[Federal Register Volume 83, Number 228 (Tuesday, November 27, 2018)]
[Proposed Rules]
[Pages 60791-60802]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-25861]
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SECURITIES AND EXCHANGE COMMISSION
17 CFR Chapter II
[Release Nos. 33-10576; 34-84640; 39-2523; IA-5067; IC-33298; File No.
S7-25-18]
List of Rules To Be Reviewed Pursuant to the Regulatory
Flexibility Act
AGENCY: Securities and Exchange Commission.
ACTION: Publication of list of rules scheduled for review.
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SUMMARY: The Securities and Exchange Commission is publishing a list of
rules to be reviewed pursuant to Section 610 of the Regulatory
Flexibility Act. The list is published to provide the public with
notice that these rules are scheduled for review by the agency and to
invite public comment on whether the rules should be continued without
change, or should be amended or rescinded to minimize any significant
economic impact of the rules upon a substantial number of such small
entities.
DATES: Comments should be submitted by December 27, 2018.
ADDRESSES: Comments may be submitted by any of the following methods:
Electronic Comments
Use the Commission's internet comment form (http://www.sec.gov/rules/proposed.shtml); or
Send an email to [email protected]. Please include
File Number S7-XX-18 on the subject line.
Paper Comments
Send paper comments to Brent J. Fields, Secretary,
Securities and Exchange Commission, 100 F Street NE, Washington, DC
20549-1090.
All submissions should refer to File No. S7-XX-18. This file number
should be included on the subject line if email is used. To help us
process and review your comments more efficiently, please use only one
method. The Commission will post all comments on the Commission's
internet website (http://www.sec.gov/rules/other.shtml). Comments also
are available for website viewing and printing in the Commission's
Public Reference Room, 100 F Street NE, Washington, DC 20549 on
official business days between the hours of 10:00 a.m. and 3:00 p.m.
All comments received will be posted without change. Persons submitting
comments are cautioned that we do not redact or edit personal
identifying information from comment submissions. You should submit
only information that you wish to make available publicly.
FOR FURTHER INFORMATION CONTACT: Leila Bham, Office of the General
Counsel, 202-551-5532.
SUPPLEMENTARY INFORMATION: The Regulatory Flexibility Act (``RFA''),
codified at 5 U.S.C. 601-612, requires an agency to review its rules
that have a significant economic impact upon a substantial number of
small entities within ten years of the publication of such rules as
final rules. 5 U.S.C. 610(a). The purpose of the review is ``to
determine whether such rules should be continued without change, or
should be amended or rescinded . . . to minimize any significant
economic impact of the rules upon a substantial number of such small
entities.'' 5 U.S.C. 610(a). The RFA sets forth specific considerations
that must be addressed in the review of each rule:
The continued need for the rule;
the nature of complaints or comments received
concerning the rule from the public;
the complexity of the rule;
the extent to which the rule overlaps, duplicates or
conflicts with other federal rules, and, to the extent feasible,
with state and local governmental rules; and
the length of time since the rule has been evaluated or
the degree to which technology, economic conditions, or other
factors have changed in the area affected by the rule. 5 U.S.C.
610(c).
The Securities and Exchange Commission, as a matter of policy,
reviews all final rules that it published for notice and comment to
assess not only their continued compliance with the RFA, but also to
assess generally
[[Page 60792]]
their continued utility. When the Commission implemented the Act in
1981, it stated that it ``intend[ed] to conduct a broader review [than
that required by the RFA], with a view to identifying those rules in
need of modification or even rescission.'' Securities Act Release No.
6302 (Mar. 20, 1981), 46 FR 19251 (Mar. 30, 1981). The list below is
therefore broader than that required by the RFA, and may include rules
that do not have a significant economic impact on a substantial number
of small entities. Where the Commission has previously made a
determination of a rule's impact on small businesses, the determination
is noted on the list.
The Commission particularly solicits public comment on whether the
rules listed below affect small businesses in new or different ways
than when they were first adopted. The rules and forms listed below are
scheduled for review by staff of the Commission.
Title: Fund of Funds Investments.
Citation: 17 CFR 270.12d1-1, 17 CFR 270.12d1-2, 17 CFR 270.12d1-3.
Authority: 15 U.S.C. 77f, 77g(a), 77j, 77s(a), 80a-6(c), 80a-8(b),
80a-12(d)(1)(J), 80a-24(a), 80a-29, 80a-37(a).
Description: The Commission adopted three new rules under the
Investment Company Act of 1940 (``Investment Company Act'') that
address the ability of an investment company (``fund'') to acquire
shares of another fund. Section 12(d)(1) of the Investment Company Act
prohibits, subject to certain exceptions, so-called ``fund of funds''
arrangements, in which one fund invests in the shares of another. The
rules broadened the ability of a fund to invest in shares of another
fund in a manner consistent with the public interest and the protection
of investors. The Commission also adopted amendments to forms used by
funds to register under the Investment Company Act and offer their
shares under the Securities Act of 1933 (``Securities Act''). The
amendments improved the transparency of the expenses of funds of funds
by requiring that the expenses of the acquired funds be aggregated and
shown as an additional expense in the fee table of the fund of funds.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
Commission's adoption of Release No. IC-27399 (June 20, 2006). The
Commission solicited comment on the Initial Regulatory Flexibility
Analysis included in the proposing release, Release No. IC-26198 (Oct.
1, 2003), but, as stated in the adopting release, received no comments
on that analysis.
* * * * *
Title: Joint Final Rules: Application of the Definition of Narrow-
Based Security Index to Debt Securities Indexes and Security Futures on
Debt Securities.
Citation: 17 CFR 41.15, 17 CFR 41.21, 17 CFR 240.3a55-4, 17 CFR
240.6h-2.
Authority: 7 U.S.C. 1a(25)(B)(vi) and 2(a)(1)(D); 15 U.S.C.
78c(a)(55)(C)(vi), 78c(b), 78f(h), 78w(a), 78mm.
Description: The Commodity Futures Trading Commission (``CFTC'')
and the Commission adopted a new rule and amended an existing rule
under the Commodity Exchange Act and adopted two new rules under the
Securities Exchange Act of 1934 (``Exchange Act'') that modified the
applicable statutory listing standards requirements to permit security
futures to be based on individual debt securities or a narrow-based
security index composed of such securities. In addition, these rules
and rule amendment exclude from the definition of ``narrow-based
security index'' debt securities indexes that satisfy specified
criteria. A future on a debt securities index excluded from the
definition of narrow-based security index is not a security future and
may trade subject to the exclusive jurisdiction of the CFTC.
Prior RFA Analysis: Pursuant to Section 605(b) of the Regulatory
Flexibility Act, the Commission certified that the rule would not have
a significant economic impact on a substantial number of small
entities. This certification was incorporated into the proposing
release, Release No. 34-53560 (March 29, 2006). As stated in the
adopting release, Release No. 34-54106 (July 6, 2006), the Commission
received no comments concerning the impact on small entities or the
Regulatory Flexibility Act certification.
* * * * *
Title: Executive Compensation and Related Person Disclosure.
Citation: 17 CFR 229.201, 17 CFR 229.306, 17 CFR 229.401, 17 CFR
229.402, 17 CFR 229.403, 17 CFR 229.404, 17 CFR 229.407, 17 CFR
229.601, 17 CFR 229.1107, 17 CFR 232.304, 17 CFR 240.13a-11, 17 CFR
240.13a-20, 17 CFR 240.14a-3, 17 CFR 240.14a-6, 17 CFR 240.14c-5, 17
CFR 240.15d-11, 17 CFR 240.16b-3, 17 CFR 240.14a-101, 240 CFR 15d-20,
17 CFR 245.100, 17 CFR 249.308, 17 CFR 249.210, 17 CFR 249.210b, 17 CFR
249.308a, 17 CFR 249.308b, 17 CFR 249.310, 17 CFR 249.310b, 17 CFR
249.220f, 17 CFR 239.11, 17 CFR 239.13, 17 CFR 239.25, 17 CFR 239.18,
17 CFR 239.15A, 17 CFR 274.11A, 17 CFR 239.14, 17 CFR 274.11a-1, 17 CFR
239.17a, 17 CFR 274.11b, 17 CFR 249.331, 17 CFR 274.128.
Authority: 15 U.S.C. 77c, 77d, 77e, 77f, 77g, 77h, 77j, 77k, 77s,
77s(a), 77z-2, 77z-3, 77aa(25), 77aa(26), 77mm, 77ddd, 77eee, 77ggg,
77hhh, 77iii, 77jjj, 77nnn, 77sss, 77sss(a), 77ttt, 78a et seq., 78c,
78c(b), 78d, 78e, 78f, 78g, 78i, 78j, 78j-1, 78k, 78k-1, 78l, 78m, 78n,
78o, 78o(d), 78p, 78q, 78s, 78u-5, 78w, 78w(a), 78x, 78ll, 78ll(d),
78mm, 79e, 79f, 79g, 79j, 79l, 79m, 79n, 79q, 79t, 79t(a), 80a-2(a),
80a-3, 80a-8, 80a-9, 80a-10, 80a-13, 80a-20, 80a-23, 80a-24, 80a-26,
80a-29, 80a-30, 80a-31(c), 80a-37, 80a-38(a), 80a-39, 80b-3, 80b-4,
80b-11, 7201 et seq.; 18 U.S.C. 1350.
Description: The Commission adopted amendments to the disclosure
requirements for executive and director compensation, related person
transactions, director independence and other corporate governance
matters and security ownership of officers and directors. These
amendments apply to disclosure in proxy and information statements,
periodic reports, current reports, and other filings under the Exchange
Act and to registration statements under the Exchange Act and the
Securities Act. The Commission also adopted a requirement that
disclosure under the amended items generally be provided in plain
English. The amendments were intended to make proxy and information
statements, reports, and registration statements easier to understand.
They were also intended to provide investors with a clearer and more
complete picture of the compensation earned by a company's principal
executive officer, principal financial officer and highest paid
executive officers and members of its board of directors. In addition,
they were intended to provide better information about key financial
relationships among companies and their executive officers, directors,
significant shareholders, and their respective immediate family
members.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
Commission's adoption of Release No. 33-8732A (Aug. 29, 2006). In the
adopting release, the Commission considered comments received on the
Initial Regulatory Flexibility Analysis included in the proposing
release, Release No. 33-8655 (Jan. 27, 2006).
* * * * *
Title: Mutual Fund Redemption Fees.
Citation: 17 CFR 270.22c-2.
Authority: 15 U.S.C. 80a-6(c), 80a-22(c), 80a-37(a).
[[Page 60793]]
Description: The Commission adopted amendments to a rule under the
Investment Company Act. The rule, among other things, requires most
open-end investment companies (``funds'') to enter into agreements with
intermediaries, such as broker-dealers, that hold shares on behalf of
other investors in so called ``omnibus accounts.'' These agreements
must provide funds access to information about transactions in these
accounts to enable the funds to enforce restrictions on market timing
and similar abusive transactions. The Commission amended the rule to
clarify the operation of the rule and reduce the number of
intermediaries with which funds must negotiate shareholder information
agreements.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
Commission's adoption of Release No. IC-27504 (Sept. 27, 2006). In the
adopting release, the Commission considered comments received on the
Initial Regulatory Flexibility Analysis included in the proposing
release, Release No. IC-27255 (Feb. 28, 2006).
* * * * *
Title: Definition of Eligible Portfolio Company Under the
Investment Company Act of 1940.
Citation: 17 CFR 270.2a-46, 17 CFR 270.55a-1.
Authority: 15 U.S.C. 80a-2(a)(46)(C)(iv), 80a-6(c), 80a-38(a).
Description: The Commission adopted two new rules under the
Investment Company Act. The new rules more closely aligned the
definition of eligible portfolio company, and the investment activities
of business development companies, with the purpose that Congress
intended. The rules expanded the definition of eligible portfolio
company in a manner that promotes the flow of capital to certain small,
developing and financially troubled companies.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
Commission's adoption of Release No. IC-27538 (Oct. 25, 2006). The
Commission solicited comment on the Initial Regulatory Flexibility
Analysis included in the proposing release, Release No. IC-26647 (Nov.
1, 2004), but, as stated in the adopting release, received no comments
that specifically addressed that analysis.
* * * * *
Title: Electronic Filing of Transfer Agent Forms.
Citation: 17 CFR 232.101, 17 CFR 232.104, 17 CFR 232.201, 17 CFR
240.17Ac2-1, 17 CFR 240.17Ac2-2, 17 CFR 240.17Ac3-1, 17 CFR 249b.100,
17 CFR 249b.101, 17 CFR 249b.102, 17 CFR 239.63, 17 CFR 249.446, 17 CFR
269.7, 17 CFR 274.402.
Authority: 15 U.S.C. 77s(a), 15 U.S.C. 78m(a), 15 U.S.C. 78w(a), 15
U.S.C. 78ll, 15 U.S.C. 77sss, 15 U.S.C. 80a-29, 15 U.S.C. 80a-37, 15
U.S.C. 78q(a), 15 U.S.C. 78q-1(c).
Description: The Commission adopted amendments to the rules and
forms to require that the forms filed with respect to transfer agent
registration, annual reporting, and withdrawal from registration be
filed with the Commission electronically. The forms are required to be
filed on the Commission's EDGAR database in XML format and are
accessible to Commission staff and the public for search and retrieval.
The purpose of the amendments was to improve the Commission's ability
to utilize the information reported on the forms in performing its
oversight function of transfer agent operations and to publicly
disseminate the information on the forms.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
Commission's adoption of Release No. No. 34-54864 (Dec. 4, 2006). In
the adopting release, the Commission considered comments received on
the Initial Regulatory Flexibility Analysis included in the proposing
release, Release No. 34-54356 (Aug. 24, 2006).
* * * * *
Title: Internet Availability of Proxy Materials.
Citation: 17 CFR 240.14a-2, 17 CFR 240.14a-3, 17 CFR 240.14a-4, 17
CFR 240.14a-7, 17 CFR 240.14a-8, 17 CFR 240.14a-12, 17 CFR 240.14a-13,
17 CFR 240.14b-1, 17 CFR 240.14b-2, 17 CFR 240.14c-2, 17 CFR 240.14c-3,
17 CFR 240.14c-5, 17 CFR 240.14c-7, 17 CFR 240.14a-101, 17 CFR 240.14c-
101, 17 CFR 249.310, 17 CFR 249.308a, 17 CFR 249.330 and 274.101, 17
CFR 240.14a-16.
Authority: 15 U.S.C. 77c, 77d, 77f, 77g, 77h, 77j, 77s, 77z-2, 77z-
3, 77eee, 77ggg, 77nnn, 77sss, 77ttt, 78c, 78c(b), 78d, 78e, 78f, 78g,
78i, 78j, 78j-1, 78k, 78k-1, 78l, 78m, 78n, 78o, 78o(d),78p, 78q, 78s,
78u-5, 78w, 78x, 78ll, 78mm, 80a-8, 80a-20, 80a-23, 80a-24, 80a-26,
80a-29, 80a-37, 80b-3, 80b-4, 80b-11, and 7202, 7233,7241, 7262, 7264
and 7265.; and 18 U.S.C. 1350.
Description: The Commission adopted amendments to the proxy rules
under the Exchange Act that provide an alternative method for issuers
and other persons to furnish proxy materials to shareholders by posting
them on an internet website and providing shareholders with notice of
the availability of the proxy materials. Issuers must make copies of
the proxy materials available to shareholders on request, at no charge
to shareholders. The amendments put into place processes that will
provide shareholders with notice of, and access to, proxy materials
while taking advantage of technological developments and the growth of
the internet and electronic communications. Issuers that rely on the
amendments may be able to significantly lower the costs of their proxy
solicitations that ultimately are borne by shareholders. The amendments
also might reduce the costs of engaging in a proxy contest for
soliciting persons other than the issuer. The amendments do not apply
to business combination transactions, and also do not affect the
availability of any existing method of furnishing proxy materials.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
adoption of Release No. 34-55146 (Jan. 29, 2007). In the adopting
release, the Commission considered comments received on the Initial
Regulatory Flexibility Analysis included in the proposing release,
Release No. 34-52926 (Dec. 8 2005).
* * * * *
Title: Covered Securities Pursuant to Section 18 of the Securities
Act of 1933.
Citation: 17 CFR 230.146(b).
Authority: 15 U.S.C. 77b, 77c, 77d, 77f, 77g, 77h, 77j, 77r, 77s,
77z-3, 77sss, 78c, 78d, 78j, 78l, 78m, 78n, 78o, 78t, 78w, 78ll(d),
78mm, 80a-8, 80a-24, 80a-28, 80a29, 80a-30, and 80a-37.
Description: The Commission adopted an amendment to Rule 146 under
Section 18 of the Securities Act to designate certain securities
listed, or authorized for listing, on the Nasdaq Capital Market tier of
The NASDAQ Stock Market LLC as covered securities for purposes of
Section 18(b) of the Securities Act. Covered securities under Section
18(b) of the Securities Act are exempt from state law registration
requirements. The Commission also amended Rule 146 to correct the rule
text to conform it to the language of Section 18 of the Securities Act.
Prior RFA Analysis: Pursuant to Section 605(b) of the Regulatory
Flexibility Act, the Commission certified that the rule would not have
a significant economic impact on a substantial number of small
entities.
[[Page 60794]]
This certification was incorporated into the proposing release, Release
No. 33-8754 (Nov. 22, 2006). As stated in the adopting release, Release
No. 33-8791 (Apr. 18, 2007), the Commission received no comments
concerning the impact on small entities or the Regulatory Flexibility
Act certification.
* * * * *
Title: Oversight of Credit Rating Agencies Registered as Nationally
Recognized Statistical Rating Organizations.
Citation: 17 CFR 240.17g-1, 17 CFR 240.17g-2, 17 CFR 240.17g-3, 17
CFR 240.17g-4, 17 CFR 240.17g-5, 17 CFR 240.17g-6, and 17 CFR 249b.300.
Authority: 15 U.S.C. 77c, 77d, 77g, 77j, 77s, 77z-2, 77z-3, 77eee,
77ggg, 77nnn, 77sss, 77ttt, 78c, 78d, 78e, 78f, 78g, 78i, 78j, 78j-l,
78k, 78k-1, 78l, 78m, 78n, 78o, 78p, 78q, 78s, 78u-5, 78w, 78x, 78ll,
78mm, 80a-20, 80a-23, 80a-29, 80a-37, 80b-3, 80b-4, 80b-11, and 7201 et
seq.; and 18 U.S.C. 1350.
Description: The Commission adopted rules to implement provisions
of the Credit Rating Agency Reform Act of 2006 (the ``Rating Agency
Act''), enacted on September 29, 2006. The Rating Agency Act defines
the term ``nationally recognized statistical rating organization,''
provides authority for the Commission to implement registration,
recordkeeping, financial reporting, and oversight rules with respect to
registered credit rating agencies, and directs the Commission to issue
final implementing rules.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
Commission's adoption of Release No. 34-55857 (Jun. 5, 2007). The
Commission solicited comment on the Initial Regulatory Flexibility
Analysis included in the proposing release, Release No. 34-55231 (Feb.
2, 2007), but, as stated in the adopting release, received no comments
on that analysis.
* * * * *
Title: Regulation SHO and Rule 10a-1.
Citation: 17 CFR 240.10a-1; 17 CFR 242.200; 17 CFR 242.201.
Authority: 15 U.S.C. 78b, 78c(b), 78f, 78i(a), 78j(a), 78k-1, 78o,
78o-3, 78q, 78q-1, 78w(a).
Description: The Commission adopted amendments to the short sale
price test under the Exchange Act. The amendments are intended to
provide a more consistent regulatory environment for short selling by
removing restrictions on the execution prices of short sales, as well
as prohibiting any self-regulatory organization from having a price
test. In addition, the Commission adopted amendments to Regulation SHO
to remove the requirement that a broker-dealer mark a sell order of an
equity security as ``short exempt,'' if the seller is relying on an
exception from a price test.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
Commission's adoption of Release No. 34-55970 (Jun. 28, 2007). In the
adopting release, the Commission considered comments received on the
Initial Regulatory Flexibility Analysis included in the proposing
release, Release No. 34-54891 (Dec. 7, 2006).
* * * * *
Title: Shareholder Choice Regarding Proxy Materials.
Citation: 17 CFR 240.14a-3, 17 CFR 240.14a-7, 17 CFR 240.14a-16, 17
CFR 240.14a-101, 17 CFR 240.14b-1, 17 CFR 240.14b-2, 17 CFR 240.14c-2,
and 17 CFR 240.14c-3.
Authority: 15 U.S.C. 77c, 77d, 77g, 77j, 77s, 77z-2, 77z-3, 77eee,
77ggg, 77nnn, 77sss, 77ttt, 78c, 78d, 78e, 78f, 78g, 78i, 78j, 78j-1,
78k, 78k-1, 78l, 78m, 78n, 78o, 78p, 78q, 78s, 78u-5, 78w, 78x, 78ll,
78mm, 80a-20, 80a-23, 80a-29, 80a-37, 80b-3, 80b-4, 80b-11, and 7201 et
seq.; and 18 U.S.C. 1350.
Description: The Commission adopted amendments to the proxy rules
under the Exchange Act to provide shareholders with the ability to
choose the means by which they access proxy materials. Under the
amendments, issuers and other soliciting persons are required to post
their proxy materials on an internet website and provide shareholders
with a notice of the internet availability of the materials. The issuer
or other soliciting person may choose to furnish paper copies of the
proxy materials along with the notice. If the issuer or other
soliciting person chooses not to furnish a paper copy of the proxy
materials along with the notice, a shareholder may request delivery of
a copy at no charge to the shareholder.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
adoption of Release No. 34-56135 (Jul. 26, 2007). In the adopting
release, the Commission considered comments received on the Initial
Regulatory Flexibility Analysis included in the proposing release,
Release No. 34-55147 (Jan. 22, 2007).
* * * * *
Title: Prohibition of Fraud by Advisers to Certain Pooled
Investment Vehicles.
Citation: 17 CFR 275.206(4)-8.
Authority: 15 U.S.C. 80b-6(4) and 80b-11(a).
Description: The Commission adopted a new rule that prohibits
advisers to pooled investment vehicles from making false or misleading
statements to, or otherwise defrauding, investors or prospective
investors in those pooled vehicles. This rule was designed to clarify,
in light of a court opinion prior to the rule adoption, the
Commission's ability to bring enforcement actions under the Investment
Advisers Act of 1940 against investment advisers who defraud investors
or prospective investors in a hedge fund or other pooled investment
vehicle.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
Commission's adoption of Release No. IA-2628 (Aug. 3, 2007). The
Commission solicited comment on the Initial Regulatory Flexibility
Analysis included in the proposing release, Release No. IA-2576 (Dec.
27, 2006), but, as stated in the adopting release, received no comments
on that analysis.
* * * * *
Title: Short Selling in Connection with a Public Offering.
Citation: 17 CFR 242.105.
Authority: 15 U.S.C. 77g, 77q(a), 77s, 77s(a), 78b, 78c, 78g,
78i(a), 78j, 78k-1(c), 781, 78m, 78n, 78o(b), 78o(c), 78o(g), 78q(a),
78q(b), 78q(h), 78w(a), 78dd-1, 78mm, 80a-23, 80a-29, 80a-37.
Description: A fundamental goal of Regulation M, Anti-Manipulation
Rules Concerning Securities Offerings, is protecting the independent
pricing mechanism of the securities market so that offering prices
result from the natural forces of supply and demand unencumbered by
artificial forces. Rule 105 of Regulation M governs short selling in
connection with public offerings and concerns short sales that are
effected prior to pricing an offering. The rule is particularly
concerned with short selling that can artificially depress market
prices which can lead to lower than anticipated offering prices, thus
causing an issuer's offering proceeds to be reduced. The rule is
intended to foster secondary and follow-on offering prices that are
determined by independent market dynamics and not by potentially
manipulative activity. Prior to the amendments, there had been non-
compliance with the then-current version of Rule 105 and persons
engaged in strategies to hide their non-compliance. The Commission
observed that these strategies evolved over time, so it adopted the
amendments to
[[Page 60795]]
forestall the continuation of these obfuscating transactions and to
cut-off the likely future development of more complex attempts to
disguise violations of the Rule. The amendments enhance market
integrity by prohibiting conduct that can be manipulative around the
time an offering is priced so that market prices can be fairly
determined by an independent market. The Commission believes the
amendments safeguard the integrity of the capital raising process and
protect issuers from potentially manipulative activity that can reduce
offering proceeds. The amendments are expected to promote investor
confidence in the market which should foster capital formation.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
Commission's adoption of Release No. 34-56206 (Aug. 6, 2007). In the
adopting release, the Commission considered the comment received on the
Initial Regulatory Flexibility Analysis included in the proposing
release, Release No. 34-58888 (Dec. 6, 2006).
* * * * *
Title: Amendments to Regulation SHO.
Citation: 17 CFR 242.200; 17 CFR 242.203.
Authority: 15 U.S.C. 78b, 78c(b), 78i(h), 78j, 78k-1, 78o, 78q(a),
78q-1, 78w(a).
Description: The Commission adopted amendments to Regulation SHO
under the Exchange Act. The amendments were intended to further reduce
the number of persistent fails to deliver in certain equity securities
by eliminating the grandfather provision of Regulation SHO. In
addition, the Commission amended the close-out requirement of
Regulation SHO for certain securities that a seller is ``deemed to
own.'' The amendments also updated the market decline limitation
referenced in Regulation SHO.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
Commission's adoption of Release No. 34-56212 (Aug. 7, 2007). In the
adopting release, the Commission considered comments received on the
Initial Regulatory Flexibility Analysis included in the proposing
release, Release No. 34-54154 (Jul. 14, 2006).
* * * * *
Title: Definitions of Terms and Exemptions Relating to the
``Broker'' Exceptions for Banks.
Citation: 17 CFR 247.700, 247.701, 247.721, 247.722, 247.723,
247.740, 247.741, 247.760, 247.771, 247.772, 247.775, 247.776, 247.780,
and 247.781.
Authority: Pub. L. 109-351, 120 Stat. 1966 (2006); Pub. L. 106-102,
113 Stat. 1338 (1999); 15 U.S.C. 78c(a)(4), 78c(b), 78o, 78q, 78w(a),
and 78mm.
Description: Pursuant to the Financial Services Regulatory Relief
Act of 2006 (``Regulatory Relief Act''), the Board of Governors of the
Federal Reserve System (``Board'') and the Commission jointly adopted
Regulation R to implement certain of the exceptions for banks from the
definition of the term ``broker'' under Section 3(a)(4) of the Exchange
Act, as amended by the Gramm-Leach-Bliley Act (``GLBA''). The rules in
Regulation R define terms used in these statutory exceptions and
include certain related exemptions. Regulation R applies to any
``bank'' as defined in Section 3(a)(6) of the Exchange Act, as amended
by Section 401 of the Regulatory Relief Act to include any Federal
savings association or other savings association the deposits of which
are insured by the Federal Deposit Insurance Corporation.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the Board
and the Commission's adoption of Regulation R in Release No. 34-56501
(Sept. 24, 2007). In the adopting release, the Board and the Commission
considered comments received on the Initial Regulatory Flexibility
Analysis included in the proposing release, Release No. 34-54946 (Dec.
8, 2006).
* * * * *
Title: Exemptions for Banks Under Section 3(a)(5) of the Securities
Exchange Act of 1934 and Related Rules.
Citation: 17 CFR 240.3a5-2, 240.3a5-3, and 240.15a-6.
Authority: 15 U.S.C. 78c(a)(4), 78c(b), 78o, 78q, 78w(a), and 78mm.
Description: The Commission adopted the rules and rule amendments
to provide a conditional exemption allowing banks to effect riskless
principal transactions with non-U.S. persons pursuant to Regulation S
under the Securities Act, to amend and re-designate an exemption from
the definition of ``dealer'' for banks' securities lending activities
as a conduit lender, and to conform a rule that grants a limited
exemption from U.S. broker-dealer registration for foreign broker-
dealers to the definitions of ``broker'' and ``dealer'' in the Exchange
Act, as amended by the Gramm-Leach-Bliley Act. The exemptions for banks
provided by the rules and rule amendments apply to any ``bank'' as
defined in Section 3(a)(6) of the Exchange Act, as amended by Section
401 of the Financial Services Regulatory Relief Act of 2006 to include
any Federal savings association or other savings association the
deposits of which are insured by the Federal Deposit Insurance
Corporation.
Prior RFA Analysis: Pursuant to Section 605(b) of the Regulatory
Flexibility Act, the Commission certified that the rule would not have
a significant economic impact on a substantial number of small
entities. This certification was incorporated into the proposing
release, Release No. 34-54947 (Dec. 18, 2006). As stated in the
adopting release, Release No. 34-56502 (Sept. 24, 2007), the Commission
received no comments concerning the impact on small entities or the
Regulatory Flexibility Act certification.
* * * * *
Title: Exemption of Compensatory Employee Stock Options From
Registration Under 12(g) of the Securities Exchange Act of 1934.
Citation: 17 CFR 240.12h-1.
Authority: 15 U.S.C. 77c, 77d, 77g, 77j, 77s, 77z-2, 77z-3, 77eee,
77ggg, 77nnn, 77sss, 77ttt, 78c, 78d, 78e, 78f, 78g, 78i, 78j, 78j-1,
78k, 78k-1, 78l, 78m, 78n, 78o, 78p, 78q, 78s, 78u-5, 78w, 78x, 78ll,
78mm, 80a-20, 80a-23, 80a-29, 80a-37, 80b-3, 80b-4, 80b-11, and 7201 et
seq.; and 18 U.S.C. 1350.
Description: The Commission adopted two exemptions from the
registration requirements of the Exchange Act for compensatory employee
stock options. The first exemption is available to issuers that are not
required to file periodic reports under the Exchange Act. The second
exemption is available to issuers that are required to file those
reports because they have registered under Exchange Act Section 12 a
class of security or are required to file reports pursuant to Exchange
Act Section 15(d). The exemptions apply only to the issuer's
compensatory employee stock options and do not extend to the class of
securities underlying those options.
Prior RFA Analysis: Pursuant to Section 605(b) of the Regulatory
Flexibility Act, the Commission certified that the two exemptions from
the registration provisions of Exchange Act Section 12(g) for
compensatory employee stock options would not have a significant
economic impact on a substantial number of small entities. The
certification was incorporated into the proposing release, Release No.
34-56010 (Jul. 10, 2007). As stated in the adopting release, Release
No. 34-56887 (Dec. 7, 2007), the Commission received no comments
concerning the impact on
[[Page 60796]]
small entities or the Regulatory Flexibility Act certification.
* * * * *
Title: Revisions to Rules 144 and 145.
Citation: 17 CFR 230.144, 17 CFR 230.145, 17 CFR 230.190, 17 CFR
230.701, 17 CFR 230.903, 17 CFR 239.144.
Authority: 15 U.S.C. 77b, 77c, 77d, 77f, 77g, 77h, 77j, 77r, 77s,
77z-2, 77z-3, 77sss, 78c, 78d, 78j, 78l, 78m, 78n, 78o, 78o(d), 78t,
78u-5, 78w, 78w(a), 78ll, 78ll(d), 78mm, 80a-2(a), 80a-3, 80a-8, 80a-9,
80a-10, 80a-13, 80a-24, 80a-26, 80a-28, 80a-29, 80a-30, and 80a-37.
Description: Rule 144 under the Securities Act creates a safe
harbor for the sale of securities under the exemption set forth in
Section 4(1) of the Securities Act. The Commission amended Rule 144 to
shorten the holding period requirement for ``restricted securities'' of
issuers that are subject to the reporting requirements of the Exchange
Act to six months. Restricted securities of issuers that are not
subject to the Exchange Act reporting requirements continue to be
subject to a one-year holding period prior to any public resale. The
amendments also substantially reduced the restrictions applicable to
the resale of securities by non-affiliates. In addition, the amendments
simplified the Preliminary Note to Rule 144, amended the manner of sale
requirements and eliminated them with respect to debt securities,
amended the volume limitations for debt securities, increased the Form
144 filing thresholds, and codified several staff interpretive
positions that relate to Rule 144. The Commission also amended
Securities Act Rule 145 to eliminate the presumptive underwriter
provision, except for transactions involving a shell company, and
amended the resale requirements in Rule 145(d).
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
adoption of Release No. 33-8869 (Dec. 17, 2007). In the adopting
release, the Commission considered comments received on the Initial
Regulatory Flexibility Analysis included in the proposing release,
Release No. 33-8813 (Jun. 22, 2007).
* * * * *
Title: Shareholder Proposals Relating to the Election of Directors.
Citation: 17 CFR 240.14a-8(i)(8).
Authority: 15 U.S.C. 77c, 77d, 77g, 77j, 77s, 77z-2, 77z-3, 77eee,
77ggg, 77nnn, 77sss, 77ttt, 78c, 78d, 78e, 78f, 78g, 78i, 78j, 78j-1,
78k, 78k-1, 78l, 78m, 78n, 78o, 78p, 78q, 78s, 78u-5, 78w, 78x, 78ll,
78mm, 80a-20, 80a-23, 80a-29, 80a-37, 80b-3, 80b-4, 80b-11, and 7201 et
seq.; and 18 U.S.C. 1350.
Description: The Commission adopted amendments to Rule 14a-8 under
the Exchange Act to codify the meaning of Rule 14a-8(i)(8). Rule 14a-8
provides shareholders with an opportunity to place certain proposals in
a company's proxy materials for a vote at an annual or special meeting
of shareholders. Subsection (i)(8) of the Rule permits exclusion of
certain shareholder proposals related to the election of directors. The
Commission adopted an amendment to Rule 14a-8(i)(8) to provide
certainty regarding the meaning of this provision in response to a
recent court decision.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
adoption of Release No. 34-56914 (Dec. 11, 2007). In the adopting
release, the Commission considered comments received on the Initial
Regulatory Flexibility Analysis included in the proposing release,
Release No. 34-56161 (Jul. 27, 2007).
* * * * *
Title: Revisions to the Eligibility Requirements for Primary
Securities Offerings on Forms S-3 and F-3.
Citation: 17 CFR 239.13, 17 CFR 239.33, 17 CFR 230.401(g).
Authority: 15 U.S.C. 77b, 77c, 77d, 77f, 77g, 77h, 77j, 77r, 77s,
77z-2, 77z-3, 77sss, 78c, 78d, 78j, 78l, 78m, 78n, 78o, 78o(d), 78t,
78u-5, 78w, 78w(a), 78ll, 78mm, 80a-2(a), 80a-3, 80a-8, 80a-9, 80a-10,
80a-13, 80a-24, 80a-26, 80a-28, 80a-29, 80a-30, and 80a-37.
Description: The Commission adopted amendments to the eligibility
requirements of Form S-3 and Form F-3 to allow certain domestic and
foreign private issuers to conduct primary securities offerings on
these forms without regard to the size of their public float or the
rating of debt they are offering, so long as they satisfy the other
eligibility conditions of the respective form, have a class of common
equity securities listed and registered on a national securities
exchange, and the issuers do not sell more than the equivalent of one-
third of their public float in primary offerings over any period of 12
calendar months. The amendments were intended to allow more companies
to benefit from the greater flexibility and efficiency in accessing the
public securities markets afforded by Form S-3 and Form F-3 without
compromising investor protection. The expanded form eligibility does
not extend to shell companies, however, which are prohibited from using
the new provisions until 12 calendar months after they cease being
shell companies. In addition, the Commission adopted an amendment to
the rules and regulations promulgated under the Securities Act to
clarify that violations of the one-third restriction will also violate
the requirements as to proper registration form, even though the
registration statement has been declared effective previously.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
adoption of Release No. 33-8878 (Dec. 27, 2007). In the adopting
release, the Commission considered comments received on the Initial
Regulatory Flexibility Analysis including in the proposing release,
Release No. 33-8812 (Jun. 20, 2007).
* * * * *
Title: Electronic Shareholder Forums.
Citation: 17 CFR 240.14a-2 and 17 CFR 240.14a-17.
Authority: 15 U.S.C. 77c, 77d, 77g, 77j, 77s, 77z-2, 77z-3, 77eee,
77ggg, 77nnn, 77sss, 77ttt, 78c, 78d, 78e, 78f, 78g, 78i, 78j, 78j-1,
78k, 78k-1, 78l, 78m, 78n, 78o, 78p, 78q, 78s, 78u-5, 78w, 78x, 78ll,
78mm, 80a-20, 80a-23, 80a-29, 80a-37, 80b-3, 80b-4, 80b-11, and 7201 et
seq.; and 18 U.S.C. 1350.
Description: The Commission adopted amendments to the proxy rules
under the Exchange Act to facilitate electronic shareholder forums. The
amendments clarified that participation in an electronic shareholder
forum that could potentially constitute a solicitation subject to the
proxy rules is exempt from most of the proxy rules if all of the
conditions to the exemption are satisfied. In addition, the amendments
stated that a shareholder, company, or third party acting on behalf of
a shareholder or company that establishes, maintains, or operates an
electronic shareholder forum is not liable under the federal securities
laws for any statement or information provided by another person
participating in the forum.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
adoption of Release No. 34-57172 (Jan. 18, 2008). The Commission
requested comment on the Initial Regulatory Flexibility Analysis
prepared in the proposing release, Release No. 34-56160 (Jul. 27,
2007). As stated in the adopting release, although commenters addressed
several aspects of the proposed amendments that potentially could have
affected small entities, no commenter
[[Page 60797]]
specifically discussed the effect of the proposed amendments regarding
electronic shareholder forums on small businesses or entities.
* * * * *
Title: Electronic Filing and Revision of Form D.
Citation: 17 CFR 230.502, 17 CFR 230.503, 17 CFR 232.100, 17 CFR
232.101, 17 CFR 232.104, 17 CFR 232.201, 17 CFR 232.202, and 17 CFR
239.500.
Authority: 15 U.S.C. 77b, 77c, 77d, 77f, 77g, 77h, 77j, 77r, 77s,
77s(a), 77z-2, 77z-3, 77sss, 77sss(a), 78c, 78c(b), 78d, 78j, 78l, 78m,
78n, 78o, 78o(d), 78t, 78u-5, 78w, 78w(a), 78ll, 78ll(d), 78mm, 80a-
2(a), 80a-3, 80a-6(c), 80a-8, 80a-9, 80a-10, 80a-13, 80a-24, 80a-26,
80a-28, 80a-29, 80a-30, 80a-37, and 7201 et seq.; and 18 U.S.C. 1350.
Description: The Commission adopted amendments mandating the
electronic filing of information required by Securities Act Form D
through the internet. The Commission also adopted revisions to Form D
and to Regulation D in connection with the electronic filing
requirement. The revisions simplified and restructured Form D and
updated and revised its information requirements.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
adoption of Release No. 33-8891 (Feb. 6, 2008). The Commission
requested comment on the Initial Regulatory Flexibility Analysis
included in the proposing release, Release No. 33-8814 (Jun. 29, 2007),
but, as stated in the adopting release, no commenter responded to the
request.
* * * * *
Title: Proposed Rule Changes of Self-Regulatory Organizations.
Citation: 17 CFR part 240.19b-4, 17 CFR part 240.19b-7, and 17 CFR
part 249.822.
Authority: 15 U.S.C. 77c, 77d, 77g, 77j, 77s, 77z-2, 77z-3, 77eee,
77ggg, 77nnn, 77sss, 77ttt, 78a et seq., 78c, 78d, 78e, 78f, 78g, 78i,
78j, 78j-1, 78k, 78k-1, 78l, 78m, 78n, 78o, 78p, 78q, 78s, 78u-5, 78w,
78x, 78ll, 78mm, 80a- 20, 80a-23, 80a-29, 80a-37, 80b-3, 80b-4, 80b-11,
and 7201 et seq. and 18 U.S.C. 1350.
Description: The Commission adopted rule amendments to require
Self-Regulatory Organizations (``SROs'') that submit proposed rule
changes pursuant to Section 19(b)(7)(A) of the Exchange Act to file
these rule changes electronically. In addition, the Commission adopted
rule amendments to require SROs to post all such proposed rule changes
on their websites. Together, the amendments are designed to expand the
electronic filing by SROs of proposed rule changes, making it more
efficient and cost effective, and to harmonize the process of filings
made under Section 19(b)(7)(A) with that for filings made by SROs under
Section 19(b)(1) of the Act.
Prior RFA Analysis: Pursuant to Section 605(b) of the Regulatory
Flexibility Act, the Commission certified that the rule would not have
a significant economic impact on a substantial number of small
entities. This certification was incorporated into the proposing
release, Release No. 34-55341 (Feb. 23, 2007). As stated in the
adopting release, Release No. 34-57526 (Mar. 19, 2008), the Commission
received no comments concerning the impact on small entities or the
Regulatory Flexibility Act certification.
* * * * *
Title: Disclosure of Divestment by Registered Investment Companies
in Accordance With Sudan Accountability and Divestment Act of 2007.
Citation: 17 CFR 294.331, 17 CFR 274.128, 17 CFR 294.330, and 17
CFR 274.101.
Authority: 15 U.S.C. 78j(b), 78m, 78o(d), 78w(a), 78mm, 80a-8, 80a-
13(c), 80a-24(a), 80a-29, and 80a-37.
Description: The Commission adopted amendments to its forms under
the Exchange Act and the Investment Company Act that required
disclosure by a registered investment company that divests, in
accordance with the Sudan Accountability and Divestment Act of 2007,
from securities of issuers that the investment company determines,
using credible information that is available to the public, conduct or
have direct investments in certain business operations in Sudan. The
Sudan Accountability and Divestment Act limits civil, criminal, and
administrative actions that may be brought against a registered
investment company that divests itself from such securities, provided
that the investment company makes disclosures in accordance with
regulations prescribed by the Commission.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
Commission's adoption of Release No. IC-28254 (Apr. 24, 2008). The
Commission solicited comment on the Initial Regulatory Flexibility
Analysis included in the proposing release, Release No. IC-28148 (Feb.
11, 2008), but, as stated in the adopting release, received no comments
on that analysis.
* * * * *
Title: Definition of Eligible Portfolio Company under the
Investment Company Act of 1940.
Citation: 17 CFR 270.2a-46.
Authority: 15 U.S.C. 80a-1 et seq., 80a-34(d), 80a-37, and 80a-39.
Description: The Commission adopted an amendment to a rule under
the Investment Company Act to more closely align the definition of
eligible portfolio company, and the investment activities of business
development companies (``BDCs''), with the purpose that Congress
intended. The amendment expanded the definition of eligible portfolio
company to include certain companies that list their securities on a
national securities exchange.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
Commission's adoption of Release No. IC-28266 (May 15, 2008). The
Commission solicited comment on the Initial Regulatory Flexibility
Analysis included in the proposing release, Release No. IC-27539 (Oct.
25, 2006), but, as stated in the adopting release, received no comments
on that analysis.
* * * * *
Title: Commission Guidance and Revisions to the Cross-Border Tender
Offer, Exchange Offer, Rights Offerings, and Business Combination Rules
and Beneficial Ownership Reporting Rules for Certain Foreign
Institutions.
Citation: 17 CFR 230.162, 17 CFR 230.800, 17 CFR 230.802, 17 CFR
232.101, 17 CFR 239.25, 17 CFR 239.34, 17 CFR 239.42, 17 CFR 239.800,
17 CFR 240.13d-1, 17 CFR 240.13d-102, 17 CFR 240.13e-3, 17 CFR 240.13e-
4, 17 CFR 240.14d-1, 17 CFR 240.14d-11, 17 CFR 240.14d-100, 17 CFR
240.14e-5, 17 CFR 240.16a-1, and 17 CFR 249.480.
Authority: 15 U.S.C. 77b, 77c, 77d, 77f, 77g, 77h, 77j, 77r, 77s,
77s(a), 77z-2, 77z-3, 77eee, 77ggg, 77nnn, 77sss, 77sss(a), 77ttt, 78c,
78c(b), 78d, 78e, 78f, 78g, 78i, 78j, 78j-1, 78k, 78k-1, 78l, 78m, 78n,
78o, 78o(d), 78p, 78q, 78s, 78t, 78u-5, 78w, 78w(a), 78x, 78ll,
78ll(d), 78mm, 80a-2(a), 80a-3, 80a-6(c), 80a-8, 80a-9, 80a-10, 80a-13,
80a-20, 80a-23, 80a-24, 80a-26, 80a-28, 80a-29, 80a-30, 80a-37, 80b-3,
80b-4, 80b-11, 7201 et seq., 7202, 7233, 7241, 7262, 7264, and 7265;
and 18 U.S.C. 1350.
Description: The Commission adopted changes to expand and enhance
the utility of the cross-border exemptions for business combination
transactions and rights offerings and to encourage offerors and issuers
to permit U.S. security holders to participate in these transactions on
the same terms as other
[[Page 60798]]
target security holders. The Commission also set forth interpretive
guidance on several topics. In two instances, the Commission extended
the rule changes adopted in this release to apply to acquisitions of
U.S. companies. The Commission also adopted changes to allow certain
foreign institutions to file on Schedule 13G to the same extent as
would be permitted for their U.S. counterparts, where specified
conditions are satisfied. The Commission also adopted a conforming
change to Rule 16a-1(a)(1) to include the foreign institutions eligible
to file on Schedule 13G.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
adoption of Release No. 33-8957 (Sept. 19, 2008). The Commission
requested comment on the Initial Regulatory Flexibility Analysis
(``IFRA'') included in the proposing release, Release No. 33-8917 (May
6, 2008), but, as stated in the adopting release, the Commission did
not receive any public comments that responded directly to the IRFA or
that dealt directly with the proposal's impact on small entities.
* * * * *
Title: ``Naked'' Short Selling Antifraud Rule.
Citation: 17 CFR 240.10b-21.
Authority: 15 U.S.C. 78b, 78c(b), 78f, 78i(h), 78j, 78k-1, 78o,
78o-3, 78q, 78q-1, 78s and 78w(a).
Description: The Commission adopted an antifraud rule under the
Exchange Act to address fails to deliver securities that have been
associated with ``naked'' short selling. The rule is intended to
further evidence the liability of short sellers, including broker-
dealers acting for their own accounts, who deceive specified persons
about their intention or ability to deliver securities in time for
settlement (including persons that deceive their broker-dealer about
their locate source or ownership of shares) and that fail to deliver
securities by settlement date.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
Commission's adoption of Release No. 34-58774 (Oct. 14, 2008). In the
adopting release, the Commission considered comments received on the
Initial Regulatory Flexibility Analysis included in the proposing
release, Release No. 34-57511 (Mar. 17, 2008).
* * * * *
Title: Amendments to Regulation SHO.
Citation: 17 CFR 242.203.
Authority: 15 U.S.C. 78b, 78c(b), 78i(h), 78j, 78k-1, 78o, 78q(a),
78q-1, 78w(a).
Description: The Commission adopted amendments to Regulation SHO
under the Exchange Act. The amendments were intended to further reduce
the number of persistent fails to deliver in certain equity securities
by eliminating the options market maker exception to the close-out
requirement of Regulation SHO. As a result of the amendments, fails to
deliver in threshold securities that result from hedging activities by
options market makers are no longer be excepted from Regulation SHO's
close-out requirement. The Commission also provided guidance regarding
bona fide market making activities for purposes of the market maker
exception to Regulation SHO's locate requirement.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
Commission's adoption of Release No. 34-58775 (Oct. 14, 2008). In the
adopting release, the Commission considered comments received on the
Initial Regulatory Flexibility Analysis included in the re-proposing
release, Release No. 34-56213 (Aug. 7, 2007).
* * * * *
Title: Mandatory Electronic Submission of Applications for Orders
under the Investment Company Act and Filings Made Pursuant to
Regulation E.
Citation: 17 CFR 232.101, 17 CFR 232.201, and 17 CFR 270.0-2.
Authority: 15 U.S.C. 77f, 77g, 77h, 77j, 77s(a), 78c, 78l, 78m,
78n, 78o(d), 78w(a), 78ll, 80a-8, 80a-29, 80a-30, and 80a-37.
Description: The Commission adopted several amendments to rules
regarding the Electronic Data Gathering, Analysis, and Retrieval
(EDGAR) system. Specifically, the Commission amended rules to make
mandatory the electronic submission on EDGAR of applications for orders
under any section of the Investment Company Act as well as Regulation E
filings of small business investment companies and business development
companies. The Commission also amended the electronic filing rules to
make the temporary hardship exemption unavailable for submission of
applications under the Investment Company Act. Finally, the Commission
amended Rule 0-2 under the Investment Company Act, eliminating the
requirement that certain documents accompanying an application be
notarized and the requirement that applicants submit a draft notice as
an exhibit to an application.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
Commission's adoption of Release No. IC-28476 (Oct. 29, 2008). The
Commission solicited comment on the Initial Regulatory Flexibility
Analysis included in the proposing release, Release No. IC-28042 (Nov.
1, 2007), but, as stated in the adopting release, received no comments
on that analysis.
* * * * *
Title: Amendment to Municipal Securities Disclosure.
Citation: 17 CFR 240.15c2-12.
Authority: 15 U.S.C. 78b, 78c(b), 78j, 78o(c), 78o-4, and
78w(a)(1).
Description: The Commission adopted amendments to Rule 15c2-12
under the Exchange Act relating to municipal securities disclosure. The
amendments change certain requirements regarding the information that
the broker, dealer, or municipal securities dealer acting as an
underwriter in a primary offering of municipal securities must
reasonably determine that an issuer of municipal securities or an
obligated person has undertaken, in a written agreement or contract for
the benefit of holders of the issuer's municipal securities, to
provide. Specifically, the amendments require the broker, dealer, or
municipal securities dealer to reasonably determine that the issuer or
obligated person has agreed to provide the information covered by the
written agreement to the Municipal Securities Rulemaking Board
(``MSRB''), instead of to multiple nationally recognized municipal
securities information repositories and state information depositories;
and to provide such information in an electronic format and accompanied
by identifying information as prescribed by the MSRB.
Prior RFA Analysis: Pursuant to Section 605(b) of the Regulatory
Flexibility Act, the Commission certified that the rule would not have
a significant economic impact on a substantial number of small
entities. This certification was incorporated into the proposing
release, Release No. 34-58255 (August 7, 2008). As stated in the
adopting release, Release No. 34-59062 (December 15, 2008), the
Commission received no comments concerning the impact on small entities
or the Regulatory Flexibility Act certification.
* * * * *
Title: Modernization of Oil and Gas Reporting.
Citation: 17 CFR 210.4-10, 17 CFR 229.102, 17 CFR 229.801, 17 CFR
229.802, 17 CFR 229.1201, 17 CFR 229.1202, 17 CFR 229.1203, 17 CFR
[[Page 60799]]
229.1204, 17 CFR 229.1205, 17 CFR 229.1206, 17 CFR 229.1207, 17 CFR
229.1208, and 17 CFR 249.220f.
Authority: 15 U.S.C. 77e, 77f, 77g, 77h, 77j, 77k, 77s, 77z-2, 77z-
3, 77aa(25), 77aa(26), 77ddd, 77eee, 77ggg, 77hhh, 77iii, 77jjj, 77nnn,
77sss, 78a et seq., 78c, 78i, 78j, 78j-1, 78l, 78m, 78n, 78o, 78o(d),
78q, 78u-5, 78w, 78w(a), 78ll, 78mm, 80a-8, 80a-9, 80a-20, 80a-29, 80a-
30, 80a-31, 80a-31(c), 80a-37, 80a-37(a), 80a-38(a), 80a-39, 80b-3,
80b-11, 7201 et seq., 7202, and 7262; and 18 U.S.C. 1350.
Description: The Commission adopted revisions to its oil and gas
reporting disclosures in Regulation S-K and Regulation S-X under the
Securities Act and the Exchange Act, as well as Industry Guide 2. The
revisions were intended to provide investors with a more meaningful and
comprehensive understanding of oil and gas reserves to help them
evaluate the relative value of oil and gas companies. The amendments
were designed to modernize and update the oil and gas disclosure
requirements to align them with current practices and changes in
technology. The amendments concurrently aligned the full cost
accounting rules with the revised disclosures. The amendments also
codified and revised Industry Guide 2 in Regulation S-K. In addition,
they harmonized oil and gas disclosures by foreign private issuers with
the disclosures for domestic issuers.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
adoption of Release No. 33-8995 (Dec. 31, 2008). The Commission
requested comment on the Initial Regulatory Flexibility Analysis
(``IFRA'') prepared in the proposing release, Release No. 33-8935 (Jun.
27, 2008), but, as stated in the adopting release, did not receive
comments specifically addressing the impact of the proposed rules and
amendments on small entities. However, several comments related to
burdens that would be placed on all companies affected by the proposals
and the Commission considered those comments.
* * * * *
Title: Indexed Annuities and Certain Other Insurance Contracts.
Citation: 17 CFR 240.12h-7.
Authority: 15 U.S.C. 77c, 77d, 77g, 77j, 77s, 77z-2, 77z-3, 77eee,
77ggg, 77nnn, 77sss, 77ttt, 78c, 78d, 78e, 78f, 78g, 78i, 78j, 78j-1,
78k, 78k-1, 78l, 78m, 78n, 78o, 78p, 78q, 78s, 78u-5, 78w, 78x, 78ll,
78mm, 80a-20, 80a-23, 80a-29, 80a-37, 80b-3, 80b-4, 80b-11, and 7201 et
seq., and 18 U.S.C. 1350.
Description: The Commission adopted a new rule that exempts
insurance companies from filing reports under the Exchange Act with
respect to indexed annuities and other securities that are registered
under the Securities Act, provided that certain conditions are
satisfied, including that the securities are regulated under state
insurance law, the issuing insurance company and its financial
condition are subject to supervision and examination by a state
insurance regulator, and the securities are not publicly traded.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
Commission's adoption of Release No. 34-59221 (Jan. 8, 2009). In the
adopting release, the Commission considered comments received on the
Initial Regulatory Flexibility Analysis included in the proposing
release, Release No. 34-58022 (June 25, 2008).
* * * * *
Title: Enhanced Disclosure and New Prospectus Delivery Option for
Registered Open-End Management Investment Companies.
Citation: 17 CFR 230.159A, 17 CFR 230.482, 17 CFR 230.485, 17 CFR
230.497, 17 CFR 230.498, 17 CFR 232.304, 17 CFR 232.401, 17 CFR 232.10
et seq., 17 CFR 239.15A and 274.11A, 17 CFR 239.17b and 274.11c, and 17
CFR 239.23.
Authority: 15 U.S.C. 77e, 77f, 77g, 77j, 77s, 77s(a), 77z-3, 80a-8,
80a-24(a), 80a-24(g), 80a-29, and 80a-37.
Description: The Commission adopted amendments to the form used by
mutual funds to register under the Investment Company Act and to offer
their securities under the Securities Act in order to enhance the
disclosures that are provided to mutual fund investors. The amendments
require key information to appear in plain English in a standardized
order at the front of the mutual fund statutory prospectus. The
Commission also adopted rule amendments that permit a person to satisfy
its mutual fund prospectus delivery obligations under Section 5(b)(2)
of the Securities Act by sending or giving the key information directly
to investors in the form of a summary prospectus and providing the
statutory prospectus on an internet website. Upon an investor's
request, mutual funds are also required to send the statutory
prospectus to the investor. These amendments were intended to improve
mutual fund disclosure by providing investors with key information in
plain English in a clear and concise format, while enhancing the means
of delivering more detailed information to investors. Finally, the
Commission adopted additional amendments that were intended to result
in the disclosure of more useful information to investors who purchase
shares of exchange-traded funds on national securities exchanges.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
Commission's adoption of Release No. IC-28584 (Jan. 13, 2009). The
Commission solicited comment on the Initial Regulatory Flexibility
Analysis included in the proposing release, Release No. IC-28064 (Nov.
21, 2007), but, as stated in the adopting release, received no comments
on that analysis.
* * * * *
Title: Interactive Data to Improve Financial Reporting.
Citation: 17 CFR 229.601, 17 CFR 232.11, 17 CFR 232.201, 17 CFR
232.202, 17 CFR 232.305, 17 CFR 232.401, 17 CFR 232.402, 17 CFR
230.144, 17 CFR 240.12b-25, 17 CFR 240.13a-14, 17 CFR 240.15d-14, 17
CFR 239.13, 17 CFR 239.16b, 17 CFR 239.33, 17 CFR 239.39, 17 CFR
239.40, 17 CFR 249.308a, 17 CFR 249.310, 17 CFR 249.322, 17 CFR
249.220f, 17 CFR 249.240f, 17 CFR 249.306, 17 CFR 232.405, 17 CFR
232.406T.
Authority: 15 U.S.C. 77b, 77c, 77d, 77e, 77f, 77g, 77h, 77j, 77k,
77r, 77s, 77s(a), 77z-2, 77z-3, 77aa(25), 77aa(26), 77ddd, 77eee,
77ggg, 77hhh, 77iii, 77jjj, 77nnn, 77sss, 77sss(a), 77ttt, 78(a) et
seq., 78c, 78c(b), 78d, 78e, 78f, 78g, 78i, 78j, 78j-1, 78k, 78k-1,
78l, 78m, 78n, 78o, 78o(d), 78p, 78q, 78s, 78t, 78u-5, 78w, 78w(a),
78x, 78ll, 78ll(d), 78mm, 80a-2(a), 80a-3, 80a-6(c), 80a-8, 80a-9, 80a-
10, 80a-13, 80a-20, 80a-23, 80a-24, 80a-26, 80a-28, 80a-29, 80a-30,
80a-31(c), 80a-37, 80a-38(a), 80a-39, 80b-3, 80b-4, 80b-11, and 7201 et
seq.; and 18 U.S.C. 1350.
Description: The Commission adopted rules requiring companies that
prepare their financial statements in accordance with U.S. generally
accepted accounting principles (U.S. GAAP), and foreign private issuers
that prepare their financial statements using International Financial
Reporting Standards as issued by the International Accounting Standards
Board, to provide their financial statement information in interactive
data format using the eXtensible Business Reporting Language. The
interactive data is provided as an exhibit to periodic and current
reports and registration statements, as well as to transition reports
for a change in fiscal year. The format is intended to make financial
[[Page 60800]]
information easier for investors to analyze, and also to help in
automating regulatory filings and business information processing.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
adoption of Release No. 33-9002 (Jan. 30, 2009). In the adopting
release, the Commission considered comments received on the Initial
Regulatory Flexibility Act Analysis included in the proposing release,
Release No. 33-8924 (May 30, 2008).
* * * * *
Title: Amendments to Rules for Nationally Recognized Statistical
Rating Organizations.
Citation: 17 CFR 240.17g-2, 17 CFR 240.17g-3, 17 CRF 240.17g-5, and
17 CFR 249b.300.
Authority: 15 U.S.C. 77c, 77d, 77g, 77j, 77s, 77z-2, 77z-3, 77eee,
77ggg, 77nnn, 77sss, 77ttt, 78c, 78d, 78e, 78f, 78g, 78i, 78j, 78j-1,
78k, 78k-1, 78l, 78m, 78n, 78o, 78p, 78q, 78s, 78u5, 78w, 78x, 78ll,
78mm, 80a-20, 80a-23, 80a-29, 80a-37, 80b-3, 80b-4, 80b-11, and 7201 et
seq.; and 18 U.S.C. 1350; and 15 U.S.C. 78a et seq.
Description: The Commission adopted amendments to certain rules and
to a form applicable to nationally recognized statistical rating
organizations (``NRSROs''). The amendments established additional
recordkeeping and disclosure requirements for NRSROs, required NRSROs
to furnish the Commission with an additional annual report, prohibited
NRSROs from issuing or maintaining credit ratings subject to certain
conflicts of interest, and required NRSROs to disclose additional
information regarding the performance data for credit ratings and the
procedures and methodologies used to determine credit ratings.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
Commission's adoption of Release No. 34-59342 (Feb. 2, 2009). The
Commission solicited comment on the Initial Regulatory Flexibility
Analysis included in the proposing release, Release No. 34-57967 (June
16, 2008), but, as stated in the adopting release, received no comments
on that analysis.
* * * * *
Title: Interactive Data for Mutual Fund Risk/Return Summary.
Citation: 17 CFR 230.485, 17 CFR 230.497, 17 CFR 232.11, 17 CFR
232.202, 17 CFR 232.401, 17 CFR 232.405, 17 CFR 232.10 et seq., 17 CFR
239.15A, and 17 CFR 232.274.11A.
Authority: 15 U.S.C. 77e, 77f, 77g, 77j, 77s(a), 77z3, 78c, 78l,
78m, 78n, 77nnn, 77sss, 78o(d), 78w(a), 78ll, 78mm, 80a-6(c), 80a-8,
80a-24, 80a-29, and 80a-37.
Description: The Commission adopted rule amendments requiring
mutual funds to provide risk/return summary information in a form that
is intended to improve its usefulness to investors. Under the rules,
risk/return summary information could be downloaded directly into
spreadsheets, analyzed in a variety of ways using commercial off-the-
shelf software, and used within investment models in other software
formats. Mutual funds provide the risk/return summary section of their
prospectuses to the Commission and on their websites in interactive
data format using the eXtensible Business Reporting Language
(``XBRL''). The interactive data is provided as exhibits to
registration statements and as exhibits to prospectuses with risk/
return summary information that varies from the registration statement.
The rules were intended not only to make risk/return summary
information easier for investors to analyze but also to assist in
automating regulatory filings and business information processing.
Interactive data has the potential to increase the speed, accuracy, and
usability of mutual fund disclosure, and eventually reduce costs. The
Commission also adopted rules to permit investment companies to submit
portfolio holdings information in the interactive data voluntary
program without being required to submit other financial information.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
Commission's adoption of Release No. IC-28617 (Feb. 11, 2009). In the
adopting release, the Commission considered comments received on the
Initial Regulatory Flexibility Analysis included in the proposing
release, Release No. IC-28298 (June 10, 2008).
* * * * *
Title: Amendments to Regulation SHO.
Citation: 17 CFR 242.204; 17 CFR 200.30-3.
Authority: 15 U.S.C. 77g, 77o, 77q(a), 77s, 77s(a), 77sss, 78b,
78c, 78d, 78d-1, 78d-2, 78g(c)(2), 78i(a), 78j, 78k-1(c), 781, 78ll(d),
78m, 78mm, 78n, 78o(b), 78o(c), 78o(g), 78q(a), 78q(b), 78q(h), 78w,
78w(a), 78dd-1, 78mm, 80a-23, 80a29, 80a-37, 80b-11, and 7202.
Description: The Commission adopted amendments to help further the
goal of reducing fails to deliver by maintaining the reductions in
fails to deliver achieved by the adoption of temporary Rule 204T, as
well as other actions taken by the Commission. In addition, these
amendments are intended to help further the goal of addressing abusive
``naked'' short selling in all equity securities. These goals will be
furthered by requiring that, subject to certain limited exceptions, if
a participant of a registered clearing agency has a fail to deliver
position at a registered clearing agency it must immediately purchase
or borrow securities to close out the fail to deliver position by no
later than the beginning of regular trading hours on the settlement day
following the day the participant incurred the fail to deliver
position. Failure to comply with the close-out requirement of this
final rule is a violation of the rule. In addition, a participant that
does not comply with this closeout requirement, and any broker-dealer
from which it receives trades for clearance and settlement, will not be
able to short sell the security either for itself or for the account of
another, unless it has previously arranged to borrow or borrowed the
security, until the fail to deliver position is closed out.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
Commission's adoption of Release No. 34-60388 (Jul. 27, 2009). In the
adopting release, the Commission considered comments received on the
Initial Regulatory Flexibility Analysis included in the proposing
release, Release No. 34-58773 (Oct. 14, 2008).
* * * * *
Title: Regulation S-AM: Limitations on Affiliate Marketing.
Citation: 17 CFR 248.101-128.
Authority: Pub. L. 108-159, 117 Stat. 1952 (2003); 15 U.S.C. 78q,
78w, 78mm, 80a-30, 80a-37, 80b-4, and 80b-11.
Description: The Commission adopted Regulation S-AM pursuant to
Section 214 of the Fair and Accurate Credit Transactions Act of 2003
(``FACT Act''), which required the Commission and other federal
agencies to adopt rules implementing limitations on a person's use of
certain information received from an affiliate to solicit a consumer
for marketing purposes, unless the consumer has been given notice and a
reasonable opportunity and a reasonable and simple method to opt out of
such solicitations. Regulation S-AM applies to investment advisers and
transfer agents registered with the Commission, as well as brokers,
dealers and investment companies.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
[[Page 60801]]
prepared in accordance with 5 U.S.C. 604 in conjunction with the
Commission's adoption of Regulation S-AM in Release Nos. 34-60423, IC-
28842, and IA-2911 (Aug. 4, 2009). The Commission requested comment on
the Initial Regulatory Flexibility Analysis included in the proposing
release, Release Nos. 34-49985, IC-26494, and IA-2259 (July 8, 2004),
but, as stated in the adopting release, received no comments concerning
the impact on small entities or the Initial Regulatory Flexibility
Analysis.
* * * * *
Title: References to Ratings of Nationally Recognized Statistical
Rating Organizations.
Citation: 17 CFR 240.3a1-1; 17 CFR 242.300; 17 CFR 242.301; 17 CFR
249.638 (Form ATS-R); 17 CFR 249.821 (Form PILOT); 17 CFR 270.5b-3; and
17 CFR 270.10f-3.
Authority: 15 U.S.C. 77c, 77d, 77g, 77j, 77q(a), 77s, 77s(a), 77z-
2, 77z-3, 77eee, 77ggg, 77nnn, 77sss, 77ttt, 78a et seq., 78b, 78c,
78d, 78e, 78f, 78g, 78g(c)(2), 78i, 78i(a), 78j, 78j-1, 78k, 78k-1,
78k-1(c), 78l, 78m, 78n, 78o, 78o(b), 78o(c), 78o(g), 78p, 78q, 78q(a),
78q(b), 78q(h), 78s, 78u-5, 78w, 78w(a), 78x, 78dd-1, 78ll, 78mm, 80a-1
et seq., 80a-20, 80a-23, 80a-29, 80a-34(d), 80a-37, 80a-39, 80b-3, 80b-
4, 80b-11, 7201 et seq., and 18 U.S.C. 1350.
Description: The Commission adopted amendments to the rules and
forms noted above that removed references to credit ratings issued by
NRSROs. As stated in Securities Exchange Act Release No. 34-60789 (Oct.
5, 2009), the Commission believes that the references to credit ratings
in these rules and forms no longer serve their intended purpose, and
that such references might have contributed to undue reliance on those
ratings by market participants.
Prior RFA Analysis: Pursuant to Section 605(b) of the Regulatory
Flexibility Act, the Commission certified that the rule would not have
a significant economic impact on a substantial number of small
entities. This certification was incorporated into the proposing
release, Release No. 34-58070 (July 1, 2008). As stated in the adopting
release, Release No. 34-60789 (Oct. 5, 2009), the Commission received
no comments concerning the impact on small entities or the Regulatory
Flexibility Act certification.
* * * * *
Title: Final Model Privacy Form under the Gramm-Leach-Bliley Act.
Citation: 17 CFR part 248, subpart A, and Appendix A to Subpart A.
Authority: Pub. L. 109-351, 120 Stat. 1966 (2006); 15 U.S.C. 6804;
15 U.S.C. 78w, 80a-37(a), and 80b-11(a).
Description: The Commission adopted the Final Model Privacy Form
under the GLBA pursuant to Section 728 of the Financial Services
Regulatory Relief Act of 2006, which required the Commission and other
federal agencies to jointly develop a comprehensible, clear and
conspicuous, and succinct model form to provide customers of financial
institutions a means of easily identifying a financial institution's
information sharing practices and comparing those practices with
others, and to provide financial institutions a safe harbor for
satisfying disclosure requirements of rules implementing GLBA
provisions under which financial institutions must provide initial and
annual privacy notices to their customers. In connection with adopting
the Model Privacy Form, the Commission also adopted a new Appendix A to
Regulation S-P and amendments to Regulation S-P's provisions regarding
privacy notices provided by broker-dealers, investment advisers
registered with the Commission, and investment companies.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
Commission's adoption of the Model Privacy Form as Form S-P in Release
Nos. 34-61003, IA-2950, IC-28997 (Nov. 16, 2009). In the adopting
release, the Commission considered comments received on the Initial
Regulatory Flexibility Analysis included in the proposing release,
Release Nos. 34-55497, IA-2598, IC-27755 (Mar. 20, 2007).
* * * * *
Title: Amendments to Rules for Nationally Recognized Statistical
Rating Organizations.
Citation: 17 CFR 240.17g-2, 17 CRF 240.17g-5, and 17 CFR 243.100.
Authority: 15 U.S.C. 77c, 77d, 77g, 77j, 77s, 77z-2, 77z-3, 77eee,
77ggg, 77nnn, 77sss, 77ttt, 78c, 78d, 78e, 78f, 78g, 78i, 78j, 78j-1,
78k, 78k-1, 78l, 78m, 78n, 78o, 78p, 78q, 78s, 78u-5, 78w, 78x, 78ll,
78mm, 80a-20, 80a-23, 80a-29, 80a-37, 80b-3, 80b-4, 80b-11, and 7201 et
seq.; and 18 U.S.C. 1350.
Description: The Commission adopted amendments to certain rules
applicable to nationally recognized statistical rating organizations
NRSROs. The amendments identify an additional conflict of interest
relating to the issuance and maintenance of a credit rating of an
asset-backed security that was paid for by an issuer, sponsor, or
underwriter of the asset-backed security. The amendments specify that
an NRSRO subject to this conflict of interest is prohibited from
issuing a credit rating for the asset-backed security unless it takes
certain actions designed to make the information given to the NRSRO
hired to issue the rating available to NRSROs that were not hired to
issue the rating. The information is intended to make it possible for
non-hired NRSROs to determine credit ratings on asset-backed securities
that are rated by hired NRSROs. The amendments also expanded disclosure
requirements with respect to rating action histories of NRSROs.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
Commission's adoption of Release No. 34-61050 (Nov. 23, 2009). The
Commission solicited comment on the Initial Regulatory Flexibility
Analysis included in the proposing release, Release No. 34-59343 (Feb.
2, 2009), but, as stated in the adopting release, received no comments
on that analysis.
* * * * *
Title: Proxy Disclosure Enhancements.
Citation: 17 CFR 229.401, 17 CFR 229.402, 17 CFR 229.407, 17 CFR
240.14a-101, 17 CFR 249.308, 17 CFR 249.308a, 17 CFR 249.310, 17 CFR
239.15A and 274.11A, 17 CFR 239.14 and 274.11a-1, and 17 CFR 239.17a
and 274.11b.
Authority: 15 U.S.C. 77e, 77f, 77g, 77h, 77j, 77k, 77s, 77z-2, 77z-
3, 77aa(25), 77aa(26), 77ddd, 77eee, 77ggg, 77hhh,77iii, 77jjj, 77nnn,
77sss, 78c, 78c(b), 78i, 78j, 78l, 78m, 78n, 78o, 78o(d), 78u-5, 78w,
78w(a), 78ll, 78mm, 80a-2(a), 80a-3, 80a-8, 80a-9, 80a-10, 80a-13, 80a-
20, 80a-24, 80a-26, 80a-29, 80a-30, 80a-31(c), 80a-37, 80a-38(a), 80a-
39, 80b-11, and 7201 et seq.; and 18 U.S.C. 1350.
Description: The Commission adopted amendments to enhance
disclosure provided in connection with proxy solicitations and other
reports. These amendments require new or revised disclosures with
regard to compensation policies and practices that present material
risks to the company; stock and option awards of executives and
directors; director and nominee qualifications and legal proceedings;
board leadership structure; the board's role in risk oversight; and
potential conflicts of interest of compensation consultants that advise
companies and their boards of directors. The amendments apply to
disclosure provided in proxy and information statements, annual reports
and registration statements under the
[[Page 60802]]
Exchange Act, and registration statements under the Securities Act as
well as the Investment Company Act. The amendments also transferred
from Forms 10-Q and 10-K to Form 8-K the requirement to disclose
shareholder voting rights.
Prior RFA Analysis: A Final Regulatory Flexibility Act Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
adoption of Release No. 33-9089 (Dec. 16, 2009). The Commission
requested comment on the Initial Regulatory Flexibility Act Analysis
included in the proposing release, Release No. 33-9052 (July 10, 2009),
but received no comments specifically addressing it. Other comments
received that addressed aspects of the proposed rule that could
potentially affect small entities were considered in the proposing
release, however.
* * * * *
Title: Custody of Funds or Securities of Clients by Investment
Advisers.
Citation: 17 CFR 275.204-2, 17 CFR 275.206(4)-2, 17 CFR 279.1, and
17 CFR 279.8.
Authority: 15 U.S.C. 80b-6(4) 80b-3(c)(1), 80b-4, 80b11 and 80b-
11(a).
Description: The Commission adopted amendments to the custody and
recordkeeping rules under the Investment Advisers Act of 1940 and
related forms. The amendments were designed to provide additional
safeguards under the Advisers Act when a registered adviser has custody
of client funds or securities by requiring such an adviser, among other
things: To undergo an annual surprise examination by an independent
public accountant to verify client assets; to have the qualified
custodian maintaining client funds and securities send account
statements directly to the advisory clients; and unless client assets
are maintained by an independent custodian (i.e., a custodian that is
not the adviser itself or a related person), to obtain, or receive from
a related person, a report of the internal controls relating to the
custody of those assets from an independent public accountant that is
registered with and subject to regular inspection by the Public Company
Accounting Oversight Board. Finally, the amended custody rule and forms
provide the Commission and the public with better information about the
custodial practices of registered investment advisers.
Prior RFA Analysis: A Final Regulatory Flexibility Analysis was
prepared in accordance with 5 U.S.C. 604 in conjunction with the
Commission's adoption of Release No. IA-2968 (Dec. 30, 2009). In the
adopting release, the Commission considered comments received on the
Initial Regulatory Flexibility Analysis included in the proposing
release, Release No. IA-2876 (May 20, 2009).
* * * * *
By the Commission.
Dated: November 21, 2018.
Brent J. Fields,
Secretary.
[FR Doc. 2018-25861 Filed 11-26-18; 8:45 am]
BILLING CODE 8011-01-P