in order to allow investors to make better-informed decisions.
    The Commission estimates that 59,245 responses to rule 482 are 
filed annually by 3,430 investment companies offering approximately 
16,428 portfolios, or approximately 3.6 responses per portfolio 
annually. The burden associated with rule 482 is presently estimated to 
be 5.16 hours per response. The hourly burden is therefore 
approximately 305,704 hours.\4\
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    \4\ 59,245 responses x 5.16 hours per response = 305,704 hours.
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    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 provision of information under rule 482 
is necessary to obtain the benefits of the safe harbor offered by the 
rule. The information provided under rule 482 will not be kept 
confidential. 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 OMB 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 Thomas Bayer, Chief 
Information Officer, Securities and Exchange Commission, c/o Remi 
Pavlik-Simon, 6432 General Green Way, Alexandria, VA 22312; or send an 
email to: [email protected].

    Dated: December 5, 2013.
Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2013-29501 Filed 12-10-13; 8:45 am]
BILLING CODE 8011-01-P