[Federal Register Volume 83, Number 165 (Friday, August 24, 2018)]
[Notices]
[Pages 42962-42963]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-18361]
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SECURITIES AND EXCHANGE COMMISSION
Proposed Collection; Comment Request
Upon Written Request, Copies Available From: Securities and Exchange
Commission, Office of FOIA Services, 100 F Street NE, Washington, DC
20549-2736
Extension:
Rule 23c-3 and Form N-23c-3, SEC File No. 270-373, OMB Control No.
3235-0422
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
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 23c-3 (17 CFR 270.23c-3) under the Investment Company Act of
1940 (15 U.S.C. 80a-1 et seq.) permits a registered closed-end
investment company (``closed-end fund'' or ``fund'') that meets certain
requirements to repurchase common stock of which it is the issuer from
shareholders at periodic intervals, pursuant to repurchase offers made
to all holders of the stock. The rule enables these funds to offer
their shareholders a limited ability to resell their shares in a manner
that previously was available only to open-end investment company
shareholders. To protect shareholders, a closed-end fund that relies on
rule 23c-3 must send shareholders a notification that contains
specified information each time the fund makes a repurchase offer (on a
quarterly, semi-annual, or annual basis, or, for certain funds, on a
discretionary basis not more often than every two years). The fund also
must file copies of the shareholder notification with the Commission
(electronically through the Commission's Electronic Data Gathering,
Analysis, and Retrieval System (``EDGAR'')) on Form N-23c-3, a filing
that provides certain information about the fund and the type of offer
the fund is making.\1\ The fund must describe in its annual report to
shareholders the fund's policy concerning repurchase offers and the
results of any repurchase offers made during the reporting period. The
fund's board of directors must adopt written procedures designed to
ensure that the fund's investment portfolio is sufficiently liquid to
meet its repurchase obligations and other obligations under the rule.
The board periodically must review the composition of the fund's
portfolio and change the liquidity procedures as necessary. The fund
also must file copies of advertisements and other sales literature with
the Commission as if it were an open-end investment company subject to
Section 24 of the Investment Company Act (15 U.S.C. 80a-24) and the
rules that implement Section 24. Rule 24b-3 under the Investment
Company Act (17 CFR 270.24b-3), however, exempts the fund from that
requirement if the materials are filed instead with the Financial
Industry Regulatory Authority (``FINRA'').
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\1\ Form N-23c-3, entitled ``Notification of Repurchase Offer
Pursuant to Rule 23c-3,'' requires the fund to state its
registration number, its full name and address, the date of the
accompanying shareholder notification, and the type of offer being
made (periodic, discretionary, or both).
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The requirement that the fund send a notification to shareholders
of each offer is intended to ensure that a fund provides material
information to shareholders about the terms of each offer. The
requirement that copies be sent to the Commission is intended to enable
the Commission to monitor the fund's compliance with the notification
requirement. The requirement that the shareholder notification be
attached to Form N-23c-3 is intended to ensure that the fund provides
basic information necessary for the Commission to process the
notification and to monitor the fund's use of repurchase offers. The
requirement that the fund describe its current policy on repurchase
offers and the results of recent offers in the annual
[[Page 42963]]
shareholder report is intended to provide shareholders current
information about the fund's repurchase policies and its recent
experience. The requirement that the board approve and review written
procedures designed to maintain portfolio liquidity is intended to
ensure that the fund has enough cash or liquid securities to meet its
repurchase obligations, and that written procedures are available for
review by shareholders and examination by the Commission. The
requirement that the fund file advertisements and sales literature as
if it were an open-end fund is intended to facilitate the review of
these materials by the Commission or FINRA to prevent incomplete,
inaccurate, or misleading disclosure about the special characteristics
of a closed-end fund that makes periodic repurchase offers.
The Commission staff estimates that 33 funds make use of rule 23c-3
annually, including eight funds that are relying upon rule 23c-3 for
the first time. The Commission staff estimates that on average a fund
spends 89 hours annually in complying with the requirements of the rule
and Form N-23c-3, with funds relying upon rule 23c-3 for the first time
incurring an additional one-time burden of 28 hours. The Commission
therefore estimates the total annual hour burden of the rule's and
form's paperwork requirements to be 3,161 hours. In addition to the
burden hours, the Commission staff estimates that the average yearly
cost to each fund that relies on rule 23c-3 to print and mail
repurchase offers to shareholders is about $31,184.88. The Commission
estimates total annual cost is therefore about $1,029,101.
Estimates of average burden hours and costs are made solely for
purposes of the Paperwork Reduction Act and are not derived from a
comprehensive or even representative survey or study of the costs of
Commission rules and forms. Compliance with the collection of
information requirements of the rule and form is mandatory only for
those funds that rely on the rule in order to repurchase shares of the
fund. The information provided to the Commission on Form N-23c-3 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 collection of
information is 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 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 Pamela Dyson, Chief
Information Officer, Securities and Exchange Commission, c/o Candace
Kenner, 100 F Street NE, Washington, DC 20549; or send an email to:
[email protected].
All submissions should refer to File Number 270-373. This file
number should be included on the subject line if email is used. The
Commission will post all comments on the Commission's internet website
(http://www.sec.gov). All comments received will be posted without
change; we do not edit personal identifying information from
submissions. You should submit only information that you wish to make
available publicly.
Dated: August 21, 2018.
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-18361 Filed 8-23-18; 8:45 am]
BILLING CODE 8011-01-P