[Federal Register Volume 85, Number 105 (Monday, June 1, 2020)]
[Rules and Regulations]
[Pages 33290-33394]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-07790]



[[Page 33289]]

Vol. 85

Monday,

No. 105

June 1, 2020

Part II





Securities and Exchange Commission





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





17 CFR Parts 229, 230, 232, et al.





Securities Offering Reform for Closed-End Investment Companies; Final 
Rule

  Federal Register / Vol. 85, No. 105 / Monday, June 1, 2020 / Rules 
and Regulations  

[[Page 33290]]


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

SECURITIES AND EXCHANGE COMMISSION

17 CFR Parts 229, 230, 232, 239, 240, 243, 249, 270, and 274

[Release Nos. 33-10771; 34-88606; IC-33836; File No. S7-03-19]
RIN 3235-AM31


Securities Offering Reform for Closed-End Investment Companies

AGENCY: Securities and Exchange Commission.

ACTION: Final rule.

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

SUMMARY: The Securities and Exchange Commission (the ``Commission'') is 
adopting rules that will modify the registration, communications, and 
offering processes for business development companies (``BDCs'') and 
other closed-end investment companies under the Securities Act of 1933. 
As directed by Congress, we are adopting rules that will allow these 
investment companies to use the securities offering rules that are 
already available to operating companies. These rules will extend to 
closed-end investment companies offering reforms currently available to 
operating company issuers by expanding the definition of ``well-known 
seasoned issuer'' to allow these investment companies to qualify; 
streamlining the registration process for these investment companies, 
including the process for shelf registration; permitting these 
investment companies to satisfy their final prospectus delivery 
requirements by filing the prospectus with the Commission; and 
permitting additional communications by and about these investment 
companies during a registered public offering. In addition, we are 
amending certain rules and forms to tailor the disclosure and 
regulatory framework to these investment companies. These amendments 
also will modernize our approach to securities registration fee payment 
by requiring closed-end investment companies that operate as ``interval 
funds'' to pay securities registration fees using the same method as 
mutual funds and exchange-traded funds and extend the ability to use 
this payment method to issuers of certain continuously offered, 
exchange-traded products (``ETPs''). Additionally, we are expanding the 
ability of certain registered closed-end funds or BDCs that conduct 
continuous offerings to make changes to their registration statements 
on an immediately effective basis or on an automatically effective 
basis a set period of time after filing. Lastly, we are adopting 
certain structured data reporting requirements, including for filings 
on the form providing annual notice of securities sold pursuant to the 
rule under the Investment Company Act of 1940 that prescribes the 
method by which certain investment companies (including mutual funds) 
calculate and pay registration fees.

DATES: 
    Effective Dates: This rule is effective August 1, 2020, except for 
amendatory instructions 21, 22, 30, 31, 33, 34, 41, 42, and 45 which 
are effective August 1, 2021.
    Compliance Dates: The applicable compliance dates are discussed 
below in section II.J.

FOR FURTHER INFORMATION CONTACT: Asaf Barouk, Attorney-Adviser; Joel 
Cavanaugh, Senior Counsel; Terri G. Jordan, Senior Counsel; Amy Miller, 
Senior Counsel; Angela Mokodean, Senior Counsel; Amanda Hollander 
Wagner, Branch Chief; David J. Marcinkus, Branch Chief; Jacob D. 
Krawitz, Branch Chief; or Brian McLaughlin Johnson, Assistant Director, 
at (202) 551-6792, Investment Company Regulation Office, Division of 
Investment Management; Charles Kwon, Senior Counsel, Office of 
Rulemaking, at (202) 551-3430, Division of Corporation Finance; U.S. 
Securities and Exchange Commission, 100 F Street NE, Washington, DC 
20549.

SUPPLEMENTARY INFORMATION: The Commission is adopting amendments to:
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 77a et seq.
    \2\ 15 U.S.C. 78a et seq.
    \3\ 15 U.S.C. 80a-1 et seq.

------------------------------------------------------------------------
           Commission reference                 CFR citation (17 CFR)
------------------------------------------------------------------------
             SECURITIES ACT OF 1933 (``SECURITIES ACT'') \1\
------------------------------------------------------------------------
Rule 134..................................  Sec.   230.134
Rule 138..................................  Sec.   230.138
Rule 156..................................  Sec.   230.156
Rule 163..................................  Sec.   230.163
Rule 163A.................................  Sec.   230.163A
Rule 164..................................  Sec.   230.164
Rule 168..................................  Sec.   230.168
Rule 169..................................  Sec.   230.169
Rule 172..................................  Sec.   230.172
Rule 173..................................  Sec.   230.173
Rule 405..................................  Sec.   230.405
Rule 415..................................  Sec.   230.415
Rule 418..................................  Sec.   230.418
Rule 424..................................  Sec.   230.424
Rule 430A.................................  Sec.   230.430A
Rule 430B.................................  Sec.   230.430B
Rule 433..................................  Sec.   230.433
Rule 456..................................  Sec.   230.456
Rule 457..................................  Sec.   230.457
Rule 462..................................  Sec.   230.462
Rule 486..................................  Sec.   230.486
Rule 497..................................  Sec.   230.497
Form S-1..................................  Sec.   239.11
Form S-3..................................  Sec.   239.13
Form N-14.................................  Sec.   239.23
Form F-1..................................  Sec.   239.31
Form F-3..................................  Sec.   239.33
------------------------------------------------------------------------
             REGULATION S-T [17 CFR 232.10 THROUGH 232.903]
------------------------------------------------------------------------
Rule 11...................................  Sec.   232.11
Rule 405..................................  Sec.   232.405
------------------------------------------------------------------------
         SECURITIES EXCHANGE ACT OF 1934 (``EXCHANGE ACT'') \2\
------------------------------------------------------------------------
Schedule 14A..............................  Sec.   240.14a-101
Rule 103 of Regulation FD.................  Sec.   243.103
------------------------------------------------------------------------
     INVESTMENT COMPANY ACT OF 1940 (``INVESTMENT COMPANY ACT'') \3\
------------------------------------------------------------------------
Rule 8b-16................................  Sec.   270.8b-16
Rule 23c-3................................  Sec.   270.23c-3
Rule 24f-2................................  Sec.   270.24f-2
Form 24F-2................................  Sec.   274.24
------------------------------------------------------------------------
                SECURITIES ACT AND INVESTMENT COMPANY ACT
------------------------------------------------------------------------
Form N-2..................................  Sec.  Sec.   239.14 and
                                             274.11a-1
------------------------------------------------------------------------
                 EXCHANGE ACT AND INVESTMENT COMPANY ACT
------------------------------------------------------------------------
Form N-CSR................................  Sec.  Sec.   249.331 and
                                             274.128
------------------------------------------------------------------------

Table of Contents

I. Introduction
II. Discussion
    A. Scope of Closed-End Investment Companies Affected by the 
Final Rule
    B. Registration Process
    1. Current Shelf Offering Process for Affected Funds
    2. Amendments to the Registration Process for Affected Funds
    3. Short-Form Registration on Form N-2
    C. Well-Known Seasoned Issuer Status
    1. WKSI Definition
    2. WKSI Eligibility
    3. Ineligible Issuer Definition
    D. Automatic or Immediate Effectiveness for Filings by Affected 
Funds Conducting Certain Continuous Offerings
    E. Final Prospectus Delivery Reforms
    F. Communications Reforms
    1. Offering Communications
    2. Broker-Dealer Research Reports
    G. Other Rule Amendments
    1. Rule 418 Supplemental Information
    2. Amendments to Incorporation by Reference Into Proxy 
Statements
    3. Rule 103 of Regulation FD
    H. New Registration Fee Payment Method for Interval Funds and 
Issuers of Certain Exchange-Traded Products
    I. Disclosure and Reporting Parity Proposals

[[Page 33291]]

    1. Structured Data Requirements
    2. Periodic Reporting Requirements
    3. Current Reporting Requirements for Affected Funds
    4. Online Availability of Information Incorporated by Reference
    5. Amendments to Certain Registered CEFs' Annual Report 
Disclosure
    J. Effective and Compliance Dates
III. Economic Analysis
    A. Introduction and Baseline
    1. Number of Affected Funds
    2. Current Securities Offering Requirements for Affected Funds
    3. Current Disclosure Obligations of Affected Funds
    B. Potential Benefits Resulting From the Proposed Implementation 
of the Statutory Mandates
    1. Improved Access to Capital and Lower Cost of Capital
    2. Facilitated Communication With Investors
    C. Potential Costs Resulting From the Proposed Implementation of 
the Statutory Mandates
    1. Compliance Costs
    2. Other Costs
    D. Alternatives to Adopted Approach To Implementing Statutory 
Mandates
    E. Discussion of Discretionary Choices
    1. New Registration Fee Payment Method for Interval Funds and 
Issuers of Certain Exchange-Traded Products
    2. Structured Data Requirements
    3. Periodic Reporting Requirements
    4. Discretionary Amendments to Incorporation by Reference 
Requirements
    5. Automatic or Immediate Effectiveness of Filings by Affected 
Funds Conducting Certain Continuous Offerings
IV. Paperwork Reduction Act Analysis
    A. Background
    B. Summary of the Amendments and Impact on Information 
Collections
    1. Amendments to Form N-2 Registration Statement
    2. Structured Data Reporting Requirements
    3. New Annual Reporting Requirements Under 17 CFR 270.30e-1 
(Rule 30e-1) and Exchange Act Periodic Reporting Requirements for 
BDCs
    4. Securities Offering Communications
    5. Prospectus Delivery Requirements
    6. Form 24F-2
    7. Amendments Permitting the Registration of Offerings of an 
Indeterminate Number of Exchange-Traded Vehicle Securities and the 
Payment of Registration Fees for Such Offerings on an Annual Net 
Basis
    8. Amendments to Form N-14
V. Final Regulatory Flexibility Analysis
    A. Need and Objectives of the Final Rule
    B. Significant Issues Raised by Public Comments
    C. Small Entities Subject to the Rule
    D. Projected Reporting, Recordkeeping, and Other Compliance 
Requirements
    1. Registration Process and Final Prospectus Delivery
    2. Communications Rules
    3. New Registration Fee Payment Method for Interval Funds
    4. Disclosure and Reporting Requirements
    5. Automatic or Immediate Effectiveness for Filings by Affected 
Funds Conducting Certain Continuous Offerings
    E. Agency Action To Minimize Effect on Small Entities
    1. Alternatives to the Adopted Approach To Implementing 
Statutory Mandates
    2. Alternative Approaches to Discretionary Choices
VI. Other Matters
VII. Statutory Authority

I. Introduction

    We are adopting rules that will modify the registration, 
communications, and offering processes for business development 
companies (``BDCs'') and registered closed-end investment companies 
(``registered CEFs''), including interval funds (collectively, 
``affected funds'') under the Securities Act.\4\ In 2005, the 
Commission adopted securities offering reforms for operating companies 
to modernize the securities offering and communication processes while 
maintaining the protection of investors under the Securities Act.\5\ At 
that time, the Commission specifically excluded all investment 
companies--including affected funds--from the scope of the reforms.\6\ 
Now, as directed by Congress, we are adopting rules that will allow 
affected funds to use the securities offering rules that are already 
available to operating companies.
---------------------------------------------------------------------------

    \4\ BDCs are a category of closed-end investment companies that 
do not register under the Investment Company Act, but rather elect 
to be subject to the provisions of sections 55 through 65 of the 
Investment Company Act. See section 2(a)(48) of the Investment 
Company Act [15 U.S.C. 80a-2(a)(48)]. Congress established BDCs for 
the purpose of making capital more readily available to small, 
developing and financially troubled companies that do not have ready 
access to the public capital markets or other forms of conventional 
financing. See H.R. Rep. No. 1341, 96th Cong., 2d Sess. 21 (1980). 
See infra section II.A for additional discussion of the definition 
of ``affected funds.''
    ``Interval funds'' are a type of registered CEF or BDC that make 
periodic repurchase offers pursuant to rule 23c-3 under the 
Investment Company Act. See 17 CFR 270.23c-3 (``rule 23c-3'').
    \5\ Securities Offering Reform, Securities Act Release No. 8591 
(July 19, 2005) [70 FR 44721 (Aug. 3, 2005)] (``Securities Offering 
Reform Adopting Release''). In this release we generally use the 
term ``operating company'' to refer to issuers that are not 
investment companies and that are currently eligible to rely on the 
rules we are amending.
    \6\ See, e.g., id. at 44727 (discussing the exclusion of 
investment companies registered under the Investment Company Act and 
BDCs from the definition of ``well-known seasoned issuer''); id. at 
44735 (discussing the exclusion of such companies from the safe 
harbors for factual business information and forward-looking 
information); id. at 44784 (discussing the exclusion of such 
companies from final prospectus delivery reforms).
---------------------------------------------------------------------------

    The Small Business Credit Availability Act (the ``BDC Act'') 
directs us to allow a BDC to use the securities offering rules that are 
available to other issuers required to file reports under section 13(a) 
or section 15(d) of the Exchange Act.\7\ As discussed in detail below, 
the BDC Act identifies with specificity the required revisions.\8\ The 
Economic Growth, Regulatory Relief, and Consumer Protection Act (the 
``Registered CEF Act'') (and, together with the BDC Act, the ``Acts'') 
directs us to adopt rules to allow any registered CEF that is listed on 
a national securities exchange (a ``listed registered CEF'') or that 
makes periodic repurchase offers under rule 23c-3 to use the securities 
offering rules that are available to other issuers that are required to 
file reports under section 13(a) or section 15(d) of the Exchange Act, 
subject to appropriate conditions.\9\ Unlike the BDC Act, the 
Registered CEF Act does not identify with specificity the revisions 
that are required.
---------------------------------------------------------------------------

    \7\ Section 803(b) of Small Business Credit Availability Act, 
Public Law 115-141, 132 Stat. 348 (2018) (``BDC Act''). This section 
also directs us to make specified revisions to allow a BDC to use 
the proxy rules that are available to such other issuers. Id. 
Affected funds generally use the proxy rules that are available to 
operating companies already. One current difference applicable to 
these entities, however, is a more limited ability to incorporate 
information into their proxy statements by reference. The BDC Act 
directs that we eliminate this difference by providing these 
entities parity with operating companies. Section 803(b)(2)(N) of 
the BDC Act; see also infra section II.G.2.
    \8\ See section 803(b)(2) of the BDC Act.
    \9\ Section 509(a) of Economic Growth, Regulatory Relief, and 
Consumer Protection Act, Public Law 115-174, 132 Stat. 1296 (2018) 
(``Registered CEF Act''). The Registered CEF Act also refers to 
proxy rules, as does the BDC Act. See supra footnote 7.
---------------------------------------------------------------------------

    In 2019, we proposed rules that would modify the registration, 
communications, and offering processes for affected funds under the 
Securities Act.\10\ As discussed in greater detail below, most 
commenters supported the proposal.\11\ Many of the commenters who 
supported the proposal generally also recommended modifications to some 
of the proposed rules.\12\ For example, some commenters recommended 
further expanding the scope of issuers that would qualify as ``well-
known seasoned issuers'' to include smaller issuers or those without

[[Page 33292]]

public float.\13\ Commenters also recommended eliminating or modifying 
the proposed requirement that certain additional affected funds file 
current reports on Form 8-K.\14\ Other commenters recommended that the 
Commission expand the scope of issuers permitted to file certain 
immediately effective registration statements.\15\ Several commenters 
that are sponsors to exchange-traded products recommended that the 
Commission expand the scope of issuers permitted to pay registration 
fees on an annual net basis.\16\ Finally, one commenter expressed 
concern with the proposal, recommending that large BDCs and registered 
CEFs be subject to additional scrutiny.\17\ As discussed in detail 
below, we are adopting the proposed rules with certain modifications, 
after consideration of comments received.
---------------------------------------------------------------------------

    \10\ Securities Offering Reform for Closed-End Investment 
Companies, Investment Company Act Release No. 33427 (Mar. 20, 2019) 
[84 FR 14448 (Apr. 10, 2019)] (``Proposing Release'').
    \11\ See, e.g., Comment Letter of the Federal Regulation of 
Securities Committee of the Business Law Section of the American Bar 
Association (July 3, 2019) (``ABA Comment Letter''); Comment Letter 
of Alternative Credit Council (June 10, 2019) (``ACC Comment 
Letter''); Comment Letter of Coalition for Business Development 
(June 10, 2019) (``CBD Comment Letter''). The comment letters on the 
Proposing Release (File No. S7-03-19) are available at https://www.sec.gov/comments/s7-03-19.htm.
    \12\ See, e.g., Comment Letter of Calcbench, Inc. (May 13, 2019) 
(``Calcbench Comment Letter''); Comment Letter of GraniteShares LLC 
(June 26, 2019) (``GraniteShares Comment Letter''); Comment Letter 
of Institute for Portfolio Alternatives (June 10, 2019) (``IPA 
Comment Letter'').
    \13\ See infra section II.C.
    \14\ See infra section II.I.3.
    \15\ See ABA Comment Letter; Comment Letter of Investment 
Company Institute (June 10, 2019) (``ICI Comment Letter'').
    \16\ See, e.g., Comment Letter of United States Commodity Funds 
LLC (June 10, 2019) (``USCF Comment Letter''); Comment Letter of 
World Gold Council (June 10, 2019) (``WGC Comment Letter'').
    \17\ Comment Letter of Dale White (Apr. 3, 2019) (``White 
Comment Letter'').
---------------------------------------------------------------------------

    Our action will institute a number of reforms:
     First, it will streamline the registration process to 
allow eligible affected funds to use a short-form shelf registration 
statement to sell securities ``off the shelf'' more quickly and 
efficiently in response to market opportunities.
     Second, the final rule will allow affected funds to 
qualify as ``well-known seasoned issuers'' (``WKSIs'') under rule 405 
under the Securities Act.
     Third, it will allow affected funds to satisfy final 
prospectus delivery requirements using the same method as operating 
companies.
     Fourth, it will allow affected funds to use certain rules 
currently available to operating companies, such as communications safe 
harbors for certain factual business information and forward-looking 
information, ``free writing prospectuses,'' and broker-dealer research 
reports (referred throughout this release as the ``communications 
rules'').
     Fifth, the final rule will allow certain continuously-
offered affected funds to make certain changes to their registration 
statements on an immediately-effective basis or on an automatically 
effective basis a set period of time after filing.
     Finally, it will tailor the disclosure and regulatory 
framework for affected funds in light of the amendments to the offering 
rules applicable to them. These amendments include structured data 
requirements to make it easier for investors and others to analyze fund 
data; new annual report disclosure requirements to provide key 
information in annual reports; a requirement that interval funds pay 
securities registration fees using the same method that mutual funds 
and exchange-traded funds (``ETFs'') use today; and a provision that 
will allow certain ETPs that are not registered under the Investment 
Company Act to elect to pay securities registration fees in the same 
manner.
    As discussed in detail below, the final rule will affect different 
categories of affected funds differently, just as different categories 
of operating companies are treated differently under these rules 
currently. For example, some of the provisions will apply to all 
affected funds, that is, all BDCs and registered CEFs. Many of the 
provisions, however, will apply only to ``seasoned funds.'' These are 
listed affected funds that are current and timely in their reporting 
and therefore generally eligible to file a short-form registration 
statement under the proposal if they have at least $75 million in 
``public float.'' \18\ Some of the provisions will apply only to 
seasoned funds that also qualify as WKSIs, that is, listed affected 
funds that qualify as seasoned funds and generally have at least $700 
million in public float.\19\ Additionally, the final rule provides 
unlisted affected funds with the flexibility to make certain filings 
that become effective either immediately upon filing or automatically 
after 60 days.\20\ The final rule therefore will provide additional 
flexibilities to both listed and unlisted affected funds. Tables 1 and 
2 below summarize these different impacts.
---------------------------------------------------------------------------

    \18\ See General Instruction I.B.1 of Form S-3 (defining 
``aggregate market value''). In this release, we use ``public 
float'' to mean the aggregate market value of the voting and non-
voting common equity held by non-affiliates of the registrant. See 
General Instruction I.B.1 of Form S-3. Certain issuers with less 
than $75 million in public float also are eligible to use Form S-3 
to register a primary offering but are limited as to the amount of 
securities they can register. See General Instruction I.B.6 of Form 
S-3. The Commission has stated that the calculations of an issuer's 
public float for the purpose of determining an issuer's eligibility 
to use Form S-3 and for determining WKSI status under rule 405 are 
the same. See Securities Offering Reform Adopting Release, supra 
footnote 5, at n.50.
    \19\ See rule 405 (defining WKSI).
    \20\ See amended rules 486(a) and 486(b) under the Securities 
Act. See also supra section II.D.

                                 Table 1
------------------------------------------------------------------------
                 Entity                         Summary definition
------------------------------------------------------------------------
Affected funds.........................  Affected funds include all BDCs
                                          and registered CEFs, including
                                          interval funds.
Seasoned funds \1\.....................  Seasoned funds are affected
                                          funds that are current and
                                          timely in their reporting and
                                          therefore generally eligible
                                          to file a short-form
                                          registration statement if they
                                          have at least $75 million in
                                          ``public float.'' See supra
                                          footnote 18.
WKSIs..................................  WKSIs are seasoned funds that
                                          generally have at least $700
                                          million in ``public float.''
ETPs...................................  ETPs are issuers that are not
                                          registered investment
                                          companies and whose assets
                                          consist primarily of
                                          commodities, currencies or
                                          derivative instruments that
                                          reference commodities or
                                          currencies; whose securities
                                          are listed for trading on a
                                          national securities exchange;
                                          and that purchase or redeem
                                          securities for a ratable share
                                          of their assets at NAV.
------------------------------------------------------------------------
Notes:
\1.\ Some of the rule changes that are shown below as affecting
  ``seasoned funds'' will only affect those seasoned funds that elect to
  file a registration statement on Form N-2 using an instruction
  permitting funds to use the form to file a short-form registration
  statement.


[[Page 33293]]


                                                     Table 2
----------------------------------------------------------------------------------------------------------------
                                        Summary description of    Entities affected by
                 Rule                            rule                   changes             Discussed below in
----------------------------------------------------------------------------------------------------------------
                      Affected Funds (Including BDCs, Registered CEFs, and Interval Funds)
----------------------------------------------------------------------------------------------------------------
Registration Provisions:
    General Instruction F.4.a of Form  Requires online posting  Affected Funds.........  Section II.I.4.
     N-2.                               of information
                                        incorporated by
                                        reference.
    Securities Act Rules 424 and 497.  Provide the processes    Affected Funds.........  Section II.B.3.d.
                                        for filing prospectus
                                        supplements.
    Investment Company Act Rule 23c-3  Subjects interval funds  Interval Funds.........  Section II.H.
                                        to the registration
                                        fee payment system
                                        based on annual net
                                        sales.
    Securities Act Rule 486..........  Allows continuously-     Continuously-offered     Section II.D.
                                        offered unlisted         unlisted affected
                                        affected funds to make   funds not relying on
                                        certain filings that     rule 23c-3.
                                        are immediately
                                        effective upon filing
                                        or automatically
                                        effective 60 days
                                        after filing.
    General Instruction G of Form N-   Permits certain          BDCs...................  Section II.B.3.b.
     14.                                registrants to
                                        incorporate by
                                        reference.
Communication Provisions:
    Securities Act Rule 134..........  Permits issuers to       Affected Funds.........  Section II.F.1.
                                        publish factual
                                        information about the
                                        issuer or the
                                        offering, including
                                        ``tombstone ads.''.
    Securities Act Rule 163A.........  Permits issuers to       Affected Funds.........  Section II.F.1.
                                        communicate without
                                        risk of violating the
                                        gun-jumping provisions
                                        until 30 days prior to
                                        filing a registration
                                        statement.
    Securities Act Rules 168 and 169.  Permit the publication   Affected Funds.........  Section II.F.1.
                                        and dissemination of
                                        regularly released
                                        factual and forward-
                                        looking information.
    Securities Act Rules 164 and 433.  Permit use of a ``free   Affected Funds.........  Section II.F.1.
                                        writing prospectus.''.
Prospectus Delivery Provisions:
    Securities Act Rules 172 and 173.  Permit issuers,          Affected Funds.........  Section II.E.
                                        brokers, and dealers
                                        to satisfy final
                                        prospectus delivery
                                        obligations if certain
                                        conditions are
                                        satisfied.
Periodic Reporting Provisions:
    Investment Company Act Rule 8b-16  A requirement that       Registered CEFs........  Section II.I.5.
                                        funds that rely on
                                        paragraph (b) of the
                                        rule describe in the
                                        annual report the
                                        fund's current
                                        investment objectives,
                                        policies and risks,
                                        and certain key
                                        changes in enough
                                        detail to allow
                                        investors to
                                        understand each change
                                        and how it may affect
                                        the fund.
    Instruction 4.g to Item 24 of      A requirement for        Registered CEFs........  Section II.I.2.b.
     Form N-2.                          narrative disclosure
                                        about the fund's
                                        performance in the
                                        fund's annual report.
    Item 4 of Form N-2; Instruction    Requires disclosure of   BDCs...................  Section II.I.2.c.
     10 to Item 24 of Form N-2.         certain financial
                                        information.
Structured Data Reporting
 Requirements:
    Structured Financial Statement     A requirement that BDCs  BDCs...................  Section II.I.1.a.
     Data.                              tag their financial
                                        statements using
                                        Inline eXtensible
                                        Business Reporting
                                        Language (``Inline
                                        XBRL'') format.
    Prospectus Structured Data         A requirement that       Affected Funds.........  Sections II.I.1.b and
     Requirements.                      registrants tag                                   II.I.1.c.
                                        certain information
                                        required by Form N-2
                                        using Inline XBRL.
    Form 24F-2 Structured Format.....  A requirement that       Form 24F-2 Filers,       Section II.I.1.d.
                                        filings on Form 24F-2    including open-end
                                        be submitted in a        funds and unit
                                        structured format.       investment trusts.
----------------------------------------------------------------------------------------------------------------
                                                 Seasoned Funds
----------------------------------------------------------------------------------------------------------------
Registration Provisions:
    Securities Act Rule 415..........  Permits registration of  Seasoned Funds.........  Section II.B.3.
                                        securities to be
                                        offered on a delayed
                                        or a continuous basis.
    General Instructions A.2 and F.3   Provide for backward     Seasoned Funds.........  Section II.B.3.b.
     of Form N-2.                       and forward
                                        incorporation by
                                        reference.
    Securities Act Rule 430B.........  Permits certain issuers  Seasoned Funds.........  Section II.B.3.d.
                                        to omit certain
                                        information from their
                                        prospectuses at
                                        effectiveness.

[[Page 33294]]

 
    Securities Act Rule 418..........  Exempts some             Seasoned Funds.........  Section II.G.1.
                                        registrants from an
                                        obligation to furnish
                                        certain engineering,
                                        management, or similar
                                        reports.
    Regulation FD Rule 103...........  Provides that a failure  Seasoned Funds.........  Section II.G.3.
                                        to make a public
                                        disclosure required
                                        solely by 17 CFR
                                        243.100 (rule 100 of
                                        Regulation FD) will
                                        not disqualify a
                                        ``seasoned'' issuer
                                        from use of certain
                                        forms.
Communication Provisions:
    Securities Act Rule 138..........  Permits a broker or      Seasoned Funds.........  Section II.F.2.
                                        dealer to publish or
                                        distribute certain
                                        research reports about
                                        securities other than
                                        those it is
                                        distributing.
Proxy Statements:
    Item 13 of Schedule 14A..........  Permits certain          Seasoned Funds.........  Section II.G.2.
                                        registrants to use
                                        incorporation by
                                        reference to provide
                                        information that
                                        otherwise must be
                                        furnished with certain
                                        types of proxy
                                        statements.
Periodic Reporting Provisions:
    Instruction 4.h.(2) to Item 24 of  A requirement for        Seasoned Funds.........  Section II.I.2.a.
     Form N-2.                          information about the
                                        investor's costs and
                                        expenses in the
                                        registrant's annual
                                        report.
    Instruction 4.h.(3) to Item 24 of  A requirement for        Seasoned Funds.........  Section II.I.2.a.
     Form N-2.                          information about the
                                        share price of the
                                        registrant's stock and
                                        any premium or
                                        discount in the
                                        registrant's annual
                                        report.
    Instruction 4.h.(1) to Item 24 of  A requirement for        Seasoned Funds.........  Section II.I.2.a.
     Form N-2.                          information about each
                                        of a fund's classes of
                                        senior securities in
                                        the registrant's
                                        annual report.
    Instruction 4.h.(4) to Item 24 of  A requirement to         Seasoned Funds.........  Section II.I.2.d.
     Form N-2.                          disclose outstanding
                                        material unresolved
                                        staff comments that
                                        remain unresolved for
                                        a substantial period
                                        of time.
----------------------------------------------------------------------------------------------------------------
                                                      WKSIs
----------------------------------------------------------------------------------------------------------------
Registration Provisions:
    Securities Act Rule 462..........  Provides for             WKSIs..................  Section II.B.3.c.
                                        effectiveness of
                                        registration
                                        statements immediately
                                        upon filing with the
                                        Commission.
Communication Provisions:
    Securities Act Rule 163..........  Permits oral and         WKSIs..................  Section II.F.1.
                                        written communications
                                        by or on behalf of
                                        WKSIs at any time.
----------------------------------------------------------------------------------------------------------------
                                                      ETPs
----------------------------------------------------------------------------------------------------------------
Registration Provisions:
    Securities Act Rules 415, 424,     Permits ETPs to          ETPs...................  Section II.H.
     456 and 457; Forms S-1, S-3, F-1   register an
     and F-3.                           indeterminate amount
                                        of certain securities
                                        and pay registration
                                        fees based on annual
                                        net sales.
----------------------------------------------------------------------------------------------------------------

II. Discussion

A. Scope of Closed-End Investment Companies Affected by the Final Rule

    As we proposed, the final rule will apply to all BDCs and 
registered CEFs, with certain conditions and exceptions discussed below 
and generally illustrated in Tables 1 and 2 above. The BDC Act applies 
to all BDCs, including BDCs that are listed on a securities exchange 
and those that are unlisted.\21\ In contrast, the Registered CEF Act 
extends to all registered CEFs listed on a securities exchange, as well 
as interval funds, but excludes other unlisted registered CEFs.\22\
---------------------------------------------------------------------------

    \21\ Listed BDCs are publicly traded BDCs that are listed on a 
stock exchange. Unlisted BDCs include non-traded BDCs, which are 
offered via a continuous offering up to a preset maximum amount, and 
private BDCs, which are offered via a private placement offering.
    \22\ See section 509(a) of the Registered CEF Act. Similar to 
BDCs, registered CEFs include listed and unlisted funds, including 
publicly traded CEFs that are listed on a stock exchange, non-traded 
CEFs, and interval funds.
---------------------------------------------------------------------------

    Although the Registered CEF Act only requires us to allow interval 
funds and listed registered CEFs to use the securities offering rules 
available to operating companies, that Act does not preclude us from 
exercising our discretion to extend these rules to all registered CEFs. 
The Commission therefore proposed to apply the rules to all BDCs and 
all registered CEFs, including unlisted registered CEFs, with certain 
conditions and exceptions.\23\ We believed that this approach would 
benefit unlisted registered CEFs and their investors by avoiding the 
adverse consequences that could result from treating unlisted 
registered CEFs differently from all other registered CEFs and unlisted 
BDCs.
---------------------------------------------------------------------------

    \23\ Proposing Release, supra footnote 10, at section II.
---------------------------------------------------------------------------

    We believed that applying such a distinction is unnecessary 
because, for purposes of these rules, unlisted registered CEFs are not 
distinguishable

[[Page 33295]]

from unlisted BDCs, which the rule amendments must cover. Unlisted 
registered CEFs, like unlisted BDCs, also would benefit from parity of 
treatment.\24\ We did not receive comment on this aspect of the 
proposal. Because we continue to believe that this approach will 
benefit unlisted registered CEFs and their investors by providing new 
investor protections and avoiding adverse consequences from 
differential treatment, the final rule will apply to all BDCs and 
registered CEFs as proposed.
---------------------------------------------------------------------------

    \24\ Id.
---------------------------------------------------------------------------

    The Commission proposed to generally apply the specific 
requirements of the BDC Act to both BDCs and registered CEFs because it 
believed that, except where dictated by meaningful differences between 
BDCs and registered CEFs, consistent application of the proposed rules 
across affected funds would result in more efficient offering processes 
and more consistent investor protections.\25\ We continue to believe 
that both Acts share the overall purpose of providing offering and 
communication rule parity to the investment companies covered by each 
Act.\26\ We did not receive public comment on this aspect of the 
proposal, and, for the reasons stated above, we are adopting it as 
proposed.
---------------------------------------------------------------------------

    \25\ Id.
    \26\ Id. (explaining the similarity of the BDC Act's and the 
Registered CEF Act's broad mandates).
---------------------------------------------------------------------------

B. Registration Process

    We are adopting, substantially as proposed, amendments to our rules 
and forms to streamline the registration process for affected funds by 
permitting them to use the more flexible registration process available 
to operating companies. These amendments collectively will allow 
affected funds to offer and sell securities ``off the shelf'' more 
quickly and efficiently in response to market opportunities.
1. Current Shelf Offering Process for Affected Funds
    Issuers, including affected funds, whose offerings are registered 
or qualified to be registered on Form S-3 may conduct primary offerings 
``off the shelf'' under Securities Act rule 415(a)(1)(x), the provision 
for offerings made on a delayed or continuous basis.\27\ In a rule 
415(a)(1)(x) shelf offering, a seasoned issuer can register an 
unallocated dollar amount of securities for sale at a later time.\28\ 
The issuer can then take down securities ``off the shelf'' for sale in 
a public offering as market conditions warrant. This allows seasoned 
issuers to quickly access the public securities markets from time to 
time to take advantage of favorable market conditions.\29\
---------------------------------------------------------------------------

    \27\ See Proposing Release, supra footnote 10, at n.17 
(discussing rule 415(a)(1)).
    \28\ In this release we use the term ``seasoned'' to refer 
generally to an issuer that meets the registrant requirements in 
General Instruction I.A of Form S-3 and, when referring to seasoned 
funds, a fund that meets these Form S-3 registrant requirements as 
well as certain modifications for registered CEFs. See Proposing 
Release, supra footnote 10, at n.18 (explaining the requirements 
under General Instruction I.A. of Form S-3).
    \29\ Issuers that rely on rule 415(a)(1)(x) must file a new 
registration statement every three years, with unsold securities and 
fees paid thereon carried forward to the new registration statement. 
See Securities Act rule 415(a)(5) and (6). If the new registration 
statement is an automatic shelf registration statement filed by a 
WKSI, it will be effective immediately upon filing.
---------------------------------------------------------------------------

    Affected funds currently can make shelf offerings under rule 
415(a)(1)(x) if they meet the eligibility criteria for Form S-3, even 
though affected funds register their securities offerings on Form N-
2.\30\ Our rules for operating companies, however, are more flexible 
and efficient than for affected funds. In particular, seasoned 
operating companies can use a short-form registration statement on Form 
S-3. Certain seasoned operating companies also can rely on Securities 
Act rule 430B to omit certain information from the ``base'' prospectus 
when the registration statement becomes effective and later provide 
that information in a subsequent Exchange Act report incorporated by 
reference, a prospectus supplement, or a post-effective amendment.\31\ 
The ability to ``forward incorporate'' information in Exchange Act 
reports filed after the registration statement becomes effective allows 
operating companies to efficiently update their prospectuses and access 
capital markets without the expense and delay of filing post-effective 
amendments in most cases.
---------------------------------------------------------------------------

    \30\ See Proposing Release, supra footnote 10, at n.20.
    \31\ The base prospectus of a shelf registration statement will 
generally describe in broad terms the types of securities and 
offerings that the issuer may conduct at some later time.
---------------------------------------------------------------------------

    Affected funds, on the other hand, currently have limited ability 
to incorporate information by reference into their registration 
statements and cannot forward incorporate information from 
subsequently-filed Exchange Act reports.\32\ When an affected fund 
sells securities, including as part of a takedown ``off the shelf,'' 
its registration statement must include all required information.\33\ 
In particular, the affected fund's registration statement must include 
current financial information, including any annual update required by 
section 10(a)(3) of the Securities Act.\34\ Affected funds provide any 
section 10(a)(3) update to the registration statement by filing a post-
effective amendment, which involves the expense and potential delay 
associated with the fund's preparation of the amendment and also 
provides our staff with time to review the amendment for compliance 
with the applicable disclosure and accounting requirements and to 
provide comments where appropriate.\35\
---------------------------------------------------------------------------

    \32\ See Proposing Release, supra footnote 10, at n.22 
(discussing ``backward incorporation'').
    \33\ The fund's registration statement must include all required 
information to avoid liability from selling securities from an out-
of-date prospectus and to satisfy section 10(a) of the Securities 
Act. See infra footnotes 83-84 and accompanying text.
    \34\ See Proposing Release, supra footnote 10, at n.24.
    \35\ These post-effective amendments become effective pursuant 
to section 8(c) of the Securities Act on such date as the Commission 
may determine and are typically declared effective by the staff 
acting pursuant to delegated authority. In contrast, Form S-3 is 
updated through the filing of an annual report on Form 10-K, which 
contains the issuer's audited financial statements for its most 
recently completed fiscal year. See Securities Offering Reform 
Adopting Release, supra footnote 5, at n.61; see also Proposing 
Release, supra footnote 10, at n.25.
---------------------------------------------------------------------------

    Affected funds also cannot currently rely on rule 430B, which 
allows certain issuers to omit information from a prospectus, or the 
process that operating companies follow to file prospectus 
supplements.\36\ In addition, affected funds cannot currently file 
automatic shelf registration statements because only WKSIs can file 
these registration statements. These differences can result in 
additional expense or delay for affected funds relative to operating 
companies and can affect the timing of an affected fund's capital 
raising.\37\
---------------------------------------------------------------------------

    \36\ See id. at n.26.
    \37\ The final rule will give certain affected funds greater 
flexibility to control the timing of their capital raising. As 
discussed in the Proposing Release, section 23(b) of the Investment 
Company Act generally prohibits a registered CEF from issuing its 
shares at a price below the fund's current net asset value (``NAV'') 
without shareholder approval (this provision applies to BDCs as well 
with certain modifications). See id. at n.27. Because the shares of 
affected funds often trade at a discount to NAV, by allowing certain 
affected funds to sell securities ``off the shelf,'' the final rule 
will avoid potential delays associated with updating the funds' 
registration statements if they seek to access the markets when 
their shares are trading at a premium.
---------------------------------------------------------------------------

2. Amendments to the Registration Process for Affected Funds
    The amendments we are adopting are designed to streamline the 
registration process for affected funds in parity with operating 
companies. Specifically, and as discussed in more detail below, the 
amendments will permit affected funds to:
     File a short-form registration statement on Form N-2 that 
will

[[Page 33296]]

function like a Form S-3 registration statement. An affected fund that 
files this short-form registration statement can use it to register 
shelf offerings, including shelf registration statements that are filed 
by affected funds that qualify as WKSIs and become effective 
automatically, and can satisfy Form N-2's disclosure requirements by 
incorporating by reference information from the fund's Exchange Act 
reports;
     Rely on rule 430B to omit information from their base 
prospectuses, and to use the process operating companies follow to file 
prospectus supplements; and
     Include additional information in periodic reports to 
update their registration statements.
    Commenters generally supported our general approach to streamlining 
the registration process for affected funds. Commenters stated that the 
proposed amendments would allow affected funds to raise capital more 
efficiently and cost-effectively and would provide affected funds with 
greater flexibility to manage the timing of their offerings in response 
to market opportunities.\38\ One commenter stated that affected funds 
will benefit from the proposed amendments because they no longer will 
have to file post-effective amendments to shelf registration statements 
to update their financial statements. Instead, that information will be 
in annual reports and incorporated by reference into their registration 
statements.\39\
---------------------------------------------------------------------------

    \38\ See, e.g., ACC Comment Letter; ICI Comment Letter; Comment 
Letter of Securities Industry and Financial Markets Association 
(June 5, 2019) (``SIFMA Comment Letter'').
    \39\ See ICI Comment Letter.
---------------------------------------------------------------------------

3. Short-Form Registration on Form N-2
    We are adopting, as proposed, new General Instruction A.2 in Form 
N-2, which will allow affected funds to file a short-form registration 
statement on Form N-2 that will function like a registration statement 
filed on Form S-3.\40\ If a fund files a registration statement under 
this new instruction, the fund's registration statement will 
incorporate certain past and future Exchange Act reports by reference, 
allowing the fund to use a short-form registration statement and avoid 
the need to make post-effective amendments in most cases. An affected 
fund may use the new instruction to register a shelf offering under 
rule 415(a)(1)(x), and we are adopting conforming amendments to that 
rule to make this clear.\41\ The new instruction, however, is not 
limited to offerings under rule 415(a)(1)(x). Rather, an affected fund 
may use the new instruction to register any of the securities offerings 
that operating companies are permitted to register on Form S-3.\42\
---------------------------------------------------------------------------

    \40\ Throughout this release, we refer to General Instruction 
A.2 as the ``short-form registration instruction'' and refer to 
funds relying on this instruction as filing a ``short-form 
registration statement'' on amended Form N-2. Some of the required 
amendments and the conditions in our current rules are available 
only to issuers that meet the eligibility and transaction 
requirements of Form S-3 and therefore are eligible to file a short-
form registration statement on that form. The short-form 
registration instruction in Form N-2 is designed to facilitate these 
amendments, as directed in the BDC Act and the Registered CEF Act.
    \41\ See amended rule 415(a)(1)(x) (conforming amendments for 
affected funds); see also supra section II.B.3.c.
    \42\ See General Instruction I.B of Form S-3 (identifying 
transactions that can be registered on the form); see also General 
Instruction A.2.c of amended Form N-2. Form S-3, and therefore the 
short-form registration instruction, also is available to a 
majority-owned subsidiary that is a closed-end management investment 
company eligible to register a securities offering on Form N-2 if it 
meets certain conditions. See Proposing Release, supra footnote 10, 
at n.29 (describing the conditions necessary for majority-owned 
subsidiaries of closed-end management companies to register a 
securities offering on Form N-2).
---------------------------------------------------------------------------

a. Eligibility To File a Short-Form Registration Statement
    As proposed, we are adopting amendments to permit an affected fund 
to file a short-form registration statement under the short-form 
registration instruction on Form N-2 if:
     For either a BDC or a registered CEF, the fund meets both 
the registrant requirements and the transaction requirements of Form S-
3 (i.e., the fund could register the offering on Form S-3 if it were an 
operating company); \43\ and
---------------------------------------------------------------------------

    \43\ See General Instructions A.2.a and A.2.c of amended Form N-
2; General Instructions I.A (registrant requirements) and I.B 
(transaction requirements) of Form S-3.
---------------------------------------------------------------------------

     for registered CEFs only, the fund also has been 
registered under the Investment Company Act for at least 12 calendar 
months immediately preceding the filing of the registration statement 
and has timely filed all reports required to be filed under section 30 
of the Investment Company Act during that time.\44\
---------------------------------------------------------------------------

    \44\ Under this amendment to Form N-2, the fund also must have 
timely filed all reports required to be filed under section 30 of 
the Investment Company Act during any portion of a month immediately 
preceding the filing of the registration statement. See new General 
Instruction A.2.b of amended Form N-2.
---------------------------------------------------------------------------

    An affected fund generally will meet the registrant requirements of 
Form S-3 if it has timely filed all reports and other materials 
required under the Exchange Act during the prior year.\45\ An affected 
fund will generally meet the transaction requirements of Form S-3 for a 
primary offering if the fund's public float is $75 million or more.\46\ 
Requiring affected funds to satisfy the requirements of Form S-3 in 
order to file a short-form registration statement provides parity 
between affected funds and operating companies, consistent with 
Congress's mandates in the BDC Act and Registered CEF Act.
---------------------------------------------------------------------------

    \45\ See General Instruction I.A.3 of Form S-3.
    \46\ See General Instruction I.B of Form S-3.
---------------------------------------------------------------------------

    Commenters generally supported the proposal to permit affected 
funds to file short-form registration statements.\47\ Several 
commenters, however, urged that we provide additional bases other than 
public float for an affected fund to be eligible to file a short-form 
registration statement (or to qualify as a WKSI).\48\ While the 
arguments advanced by commenters apply to our proposed short-form 
registration requirement, commenters focused primarily on our proposed 
public float threshold for WKSI status.\49\ Accordingly, we discuss 
these comments below in section II.C.2. For the reasons discussed in 
that section, we are not changing the public float requirement or 
adopting new requirements for affected funds to file a short-form 
registration statement. We are adopting the proposed $75 million public 
float requirement for an affected fund to file a short-form 
registration statement on Form N-2 to provide affected funds parity 
with operating companies.
---------------------------------------------------------------------------

    \47\ See, e.g., SIFMA Comment Letter; Comment Letter of Mutual 
Fund Directors Forum (June 12, 2019) (``MFDF Comment Letter'').
    \48\ See, e.g., ICI Comment Letter; ABA Comment Letter.
    \49\ See infra section II.C.2 (discussing comments on public 
float requirement for WKSI eligibility).
---------------------------------------------------------------------------

    Certain affected funds, including most interval funds,\50\ do not 
list their securities on an exchange and thus do not have public float. 
As a result, these affected funds generally would not be able to 
satisfy the transaction requirement necessary to file a short-form 
registration statement.\51\ In

[[Page 33297]]

addition, as we noted in the Proposing Release, because interval funds 
make continuous offerings, they (as well as other continuously offered, 
non-listed affected funds) would not be able to file a short-form 
registration statement that omits information required to be in an 
issuer's prospectus when it is offering its securities.\52\
---------------------------------------------------------------------------

    \50\ Only one interval fund is currently exchange-listed.
    \51\ We intend for the short-form registration instruction to 
provide affected funds parity with operating companies so that 
affected funds can register the same transactions as operating 
companies register on Form S-3. To register a primary offering of 
equity securities on Form S-3, an issuer must meet the applicable 
eligibility and registrant requirements. For example, an issuer with 
the requisite public float may register a primary offering of 
securities to be offered for cash. See General Instruction I.B.1 of 
Form S-3. Alternatively, an issuer may register a primary offering 
if it has common equity securities listed on an exchange, limits the 
amount sold over a twelve-month period to no more than one-third of 
the aggregate value of voting and non-voting common equity held by 
non-affiliates, and meets certain other requirements. See General 
Instruction I.B.6 of Form S-3. Interval funds that are not exchange-
listed and without public float would not be qualified to register a 
primary offering of their shares on Form S-3.
    \52\ See Proposing Release, supra footnote 10, at text following 
n.37.
---------------------------------------------------------------------------

    Interval funds also have their own offering provision, Securities 
Act rule 415(a)(1)(xi),\53\ and post-effective amendments to their 
registration statements are immediately effective upon filing or 
automatically effective 60 days after filing under rule 486 under the 
Securities Act, depending on the substance of the amendments.\54\ As a 
result, interval funds currently have a tailored registration process 
that, although different in certain respects from that of operating 
companies, may provide many of the same efficiencies, including the 
ability to raise capital as the opportunity arises. As discussed below 
in section II.D, we are adopting amendments to rule 486 to allow any 
affected fund that conducts continuous offerings under rule 
415(a)(1)(ix), such as continuously-offered tender offer funds, to rely 
on rule 486. We believe these amendments will benefit such 
continuously-offered affected funds by allowing them to maintain 
effective registration statements in a more efficient, cost-effective 
manner, similar to the benefits that the rules we are adopting will 
provide to affected funds that file short-form registration statements.
---------------------------------------------------------------------------

    \53\ 17 CFR 230.415(a)(1)(xi).
    \54\ See 17 CFR 230.486.
---------------------------------------------------------------------------

    As proposed, in addition to satisfying the registrant requirements 
of Form S-3, a registered CEF also must have timely filed all reports 
required under section 30 of the Investment Company Act for the 
preceding 12 months in order to register an offering under the short-
form registration instruction. A registered CEF therefore must have 
timely filed during the prior year all required Exchange Act reports, 
such as annual and semi-annual reports to shareholders filed with the 
Commission on Form N-CSR, as well as reports required only under 
section 30 of the Act, such as reports on Forms N-CEN and N-PORT.
    As we stated in the Proposing Release, an issuer's Exchange Act 
filings provide the basic source of information to the market and to 
potential purchasers, and investors in the secondary market use that 
information in making their investment decisions.\55\ Although all 
affected funds file reports under the Exchange Act, registered CEFs 
also file reports under the Investment Company Act. These Investment 
Company Act reports also provide important information to the market 
and investors, including information about an affected fund's portfolio 
holdings that will be publicly reported on a quarterly basis on Form N-
PORT. We believe that the market will analyze this portfolio holdings 
information in a similar manner to how it analyzes financial statements 
for operating companies to determine changes in prospects for growth 
and performance. Portfolio holdings disclosure on Form N-PORT, for 
example, provides important information that is comparable to 
information BDCs include in Exchange Act reports for purposes of 
providing a quarterly flow of key information to the market. Moreover, 
requiring registered CEFs to have timely filed their Investment Company 
Act reports also will provide parity among BDCs, registered CEFs, and 
operating companies. This is because once Form N-PORT fully replaces 
Form N-Q, registered CEFs will only file Exchange Act reports semi-
annually on Form N-CSR, whereas BDCs and operating companies file 
Exchange Act reports on Forms 10-K, 10-Q and 8-K.\56\ As such, all 
issuers will be required to have filed their quarterly and other 
required reports in order to file a short-form registration statement.
---------------------------------------------------------------------------

    \55\ See Proposing Release, supra footnote 10, at text 
accompanying nn.42-46.
    \56\ Because Form N-PORT will render reports on Form N-Q 
unnecessarily duplicative, once a registered fund begins filing 
reports on Form N-PORT, it will no longer be required to file 
reports on Form N-Q. See Investment Company Reporting Modernization, 
Investment Company Act Release No. 32936 (Dec. 8, 2017) [82 FR 58731 
(Dec. 14, 2017)] (delaying the requirement for registered funds to 
submit reports on Form N-PORT through the EDGAR system until April 
2019 for larger fund groups, and April 2020 for smaller fund 
groups). Form N-Q will be rescinded on May 1, 2020. See id.
---------------------------------------------------------------------------

    We received one comment on this particular aspect of the proposal. 
This commenter expressed support for this aspect of the proposal, 
stating that it provides parity between registered CEFs and operating 
companies.\57\
---------------------------------------------------------------------------

    \57\ See Comment Letter of Teachers Insurance and Annuity 
Association of America (June 13, 2019) (``TIAA Comment Letter'').
---------------------------------------------------------------------------

b. Information Incorporated by Reference
    As proposed, the same rules on incorporation by reference that 
apply to Form S-3 registration statements also will apply to a short-
form registration statement filed on Form N-2.\58\ We did not receive 
comments on these amendments and are adopting them as proposed. 
Specifically, an affected fund relying on the short-form registration 
instruction will be required to:
---------------------------------------------------------------------------

    \58\ See section 803(c)(1) of the BDC Act (directing us to 
include an item or instruction that is similar to item 12 on Form S-
3 to provide that a BDC that would otherwise meet the requirements 
of Form S-3 shall incorporate by reference the reports and documents 
filed by the BDC under the Exchange Act into the registration 
statement of the BDC filed on Form N-2). We are amending General 
Instruction F.3 of current Form N-2 in its entirety and replacing it 
with a new General Instruction F.3. In these provisions and others 
that are substantively identical to parallel provisions in Form S-3, 
we have included conforming references to a fund's SAI.
---------------------------------------------------------------------------

     Specifically incorporate by reference into the prospectus 
and statement of additional information (``SAI''): (1) Its latest 
annual report filed pursuant to section 13(a) or section 15(d) of the 
Exchange Act that contains financial statements for the registrant's 
latest fiscal year for which a Form N-CSR or Form 10-K was required to 
be filed; and (2) all other reports filed pursuant to section 13(a) or 
15(d) of the Exchange Act since the end of the fiscal year covered by 
the annual report (backward incorporation by reference); \59\ and
---------------------------------------------------------------------------

    \59\ See new General Instruction F.3.a.(1)-(2) of amended Form 
N-2; cf. Item 12(a)(1)-(2) of Form S-3. In addition, if sales of a 
class of capital stock are to be registered on Form N-2 and the same 
class is registered under section 12 of the Exchange Act, the 
affected fund must incorporate by reference the description of the 
class contained in the Exchange Act registration statement with 
respect to that class (including any amendment or reports filed for 
the purpose of updating such description). See new General 
Instruction F.3.a.(3) of amended Form N-2; cf. Item 12(a)(3) of Form 
S-3.
---------------------------------------------------------------------------

     State that all documents subsequently filed pursuant to 
section 13(a), 13(c), 14, or 15(d) of the Exchange Act prior to the 
termination of the offering shall be deemed to be incorporated by 
reference into the prospectus and SAI (forward incorporation by 
reference).\60\
---------------------------------------------------------------------------

    \60\ See new General Instruction F.3.b of amended Form N-2; cf. 
Item 12(b) of Form S-3.
---------------------------------------------------------------------------

    We also are adopting, as proposed, an instruction to Form N-2 that 
will permit an affected fund filing a short-form registration statement 
on Form N-2 to satisfy the disclosure requirements for its prospectus 
or SAI by incorporating the information by reference from Exchange Act 
reports.\61\ This provision,

[[Page 33298]]

which is substantively identical to a parallel item in Form S-3, will 
give affected funds filing a short-form registration statement on Form 
N-2 the option to either provide required disclosure directly in the 
prospectus or SAI or to satisfy Form N-2's disclosure requirements with 
information incorporated by reference.\62\ We did not receive any 
comments on these particular amendments to Form N-2.
---------------------------------------------------------------------------

    \61\ See new General Instruction F.3 of amended Form N-2. The 
amendments will permit a fund to use this incorporated information 
to provide the disclosure required by Items 3-12 and Items 16-24 of 
Form N-2. See new General Instruction F.3.c of amended Form N-2; cf. 
Item 12(d) of Form S-3.
    \62\ The BDC Act directed us to extend this parallel item in 
Form S-3 (Item 12) to BDCs that meet Form S-3's requirements. See 
supra footnote 58; Item 12(d) of Form S-3; see also section 509(a) 
of the Registered CEF Act.
---------------------------------------------------------------------------

    We also are adopting, as proposed, conforming changes to Form N-2's 
undertakings.\63\ Form N-2 currently requires an undertaking that would 
prevent seasoned funds that file a short-form shelf registration 
statement from incorporating information by reference as proposed, 
because it requires funds to file post-effective amendments in certain 
circumstances without providing an exception that would allow the 
required information to be supplied via incorporation by reference.\64\ 
In contrast, operating companies registering an offering on Form S-3 
are not required under the applicable undertaking to file post-
effective amendments if the required information is included in an 
Exchange Act report incorporated by reference or a prospectus 
supplement that is part of the registration statement.\65\ To implement 
the statutory mandates and provide parity for affected funds, we are 
adopting amendments to Form N-2's undertakings to provide the same 
approach for affected funds filing a short-form registration statement 
on that form that applies to operating companies that file on Form S-
3.\66\
---------------------------------------------------------------------------

    \63\ See section 803(b)(2)(P) of the BDC Act (directing us to 
revise Item 34 of Form N-2 to require a BDC to provide undertakings 
``that are no more restrictive than the undertakings that are 
required of a registrant under [Item 512 of Regulation S-K],'' which 
sets forth the undertakings an operating company must include in its 
registration statement for certain offerings).
    Commenters suggested that the Item 34.1 undertaking to suspend 
an offering if a fund's NAV declines more than 10% from its NAV on 
its registration statement effective date until the fund amends the 
prospectus should not apply to continuous or delayed shelf offerings 
conducted by affected funds pursuant to proposed General Instruction 
A.2 of Form N-2. See Comment Letter of Dechert LLP (June 10, 2019) 
(``Dechert Comment Letter''); IPA Comment Letter; see also Item 34.1 
of current Form N-2. Commenters urged that the undertaking should 
not apply in these circumstances because the shelf offering could 
extend over 3-1/2 years, and the undertaking did not seem necessary 
because the fund would amend its prospectus by incorporating by 
reference the information from its Exchange Act reports. See Dechert 
Comment Letter; IPA comment Letter. We agree, and are amending Item 
34.1 to clarify that this undertaking is not applicable in the 
circumstance described by commenters. See Item 34.1 of amended Form 
N-2.
    \64\ Form N-2 currently requires an affected fund registering an 
offering under rule 415 to undertake to file, during any period in 
which offers or sales are being made, a post-effective amendment to 
the registration statement under certain circumstances, including to 
provide any prospectus required by section 10(a)(3) of the 
Securities Act. See Item 34.4.a of current Form N-2.
    \65\ See 17 CFR 229.512(a)(1)(iii)(B) (Item 512(a)(1)(iii)(B) of 
Regulation S-K).
    \66\ Specifically, our amendments add a new provision to the 
relevant undertaking stating that the requirement to undertake to 
file a post-effective amendment does not apply if the registration 
statement is filed under the short-form registration instruction and 
the information required to be included in a post-effective 
amendment is contained in Exchange Act reports that are incorporated 
by reference into the fund's registration statement or is contained 
in a form of prospectus that is part of the registration statement. 
See Item 34.3.a of amended Form N-2; cf. Item 512(a) of Regulation 
S-K.
     We also are amending Item 34 to make conforming changes to 
mirror parallel undertakings in Item 512 of Regulation S-K. See, 
e.g., Item 34.3.a(2) of amended Form N-2; cf. Item 512(a)(1)(ii) of 
Regulation S-K; Item 34.3.d(1) of amended Form N-2; cf. Item 
512(a)(5)(i) of Regulation S-K; Item 34.3.e(2)-(3) of amended Form 
N-2; cf. Item 512(a)(6)(ii)-(iii) of Regulation S-K; Item 34.5 of 
amended Form N-2; cf. Item 512(b) of Regulation S-K; and Item 34.6 
of amended Form N-2; cf. Item 512(h) of Regulation S-K.
    Additionally, in response to comments, we are eliminating the 
undertaking in Item 34.3 of current Form N-2, which requires 
affected funds to undertake to supplement the prospectus or file a 
post-effective amendment to disclose certain information if the 
securities being registered are to be offered to existing 
shareholders, and if not taken, to be reoffered to the public. See 
Dechert Comment Letter; IPA Comment. The Commission recently 
eliminated a parallel undertaking from Regulation S-K because other 
requirements make the undertaking duplicative and unnecessary. See 
FAST Act Modernization and Simplification of Regulation S-K, 
Investment Company Act Release No. 33426 (Mar. 20, 2019) [84 FR 
12674 (Apr. 2, 2019)] (``FAST Act Modernization Adopting Release''), 
at n.171. We are eliminating this undertaking from Form N-2 for the 
same reasons, and renumbering Item 34's sub-items accordingly.
---------------------------------------------------------------------------

    The Proposing Release requested comment on whether we should modify 
incorporation by reference provisions in other registration forms filed 
by affected funds to provide parity or consistency across registration 
statements. In particular, we asked if we should amend Form N-14 to 
provide that BDCs may incorporate by reference to the same extent as 
registered CEFs.\67\ Commenters supported this approach,\68\ which 
would provide for more consistent treatment between registered CEFs and 
BDCs.
---------------------------------------------------------------------------

    \67\ Form N-14 currently permits a registered CEF--but not a 
BDC--to incorporate by reference certain information about the 
registrant and the company being acquired that is required by Items 
5, 6 and 11-14 of Form N-14 from its prospectus, SAI, or Investment 
Company Act reports into the Form N-14 prospectus. See General 
Instruction G of current Form N-14.
    \68\ See Dechert Comment Letter; IPA Comment Letter.
---------------------------------------------------------------------------

    We are modifying Form N-14 to allow BDCs to incorporate by 
reference to the same extent as registered CEFs. As commenters 
observed, this change will provide consistent treatment for BDCs and 
registered CEFs. This change also will reduce the length of a BDC's 
Form N-14 prospectus, which in some cases can exceed 1,000 pages, 
because BDCs cannot currently incorporate information by reference. To 
effectuate this change, we are amending the instruction in Form N-14 
that governs incorporation by reference to specifically include BDCs 
and clarify that current reports include those filed pursuant to 
section 13(a) or 15(d) of the Exchange Act.\69\ Additionally, in 
response to comments,\70\ we are eliminating the requirement that 
registrants file with the Form N-14 registration statement the 
documents that contain information that is incorporated by reference 
into the prospectus or SAI.\71\ Such documents are filed on EDGAR and 
readily available to Commission staff.
---------------------------------------------------------------------------

    \69\ See General Instruction G of amended Form N-14. We also are 
eliminating the instruction's reference to sub-paragraph (d) of 
Section 30, and will instead reference Section 30 (no sub-part 
specified). This change will have the effect of requiring a Form N-
14 registrant that seeks to incorporate by reference to be current 
in filing all Section 30 reports, including reports filed on Forms 
N-PORT and N-CEN. Commenters also suggested that we further amend 
Form N-14 to provide that a seasoned affected fund that incorporates 
by reference information about the registrant into the prospectus 
need not deliver copies of the documents containing such information 
with the prospectus. See, e.g., Dechert Comment Letter. Because the 
delivery requirement applies to funds generally and not just 
affected funds, we believe that any changes to the requirement 
should be considered on a broader basis that is beyond the scope of 
this rulemaking.
    \70\ See Dechert Comment Letter; IPA Comment Letter.
    \71\ See General Instruction G of amended Form N-14. The 
requirement to file with the registration statement the documents 
that contain the information that is incorporated by reference is no 
longer necessary given the availability of such documents on EDGAR. 
We are similarly eliminating the requirement to file with the 
registration statement each document from which information is 
incorporated by reference into the SAI.
---------------------------------------------------------------------------

c. Affected Funds' Use of Rule 415(a)(1)(x) and Automatic Shelf 
Registration Statements \72\
---------------------------------------------------------------------------

    \72\ As proposed, amended Form N-2 will become effective on 
August 1, 2020. The Commission also will need time to modify its 
systems to automatically reflect that automatic shelf registration 
statements are effective upon filing and process ``pay-as-you-go'' 
payments for affected funds that are WKSIs. See infra section II.J. 
Until such modifications are complete, which is anticipated to be 
September 2020, affected funds should contact the staff of the 
Division of Investment Management's Disclosure Review and Accounting 
Office if they are filing an automatic shelf registration statement.
---------------------------------------------------------------------------

    We are adopting, as proposed, two additional amendments to allow

[[Page 33299]]

affected funds to use the shelf registration system in parity with 
operating companies. First, we are amending rule 415(a)(1)(x) to 
clarify that affected funds may use that rule by adding references to a 
registration statement filed under the short-form registration 
instruction.\73\ Second, we are adopting a new general instruction to 
permit affected funds that qualify as WKSIs to file an automatic shelf 
registration statement.\74\ A WKSI can register unspecified amounts of 
different types or classes of securities on an automatic shelf 
registration statement.\75\ An automatic shelf registration statement 
and any amendments to the registration statement will be effective 
immediately upon filing.\76\ Automatic shelf registration provides 
WKSIs with significant flexibility to take advantage of market windows, 
structure terms of securities on a real-time basis to accommodate 
investor demand, and determine or change the plan of distribution in 
response to changing market conditions. WKSIs using an automatic shelf 
registration statement further benefit by being able to pay filing fees 
at any time in advance of a shelf takedown or on a ``pay-as-you-go'' 
basis at the time of each takedown off the shelf registration statement 
in an amount calculated for that takedown.\77\ Our amendments will 
extend these same benefits to affected funds that qualify as WKSIs, as 
directed by the BDC Act and the Registered CEF Act.\78\ We did not 
receive any comments on these particular amendments.\79\
---------------------------------------------------------------------------

    \73\ See rule 415(a)(1)(x) (amended to include securities 
registered pursuant to General Instruction A.2 of Form N-2). See 
also section 803(b)(2)(J) of the BDC Act (directing us to revise 
rule 415(a)(1)(x) to provide that a BDC that would otherwise meet 
the eligibility requirements of Form S-3 can register its securities 
under that provision). Our amendments also add a reference to a Form 
N-2 registration statement filed pursuant to General Instruction A.2 
to rule 415(a)(2) to make clear that affected funds registering 
offerings pursuant to rule 415(a)(1)(ix), like other issuers relying 
on that provision, will not be subject to the limitation that they 
register an amount of securities that the issuer reasonably expected 
would be offered or sold within two years from the date that the 
registration statement became effective. Cf. Securities Offering 
Reform Adopting Release, supra footnote 5, at 44774-44775.
    \74\ See General Instruction B of amended Form N-2; section 
803(c)(2) of the BDC Act (directing that we amend Form N-2 to 
include an instruction that is similar to the instruction regarding 
automatic shelf registration offerings by WKSIs on Form S-3 to 
provide that a BDC that is a WKSI may file automatic shelf offerings 
on Form N-2). This instruction will provide that an affected fund 
that is a WKSI may use the form as an automatic shelf registration 
statement only for the transactions that are described in, and 
consistent with the requirements of, General Instruction I.D of Form 
S-3. This provides parity with operating companies because General 
Instruction I.D of Form S-3 specifies the transactions and 
requirements for an automatic shelf registration statement filed on 
Form S-3. Consistent with General Instruction I.D of Form S-3, 
General Instruction B specifies that the form could not be used as 
an automatic shelf registration statement for securities offerings 
under rule 415(a)(1)(vii) or (viii).
    \75\ See 17 CFR 230.430B(a) (Securities Act rule 430B(a)).
    \76\ See 17 CFR 230.462(e) and (f) (Securities Act rule 462(e) 
and (f)).
    \77\ See 17 CFR 230.457(r) and 17 CFR 230.456(b) (Securities Act 
rule 457(r) and rule 456(b)).
    \78\ As proposed, we are making conforming amendments to 
Securities Act rule 462(f) and to the registration fee table in Form 
N-2 to enhance consistency with Form S-3 and to allow affected funds 
that file as WKSIs to use the pay-as-you-go registration fee 
process. See section II.J for a discussion of applicable effective 
dates for pay-as-you-go registration fees.
    \79\ While we did not receive any comments specifically on the 
proposed general instruction to permit affected funds that qualify 
as WKSIs to file an automatic shelf registration statement, we did 
receive comments on the proposed WKSI standard for affected funds. 
Those comments are addressed in section II.C below.
---------------------------------------------------------------------------

d. Omitting Information From a Base Prospectus and Prospectus 
Supplements
    The BDC Act directed us to include a process for a BDC to file a 
prospectus in the same manner as under rule 424(b).\80\ Consistent with 
this directive and with the Registered CEF Act, we are amending, as 
proposed, rule 424(f) to allow affected funds to file a prospectus 
under rule 424.\81\ As discussed in the Proposing Release, affected 
funds registering shelf offerings under Securities Act rule 415 
generally can omit required information from the base prospectus that 
is unknown or not reasonably available to the fund when the 
registration statement becomes effective.\82\ WKSIs and certain issuers 
eligible to use Form S-3 for primary offerings are permitted under rule 
430B to omit certain additional information. A base prospectus that 
omits statutorily-required information is not a final prospectus under 
section 10(a) of the Securities Act.\83\ Filing a prospectus supplement 
pursuant to rule 424 is one way to provide information required for a 
prospectus to satisfy the requirements of section 10(a).\84\
---------------------------------------------------------------------------

    \80\ See section 803(b)(2)(K) of the BDC Act.
    \81\ These amendments will not apply to open-end funds or other 
registered investment companies. Accordingly, those investment 
companies would continue to file prospectuses pursuant to rule 497. 
See amended rule 424(f). We also are amending rule 424(f) to state 
that references to the term ``form of prospectus'' in the rule 
include the SAI.
    \82\ See 17 CFR 230.409 (Securities Act rule 409).
    \83\ 15 U.S.C. 77j(a).
    \84\ Omitted information also may be provided in a post-
effective amendment or, where permitted, through Exchange Act 
filings that are incorporated by reference.
---------------------------------------------------------------------------

    Our rules, however, provide different processes for operating 
companies and investment companies to file prospectuses. Operating 
companies currently follow rule 424 to file prospectus supplements, 
whereas investment companies follow rule 497.
    Although these rules provide similar processes, they have certain 
key differences. For example, rule 424(b) is designed to work together 
with rule 415(a)(1)(x), and provides additional time for an issuer to 
file a prospectus. Rule 497 does not contain provisions specifically 
related to offerings under rule 415(a)(1)(x) and requires the fund to 
file a prospectus with the Commission before using it. Rule 424 also 
requires an issuer to file a prospectus when the issuer makes changes 
from or additions to a previously-filed prospectus that are 
substantive, whereas rule 497 requires funds to file every prospectus 
that varies from any previously-filed prospectus.
    Under the amendment to rule 424(f), an affected fund will be able 
to file any type of prospectus enumerated in rule 424(b) to update, or 
to include information omitted from, a prospectus or in connection with 
a shelf takedown.\85\ We also are amending rule 497 to provide that 
rule 424 would be the exclusive rule for affected funds to file a 
prospectus supplement other than an advertisement that is deemed to be 
a prospectus under 17 CFR 230.482 (rule 482).\86\ This will avoid any 
confusion that might result if affected funds were permitted to file 
prospectuses under both rule 424 and rule 497, while also continuing to 
require affected funds to file rule 482 advertisements as they and 
other investment companies do today.
---------------------------------------------------------------------------

    \85\ An affected fund that seeks to file a rule 424(b)(1) or 
424(b)(4) prospectus supplement to provide pricing information 
omitted pursuant to rule 430A must be able to satisfy the conditions 
of rule 430A, which include the requirement to furnish the 
``undertakings required by Item 512(i) of Regulation S-K.'' See rule 
430A(a)(2) under the Securities Act. To facilitate an affected 
fund's ability to rely on the rule, we are amending rule 430A to 
require affected funds to provide the parallel undertaking required 
by Item 34.4 of amended Form N-2.
    \86\ See amended Securities Act rule 497(l).
---------------------------------------------------------------------------

    We also are adopting, as proposed, an amendment to permit affected 
funds to use rule 430B in parity with operating companies.\87\ We 
received no comments on this aspect of the proposal. Thus an affected 
fund may omit certain information from its prospectus in two 
circumstances:
---------------------------------------------------------------------------

    \87\ See Proposing Release, supra footnote 10, at text preceding 
n.72.
---------------------------------------------------------------------------

     A WKSI filing an automatic shelf registration statement 
may omit the plan

[[Page 33300]]

of distribution and information as to whether the offering is a primary 
one or an offering on behalf of selling security holders.
     If an issuer is eligible to file a registration statement 
on Form S-3 to register a primary offering pursuant to General 
Instruction I.B.1 of Form S-3, and is registering the resale of 
securities on behalf of selling security holders, it may omit the 
identities of selling security holders and the amount of securities to 
be registered on their behalf, subject to certain conditions.\88\
---------------------------------------------------------------------------

    \88\ See amended rule 430B (allowing affected funds eligible to 
register a primary offering under the short-form registration 
instruction to rely on rule 430B). We also are amending the 
undertakings in Form N-2 to require affected funds relying on rule 
430B to make the same undertakings required of operating companies 
that rely on the rule. See Item 34.3.d(1) of amended Form N-2; cf. 
Item 512(a)(5)(i) of Regulation S-K. See also supra footnotes 63-66 
and accompanying text. Rules 430B and 424 and 17 CFR 230.158 (rule 
158) specify when information contained in a prospectus supplement 
will be deemed part of and included in the registration statement 
and circumstances that will trigger a new effective date of the 
registration statement for purposes of section 11(a) of the 
Securities Act. These rules apply to affected funds just as they 
apply to operating companies.
---------------------------------------------------------------------------

e. Additional Information in Periodic Reports
    As discussed above, the amendments we are adopting will permit 
certain affected funds to forward incorporate information from their 
Exchange Act reports. These funds may wish to include information in 
their periodic reports that is not required to be included in these 
reports in order to update their registration statements. We therefore 
proposed to include a new instruction to Form N-2 that would allow a 
fund to include additional information so as long as the fund included 
a statement in the report identifying information that it included for 
this purpose to provide context for investors.\89\ After considering 
comments we received, we are not adopting this proposed instruction.
---------------------------------------------------------------------------

    \89\ See Proposing Release, supra footnote 10, at n.73 and 
accompanying text (discussing proposed Instruction 6.i to Item 24 of 
Form N-2).
---------------------------------------------------------------------------

    The commenters that addressed this proposed new instruction to Form 
N-2 recommended against requiring this identifying statement in 
periodic reports on the grounds that it unnecessarily emphasized 
information included to update the fund's registration statement and 
could potentially distract investors from other information that may be 
more material to their investment decisions.\90\ These commenters also 
stated that requiring funds to identify this information would not be 
consistent with an integrated disclosure regime in which the 
information is incorporated by reference. We have determined not to 
adopt the identification requirement. After considering comments, we 
are persuaded that requiring an affected fund to highlight information 
just because it updates the fund's registration statement could 
unnecessarily emphasize it.
---------------------------------------------------------------------------

    \90\ See Dechert Comment Letter; IPA Comment Letter.
---------------------------------------------------------------------------

C. Well-Known Seasoned Issuer Status

    We are adopting, as proposed, amendments that will allow certain 
affected funds to qualify as WKSIs. Issuers that qualify as WKSIs are 
permitted to receive the greatest degree of benefits from the 
modifications to the communications and registration rules that the 
Commission adopted in 2005.\91\ A WKSI, for example, can file a 
registration statement or amendment that becomes effective 
automatically in a broader variety of contexts than a non-WKSI. In 
addition, subject to certain conditions, a WKSI may communicate at any 
time, including through a free writing prospectus, without violating 
the ``gun-jumping'' provisions of the Securities Act.\92\
---------------------------------------------------------------------------

    \91\ Securities Offering Reform Adopting Release, supra footnote 
5, at 44727.
    \92\ See infra section II.F.
---------------------------------------------------------------------------

    To qualify as a WKSI, the issuer must meet the registrant 
requirements of Form S-3, i.e., it must be ``seasoned'' \93\ and 
generally must have at least $700 million in public float.\94\ An 
issuer is not eligible for WKSI status if, among other bases: (1) It is 
not current and timely in its Exchange Act reports, or (2) it is the 
subject of a judicial or administrative decree or order arising out of 
a governmental action involving violations of the anti-fraud provisions 
of the Federal securities laws (the ``anti-fraud prong'' of the 
ineligible issuer definition).\95\
---------------------------------------------------------------------------

    \93\ See supra footnote 28.
    \94\ See paragraph (1)(i)(A) of the WKSI definition in rule 405. 
See also supra footnote 19. See also Proposing Release, supra 
footnote 10, at n.77 (identifying alternative bases for an issuer to 
qualify as a WKSI, including that an issuer may qualify if it has 
issued, for cash, within the last three years, at least $1 billion 
in aggregate principal amount of non-convertible securities, other 
than common equity, in primary offerings registered under the 
Securities Act).
    \95\ See paragraphs (1)(i) and (vi) of the definition of 
ineligible issuer in Securities Act rule 405.
---------------------------------------------------------------------------

1. WKSI Definition
    As proposed, we are amending rule 405 to delete the exclusion of 
affected funds from the definition of WKSI.\96\ In addition, we are 
adopting, as proposed, an amendment to the WKSI definition to include a 
reference to the registrant requirements of the proposed short-form 
registration instruction on Form N-2.\97\ We received no comments on 
our proposal to make these particular amendments to rule 405. 
Commenters generally supported permitting affected funds to qualify as 
WKSIs.\98\
---------------------------------------------------------------------------

    \96\ See amended paragraph (1)(v) of rule 405.
    \97\ See amended paragraph (1)(i) of the WKSI definition in rule 
405. In addition, we are adopting, as proposed, amendments to the 
definition of WKSI to make conforming references to a registration 
statement filed under new General Instruction A.2 of amended Form N-
2. See paragraphs (1)(i) introductory text and (1)(i)(B)(2) of the 
definition of WKSI in amended rule 405; new General Instruction A.2 
of amended Form N-2. We also are making a conforming amendment, as 
proposed, to paragraph (2) of the definition of WKSI to add a 
reference to Form N-CSR, the form on which registered CEFs file 
their shareholder reports with the Commission. See amendment to 
paragraph (2) of the definition of WKSI in amended rule 405. We did 
not receive any comments on our proposal to make these conforming 
amendments to the WKSI definition in rule 405.
    \98\ See, e.g., ICI Comment Letter; ACC Comment Letter; SIFMA 
Comment Letter; MFDF Comment Letter.
---------------------------------------------------------------------------

2. WKSI Eligibility
    The BDC Act directed us to amend Securities Act rule 405 to allow a 
BDC to qualify as a WKSI, and the Registered CEF Act directed us to 
allow a registered CEF covered by the Act to use the securities 
offering rules that are available to operating companies.\99\ 
Consistent with these directives, and to provide parity in the offering 
rules for affected funds and operating companies, we are adopting, as 
proposed, amendments to allow affected funds to qualify as WKSIs if 
they satisfy the same $700 million public float requirement that 
applies to operating companies.
---------------------------------------------------------------------------

    \99\ See section 803(b)(2)(A)(i) of the BDC Act and section 
509(a) of the Registered CEF Act.
---------------------------------------------------------------------------

    Our securities offering rules provide WKSIs with certain 
registration and communication flexibilities because, among other 
reasons, they have a demonstrated market following (i.e., they are 
``well-known'').\100\ The Commission has used public float as an 
approximate measure of an issuer's market following and the extent to 
which the market absorbs information about the issuer that is 
ultimately reflected in the price of the issuer's securities.\101\ The 
$700 million public

[[Page 33301]]

float requirement is meant to encompass issuers that are presumptively 
the most widely followed in the marketplace and whose disclosures and 
other communications therefore are subject to market scrutiny by 
investors, the financial press, analysts, and others.\102\
---------------------------------------------------------------------------

    \100\ See Securities Offering Reform Adopting Release, supra 
footnote 5, at n.49 and accompanying text. In establishing the WKSI 
category of issuers for operating companies, the Commission stated 
that issuers that meet the $700 million public float threshold or 
the alternative $1 billion registered offering of non-convertible 
securities threshold have a wide following by market participants, 
the media, and institutional investors. See id. at section II.A.
    \101\ See, e.g., id. at n.50 (stating that the determination of 
public float is based on a public trading market, such as an 
exchange or certain over-the-counter markets). See also Shelf 
Registration, Securities Act Release No. 6499, at 5 (Nov. 17, 1983) 
[48 FR 52889] (``Forms S-3 and F-3 recognize the applicability of 
the efficient market theory to those companies which provide a 
steady stream of high quality corporate information to the 
marketplace and whose corporate information is broadly disseminated. 
Information about these companies is constantly digested and 
synthesized by financial analysts, who act as essential conduits in 
the continuous flow of information to investors, and is broadly 
disseminated on a timely basis by the financial press and other 
participants in the marketplace.''); see also Covered Investment 
Fund Research Reports, Investment Company Act Release No. 33311 
(Nov. 30, 2018) [83 FR 64180 (Dec. 13, 2018)] (``Covered Investment 
Fund Research Reports Adopting Release'').
    \102\ See Securities Offering Reform Adopting Release, supra 
footnote 5, at text accompanying n.40.
---------------------------------------------------------------------------

    Although the comments we received generally supported permitting 
affected funds to qualify as WKSIs, commenters also suggested specific 
modifications to the proposed amendments to permit certain additional 
affected funds to qualify. Several commenters recommended that we 
eliminate the public float requirement for affected funds.\103\ Other 
commenters recommended that we adopt a substantially lower public float 
threshold for affected funds, among other reasons, to make WKSI status 
available to a greater percentage of affected funds that have listed 
securities.\104\ One such commenter offered a specific suggestion: That 
we reduce the public float threshold for affected funds from $700 
million to $480 million.\105\ This commenter stated that the $700 
million public float requirement adopted in 2005 for operating 
companies permitted approximately 30% of operating companies to qualify 
as WKSIs, and stated that we should seek to achieve a similar 30% 
``target'' by adopting a $480 million public float requirement for 
affected funds.
---------------------------------------------------------------------------

    \103\ See ICI Comment Letter (suggesting that we permit affected 
funds to qualify as WKSIs solely based on the other proposed 
requirements for WKSI status, such as meeting other registrant and 
transaction requirements of Form S-3); see also Comment Letter of 
Invesco Ltd. (June 10, 2019) (``Invesco Comment Letter'') (same). 
See also TIAA Comment Letter (recommending that we eliminate the 
public float requirement and adopt a standard for WKSI qualification 
for registered CEFs based on whether certain information about the 
fund is available to the public, such as information about the 
fund's holdings, total return performance, and daily NAV).
    \104\ See ABA Comment Letter. See also TIAA Comment Letter 
(recommending that we adopt a $480 million public float requirement 
for registered CEFs in order to permit approximately 30% of 
registered CEFs to qualify as WKSIs, which would be consistent with 
the percentage of operating companies that were permitted to qualify 
as WKSIs under the Commission's 2005 securities offering reforms).
    \105\ See TIAA Comment Letter (recommending that we reduce the 
public float threshold to $480 million as an alternative to its 
recommendation that we eliminate the public float requirement for 
affected funds). See supra footnote 103.
---------------------------------------------------------------------------

    As the basis for the recommended elimination of or modification to 
the $700 million public float requirement for affected funds, these 
commenters stated that while affected funds may not have the same level 
of market following as operating companies with the requisite public 
float, market following is a less relevant standard for affected funds 
than it is for operating companies. These commenters suggested that 
certain distinguishing characteristics of affected funds compensate for 
their relative lack of market following and corresponding market 
scrutiny. For example, commenters stated that affected funds, as pass-
through investment vehicles, have a less complex business than 
traditional operating companies, and thus require less market 
scrutiny.\106\ Commenters also stated that market scrutiny is less 
relevant for affected funds because, unlike operating companies, 
affected funds must satisfy the investor protection requirements of the 
Investment Company Act and related Commission rules, including 
requirements relating to financial transparency, valuation of portfolio 
securities, transactions with affiliates, and board oversight, among 
others.\107\
---------------------------------------------------------------------------

    \106\ See, e.g., ICI Comment Letter; see also ABA Comment Letter 
(stating that, unlike operating companies, affected funds 
``generally describe their operations in terms of a stated 
investment objective and investment strategies that tend to remain 
constant over time''). The ABA Comment Letter further asserted that 
the proposed $700 million public float requirement would be 
burdensome for affected funds relative to operating companies 
because, unlike operating companies, affected funds have a 
relatively fixed asset base (and therefore a relatively fixed public 
float) that would be unlikely to increase over time to a level that 
would satisfy the public float requirement.
    \107\ See, e.g., ABA Comment Letter (stating that the 
``operating limitations, oversight requirements and investor 
protection provisions'' that apply to affected funds under the 
Investment Company Act ``more than compensate for Affected Funds' 
lower level of research analyst coverage relative to large operating 
companies''); ICI Comment Letter (stating that affected funds ``are 
subject to important requirements under the Investment Company Act, 
including valuing their investments under board-approved valuation 
procedures and ongoing board oversight''); TIAA Comment Letter 
(stating that market following is less relevant to affected funds 
because, among other reasons, they are subject to ``the valuation 
framework of the 1940 Act'').
---------------------------------------------------------------------------

    Similarly, on the basis that public float is not a suitable 
criterion for determining WKSI status for affected funds, commenters 
also urged that we permit unlisted affected funds (which do not have 
public float) to qualify for WKSI status on the basis of their 
aggregate NAVs.\108\ In addition to the reasons provided by commenters, 
discussed above, for eliminating or modifying the public float 
requirement,\109\ these commenters stated that the intermediaries and 
distribution platforms through which unlisted affected funds are sold 
perform extensive due diligence on unlisted affected funds, resulting 
in these funds being subject to scrutiny ``equal'' to the market 
scrutiny indicated by a large public float.\110\ Commenters also stated 
that technological advancements have made unlisted affected funds' 
financial disclosures directly accessible to investors, and that, 
particularly in light of the extensive disclosure funds provide, 
investors are less dependent on market analysts for financial 
information.\111\
---------------------------------------------------------------------------

    \108\ See, e.g., ABA Comment Letter; Dechert Comment Letter; ICI 
Comment Letter.
    \109\ Similar to the comments discussed above recommending that 
we eliminate or reduce the $700 million public float requirement, 
these commenters stated, among other things, that unlisted affected 
funds are subject to the Investment Company Act's investor 
protection, board oversight, and disclosure requirements, and that 
unlisted affected funds are structurally and operationally less 
complex than operating companies. See supra footnotes 106-107 and 
accompanying text.
    \110\ See Dechert Comment Letter; ABA Comment Letter.
    \111\ See, e.g., Dechert Comment Letter. See section 509(a) of 
the Registered CEF Act.
---------------------------------------------------------------------------

    After considering these comments, we are adopting, as proposed, 
WKSI requirements for affected funds that are in parity with the 
requirements for operating companies. We are not eliminating or 
modifying the $700 million public float requirement for affected funds, 
or permitting affected funds to qualify as WKSIs based on their 
aggregate NAVs. Our amendments will implement the BDC Act and 
Registered CEF Act, and are designed to provide parity in the offering 
rules for affected funds and operating companies.
    As discussed above, commenters stated that there are certain 
distinctions between affected funds and operating companies that 
suggest that the $700 million public float requirement is not an 
appropriate criterion for determining WKSI status for affected funds. 
For example, commenters noted that affected funds generally have less 
complex businesses than operating companies, are subject to the 
requirements of the Investment Company Act, and provide extensive 
financial information to the market. We agree with commenters that the 
WKSI framework, which the Commission designed specifically for 
operating

[[Page 33302]]

companies, is not well-tailored to the specific characteristics of 
affected funds. However, these rules are designed to provide WKSI 
status to issuers with a demonstrated market following, and the 
Commission has for many years used public float, based on a public 
trading market, as an approximate measure of a stock's market following 
and, consequently, the degree of efficiency with which the market 
absorbs information and reflects it in the price of a security.\112\ 
Moreover, the offering rules for operating companies, which Congress 
specifically directed the Commission to extend to certain affected 
funds, are not premised on the characteristics of specific types of 
issuers, such as whether an issuer's business is less complex than 
other issuers' businesses or whether an issuer is subject to different 
regulatory requirements. Further, the market following for closed-end 
funds is significantly less robust than is the case for operating 
companies. As a result, in our view, it would not be appropriate to 
select a public float figure that is below the figure used to determine 
WKSI status for operating companies.
---------------------------------------------------------------------------

    \112\ See Revisions to the Eligibility Requirements for Primary 
Securities Offerings on Forms S-3 and F-3, Securities Act Release 
No. 8878 (Dec. 19, 2007) [72 FR 73534 (Dec. 27, 2007)], at text 
accompanying n.25; See also Securities Offering Reform Adopting 
Release, supra footnote 5, at text accompanying n.52 (``High levels 
of analyst coverage, institutional ownership, and trading volume are 
useful indicators of the scrutiny that an issuer receives from the 
market, although no one statistic can fully capture the extent to 
which an issuer is followed by the market.'').
---------------------------------------------------------------------------

    We also are not persuaded by commenters that allowing an affected 
fund, including an unlisted affected fund, to qualify on the basis of 
its aggregate NAV would be consistent with the requirements for an 
issuer to qualify as a WKSI, which Congress directed us to extend to 
affected funds.\113\ In addition, permitting unlisted affected funds to 
qualify as WKSIs based on their aggregate NAVs would result in 
disparate treatment between unlisted affected funds and similarly 
situated operating companies under these rules. For example, unlisted 
real estate investment trusts (``unlisted REITs'') do not have a public 
float and therefore generally cannot qualify as WKSIs under the rules 
for operating companies. Unlisted REITs, however, have many of the 
characteristics that commenters cited in support of permitting unlisted 
affected funds to use their aggregate NAVs to qualify as WKSIs.\114\ 
Nonetheless, unlisted REITs and other unlisted operating companies may 
not qualify as WKSIs unless they have the requisite public float or 
satisfy one of the alternative bases (which we also are adopting for 
affected funds).
---------------------------------------------------------------------------

    \113\ As discussed above, the Registered CEF Act, as enacted, 
requires us to allow only interval funds and listed registered CEFs 
to use the securities offering rules available to operating 
companies See supra section II.A. To provide parity of treatment for 
similarly situated affected funds, we are exercising our discretion 
to extend certain of these rules to unlisted registered CEFs that 
are not interval funds. We do not believe, however, that it would be 
consistent with the Registered CEF Act to provide these unlisted 
registered CEFs with new criteria for qualifying as WKSIs. Indeed, 
legislative language that preceded the passage of the Registered CEF 
Act would have applied to all registered closed-end investment 
companies, but the legislation enacted as the Registered CEF Act was 
subsequently narrowed in scope to apply only to listed closed-end 
funds and interval funds. Compare the Financial CHOICE Act of 2017, 
H.R. 10, 115th Cong. section 499A(a) (June 8, 2017) (directing us to 
revise rules to the extent necessary to allow a closed-end company, 
as defined in section 5(a)(2) of the Investment Company Act, that is 
registered as an investment company under the Act to use the 
securities offering and proxy rules that are available to other 
issuers that are required to file reports under section 13(a) or 
section 15(d) of the Exchange Act) with section 509(a) of Registered 
CEF Act. See also 163 Cong. Rec. H4791, H4792 (2017) (daily ed. June 
8, 2017) (statement of Rep. Ellison) (stating that the prior bill 
would ``allow even illiquid, nontraded funds to claim multiple 
exemptions,'' making it ``harder for the . . . Commission . . . to 
police these products for investors'').
    \114\ For example, both unlisted REITS and unlisted affected 
funds sell their shares through intermediaries and both types of 
entities' financial disclosures have been made directly accessible 
to investors through advances in technology.
---------------------------------------------------------------------------

    Moreover, many of the distinctions between affected funds and 
operating companies that commenters raised are based on the 
characteristics of registered funds and BDCs generally, and are not 
unique to affected funds. We believe that the particular 
characteristics of registered funds, including affected funds, may be 
appropriate for the Commission to examine as part of a more 
comprehensive consideration of whether the securities offering rules 
for funds should be modified rather than in this rulemaking related to 
affected funds specifically.\115\
---------------------------------------------------------------------------

    \115\ As discussed at infra section III.A.1, affected funds 
represent approximately 5.1% of all registered investment companies 
by number of funds and approximately 2% by assets. In addition, as 
discussed at infra section III.D, we believe that providing affected 
funds with specific WKSI-eligibility criteria would not provide 
affected funds parity with similarly-situated operating companies 
that do not have public float or do not meet the $700 million public 
float requirement and thus cannot qualify as WKSIs under the rules 
for operating companies.
---------------------------------------------------------------------------

    We do not agree with the commenters who stated that changing or 
eliminating the WKSI requirements for affected funds would be 
consistent with the intent of the Acts. We do not believe, as 
commenters suggested, that the BDC Act and Registered CEF Act were 
designed to result in a higher percentage of affected funds qualifying 
for WKSI status.\116\ Rather, as discussed above, the Acts directed us 
to extend to affected funds the benefits of our securities offering 
rules that are available to operating companies. We believe that 
designing specific WKSI requirements for affected funds to permit a 
particular percentage of those funds to qualify as WKSIs would not 
provide parity of treatment. Moreover, the $700 million public float 
requirement for operating companies was not designed to result in a 
certain percentage of operating companies qualifying as WKSIs, as 
suggested by the commenter who recommended that the public float 
requirement for affected funds be lowered to $480 million.\117\ In 
describing the $700 million public float threshold for operating 
companies, the Commission observed that the threshold would make the 
WKSI provisions available to approximately 30% of listed issuers, but 
this was describing the effect of the provision and not its 
intent.\118\
---------------------------------------------------------------------------

    \116\ See, e.g., Invesco Comment Letter (stating that the 
percentage of listed BDCs and registered CEFs that would meet the 
$700 million public float requirement, as set forth in the proposing 
release, were lower percentages than the Acts were designed to 
permit (citing Proposing Release, supra footnote 10, at section 
IV.A.1.); ABA Comment Letter (same); Dechert Comment Letter (stating 
that a goal of the BDC Act was to improve the flow of funds to 
middle-market companies, which would be furthered by permitting 
unlisted funds to qualify as WKSIs based on their aggregate NAVs).
    \117\ See TIAA Comment Letter.
    \118\ See Securities Offering Reform Adopting Release, supra 
footnote 5, at text following n.48.
---------------------------------------------------------------------------

    We also do not agree with commenters that the Registered CEF Act, 
by referring to interval funds, requires us to permit affected funds to 
qualify as WKSIs based on criteria other than the criteria that apply 
to operating companies.\119\ The Registered CEF Act directed us to 
allow interval funds (in addition to listed CEFs) to use the securities 
offering rules that are available to other issuers required to file 
reports under section 13 or 15(d) of the Exchange Act.\120\ As 
discussed throughout this release and summarized in Tables 1 and 2 
above, the rules that we are amending in this release are available to 
all affected funds, including interval funds, that satisfy the relevant 
conditions of those rules. In addition, many of the rules we are 
amending are not conditioned on an issuer's public

[[Page 33303]]

float, such as the amendments to permit affected funds to use the 
``access equals delivery'' prospectus delivery framework available to 
operating companies.
---------------------------------------------------------------------------

    \119\ See, e.g., ICI Comment Letter (stating that the Registered 
CEF Act effectively requires the Commission to proceed without a 
public float standard to enable interval funds to qualify as 
seasoned funds and WKSI funds); Dechert Comment Letter (stating that 
adoption of a public float requirement for affected funds 
effectively would frustrate the intent of the Registered CEF Act).
    \120\ See section 509(a) of the Registered CEF Act.
---------------------------------------------------------------------------

    We are adopting certain targeted amendments to permit certain non-
interval affected funds to rely on rule 486 under the Securities Act. 
Unlike the WKSI requirements, rule 486 is specifically designed to 
apply to funds. These amendments to rule 486 will permit certain 
registered CEFs and BDCs that conduct continuous offerings--regardless 
of whether they qualify as WKSIs--to file post-effective amendments and 
certain registration statements that become either effective 
immediately upon filing under rule 486(b) or automatically effective 
after 60 days under rule 486(a).\121\ Similar to the benefits the final 
rule will provide to affected funds that qualify as WKSIs or that are 
eligible to file short-form registration statements, these amendments 
will facilitate certain unlisted affected funds' ability to raise 
capital without delay by allowing the funds to more efficiently 
maintain effective registration statements while they engage in 
continuous offerings. The final rule, therefore, will provide certain 
listed affected funds with the flexibility to use a short-form 
registration statement and to file registration statements and 
amendments that become effective automatically. Additionally, unlisted 
affected funds generally will have the flexibility to make filings that 
become effective either immediately upon filing or automatically after 
60 days. Thus the final rule will provide additional flexibilities to 
both listed and unlisted affected funds.
---------------------------------------------------------------------------

    \121\ See infra section II.D (discussing the Commission's 
request for comment on broadening rule 486(b) in the Proposing 
Release and comments received in response to this request, as well 
as the amendments we are adopting to rule 486).
---------------------------------------------------------------------------

3. Ineligible Issuer Definition
    We are adopting, as proposed, amendments to the definition of 
ineligible issuer in rule 405. Although all of the provisions in the 
ineligible issuer definition would apply to affected funds, our 
amendments are designed to tailor certain of these provisions for 
affected funds specifically. First, we are amending the definition of 
``ineligible issuer'' to provide that a registered CEF would be 
ineligible if it has failed to file all reports and materials required 
to be filed under section 30 of the Investment Company Act during the 
preceding 12 months. This provision is consistent with the proposed 
short-form registration instruction and would mirror the current 
Exchange Act reporting provision in the ineligible issuer 
definition.\122\ We did not receive any comments on this particular 
proposed amendment.
---------------------------------------------------------------------------

    \122\ See amended paragraph (1)(i) of the ineligible issuer 
definition in rule 405.
---------------------------------------------------------------------------

    Second, we are adopting, as proposed, an amendment to the 
definition of ineligible issuer to give effect to the definition's 
anti-fraud prong in the context of affected funds. Specifically, we are 
adopting a parallel anti-fraud prong for affected funds, which provides 
that an affected fund is an ineligible issuer if within the past three 
years its investment adviser, including any sub-adviser, was the 
subject of any judicial or administrative decree or order arising out 
of a governmental action that determines the investment adviser aided 
or abetted or caused the affected fund to have violated the anti-fraud 
provisions of the Federal securities laws.\123\ We believe this 
amendment is appropriate because investment companies typically are 
externally managed by an investment adviser, which is primarily 
responsible for the day-to-day management of the fund and the 
preparation of the fund's disclosures.\124\
---------------------------------------------------------------------------

    \123\ See amended paragraph (1)(ix) of the ineligible issuer 
definition in rule 405.
    \124\ See Proposing Release, supra footnote 10, at text 
following n.84.
---------------------------------------------------------------------------

    We received several comments requesting that we clarify or modify 
certain aspects of the proposed amendments. Commenters suggested that 
we clarify that a violation of section 206(4) of the Advisers Act, or 
the rules adopted under section 206(4) (except for 17 CFR 275.206(4)-8 
(rule 206(4)-8)), by an affected fund's investment adviser or sub-
adviser would not give rise to WKSI ineligibility for the affected 
fund.\125\ These commenters also recommended that we modify the 
proposed anti-fraud provision so that an affected fund would not be an 
ineligible issuer if the investment adviser (or sub-adviser) that was 
the subject of a judicial or administrative decree or order as 
described in the proposed rule no longer advises the affected fund at 
the time the affected fund seeks WKSI status.\126\
---------------------------------------------------------------------------

    \125\ See ACC Comment Letter; CBD Comment Letter.
    \126\ Id.
---------------------------------------------------------------------------

    Under the anti-fraud prong for affected funds, an affected fund is 
ineligible for WKSI status if the affected fund's adviser or sub-
adviser is determined to have aided or abetted or caused a violation by 
the fund of the anti-fraud provisions of the Federal securities laws. 
As such, only the anti-fraud provisions of the securities laws that 
apply to the affected fund itself can give rise to WKSI ineligibility. 
There could not be a violation of section 206(4) or the rules adopted 
thereunder by an affected fund, because the fund is not itself an 
adviser.
    We also do not believe it would be appropriate, as commenters 
suggested, to modify the proposed amendments to permit an affected fund 
whose adviser or sub-adviser was determined to have aided or abetted or 
caused a violation by the fund of the anti-fraud provisions of the 
securities laws to preserve its WKSI eligibility by terminating the 
adviser or sub-adviser.\127\ An operating company currently will be an 
ineligible issuer under the anti-fraud prong even if the operating 
company terminates all of the employees who aided or abetted the 
underlying violation of the Federal securities laws, and our amendments 
will provide comparable treatment if an affected fund were to terminate 
its adviser. The affected fund also may have the same board of 
directors that was in place when the affected fund violated the anti-
fraud provisions. The specific facts and circumstances relating to a 
particular issuer's WKSI status under the ineligible issuer definition 
may, however, be considered through the Commission's process under rule 
405 for granting waivers of ineligible issuer status.\128\
---------------------------------------------------------------------------

    \127\ See ACC Comment Letter; CBD Comment Letter;
    \128\ See paragraph (2) of the ineligible issuer definition in 
rule 405 (providing that the Commission may grant waivers of 
ineligible issuer status upon a good-cause showing that it is not 
necessary under the circumstances for the issuer to be considered an 
ineligible issuer).
---------------------------------------------------------------------------

    For these reasons, we are adopting the amendments to the ineligible 
issuer definition as proposed.

D. Automatic or Immediate Effectiveness for Filings by Affected Funds 
Conducting Certain Continuous Offerings

    Based on comments that we received, we are expanding the scope of 
rule 486 to permit any registered CEF or BDC that conducts continuous 
offerings under rule 415(a)(1)(ix) (e.g., a continuously-offered tender 
offer fund) to rely on the rule. Rule 486 under the Securities Act 
currently permits interval funds to file post-effective amendments and 
certain registration statements that are either immediately effective 
upon filing under rule 486(b) or automatically effective 60 days after 
filing under rule 486(a).\129\
---------------------------------------------------------------------------

    \129\ Filings under rule 486(a) are generally effective on the 
sixtieth day after filing, but a registrant may designate a later 
date for effectiveness (which must not be later than eighty days 
after filing). In addition, the Commission, having due regard to the 
public interest and the protection of investors, may declare an 
amendment or registration statement effective under rule 486(a) on 
an earlier date. See rule 486(a).

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

[[Page 33304]]

    As discussed in the Proposing Release, our staff has previously 
stated that it would not recommend that the Commission take enforcement 
action under certain provisions of the Securities Act if, on a case-by-
case basis, specific listed registered CEFs that conduct offerings 
under rule 415(a)(1)(x) use rule 486(b) to file certain post-effective 
amendments that are immediately effective upon filing.\130\ The 
Proposing Release noted that staff in the Division of Investment 
Management were reviewing these no-action letters to determine if they 
should be withdrawn in connection with any final rules. The Commission 
also requested comment on whether it should make rule 486(b) available 
to all or a broader group of registered CEFs and BDCs.\131\ In response 
to this request, several commenters asked that we allow certain non-
interval funds that conduct delayed or continuous offerings under rule 
415 to rely on rule 486, in whole or in part.\132\ For example, one 
commenter suggested that the existing no-action letters be retained or 
codified. This commenter stated that withdrawing the no-action letters 
would be disruptive to relevant non-WKSI funds and their ability to 
update their registration statements and receive automatic 
effectiveness.\133\ Additionally, two commenters recommended that we 
permit affected funds that are continuously-offered unlisted funds to 
rely on rule 486 in its entirety, including rule 486(a) and rule 
486(b). The commenters suggested that, like interval funds, these 
unlisted funds are continuously offered and would benefit if their 
filings could become immediately effective or automatically effective 
60 days after filing.\134\ One of these commenters stated that, for 
example, allowing continuously-offered unlisted affected funds to rely 
on rule 486 would benefit investors in these funds by allowing the 
funds to avoid the time and expense of an annual staff review of 
registration statements where no changes are made beyond immaterial 
updates and updates to audited financial information.\135\
---------------------------------------------------------------------------

    \130\ See, e.g., Nuveen California Select Tax-Free Income 
Portfolio, SEC Staff No-Action Letter (Nov. 21, 2017); PIMCO Dynamic 
Income Fund, SEC Staff No-Action Letter (Dec. 12, 2017); Eagle Point 
Credit Company, Inc., SEC Staff No-Action Letter (Feb. 14, 2018); 
PIMCO Corporate & Income Opportunity Fund and PIMCO Income 
Opportunity Fund, SEC Staff No-Action Letter (Sep. 13, 2018); and 
DNP Select Income Fund, Inc., SEC Staff No-Action Letter (Oct. 4, 
2018).
    \131\ See Proposing Release, supra footnote 10, at section II.I.
    \132\ See ABA Comment Letter and ICI Comment Letter.
    \133\ See ICI Comment Letter.
    \134\ See ABA Comment Letter and ICI Comment Letter.
    \135\ See ABA Comment Letter.
---------------------------------------------------------------------------

    In response to these comments, we are amending rule 486 to allow 
any registered CEF or BDC that conducts a continuous offering under 
rule 415(a)(1)(ix) to rely on rule 486.\136\ We believe this rule 
amendment will allow these continuously-offered affected funds to 
maintain effective registration statements in a more efficient, cost-
effective manner. For example, under rule 486(a), these funds will be 
able to make material changes to their registration statements on an 
automatically effective basis 60 days after filing. In addition, under 
rule 486(b), continuously-offered unlisted affected funds will be able, 
for example, to update their financial statements under section 
10(a)(3) or make non-material changes to their registration statements 
on an immediately effective basis. The rule amendment will allow these 
funds to more efficiently maintain effective registration statements 
while they engage in continuous offerings. This is similar to the 
benefits the final rule will provide to affected funds that file short-
form registration statements or qualify as WKSIs, as those funds also 
will be able to make certain updates to their registration statements 
more efficiently (i.e., through forward incorporation by reference or 
automatically effective registration statements and post-effective 
amendments).\137\ We believe it is appropriate for any affected fund 
that conducts delayed or continuous offerings under rule 415(a)(1)(ix), 
(x), or (xi) to have a mechanism for bringing its financial statements 
up to date under section 10(a)(3) without delay.\138\ Together, the 
amendments we are adopting in this release and current rule 486 will 
achieve this objective.
---------------------------------------------------------------------------

    \136\ We also are making a technical amendment to rule 
486(b)(1)(iv) to provide a more accurate cross reference to Item 
9.1.c of Form N-2. Moreover, we are amending Form N-2 to recognize 
the broader scope of affected funds that may rely on rule 486. See 
General Instruction E.4 of amended Form N-2 and cover page of 
amended Form N-2.
    \137\ See supra sections II.B.3.b and II.B.3.c. Although 
affected funds that file short-form registration statements or 
qualify as WKSIs will be able to use forward incorporation by 
reference and automatically effective filings to make a broader 
range of updates to their registration statements on an immediate 
basis than those specified in rule 486(b), the majority of post-
effective amendments that affected funds currently file are solely 
for one or more purposes described in rule 486(b). Moreover, 
interval funds, and affected funds that make continuous offerings 
under rule 415(a)(1)(ix), will be able to make other, material 
amendments that are automatically effective 60 days after filing.
    \138\ Rule 415(a)(1)(ix), (x), and (xi) are the provisions 
affected funds primarily use to conduct delayed or continuous 
offerings of their securities. Rule 415(a)(1)(ix) allows nontraded 
affected funds to engage in continuous offerings but does not allow 
delayed (or ``shelf'') offerings. Rule 415(a)(1)(x) allows affected 
funds that are eligible to file short-form registration statements 
on Form N-2 to engage in delayed or continuous offerings. Rule 
415(a)(1)(xi) allows interval funds to engage in delayed or 
continuous offerings.
---------------------------------------------------------------------------

    Continuously-offered unlisted affected funds relying on rule 486 
will continue to be subject to applicable provisions in rule 415.\139\ 
Moreover, these funds will need to comply with relevant conditions in 
rule 486.\140\ If it appears to the Commission that a post-effective 
amendment or registration statement filed under rule 486(a) may be 
incomplete or inaccurate in any material respect, the Commission may 
suspend the effective date of that filing. Further, if it appears to 
the Commission that the fund has not complied with the conditions in 
rule 486(b), the Commission may suspend the fund's ability to rely on 
rule 486(b).\141\
---------------------------------------------------------------------------

    \139\ For example, rule 415 limits the amount of securities that 
can be registered in a continuous offering under rule 415(a)(1)(ix) 
and generally requires an issuer relying on rule 415(a)(1)(ix) to 
file a new registration statement every three years. See rule 
415(a)(2), (5), and (6).
    \140\ See rule 486(b)(2) (requiring certain written 
representations that a post-effective amendment filed under rule 
486(b) is filed solely for one or more of the permissible purposes 
covered by the provision); rule 486(e) (requiring a fund to have 
filed a post-effective amendment or registration statement relating 
to its common stock that became effective within two years prior to 
the filing made under rule 486(a) or (b)).
    \141\ See rule 486(c).
---------------------------------------------------------------------------

    In addition to allowing an affected fund to rely on rule 486 if the 
fund makes continuous offerings under rule 415(a)(1)(ix), we are also 
amending the scope of registration statements that rule 486 covers. 
Currently, rule 486 is available for post-effective amendments and for 
registration statements filed for purposes of registering additional 
shares of common stock for which a Form N-2 registration statement is 
effective. This generally reflects the scope of amendments and 
registration statement filings interval funds make after their initial 
registration statements are effective. However, unlike interval funds, 
the affected funds that will newly be eligible to rely on rule 486 
generally are required to file new registration statements every three 
years under rule 415(a)(5) and (6). We are amending rule 486 to allow 
these registration statements to be immediately or automatically 
effective under the rule, depending on the substance of the 
disclosure.\142\ Specifically, a registration

[[Page 33305]]

statement a fund files to comply with rule 415(a)(5) and (6) could be 
immediately effective upon filing if it is filed for no purpose other 
than to comply with those provisions of rule 415 or for other purposes 
listed in rule 486(b), such as making non-material changes or updating 
the fund's financial statements under section 10(a)(3). If the 
registration statement does not qualify under rule 486(b) because, for 
example, it includes material changes to the fund's disclosure, the 
registration statement could be automatically effective 60 days after 
filing under rule 486(a). As a result of the amendments, affected funds 
that make continuous offerings under rule 415(a)(1)(ix) will be able to 
rely on rule 486 for registration statements filed to comply with rule 
415(a)(5) and (6), regardless of whether they choose to register 
additional shares at the time these provisions requires them to file 
new registration statements. This will promote consistent treatment of 
these funds' filings under the rule.
---------------------------------------------------------------------------

    \142\ See amended rule 486(a), (b)(1)(vi), and (g).
---------------------------------------------------------------------------

    Although one commenter suggested that we retain or codify the staff 
no-action letters discussed above to allow affected funds that conduct 
delayed or continuous offerings under rule 415(a)(1)(x) to file post-
effective amendments that are immediately effective under rule 486(b), 
we believe the final rule makes such relief unnecessary.\143\ For 
example, while these funds will need to file new registration 
statements every three years under rule 415, during the interim period 
they will be able to update their registration statements through the 
forward incorporation by reference provisions applicable to short-form 
registration statement filers.\144\ The forward incorporation by 
reference provisions allow these funds to avoid filing the types of 
post-effective amendments that rule 486(b) covers, as well as other 
types of post-effective amendments (e.g., those making material changes 
to the fund's disclosure). Thus, we do not believe that affected funds 
that make delayed or continuous offerings under rule 415(a)(1)(x) will 
need to file the types of post-effective amendments rule 486(b) covers.
---------------------------------------------------------------------------

    \143\ See ICI Comment Letter.
    \144\ See rule 415(a)(5) and (6); General Instructions A.2 and 
F.3 of amended Form N-2.
---------------------------------------------------------------------------

    Moreover, while the commenter only referred to post-effective 
amendments, rule 486(b) also covers new registration statements under 
certain circumstances. For instance, when an eligible fund has an 
effective registration statement and wants to register additional 
shares without making material amendments to its existing disclosure, 
rule 486(b) allows that new registration statement to be immediately 
effective.\145\ If we were to permit a fund that makes delayed or 
continuous offerings under rule 415(a)(1)(x) to rely on rule 486(b) in 
its entirety, then the new registration statement the fund must file 
every three years could effectively become an automatic shelf 
registration statement, even though the fund does not qualify as a WKSI 
(e.g., it does not have $700 million in public float).\146\ As a result 
of these considerations, the no-action letters stating that the staff 
would not recommend an enforcement action if specific listed, 
registered CEFs conducted offerings under rule 415(a)(1)(x) using rule 
486(b) will be withdrawn effective August 1, 2021 (one year from the 
effective date of the final rule).\147\ Importantly, as recognized 
above, the final amendments provide a mechanism for these funds to 
efficiently update their registration statements.
---------------------------------------------------------------------------

    \145\ See rule 486(b)(1)(i) and (v).
    \146\ Under these circumstances, a non-WKSI fund potentially 
could combine its ability to forward incorporate by reference and 
its ability to rely on rule 486(b) to achieve a WKSI-like status, 
with registration statements that would always be immediately 
effective upon filing. This could occur if, for example, a fund made 
material changes to its registration statement by forward 
incorporating information into its registration statement and then, 
to satisfy the requirement to file a new registration statement 
every three years, it filed a new registration statement under rule 
486(b). In contrast, when an affected fund that may rely on rule 486 
makes a material change to its registration statement, the relevant 
filing is not effective immediately. See rule 486(a).
    \147\ See supra footnote 130.
---------------------------------------------------------------------------

E. Final Prospectus Delivery Reforms

    We are adopting, as proposed, rule amendments that will allow an 
affected fund to satisfy its final prospectus delivery obligations by 
filing its final prospectus with the Commission.
    The Securities Act requires registrants to deliver to each investor 
in a registered offering a prospectus meeting the requirements of 
section 10(a) (known as a ``final prospectus'').\148\ Section 5(b)(2) 
makes it unlawful to deliver a security for the purpose of sale or for 
delivery after sale unless accompanied or preceded by a final 
prospectus. After the effectiveness of a registration statement, a 
written communication that offers a security for sale, or confirms the 
sale of a security, may be provided to investors if a final prospectus 
is sent or given previously or at the same time. Otherwise, such a 
communication may not be provided unless it is otherwise permitted 
under Commission rules or meets the requirements of section 10(a).\149\
---------------------------------------------------------------------------

    \148\ 15 U.S.C. 77j(a).
    \149\ 15 U.S.C. 77e(b)(2).
---------------------------------------------------------------------------

    Rule 172 allows issuers, brokers, and dealers to satisfy final 
prospectus delivery obligations if a final prospectus is or will be on 
file with the Commission within the time required by the rules and 
other conditions are satisfied.\150\ For example, rule 172 provides 
that a final prospectus will be deemed to precede or accompany a 
security for sale for purposes of section 5(b)(2) as long as the final 
prospectus is filed with the Commission or it will be filed as part of 
the registration statement.\151\ Rule 172 applies only to final 
prospectuses and not to other documents.\152\ Rule 173 requires the 
delivery of a copy of the final prospectus or, in lieu of a final 
prospectus, a notice to purchasers stating that a sale of securities 
was made pursuant to a registration statement or in a transaction in 
which a final prospectus would have been required to have been 
delivered in the absence of rule 172.\153\
---------------------------------------------------------------------------

    \150\ 17 CFR 230.172 (Securities Act rule 172); see also 
Securities Offering Reform Adopting Release, supra footnote 5, at 
nn.560-562 and accompanying text.
    \151\ See Securities Act rule 172. In the event that the issuer 
fails to file such a prospectus in a timely manner, the issuer must 
file the prospectus as soon as practicable thereafter. Securities 
Act rule 172(c)(3); see also Securities Offering Reform Adopting 
Release, supra footnote 5, at n.568 and preceding text (describing 
this ``cure'' provision).
    \152\ See, e.g., Securities Offering Reform Adopting Release, 
supra footnote 5, at text following n.567.
    \153\ 17 CFR 230.173 (Securities Act rule 173). See also 
Proposing Release, supra footnote 10, at n.109. Rule 173(d) provides 
that a purchaser who receives a notification may request a copy of 
the final prospectus. We proposed a change to Item 34.6 of Form N-2, 
under which funds currently undertake to provide an SAI upon 
request, to require an affected fund to also undertake to provide a 
prospectus upon request. We received no comments regarding this 
aspect of the proposal and are making the change as proposed. See 
Item 34.7 of amended Form N-2.
---------------------------------------------------------------------------

    Rules 172 and 173 do not apply to offerings of affected funds.\154\ 
The BDC Act directs us to remove the exclusion for BDC offerings.\155\ 
To implement the BDC Act, and to provide parity for registered CEFs 
consistent with the Registered CEF Act, we proposed to amend rules 172 
and 173 to remove the exclusion for offerings of all affected funds. 
Commenters supported this approach, stating that the proposed 
amendments would reduce prospectus printing and delivery costs and 
provide parity for affected funds, consistent with

[[Page 33306]]

the BDC Act and the Registered CEF Act.\156\ We are adopting the 
amendments to rules 172 and 173 as proposed.\157\
---------------------------------------------------------------------------

    \154\ See Securities Act rule 172(d)(1)-(2); Securities Act rule 
173(f)(2)-(3).
    \155\ Section 803(b)(2)(L) of the BDC Act; see also section 
509(a) of Registered CEF Act (requiring parity of securities 
offering rules with operating companies for listed registered CEFs 
and interval funds).
    \156\ See, e.g., SIFMA Comment Letter; ICI Comment Letter; 
Invesco Comment Letter; TIAA Comment Letter.
    \157\ See amended Securities Act rule 172(d); amended Securities 
Act rule 173(f).
---------------------------------------------------------------------------

F. Communications Reforms

1. Offering Communications
    We are adopting amendments to the communications rules, as 
proposed, to extend to affected funds the rules that currently provide 
operating companies and other parties (such as underwriters) increased 
flexibility in their communications.\158\ The amendments permit these 
communications notwithstanding the ``gun-jumping provisions'' in the 
Securities Act, which restrict the types of offering communications 
that issuers or other parties subject to the Act's provisions may use 
in connection with a registered public offering.\159\ The gun-jumping 
provisions were designed to make the statutorily mandated prospectus 
the primary means for investors to obtain information regarding a 
registered securities offering.\160\ Accordingly, the statute provides 
that unless otherwise permitted:
---------------------------------------------------------------------------

    \158\ See, Proposing Release, supra footnote 10 at section 
II.E.1; see also Securities Act rule 134; Securities Act rule 168; 
Securities Act rule 156; Securities Act rule 163; Securities Act 
rule 163A; Securities Act rule 164; Securities Act rule 168; 
Securities Act rule 169; and Securities Act rule 433.
    \159\ Unless otherwise noted, offering communications generally 
refer to written communications. Rule 405 provides that ``[e]xcept 
as otherwise specifically provided or the context otherwise 
requires, a written communication is any communication that is 
written, printed, a radio or television broadcast, or a graphic 
communication as defined in [rule 405].''
    \160\ See Securities Offering Reform Adopting Release, supra 
footnote 5, at 44731. But see section 5(d) of the Securities Act [15 
U.S.C. 77e(d)], which permits an emerging growth company, or any 
person authorized to act on its behalf, to engage in oral or written 
communications with potential investors that are qualified 
institutional buyers, as defined in 17 CFR 230.144A (Securities Act 
rule 144A), or institutions that are accredited investors, as 
defined in 17 CFR 230.501(a) (Securities Act rule 501(a)), either 
prior to or after the filing of a registration statement, to 
determine their interest in a contemplated registered offering. 
These communications are often referred to as ``testing the 
waters.'' 17 CFR 230.163B (Securities Act rule 163B), recently 
adopted by the Commission, extends this accommodation to all 
issuers. Solicitations of Interest Prior to a Registered Public 
Offering, Securities Act Release No. 10699 (Sept. 25, 2019) [84 FR 
53011 (Oct. 4, 2019)] (``Rule 163B Adopting Release'').
---------------------------------------------------------------------------

     Before an issuer files a registration statement, all 
offers, in whatever form, are prohibited; \161\
---------------------------------------------------------------------------

    \161\ See section 5(c) of the Securities Act [15 U.S.C. 77e(c)].
---------------------------------------------------------------------------

     After the issuer files a registration statement but before 
it has become effective, the only written offers that are permitted are 
those made using a preliminary prospectus that meets the requirements 
of section 10 of the Securities Act, which must be filed with the 
Commission; \162\ and
---------------------------------------------------------------------------

    \162\ This is because after the filing of the registration 
statement but before its effectiveness, offers made in writing 
(including electronically), by radio, or by television are limited 
to a ``statutory prospectus'' that conforms to the information 
requirements section 10 of the Securities Act. See sections 5(b)(1) 
and 10 of the Securities Act [15 U.S.C. 77e(b)(1) and 77(j)].
---------------------------------------------------------------------------

     Even after the registration statement is declared 
effective, offering participants still may make written offers only 
through a statutory prospectus, except that they may use additional 
written offering materials if a final prospectus that meets the 
requirements of Securities Act section 10(a) is sent or given prior to 
or with those materials.\163\
---------------------------------------------------------------------------

    \163\ See section 2(a)(10) and section 5(b)(1) of the Securities 
Act [15 U.S.C. 77b(a)(10) and 77e(b)(1)].
---------------------------------------------------------------------------

    Since the adoption of the Securities Act, the Commission has 
recognized that certain communications before, during, and after the 
filing of a registration statement do not raise the investor protection 
concerns that the gun jumping provisions aim to address. For this 
reason, the Commission has adopted several rules to provide clarity to 
issuers on the types of communications that are permissible and how to 
communicate with investors without violating the gun jumping 
provisions. We proposed to extend those rules to affected funds in the 
Proposing Release. Commenters generally supported the proposed 
amendments to the communications rules.\164\ Two commenters stated that 
the amendments would allow increased flexibility in communications and 
provide parity with operating companies.\165\ One commenter added that 
the amendments would make it easier to execute offerings by affected 
funds and would decrease costs, leading to lower offering costs and 
potentially enhance capital formation while not negatively impacting 
investor protections.\166\
---------------------------------------------------------------------------

    \164\ See, e.g., SIFMA Comment Letter; Comment Letter of Sidley 
Austin LLP (June 10, 2019); ICI Comment Letter; ACC Comment Letter; 
CBD Comment Letter; MFDF Comment Letter; TIAA Comment Letter.
    \165\ See, e.g., SIFMA Comment Letter; ICI Comment Letter.
    \166\ See, e.g., SIFMA Comment Letter.
---------------------------------------------------------------------------

    The Commission continues to believe that investors and the market 
will benefit from access to greater communications under conditions 
that preserve investor protections. To implement the BDC Act, and to 
provide parity for registered CEFs consistent with the Registered CEF 
Act, we are extending, as proposed, the communications rules currently 
available to operating companies to affected funds by removing the 
exclusions for affected funds and making other conforming changes.\167\ 
Specifically, the amended rules will:
---------------------------------------------------------------------------

    \167\ See amended rules 134(g), 163(b)(3), 163A(b)(4), 164(f), 
168(d)(3), and 169(d)(4) (removing references to BDCs and limiting 
the rules' exclusion of registered investment companies from the 
safe harbor to exclude registered funds other than registered CEFs).
    See also amended rule 168 (adding to paragraphs (b)(1) and (2) 
references to the Investment Company Act to parallel current 
references to the Exchange Act to provide that forward-looking 
information and factual business information may be included in 
materials filed under the Investment Company Act); amended rule 433 
(adding to paragraphs (a)(1)(i) and (iv) references to registration 
statements filed on Form N-2 under adopted General Instruction A.2 
to parallel current references to Form S-3; adding to paragraph 
(c)(1)(ii) a reference to reports filed under section 30 of the 
Investment Company Act as reports with which a free-writing 
prospectus may not conflict). See also amended rule 156(d); infra 
footnote 172.
---------------------------------------------------------------------------

     Permit affected funds to use rule 134 to publish factual 
information about the issuer or the offering, including ``tombstone 
ads.'' \168\
---------------------------------------------------------------------------

    \168\ See Proposing Release, supra footnote 10, at n.122 
(discussing rule 134).
---------------------------------------------------------------------------

     Permit affected funds to rely on rule 163A, which provides 
issuers a bright-line time period, ending 30 days prior to filing a 
registration statement, during which they may communicate without risk 
of violating the gun-jumping provisions.\169\
---------------------------------------------------------------------------

    \169\ See id. at n.123 (discussing rule 163A).
---------------------------------------------------------------------------

     Permit affected funds that are reporting companies to rely 
on rule 168 to publish or disseminate regularly released factual 
business information and forward-looking information at any time, 
including around the time of a registered offering.\170\ The amendments 
to rule 169 will also permit affected funds' continued publication or 
dissemination of regularly released factual business information that 
is intended for use by persons other than in their capacity as 
investors or potential investors.\171\ We also are adopting amendments 
to rule 156 to state that nothing in that rule may be construed to 
prevent an affected fund from qualifying for an exemption under rule 
168 or 169.\172\ The contents of any rule 168 or 169 communication 
remain subject to the anti-fraud provisions of the Federal securities 
laws.
---------------------------------------------------------------------------

    \170\ See id. at n.124 (discussing rule 168).
    \171\ Rule 169 is also a safe harbor from the definition of 
``prospectus'' in section 2(a)(10) of the Securities Act.
    \172\ See amended rule 156(d); section 803(b)(2)(G) of the BDC 
Act; section 509(a) of Registered CEF Act.

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

[[Page 33307]]

     Permit affected funds to rely on rules 164 and 433 to use 
a ``free writing prospectus.'' \173\
---------------------------------------------------------------------------

    \173\ See Proposing Release, supra footnote 10, at n.127 
(discussing rules 164 and 433).
---------------------------------------------------------------------------

     Permit affected funds that are WKSIs to engage at any time 
in oral and written communications, including use at any time of a free 
writing prospectus (before or after a registration statement is filed), 
subject to the same conditions applicable to other WKSIs.\174\
---------------------------------------------------------------------------

    \174\ See id. at n.128 (discussing how communications rules 
apply to WKSIs).
---------------------------------------------------------------------------

    As we discussed in the Proposing Release, investment company 
communications currently are subject to rule 482.\175\ Rule 482 
communications can only be used by a fund that is selling or is 
proposing to sell its securities pursuant to a filed registration 
statement, and are prospectuses subject to prospectus liability under 
section 12 of the Securities Act.\176\ The amendments to the 
communications rules provide affected funds with incremental 
flexibility in their communications, including additional flexibility 
to communicate before filing a registration statement, and some 
additional flexibility in using communications that are not subject to 
prospectus liability under section 12 of the Securities Act.\177\ 
Moreover, as we discussed in the Proposing Release, both the BDC Act 
and Registered CEF Act direct the Commission to continue to make 
available Securities Act rule 482 communications, or ``ads,'' 
notwithstanding the amendments to the communications rules.\178\ 
Affected funds therefore can now take advantage of additional 
flexibility under the communications rules as amended or continue to 
rely on rule 482 and other rules currently applicable to investment 
company communications.
---------------------------------------------------------------------------

    \175\ See id. at section II.E.1.
    \176\ 17 CFR 230.482 (Securities Act rule 482); see also 17 CFR 
230.497(i) (Securities Act rule 497).
    \177\ See Proposing Release, supra footnote 10, at section 
II.E.1.
    \178\ See id. at text following n.128; see also sections 
803(e)(2) of the BDC Act (prohibiting the Commission from 
interpreting the amendments directed by the BDC Act in a manner that 
would prevent BDCs from distributing sales material pursuant to rule 
482 under the Securities Act); and 509(c)(1) of the Registered CEF 
Act (prohibiting the Commission from interpreting the amendments 
directed by the Registered CEF Act to impair or limit in any way a 
registered closed-end company from using rule 482 communications, 
under the Investment Company Act, to distribute sales material).
---------------------------------------------------------------------------

    In addition to comments on the proposed amendments to the 
communications rules, two commenters urged us to adopt rules that would 
extend the safe harbors for liability in private actions for certain 
forward looking statements under section 27A of the Securities Act and 
section 21E of the Exchange Act to affected funds.\179\ Those 
commenters did not specify what the conditions or requirements of such 
a rule might be, and the public has not had the opportunity to comment 
on whether or how to extend safe harbors for forward-looking statements 
to affected funds. For these reasons, we believe commenters' request 
requires more extensive consideration beyond the scope of this 
rulemaking.
---------------------------------------------------------------------------

    \179\ See Dechert Comment Letter; IPA Comment Letter; see also 
sections 27A(b)(2)(B) and 27A(g) of the Securities Act [15 U.S.C. 
77z-2(b)(2)(B) and 15 U.S.C. 77z-2(g)] and sections 21E(b)(2)(B) and 
21E(g) of the Exchange Act [15 U.S.C. 78u-5(b)(2)(B) and 15 U.S.C. 
78u-5(g)].
---------------------------------------------------------------------------

2. Broker-Dealer Research Reports
    We are adopting the amendments to Securities Act rule 138 as 
proposed. Rule 138 permits a broker-dealer participating in the 
registered offering of an eligible issuer's common stock and similar 
securities to publish or distribute research reports about that 
issuer's fixed income securities, and vice versa, if it publishes or 
distributes that research in the regular course of its business.
    Although rule 138 does not currently exclude affected funds from 
coverage, it does include references to Form S-3 but not Form N-2. We 
therefore proposed to amend the rule's references to shelf registration 
statements filed on Form S-3 to include a parallel reference to a 
registration statement filed on Form N-2 under the proposed short-form 
registration instruction. Rule 138 also currently provides that an 
issuer covered in a research report published in reliance on the rule 
must be required to file reports, and must have filed all periodic 
reports required during the preceding 12 months (or such shorter time 
that the issuer was required to file such reports), on Forms 10-K and 
10-Q.\180\ Because registered CEFs do not file the periodic reports 
currently specified in rule 138, we proposed to include parallel 
references to the reports that registered CEFs are required to file, 
i.e., reports on Forms N-CSR, N-Q, N-CEN, and N-PORT.\181\ We did not 
receive any comments on these amendments and are adopting them as 
proposed.
---------------------------------------------------------------------------

    \180\ See 17 CFR 230.138(a)(2)(i) (Securities Act rule 
138(a)(2)(i)).
    \181\ See supra section II.B.3.a (Form N-Q will be rescinded on 
May 1, 2020).
---------------------------------------------------------------------------

    We are not adopting changes to 17 CFR 230.139 (rule 139).\182\ That 
rule provides a safe harbor for a broker-dealer's publication or 
distribution of research reports where the broker-dealer is 
participating in the registered offering of the issuer's securities 
and, unlike rule 138, permits the research report to cover any class of 
the issuer's securities.
---------------------------------------------------------------------------

    \182\ See Proposing Release, supra footnote 10, at section 
II.E.2.
---------------------------------------------------------------------------

    As we stated in the Proposing Release, in 2018 the Commission 
adopted new 17 CFR 230.139b (Securities Act rule 139b) to implement the 
Fair Access to Investment Research Act of 2017 (the ``FAIR Act'').\183\ 
The FAIR Act directed that the Commission extend rule 139 to cover 
broker-dealers' publication or distribution of ``covered investment 
fund research reports.'' These include research reports about affected 
funds.\184\
---------------------------------------------------------------------------

    \183\ See Fair Access to Investment Research Act of 2017, Public 
Law 115-66, 131 Stat. 1196 (2017); see also Covered Investment Fund 
Research Reports Adopting Release, supra footnote 101.
    \184\ 17 CFR 230.139b; see also Covered Investment Fund Research 
Reports Adopting Release, supra footnote 101, at 64183 (providing 
that under rule 139b, the term ``covered investment fund'' includes, 
among other things, registered investment companies and BDCs).
---------------------------------------------------------------------------

    Rule 139b includes specific provisions mandated by Congress for 
covered investment fund research reports. For example, rule 139b 
excludes from the rule's safe harbor research reports published or 
distributed by the covered investment fund itself, any affiliate of the 
covered investment fund, or any broker-dealer that is an investment 
adviser (or an affiliated person of an investment adviser) for the 
covered investment fund.\185\ The Commission did not propose changes to 
rule 139 because it believed that rule 139b satisfies the directives of 
the BDC Act and Registered CEF Act by extending rule 139's safe harbor 
to research reports on BDCs and registered CEFs and is consistent with 
Congress's core objective regarding research reports covering these 
funds.\186\ The Commission observed that, if it were to amend rule 139 
to cover research reports on BDCs, or on affected funds generally, 
exactly the same conduct would be subject to different standards based 
on the rule a broker-dealer chose to use.\187\ The Commission believed 
that it would be more appropriate to provide a consistent approach for 
affected fund research reports under rule 139b.\188\
---------------------------------------------------------------------------

    \185\ See Covered Investment Fund Research Reports Adopting 
Release, supra footnote 101 at sections II.A.1 and II.E.2; see also 
section 2(f)(3) of the FAIR Act.
    \186\ See Covered Investment Fund Research Reports Adopting 
Release, supra footnote 101, at nn.144-145 and accompanying 
paragraph.
    \187\ Id.
    \188\ Id.
---------------------------------------------------------------------------

    One commenter suggested that we amend rule 139 and repeal rule 
139b, in order to provide the same requirements for broker-dealer 
research reports on

[[Page 33308]]

affected funds and operating companies.\189\ The commenter raised 
concerns regarding differences between these two rules' requirements, 
such as rule 139b's ``affiliate exclusion.'' That provision makes rule 
139b's safe harbor inapplicable to research reports by a broker-dealer 
that is an investment adviser (or an affiliated person of an investment 
adviser) to the covered investment fund.
---------------------------------------------------------------------------

    \189\ See ABA Comment Letter.
---------------------------------------------------------------------------

    We acknowledged the differences between rule 139b and rule 139 in 
the Proposing Release. Indeed, the different requirements in rule 
139b--which were mandated by Congress in the FAIR Act--are why we did 
not propose amendments to rule 139. We continue to believe that rule 
139b already satisfies the directives of the BDC Act and Registered CEF 
Act by extending rule 139's safe harbor to research reports on BDCs and 
registered CEFs and is consistent with Congress's core objective 
regarding research reports covering these funds. If we were to amend 
rule 139 and rescind rule 139b as urged by this commenter, this would 
not give effect to Congress's more specific directives in the FAIR Act. 
Moreover, rule 139b, as directed by the FAIR Act, provides a consistent 
framework for research reports on ``covered investment funds,'' which 
are not limited to the affected funds covered in this rulemaking. 
Maintaining rule 139b therefore provides a consistent approach for all 
``covered investment fund research reports.''

G. Other Rule Amendments

1. Rule 418 Supplemental Information
    As proposed, we are adopting amendments to rule 418 to exempt 
affected funds that are eligible to file a short-form registration 
statement on Form N-2 from the requirement to furnish certain 
supplemental information to the Commission or staff on request under 
paragraph (a)(3) of the rule. As discussed in the Proposing Release, 
operating companies that are eligible to use Form S-3 are already 
exempt from having to furnish certain information under rule 
418(a)(3).\190\ Commenters did not address the amendments to rule 418, 
which we proposed to implement the BDC Act and to provide parity for 
registered CEFs consistent with the Registered CEF Act.\191\ Consistent 
with the proposal, affected funds that are eligible to file a short-
form registration statement on Form N-2 will not be required to 
furnish, on request, recent engineering, management, or similar reports 
or memoranda relating to broad aspects of the business, operations, or 
products of the registrant under amended rule 418(a)(3).\192\
---------------------------------------------------------------------------

    \190\ See Proposing Release, supra footnote 10, at text 
accompanying n.147.
    \191\ See section 803(b)(2)(M) of the BDC Act.
    \192\ See Proposing Release, supra footnote 10, at n.148.
---------------------------------------------------------------------------

2. Amendments to Incorporation by Reference Into Proxy Statements
    We are adopting amendments to Schedule 14A under the Exchange Act 
as proposed, consistent with the BDC Act and the Registered CEF 
Act.\193\ We did not receive comments on the proposed amendments to 
Schedule 14A. The amendments will allow affected funds that meet the 
requirements of the short-form registration instruction in Form N-2, as 
further described in Note E to Schedule 14A, to incorporate certain 
information by reference to previously-filed documents for proxy 
statements containing specific proposals under Item 13 of Schedule 
14A.\194\ The amendments allow eligible funds to incorporate by 
reference certain required information for relevant proxy proposals to 
the same extent that operating companies meeting the requirements of 
Form S-3 (as defined in Note E to Schedule 14A) may use incorporation 
by reference under the same circumstances.\195\
---------------------------------------------------------------------------

    \193\ Section 803(b)(2)(N) of the BDC Act (directing us to amend 
Item 13(b)(1) of Schedule 14A to include as an issuer to which Item 
13(b)(1) applies a BDC that would otherwise meet the requirements of 
Note E of the Schedule); section 509(a) of the Registered CEF Act 
(requiring us to provide certain registered CEFs with the same 
flexibility under the proxy rules, subject to appropriate 
conditions, as is available to other issuers required to file 
reports under section 13 or section 15(d) of the Exchange Act).
    \194\ Item 13 applies to proxy statements seeking security 
holder approval to authorize, issue, modify, or exchange securities 
as described in Items 11 or 12 of Schedule 14A.
    \195\ The proposed definition in Note E of Schedule 14A of an 
affected fund that ``meets the requirements of General Instruction 
A.2 of Form N-2'' included certain conditions relating to the 
transaction requirements in General Instruction I.B or I.C of Form 
S-3, consistent with the conditions in the definition in Note E of 
an operating company that ``meets the requirements of Form S-3.'' We 
are adopting the definition in Note E as proposed to provide parity 
between affected funds and operating companies although, as 
discussed in the Proposing Release, we believe these conditions are 
less likely to be relevant to affected funds. See Proposing Release, 
supra footnote 10, at n.152.
---------------------------------------------------------------------------

3. Rule 103 of Regulation FD
    We are adopting amendments to rule 103(a) of Regulation FD, as 
proposed, to provide that an affected fund's failure to make a public 
disclosure required solely by rule 100 of Regulation FD will not affect 
the fund's eligibility under the short-form registration instruction of 
Form N-2.\196\ We did not receive comments on the proposed amendments 
to rule 103(a). The final amendments to rule 103(a) will enhance parity 
between affected funds and operating companies, consistent with the BDC 
Act and the Registered CEF Act, as rule 103(a) already provides that an 
operating company's failure to make a public disclosure required solely 
by rule 100 of Regulation FD will not affect its eligibility to use 
Form S-3.\197\
---------------------------------------------------------------------------

    \196\ Rule 100 of Regulation FD generally requires an issuer to 
make either simultaneous or prompt public disclosure of any material 
nonpublic information regarding the issuer or its securities that 
the issuer or a person acting on its behalf has selectively 
disclosed to certain parties. See 17 CFR 243.100 (requiring 
simultaneous public disclosure in the case of an intentional 
selective disclosure or prompt public disclosure in the case of a 
non-intentional selective disclosure).
    \197\ See section 803(b)(2)(O) of the BDC Act; 17 CFR 243.103(a) 
(rule 103(a) of Regulation FD).
---------------------------------------------------------------------------

H. New Registration Fee Payment Method for Interval Funds and Issuers 
of Certain Exchange-Traded Products

    We are adopting a modernized approach to registration fee payment 
that will require interval funds to pay securities registration fees 
using the same method that mutual funds and ETFs use today.\198\ 
Specifically, for interval funds, the final rule will provide that such 
funds register an indefinite amount of securities upon their 
registration statements' effectiveness.\199\ Like mutual funds and 
ETFs, interval funds will be required to

[[Page 33309]]

pay registration fees based on their net issuance of shares, no later 
than 90 days after the funds' fiscal year ends.\200\ These issuers will 
be required to file information about the computation of this 
registration fee and other information on Form 24F-2 under the 
Investment Company Act when paying the fee.\201\ In response to 
comments that we received, we also are extending similar treatment to 
certain ETPs that are not registered under the Investment Company Act.
---------------------------------------------------------------------------

    \198\ In general, issuers today--including interval funds--are 
required under the Securities Act to pay a registration fee to the 
Commission at the time of filing a registration statement. See 
sections 6(b)(1) (requiring applicants to pay a fee to the 
Commission at the time of filing a registration statement) and (c) 
(providing that a registration statement shall not be deemed to have 
taken place without payment of a registration fee) of the Securities 
Act [15 U.S.C. 77f(b)(1)]. This means that they pay registration 
fees at the time they register the offering of securities, 
regardless of when (or if) they sell them. WKSIs using automatic 
shelf registration statements have additional flexibility to pay 
filing fees at or prior to the time of a securities offering. See 
supra footnote 78; see also Securities Offering Reform Adopting 
Release, supra footnote 5, at 44780. This arrangement is commonly 
known as ``pay-as-you-go.'' Id. As a result, these filers may defer 
payment until a future takedown of shares off a shelf registration 
statement. Affected funds that become WKSIs as a result of our final 
rule will also gain that flexibility, but other affected funds will 
not. See supra section II.C.
    \199\ The final rule applies to interval funds the same 
treatment provided by rule 24f-2 to open-end funds and UITs. See 
amended rule 23c-3(e) (providing that an interval fund would be 
deemed to have registered an indefinite amount of securities under 
section 24(f) upon the effective date of its registration 
statement); see also amended rule 24f-2 (providing for interval 
funds to pay their registration fees on the same annual net basis as 
mutual funds, other open-end funds, and UITs). See section 4(e) of 
the Exchange Act [15 U.S.C. 78d-4(e)]; section 28 of the Securities 
Act [15 U.S.C. 77z-3)].
    \200\ See section 24(f)(2) of the Investment Company Act [15 
U.S.C. 80a-24(f)(2)]. Specifically, mutual funds and ETFs currently 
are required to pay fees on a net basis, based upon the sales price 
for securities sold during the fiscal year and reduced based on the 
price of shares redeemed or repurchased that year.
    \201\ 17 CFR 274.24.
---------------------------------------------------------------------------

    We proposed to amend rules 23c-3 and 24f-2 so that interval funds 
would pay registration fees on this same annual net basis.\202\ The 
commenters who addressed this aspect of the proposal supported it.\203\ 
Two commenters suggested expanding the scope of this aspect of our 
proposal to include additional types of issuers.\204\ One commenter 
recommended extending the scope of the provision to ``all other funds'' 
to confer the same benefits to those additional funds, such as 
eliminating the need to predict the number of shares the fund expects 
to sell.\205\ Another commenter suggested extending the scope to 
``tender offer funds''--those that make repurchase offers but that are 
not, like interval funds, required to periodically repurchase shares or 
to have a fundamental policy regarding its repurchase offers that can 
be changed only by a shareholder vote.\206\ We are adopting this 
provision as proposed. Of the categories of investment companies 
contemplated by commenters, only interval funds routinely repurchase 
shares at NAV and are required to periodically offer to repurchase 
their shares, making these funds more like mutual funds and ETFs, which 
are required to use this method.
---------------------------------------------------------------------------

    \202\ Proposing Release, supra footnote 10, at section II.G 
(discussing how and why interval funds are currently not permitted 
to pay registration fees on an annual net basis).
    \203\ ICI Comment Letter; Invesco Comment Letter. No commenter 
expressed opposition to the proposed provision.
    \204\ ABA Comment Letter; ICI Comment Letter.
    \205\ ICI Comment Letter.
    \206\ ABA Comment Letter.
---------------------------------------------------------------------------

    In response to a request for comment in the Proposing Release, a 
number of commenters also recommended that certain ETPs that are not 
registered under the Investment Company Act be permitted to register 
offerings of an indefinite number of securities and pay registration 
fees in a manner equivalent to that under rule 24f-2.\207\ These 
commenters stated that these ETPs operate in a manner substantially 
similar to that of ETFs and would similarly benefit from paying 
registration fees on an annual net basis and from registering offerings 
of an indefinite number of securities.\208\ Some of these commenters 
also noted that the attributes cited in the Proposing Release for 
extending the ability to pay registration fees on an annual net basis 
to interval funds (routine repurchases of shares at NAV and avoiding 
the possibility that an interval fund would inadvertently sell more 
shares than it had registered) would also apply to these ETPs.\209\
---------------------------------------------------------------------------

    \207\ GraniteShares Comment Letter; Invesco Comment Letter; 
ProShares Comment Letter; Comment Letter of State Street Global 
Advisors (June 21, 2019) (``SSGA Comment Letter''); USCF Comment 
Letter; WGC Comment Letter; Comment Letter of Morgan, Lewis & 
Bockius LLP (Jan. 15, 2020).
    \208\ Invesco Comment Letter (stating that the provision would 
assist ETPs); ProShares Comment Letter (same); SSGA Comment Letter 
(same); GraniteShares Comment Letter (stating that the provision 
would assist ETPs, and would eliminate a competitive difference 
between ETPs and mutual funds); USCF Comment Letter (stating that 
the provision would provide ETPs with cost savings and efficiencies 
that would benefit investors); WGC Comment Letter (same). One 
commenter noted that the securities of these ETPs are issued and 
redeemed in large blocks called ``creation units'' through either 
in-kind transactions with brokerage firms and institutional 
investors or on a cash basis when the ETPs invest in futures 
contracts and other investments that cannot be transferred in-kind. 
GraniteShares Comment Letter.
    \209\ USCF Comment Letter; SSGA Comment Letter; WGC Comment 
Letter.
---------------------------------------------------------------------------

    After considering these comments, we have determined to adopt 
amendments to enable certain ETPs that are not registered under the 
Investment Company Act to elect to register an offering of an 
indeterminate number of securities and to pay registration fees for 
such an offering in a manner equivalent to that for mutual funds and 
ETFs (i.e., in arrears on an annual net basis). In view of the concerns 
raised by commenters as well as the similarities between these ETPs and 
ETFs, we agree that it is appropriate to extend the availability of 
this treatment to these ETPs under the Securities Act. Accordingly, 
issuers that offer exchange-traded vehicle securities, as the term will 
now be defined in amended rule 405,\210\ will be eligible under new 
Securities Act rule 456(d) to elect to register an offering of an 
indeterminate amount of exchange-traded vehicle securities and pay 
registration fees for such an offering on an annual net basis no later 
than 90 days after the end of the fiscal year when making this 
election. We are also adopting Securities Act rule 457(u), which sets 
forth the calculation method for paying registration fees in this 
manner and is consistent with the fee calculation provisions of Form 
24F-2.\211\ Finally, we are adopting rule 424(i) pursuant to which 
issuers that elect to register an offering of an indeterminate amount 
of securities pursuant to rule 456(d) will be required to file a 
prospectus supplement when paying registration fees on an annual net 
basis.\212\
---------------------------------------------------------------------------

    \210\ We believe that the scope of this definition properly 
limits the availability of this treatment to offerings of securities 
that share substantially similar attributes with those issued by 
ETFs, such as being listed on a national securities exchange and 
routine purchases and redemptions of the securities in ``creation 
units'' at NAV. The reference to ``ratable share'' in the definition 
encompasses repurchases or redemptions of securities that occur at 
NAV on an in-kind basis or cash basis.
    \211\ We are amending a number of Securities Act registration 
statement forms (Forms S-1, S-3, F-1 and F-3) to provide that an 
issuer may elect to register an indeterminate amount of exchange-
traded vehicle securities on these registration statement forms.
    \212\ Rule 424(i) also includes certain disclosure requirements 
modeled after Form 24F-2.
---------------------------------------------------------------------------

I. Disclosure and Reporting Parity Proposals

    We are adopting amendments to our rules and forms, substantially as 
proposed, intended to tailor the disclosure and regulatory framework 
for affected funds in light of our amendments to the offering rules. 
Many of these amendments are not required by the BDC Act or the 
Registered CEF Act, but we believe are consistent with the respective 
Acts' requirements to increase regulatory parity of affected funds with 
otherwise similarly-situated issuers.\213\ As discussed in detail 
below, these amendments include structured data requirements; new 
annual reporting requirements; amendments to provide all affected funds 
additional flexibility to incorporate information by reference; and 
enhancements to the disclosures that registered CEFs make to investors 
when the funds are not updating their registration statements.
---------------------------------------------------------------------------

    \213\ For example, regulatory parity could mitigate any 
competitive disparities between affected funds and other issuers. It 
also could help investors in affected funds by providing them 
investor protections that are currently provided to investors in 
similarly-situated issuers. See, e.g., infra discussion in 
paragraphs accompanying footnotes 284-289.
---------------------------------------------------------------------------

1. Structured Data Requirements
    We are adopting, substantially as proposed, certain new structured 
data reporting requirements for registered CEFs and BDCs. In 
particular, and as discussed in detail below, we are requiring:

[[Page 33310]]

     BDCs, like operating companies, to submit financial 
statement information using Inline XBRL format;
     registered CEFs and BDCs to include structured cover page 
information in their registration statements on Form N-2 using Inline 
XBRL format;
     certain information required in an affected fund's 
prospectus to be tagged using Inline XBRL format; and
     filings on Form 24F-2 to be submitted in eXtensible Markup 
Language (``XML'') format.
a. Inline XBRL Requirements for Financial Statements and Notes to 
Financial Statements
    We are adopting, as proposed, an amendment to 17 CFR 229.601 (Item 
601 of Regulation S-K) to subject BDCs to the Inline XBRL financial 
statement tagging requirements that apply to operating companies, by 
removing the exclusion for BDCs from the Inline XBRL financial 
statement tagging requirements.\214\ We continue to believe that 
reporting in a structured data format makes financial information 
easier for investors to analyze and helps automate regulatory filings 
and business information processing.\215\ We also believe that BDC 
investors and other market participants would benefit from the 
availability of relevant information in a structured data format.\216\ 
These requirements will reduce the current disparity between the 
accessibility of financial information BDCs provide to the market and 
the accessibility of substantially similar financial information that 
operating companies provide to the market.\217\
---------------------------------------------------------------------------

    \214\ Compare 17 CFR 229.601(b)(101)(i) (amended Item 
601(b)(101)(i) of Regulation S-K) (excluding registered investment 
companies from rule 601's tagging requirements) with current Item 
601(b)(101)(i) of Regulation S-K (excluding all registrants that 
prepare financial statements in accordance with 17 CFR 210.6-01 
through 210.6-10 (Article 6 of Regulation S-X); see also amended 
rule 405(b)(3)(i) of Regulation S-T (requiring a BDC to tag its 
financial statements). We also are making conforming amendments to 
Items 601(b)(101)(ii)(A) and (iii) of Regulation S-K to clarify the 
exclusion of registered investment companies from rule 601's tagging 
requirements.
    \215\ Proposing Release, supra footnote 10, at section II.H.1.a.
    \216\ Id. We also observed that having this information in a 
structured data format would enhance our staff's ability to review 
and analyze BDCs' financial statements.
    \217\ Id. (summarizing the structured data reporting 
requirements for operating companies and registered investment 
companies).
---------------------------------------------------------------------------

    The commenters who addressed this proposed requirement supported 
it.\218\ Some of these commenters stated that structured financial 
statement data would be more useful to investors than information in 
only a HyperText Markup Language (``HTML'') or plain text format.\219\ 
One of these commenters stated that more structured financial statement 
reporting would improve the clarity and transparency of reported 
information by using consistent, agreed-upon definitions, and would 
yield information that is less expensive to process and more timely 
than unstructured data.\220\ Another commenter stated that eliminating 
the delay for data users to obtain information once it is public makes 
capital markets more efficient.\221\
---------------------------------------------------------------------------

    \218\ Calcbench Comment Letter; Comment Letter of IRIS Business 
Services Ltd. (June 10, 2019) (``IRIS Comment Letter''); Comment 
Letter of XBRL US (June 10, 2019) (``XBRL US Comment Letter'').
    \219\ Calcbench Comment Letter; XBRL US Comment Letter.
    \220\ XBRL US Comment Letter.
    \221\ Calcbench Comment Letter.
---------------------------------------------------------------------------

    Two commenters supported the use of the Inline XBRL format 
specifically.\222\ One of these commenters noted that, because Inline 
XBRL is both machine-readable and human-readable, it will help 
investors in BDCs quickly access structured data just as investors in 
operating companies can.\223\ This commenter also highlighted potential 
benefits of the format for issuers, stating that data in Inline XBRL 
format is easier to review than, for example, the same data in separate 
XBRL and HTML formats.\224\ Some commenters also stated that the 
currently available XBRL taxonomies will be sufficient for BDCs.\225\ 
After considering public comments received, and because we continue to 
believe that investors will benefit from the availability of relevant 
information in a structured data format, we are adopting this 
requirement as proposed.\226\
---------------------------------------------------------------------------

    \222\ IRIS Comment Letter; XBRL US Comment Letter.
    \223\ IRIS Comment Letter.
    \224\ IRIS Comment Letter. The commenter also stated that it is 
appropriate to subject BDCs to the same format as operating 
companies--compared to requiring BDCs to report on Forms N-PORT and 
N-CEN--because the format of their financial statements is similar 
to that of operating companies. Id. Another commenter observed that 
the same applications used to prepare XBRL for operating companies 
could be leveraged for BDCs, increasing economies of scale. XBRL US 
Comment Letter.
    \225\ IRIS Comment Letter; XBRL US Comment Letter. Based on our 
staff's review of BDCs' disclosures and assessment of the XBRL 
taxonomies' development since they were first adopted in 2009, the 
Commission stated its belief that relevant XBRL taxonomies were 
sufficiently well developed for financial statement reporting by 
BDCs. Proposing Release, supra footnote 10, at section II.H.1.a. One 
commenter observed that BDC financial statement line items were 
already captured in the US GAAP Taxonomy and that a new custom 
schema would be an unnecessary cost for the Commission and the 
marketplace. XBRL US Comment Letter. Another commenter stated, 
however, that it would expect a greater use of non-standard 
reporting elements than for average operating companies. IRIS 
Comment Letter. We continue to believe that the relevant XBRL 
taxonomies are sufficiently well developed for use by BDCs, even if 
BDCs use non-standard elements more than the average operating 
company.
    \226\ See supra footnote 214.
---------------------------------------------------------------------------

b. New Check Boxes and Structured Data Format for Form N-2 Cover Page 
Information
    We are adopting, as proposed, a requirement that all affected funds 
tag all of the data points that appear on the cover page of Form N-2, 
except the Calculation of Registration Fee table, using Inline XBRL 
format.\227\ These cover page data points will include, for example, 
the company name, the Act or Acts to which the registration statement 
relates, and check boxes relating to the effectiveness of the 
registration statement. We currently require operating companies to tag 
all of the data points on the cover page of Form 10-K, Form 10-Q, Form 
8-K, Form 20-F, and Form 40-F using Inline XBRL format.\228\ The 
Commission generally proposed to extend this requirement to mandatory 
tagging of the data points on the cover page of Form N-2 because it 
believed it would allow investors, other market participants, and other 
data users to automate their use of this information.\229\
---------------------------------------------------------------------------

    \227\ See new General Instruction I.1 of amended Form N-2; new 
rule 405(b)(3)(ii) of amended Regulation S-T.
    We also are making certain conforming revisions to proposed 
General Instruction H (Interactive Data Files), which we renumbered 
as General Instruction I of amended Form N-2. In addition, and as a 
result, we renumbered General Instruction I of current Form N-2 
(Registration of Additional Securities) as General Instruction J of 
amended Form N-2.
    \228\ See 17 CFR 232.406 [rule 406 of Regulation S-T]; FAST Act 
Modernization Adopting Release, supra footnote 66, at 12674.
    \229\ Proposing Release, supra footnote 10, at section II.H.1.b. 
The Commission noted that this requirement would enhance investors' 
ability to better identify, count, sort, aggregate, compare, and 
analyze registrants and disclosures to the extent these data points 
otherwise would be formatted only in HTML.
---------------------------------------------------------------------------

    The commenters who addressed the proposed requirement supported 
it.\230\ As above, two commenters supported the proposed Inline XBRL 
format, stating that it would provide benefits for investors, 
regulators, and issuers.\231\ One commenter specifically supported 
requiring the Inline XBRL format over allowing reporting entities to 
choose from more than one data standard or developing a custom schema 
for the required information.\232\ After

[[Page 33311]]

considering public comments received, and because we continue to 
believe that it would allow investors, other market participants, and 
other data users to automate their use of this information, we are 
adopting this requirement as proposed.
---------------------------------------------------------------------------

    \230\ IRIS Comment Letter; XBRL US Comment Letter.
    \231\ IRIS Comment Letter; XBRL US Comment Letter; see also 
supra footnotes 222-224 and accompanying text.
    \232\ XBRL US Comment Letter (stating that multiple data 
standards would cause confusion in the marketplace and unnecessary 
costs throughout the reporting supply chain and that a custom schema 
would require the development of new tools to create and to extract 
and analyze the data).
---------------------------------------------------------------------------

    The Commission did not propose to require affected funds to tag the 
table on the form's cover page that includes information about 
calculation of the fund's registration fee under the Securities 
Act.\233\ One commenter recommended that the Commission require tagging 
of such registration fee information, stating that these are valuable 
data elements and that extending the requirement to fee information 
would not increase the burden of tagging on issuers.\234\ The 
Commission recently proposed such amendments to Form N-2 as part of a 
larger proposal to modernize the filing fee disclosure and payment 
methods for most of the Commission's fee-bearing forms, statements, and 
related rules.\235\ As a result, we believe that the filing fee 
disclosure and payment modernization rulemaking is a more appropriate 
vehicle for considering whether the fee calculation information on Form 
N-2 should be tagged.
---------------------------------------------------------------------------

    \233\ See Proposing Release, supra footnote 10, at section 
II.H.1.b.
    \234\ See XBRL US Comment Letter.
    \235\ See Filing Fee Disclosure and Payment Methods 
Modernization, Investment Company Act Release No. 33676 (Oct. 24, 
2019) [84 FR 71580 (Dec. 27, 2019)].
---------------------------------------------------------------------------

    In addition, we are amending Form N-2 to add new check boxes to its 
cover page, as proposed.\236\ We proposed several new check boxes to 
allow investors, Commission staff, and others to more readily identify 
types of issuers and securities.\237\ We continue to believe that this 
check box information will allow investors, Commission staff, and 
others to more readily identify types of issuers and securities, and so 
are adopting this provision as proposed.\238\ These check boxes will be 
among the data points required to be tagged using Inline XBRL 
format.\239\
---------------------------------------------------------------------------

    \236\ See cover page of amended Form N-2. For purposes of 17 CFR 
230.401(g) (Securities Act rule 401(g)), an affected fund that 
checks a box on Form N-2 to indicate that it is relying on the 
short-form registration instruction or that it is a WKSI filing an 
automatic shelf registration statement will be deemed to have filed 
the relevant registration statement or post-effective amendment 
properly under the applicable provisions of Form N-2 unless the 
Commission objects in the manner set forth in rule 401(g). See 17 
CFR 230.401(g).
    \237\ Proposing Release, supra footnote 10, at section II.G.1.b. 
(discussing proposed check box requirements on Form N-2 cover page). 
In a conforming change, we are also including a check box that is 
substantively identical to a parallel check box on Form S-3 for 
emerging growth companies that have elected not to use an extended 
transition period for complying with new or revised accounting 
standards. See cover page of amended Form N-2.
    \238\ Commenters recommended that the Commission clarify that 
the check box indicating that the only securities being registered 
are being offered pursuant to dividend or interest reinvestment 
plans is not intended to affect the ability of affected funds to 
rely on ``Guide 5. Dividend Reinvestment Plans'' to Form N-2. See 
Dechert Comment Letter; IPA Comment Letter. The new check box will 
not affect that ability.
    \239\ See supra footnote 227.
---------------------------------------------------------------------------

c. Tagging of Prospectus Disclosure Items
    We are adopting, as proposed, a requirement that all affected funds 
tag certain information that is required to be included in an affected 
fund's prospectus using Inline XBRL format. All affected funds will be 
required to submit certain information in registration statements or 
post-effective amendments filed on Form N-2 and certain forms of 
prospectuses filed pursuant to rule 424 under the Securities Act to the 
Commission using Inline XBRL.\240\ A seasoned fund filing a short-form 
registration statement on Form N-2 also will be required to tag 
information appearing in Exchange Act reports--such as those on Form N-
CSR, 10-K, 10-Q, or 8-K--if that information is required to be tagged 
in the fund's prospectus.\241\
---------------------------------------------------------------------------

    \240\ See new General Instruction I.2 of amended Form N-2.
    \241\ See new General Instruction I.3 of amended Form N-2.
---------------------------------------------------------------------------

    We will require affected funds to tag the following prospectus 
disclosure items using Inline XBRL format: Fee Table; Senior Securities 
Table; Investment Objectives and Policies; Risk Factors; Share Price 
Data; and Capital Stock, Long-Term Debt, and Other Securities.\242\ We 
continue to believe that these items are of greatest utility for 
investors and other data users that seek structured data to analyze and 
compare funds, as they provide important information about a fund's key 
features, costs, and risks.\243\ We believe tagging the Fee Table, 
which provides detailed information about the fund's costs, could 
facilitate analysis of fund costs and allow investors and other data 
users to compare the costs of a particular affected fund to the costs 
of other funds or other investment products, such as mutual funds. The 
Senior Securities Table requires registrants to include information 
about each class of senior securities, including bank loans. Tagging 
this information will facilitate analyses of outstanding senior 
securities that may bear on the likelihood, frequency, and size of 
distributions from the fund to its investors. Tagging Investment 
Objectives and Policies, which provides information about the fund's 
principal portfolio emphasis, will help an investor determine the 
degree to which a fund's objectives and policies align with the 
investor's preferences. Risk Factors describes risks associated with an 
investment in the fund. Tagging Risk Factors will facilitate the 
aggregation, analysis, and comparison by investors and other data users 
of information about a fund's risks alongside the fund's features and 
benefits. Tagging Share Price Information is important because the 
presence of a premium or discount may bear on the likelihood, 
frequency, and size of distributions from the fund to its investors, 
which we believe may be of particular importance to many affected fund 
investors. Tagging Capital Stock, Long-Term Debt, and Other Securities 
better informs common shareholders how their rights, expenses, and 
risks are affected when the fund issues other types or classes of 
securities. We also continue to believe that these items are best 
suited to being tagged in a structured format.
---------------------------------------------------------------------------

    \242\ See new General Instructions I.2 and I.3 of amended Form 
N-2; see also Items 3.1, 4.3, 8.2.b, 8.2.d, 8.3.a, 8.3.b, 8.5.b, 
8.5.c, 8.5.e, 10.1.a-d, 10.2.a-c, 10.2.e, 10.3, and 10.5 of amended 
Form N-2. This information largely parallels similar information 
contained in the Form N-1A risk/return summary. See Item 2 (Risk/
Return Summary: Investment Objectives/Goals), Item 3 (Risk/Return 
Summary: Fee Table), and Item 4 (Risk/Return Summary: Investments, 
Risks and Performance) of Form N-1A.
    \243\ See generally Proposing Release, supra footnote 10, at 
section II.H.1.b.
---------------------------------------------------------------------------

    The commenters who addressed the proposed requirement supported 
it.\244\ These commenters stated that the tagged data would be useful, 
including both numeric and narrative information.\245\ In addition, one 
commenter asserted that the Commission should require tagging all 
financial data that is required to be reported.\246\ We believe that 
this rule is appropriately focused on the key items that are most 
suitable for tagging and of greatest utility for investors.
---------------------------------------------------------------------------

    \244\ IRIS Comment Letter; XBRL US Comment Letter.
    \245\ Id. One commenter also supported the proposed scope of the 
new requirement--all affected funds--stating that if some issuers 
are excluded, it would result in higher costs for preparer and users 
of data. XBRL US Comment Letter. One commenter offered support for 
the proposed Inline XBRL format, stating that it would provide 
benefits to investors, regulators, and issuers. IRIS Comment Letter; 
see also supra footnotes 222-224 and accompanying text.
    \246\ XBRL US Comment Letter.
---------------------------------------------------------------------------

    Because we continue to believe that structuring these data elements 
will allow investors, other market participants, and other data users 
to automate their use of this information,

[[Page 33312]]

we are adopting this requirement as proposed.\247\ As with other new 
Commission XBRL taxonomies, staff will post for public review and 
feedback a draft Inline XBRL taxonomy for affected funds' tagged 
prospectus disclosures.\248\ When available, affected funds will be 
required to use the most recent version of the Inline XBRL taxonomy for 
tagged prospectus disclosures, as specified by the EDGAR Filer 
Manual.\249\
---------------------------------------------------------------------------

    \247\ See new General Instructions I.2 and I.3 of amended Form 
N-2; new rule 405(b)(3)(iii) of amended Regulation S-T. We also are 
making conforming amendments to rule 601(b)(101)(i)(C) of Regulation 
S-K, rule 11 of Regulation S-T, and adding a new general instruction 
to Form N-CSR to implement the specified prospectus disclosure 
tagging requirements for affected funds.
    \248\ Taxonomies are available at https://www.sec.gov/structureddata/dera_taxonomies.
    \249\ See rule 405(c)(1) of Regulation S-T.
---------------------------------------------------------------------------

    As the Commission proposed, and as required of mutual funds and 
ETFs under the recently adopted Inline XBRL regime,\250\ we will 
require affected funds to submit ``Interactive Data Files'' (i.e., 
machine-readable computer code that presents information in XBRL 
format) \251\ as follows:
---------------------------------------------------------------------------

    \250\ See Inline XBRL Filing of Tagged Data, Investment Company 
Act Release No. 33139 (June 28, 2018) (``Inline XBRL Adopting 
Release'').
    \251\ The term ``Interactive Data File'' is defined to mean 
``the machine-readable computer code that presents information in 
[XBRL] electronic format pursuant to [rule 405 of Regulation S-T] 
and as specified by the EDGAR Filer Manual.'' See rule 11 of 
Regulation S-T. The EDGAR Filer Manual sets forth the technical 
formatting requirements for the presentation and submission of 
electronic filings through the EDGAR system.
---------------------------------------------------------------------------

     For any registration statements and post-effective 
amendments, Interactive Data Files must be filed either concurrently 
with the filing or in a subsequent amendment that is filed on or before 
the date that the registration statement or post-effective amendment 
that contains the related information becomes effective; \252\
---------------------------------------------------------------------------

    \252\ New General Instruction I.2 of amended Form N-2; cf. 
General Instruction C.3.(g)(i)(B) of Form N-1A.
---------------------------------------------------------------------------

     for any form of prospectus filed pursuant to rule 424, 
Interactive Data Files must be submitted concurrently with the filing; 
\253\ and
---------------------------------------------------------------------------

    \253\ New General Instruction I.2 of amended Form N-2; cf. 
General Instruction C.3.(g)(ii) of Form N-1A.
---------------------------------------------------------------------------

     for any Exchange Act reports that a seasoned fund filing a 
short-form registration statement on Form N-2 will have to tag, as 
discussed above, Interactive Data files must be submitted concurrently 
with the filing.\254\
---------------------------------------------------------------------------

    \254\ New General Instruction I.3 of amended Form N-2.
---------------------------------------------------------------------------

    We proposed this approach to facilitate timely availability and 
promote the comparability and utility of important information in a 
structured data format for investors, other market participants, and 
other data users, which we believed would yield substantial 
benefits.\255\ We did not receive comments on this aspect of the 
proposal. We continue to believe that this approach will yield the 
substantial benefits discussed above and therefore are adopting it as 
proposed.
---------------------------------------------------------------------------

    \255\ Proposing Release, supra footnote 10, at section II.H.1.c.
---------------------------------------------------------------------------

d. Structured Data Format for Form 24F-2
    We will require submission of filings on Form 24F-2 in a structured 
XML format.\256\ We proposed this use of a structured data format, 
believing that it would make it easier for issuers to accurately 
prepare and submit the information required by Form 24F-2 and would 
make the submitted information more useful to Commission staff.\257\ 
The commenters who addressed the proposed requirement to structure Form 
24F-2 supported it,\258\ with one commenter observing that the 
structured registration fee information could be useful in validating 
the submission.\259\ Commenters were mixed on the proposed custom XML 
format, with one commenter supporting the proposed XML format,\260\ and 
another recommending that the Commission use an XBRL format 
instead.\261\
---------------------------------------------------------------------------

    \256\ See General Instruction A.3 to amended Form 24F-2 
(requiring reports on Form 24F-2 to be submitted in electronic 
format pursuant to the EDGAR Filer Manual and Appendices). We are 
expanding the group of issuers subject to filing on Form 24F-2 to 
include interval funds. See supra section II.H. We also are making a 
technical correction in Form 24F-2 to refer to the applicable 
paragraph of 17 CFR 232.101 (rule 101 of Regulation S-T). See 
General Instruction A.3 to amended Form 24F-2 (correcting ``rule 
101(a)(1)(i)'' to ``rule 101(a)(1)(iv)''). In addition, we are 
amending Form 24F-2 to add a free text response field, and a 
requirement to provide the EDGAR series/class (contract) ID for each 
separately reported series/class (contract) to facilitate 
implementation of the new structured data format. See amended Form 
24F-2.
    \257\ Proposing Release, supra footnote 10, at section II.H.1.d.
    \258\ IRIS Comment Letter; XBRL US Comment Letter.
    \259\ IRIS Comment Letter.
    \260\ IRIS Comment Letter. Additionally, two commenters 
recommended that the Commission require that reports on Forms N-CEN 
and N-PORT, which require reporting of information in a structured 
data format using a custom XML schema, be in XBRL or Inline XBRL 
format. See XBRL US Comment Letter; IRIS Comment Letter. The 
Commission considered requiring reporting in XBRL format in 
connection with its adoption of Forms N-CEN and N-PORT and 
determined that the relatively simple characteristics reported on 
those forms is more suited to XML than XBRL. See Investment Company 
Reporting Modernization, Investment Company Act Release No. 32314 
(Oct. 13, 2016) [81 FR 81870, 81906-07 (Nov. 17, 2016)] 
(``Investment Company Reporting Modernization Adopting Release'').
    \261\ XBRL US Comment Letter (stating that a custom XML schema 
will result in added costs for reporting entities and data consumers 
relative to XBRL). This commenter also suggested requiring the use 
of validation rules and linking custom extensions to improve data 
quality for reported financial information. XBRL US Comment Letter. 
While we encourage the use of appropriate tools to improve data 
quality, we believe that consideration of a requirement to use 
validation rules or use custom extension linking would best be taken 
up on a separate, holistic basis, for BDCs and operating companies 
alike, rather than in the context of this final rule.
---------------------------------------------------------------------------

    Because Form 24F-2 is primarily used by Commission staff to 
validate registration fees paid by issuers and not for financial 
reporting purposes, we continue to believe that a custom XML schema 
will be an appropriate format for the required information. For 
example, while XBRL allows issuers to capture the rich complexity of 
financial information presented in accordance with GAAP, we believe 
that XML is more appropriate for the relatively simple characteristics 
of the fund's fee information in reports on Form 24F-2.\262\ In 
addition we continue to believe that the XML format will improve the 
quality of information disclosed by providing a built-in validation 
framework of the data in the reports.\263\ We therefore will require 
reports on Form 24F-2 to be filed in a structured XML format, as 
proposed.
---------------------------------------------------------------------------

    \262\ See Investment Company Reporting Modernization Adopting 
Release, supra footnote 260, at nn.449-50 and accompanying text.
    \263\ See id.
---------------------------------------------------------------------------

2. Periodic Reporting Requirements
    We are also adopting new annual report requirements, as proposed. 
As we discussed in the Proposing Release, we expect several of the 
reforms we are adopting in this release, such as those relating to 
automatically effective shelf registration, forward incorporation by 
reference, and final prospectus delivery, will elevate the importance 
of periodic reporting relative to prospectus disclosure for affected 
funds.
    A seasoned fund filing a short-form registration statement on Form 
N-2 will be required to forward incorporate all periodic Exchange Act 
reports into its registration statement.\264\ This should result in 
periodic reports becoming a more salient, convenient, and comprehensive 
source of updated information about a particular seasoned fund, 
relative to that fund's registration statement. As a result, these 
funds' annual reports may take on greater prominence, with investors 
looking to the annual reports for key

[[Page 33313]]

information.\265\ Registered CEFs' shareholder reports may also take on 
greater prominence for investors because, under the final rule, 
affected funds will not be required to deliver final prospectuses but 
will still be required to deliver shareholder reports at least semi-
annually.\266\
---------------------------------------------------------------------------

    \264\ See new General Instruction F.3.b of amended Form N-2.
    \265\ In 2005, the Commission observed that recent enhancements 
to Exchange Act reporting enabled us to rely on those reports to a 
greater degree in adopting our rules to reform the securities 
offering process. Securities Offering Reform Adopting Release, supra 
footnote 5, at 44726. As the Commission did then, we believe that 
enhanced periodic reporting is an important corollary to reform of 
the offering process under the Securities Act. See id.
    \266\ Compare Securities Act rule 172 with 17 CFR 270.30e-1 
(Investment Company Act rule 30e-1); see also supra section II.C.
---------------------------------------------------------------------------

    Accordingly, as proposed, we are requiring seasoned funds that 
register using the proposed short-form registration instruction to 
include key information in their annual reports regarding fees and 
expenses, premiums and discounts, and outstanding senior securities 
that the funds currently disclose in their prospectuses.\267\ Because 
the annual report will be incorporated by reference into the fund's 
prospectus, requiring disclosure in both the prospectus and annual 
report should not require duplicative disclosure. Moreover, specifying 
identical disclosure requirements in both places may facilitate forward 
incorporation by reference, by making clear that the same required 
disclosure will satisfy both requirements. We continue to believe that 
investors should have no less current information than they do today 
about these items when the fund is offering its shares.\268\ Finally, 
we are requiring, as proposed, registered CEFs to provide management's 
discussion of fund performance (or ``MDFP'') in their annual reports to 
shareholders, BDCs to provide financial highlights in their 
registration statements and annual reports, and affected funds filing a 
short-form registration statement on Form N-2 to disclose material 
unresolved staff comments.\269\ These provisions are intended to 
modernize and harmonize our periodic report disclosure requirements for 
affected funds with those applicable to operating companies and mutual 
funds and ETFs.\270\
---------------------------------------------------------------------------

    \267\ In general, these requirements are expressed as a cross-
reference to the specified registration statement requirements in 
Form N-2. See new Instructions 4.h.(1)-4.h.(3) to Item 24 of amended 
Form N-2 (referencing Items 4.3, 3.1, and 8.5 of amended Form N-2, 
respectively).
    \268\ Proposing Release, supra footnote 10, at section II.H.2.
    \269\ See infra sections II.I.2.a-II.I.2.d. See new Instruction 
4.g to Item 24 of amended Form N-2 (MDFP); deletion of Instruction 1 
to Item 4 of current Form N-2 (BDC financial highlights); and new 
Instruction 4.h.(4) to Item 24.4.h(4) of amended Form N-2 (material 
unresolved staff comments).
    \270\ We are also, as proposed, amending Form N-2 to apply 
certain of its requirements for annual reports to BDCs. See new 
Instruction 10 to Item 24 of amended Form N-2.
---------------------------------------------------------------------------

a. Fee and Expense Table, Share Price Data, and Senior Securities Table
    We are adopting a requirement, as proposed, that funds filing a 
short-form registration statement on Form N-2 include key information 
in their annual reports that they disclose in their prospectuses in 
light of the importance of this information and the increased 
prominence of shareholder reports under our final rule. Specifically, 
we will require that these funds include the following information in 
their annual reports: \271\
---------------------------------------------------------------------------

    \271\ See new Instructions 4.h.(1) (senior securities table), 
4.h.(2) (fee and expense table), and 4.h.(3) (share price data) to 
Item 24 of amended Form N-2.
---------------------------------------------------------------------------

     Fee and Expense Table: Form N-2 requires registrants to 
include information about the costs and expenses that the investor will 
bear directly or indirectly, using specified captions and a specified 
tabular format.\272\ This table is designed to help investors 
understand the costs of investing in an affected fund and to compare 
those costs with the costs of other affected funds.\273\ The Commission 
has previously noted the importance of costs to an investment decision 
and, in the case of registered open-end funds, has specified the 
location of the fee table to enhance the prominence of the cost 
information.\274\
---------------------------------------------------------------------------

    \272\ See Item 3.1 of amended Form N-2; see also new Instruction 
4.h.(2) to Item 24 of amended Form N-2.
    \273\ See Enhanced Disclosure and New Prospectus Delivery Option 
for Registered Open-End Management Investment Companies, Investment 
Company Release No. 28064 (Nov. 21, 2007) [72 FR 67790, 67794 (Nov. 
30, 2007)].
    \274\ See id.; Enhanced Disclosure and New Prospectus Delivery 
Option for Registered Open-End Management Investment Companies, 
Investment Company Act Release No. 28584 (Jan. 13, 2009) [74 FR 
4546, 4553 (Jan. 26, 2009)]; Request for Comment on Fund Retail 
Investor Experience and Disclosure, Investment Company Act Release 
No. 33113 (June 5, 2018) [83 FR 26891, 26901 (June 11, 2018)] 
(``Investor Experience Request for Comment'').
---------------------------------------------------------------------------

     Share Price Data: Form N-2 requires registrants to include 
information about the share price of the registrant's stock as well as 
information about any premium or discount that the share price 
reflects, compared to the registrant's NAV.\275\ The presence of a 
premium or discount may bear on the likelihood, frequency, and size of 
distributions from the fund to its investors, which we believe may be 
of particular importance to many affected fund investors.
---------------------------------------------------------------------------

    \275\ See Item 8.5 of amended Form N-2; see also new Instruction 
4.h.(3) to Item 24 of amended Form N-2 (share price data).
---------------------------------------------------------------------------

     Senior Securities Table: Form N-2 requires registrants to 
include information about each of its classes of senior securities, 
including bank loans.\276\ As with a premium or discount, any 
outstanding senior securities may bear on the likelihood, frequency, 
and size of distributions from the fund to its investors. A registrant 
must disclose information about its senior securities for the most 
recent ten years, the last five years of which must be audited.\277\
---------------------------------------------------------------------------

    \276\ See Item 4.3 of amended Form N-2; see also new Instruction 
4.h.(1) to Item 24 of amended Form N-2.
    \277\ See Instruction 1 to Item 4.3 (applying Instruction 8 to 
Item 4.1 to Item 4.3) and Instruction 8 to Item 4.1 (requiring the 
information to be audited) of amended Form N-2.
---------------------------------------------------------------------------

    The commenters that addressed these proposed requirements related 
to the Fee and Expense Table, Share Price Data, and Senior Securities 
Table supported them.\278\ Because we continue to believe in the 
importance of this information and the increased prominence of 
shareholder reports under our final rule,\279\ we are adopting this 
aspect of the proposal as proposed.\280\
---------------------------------------------------------------------------

    \278\ ICI Comment Letter; Invesco Comment Letter. Two other 
commenters stated that they did ``not object'' to the proposed 
requirements. Dechert Comment Letter; IPA Comment Letter. Several 
commenters opposed related potential modifications addressed in the 
requests for comment within the Proposing Release that we are not 
adopting. Dechert Comment Letter (opposing expansion of proposed 
requirement to semi-annual reports; opposing expansion of 
requirement to ``portfolio companies'' table); IPA Comment Letter 
(same). One commenter recommended that the Commission continue to 
consider ways to enhance the fund retail investor experience, 
including the content of the annual report. ICI Comment Letter. The 
Commission staff is continuing to consider comment letters received 
in response to the Investor Experience Request for Comment. See 
supra footnote 274.
    \279\ Proposing Release, supra footnote 10, at section II.H.2.a.
    \280\ One commenter recommended that we add an instruction to 
Form N-2 to ``clarify'' that the schedules required by 17 CFR 
210.12-12 (rule 12-12 of Regulation S-X) satisfy the Portfolio 
Companies table requirement in Item 8.6.a of Form N-2. See Dechert 
Comment Letter. We are not making this change because the two 
provisions do not require the same information. Disclosure 
satisfying the requirements of rule 12-12 of Regulation S-X would 
not always satisfy the requirements of Item 8.6.a. For example, Item 
8.6.a of Form N-2 requires certain information about each portfolio 
company, such as the percentage of each class owned by the issuer, 
the issuer's relationship with the portfolio company, and the 
address of the portfolio company. Regulation S-X requires no such 
disclosures.
---------------------------------------------------------------------------

    With respect to the Senior Securities Table, two commenters 
requested that we revise the instruction to Form N-2

[[Page 33314]]

as it relates to affected funds to reduce the audit requirement from 
the last five-years (in the registration statement) to the same periods 
as contained in the audited balance sheet presented in the annual 
report.\281\ However, such a change would alter the periods presented 
for the Senior Securities Table, which match the periods presented in 
the Financial Highlights.\282\ Given the importance of asset coverage 
and the comparability of information contained in both the Financial 
Highlights and the Senior Securities Table, we do not believe such a 
change is appropriate. Additionally, because the annual report will be 
incorporated by reference into the fund's prospectus, filing the 
audited senior securities table in the annual report will not result in 
duplicative disclosure. For this reason, we have determined not to 
amend the requirements in the manner suggested by the commenters.
---------------------------------------------------------------------------

    \281\ Dechert Comment Letter (``[W]e believe that the SEC should 
revise the instructions to Item 4.3 of Form N-2 to state that an 
Affected Fund need only audit the information in the senior 
securities table for the same periods as contained in the audited 
balance sheet included in the fund's annual report.''); IPA Comment 
Letter.
    \282\ See Instruction 1 to Item 4.3 of Form N-2 (applying 
Instruction 3 to Item 4.1 to the Senior Securities Table).
---------------------------------------------------------------------------

b. Management's Discussion of Fund Performance
    We are also adopting, as proposed, an amendment to Form N-2 that 
will extend the MDFP disclosure requirements to all registered 
CEFs.\283\ Currently, mutual funds and ETFs are required to include 
MDFP in their annual reports to shareholders.\284\ MDFP disclosure aids 
investors in assessing a fund's performance over the prior year and 
complements other backward looking information required in the annual 
report, such as financial statements.\285\ This required disclosure is 
grounded conceptually in the disclosure requirement for operating 
companies (as well as BDCs) to include a narrative discussion of the 
financial statements of the company--``management discussion and 
analysis'' or ``MD&A''--and to provide an opportunity to look at a 
company ``through the eyes of management.'' \286\
---------------------------------------------------------------------------

    \283\ New Instruction 4.g to Item 24 of amended Form N-2.
    \284\ Item 27(b)(7) of Form N-1A. This requirement applies to 
registered open-end management investment companies other than money 
market funds.
    \285\ Shareholder Reports and Quarterly Portfolio Disclosure of 
Registered Management Investment Companies, Investment Company Act 
Release No. 26372 (Feb. 27, 2004) [69 FR 11243, 11254 (Mar. 9, 
2004)] (``Quarterly Portfolio Disclosure Adopting Release''); see 
also Proposing Release, supra footnote 10, at section II.H.2.b 
(summarizing the history and purpose of the requirement).
    \286\ Disclosure and Analysis of Mutual Fund Performance 
Information; Portfolio Manager Disclosure, Investment Company Act 
Release No. 17294 (Jan. 8, 1990) [55 FR 1460, 1462 (Jan. 16, 1990)].
---------------------------------------------------------------------------

    We proposed to amend Form N-2 to extend the MDFP disclosure 
requirements to all registered CEFs.\287\ Specifically, we proposed to 
require that registered CEFs:
---------------------------------------------------------------------------

    \287\ Proposing Release, supra footnote 10, at section II.H.2.b.
---------------------------------------------------------------------------

     Discuss the factors that materially affected their 
performance during the most recently completed fiscal year, including 
the relevant market conditions and the investment strategies and 
techniques used by the fund;
     Provide a line graph comparing the initial and subsequent 
account values at the end of each of the most recently completed ten 
fiscal years of the fund and a table of the fund's total returns for 
the 1-, 5-, and 10-year periods as of the last day of the fund's most 
recent fiscal year; and
     Discuss the effect of any policy or practice of 
maintaining a specified level of distributions to shareholders on the 
fund's investment strategies and per share NAV during the last fiscal 
year, as well as the extent to which the registrant's distribution 
policy resulted in distributions of capital.
    Commenters that addressed this aspect of the proposal supported 
it.\288\ Because we continue to believe that investors in these funds--
like investors in mutual funds, ETFs, BDCs, and operating companies--
would benefit from annual report disclosure that aids them in assessing 
the fund's performance over the prior year and that complements other 
information in the report,\289\ we are adopting this requirement as 
proposed.\290\
---------------------------------------------------------------------------

    \288\ ABA Comment Letter; ICI Comment Letter; Invesco Comment 
Letter; TIAA Comment Letter. One commenter stated that MDFP 
information can assist investors with understanding fund performance 
and market conditions over the reporting period from the fund 
manager's perspective. ICI Comment Letter. In the Proposing Release, 
we asked whether, instead of requiring MDFP information for 
registered CEFs, we should require such funds to disclose MD&A 
information like BDCs and operating companies. Proposing Release, 
supra footnote 10, at section II.H.2.b. A few commenters expressly 
opposed this change to the proposed requirement compared with the 
MDFP requirement in Form N-1A. ABA Comment Letter; ICI Comment 
Letter; Invesco Comment Letter; TIAA Comment Letter.
    \289\ Proposing Release, supra footnote 10, at section II.H.2.b.
    \290\ New Instruction 4.g to Item 24 of amended Form N-2.
---------------------------------------------------------------------------

c. Financial Highlights
    We are amending Form N-2, as proposed, to require that a BDC, like 
other affected funds, include financial highlights disclosure 
summarizing its financial statements in its registration statement and 
annual report.\291\ Today, BDCs include their full financial statements 
in their prospectus, and we currently permit BDCs to omit financial 
highlights disclosure summarizing these financial statements.\292\ We 
understand, however, that it is generally market practice for BDCs to 
include financial highlights disclosure. This information is arranged 
to allow investors to trace the operating performance of a fund on a 
per share basis from the fund's beginning NAV to its ending NAV so that 
investors may understand the sources of changes.\293\ It summarizes the 
financial statements.\294\ Commenters did not address this aspect of 
the proposal. Because we continue to believe that investors will 
benefit from required disclosure summarizing a BDC's financial 
statements,\295\ we are adopting this change as proposed.\296\
---------------------------------------------------------------------------

    \291\ To effectuate this change, we are removing and reserving 
Instruction 1 to Item 4, and adding new Instruction 10 to Item 24 of 
amended Form N-2. Currently, only registered CEFs are required to 
include financial highlights in their registration statements, and 
annual reports to shareholders. See Instruction 1 to Item 4.1 
(limiting the applicability of Item 4.1 in the case of BDCs), and 
Instruction 4.b (requiring the financial highlights required by Item 
4.1 to be included in the annual report) to Item 24 of current Form 
N 2.
    \292\ General Instruction 1 to Item 4.1 of current Form N-2.
    \293\ Registration Form for Closed-End Management Investment 
Companies, Investment Company Act Release No. 19115 (Nov. 20, 1992) 
[57 FR 56826, 56829 (Dec. 1, 1992)].
    \294\ Registration Form for Closed-End Management Investment 
Companies, Investment Company Act Release No. 17091 (July 28, 1989) 
[54 FR 32993, 32997 (Aug. 11, 1989)].
    \295\ See Proposing Release, supra footnote 10, at section 
II.H.2.c.
    \296\ See Instruction 1 to Item 4.1 of amended Form N-2 (removed 
and reserved); new Instruction 10 to Item 24 of amended Form N-2.
    In addition, we are adopting, as proposed, a conforming change 
to the financial highlights requirements to eliminate the current 
requirement that registered CEFs specify the average commission rate 
paid. See Item 4.1 of amended Form N-2 (removing Instructions 18-19 
from Item 4.1). Although this information is currently required for 
registered CEFs, the Commission previously eliminated a similar 
requirement from Item 13(a) of Form N-1A for open-end funds 
registered on Form N-1A. Item 4.1.l of Form N-2; Instructions 18-19 
to Item 4.1 of Form N-2; Item 13(a) of Form N-1A; See Registration 
Form Used by Open-End Management Investment Companies, Investment 
Company Act Release No. 23064 (Mar. 13, 1998) [63 FR 13916, 13936 
(Mar. 23, 1998)]. The Commission reached this determination after 
receiving and considering public comment arguing that these rates 
are technical information that typical investors are unable to 
understand. Id. We continue to believe that the same considerations 
supporting elimination of this requirement from Form N-1A also apply 
to registered CEFs.

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

[[Page 33315]]

d. Unresolved Staff Comments
    We are also adopting, as proposed, a requirement that affected 
funds filing a short-form registration statement disclose outstanding 
staff comments that remain unresolved for a substantial period of time 
and that the fund believes are material.\297\ As part of the 
Commission's 2005 securities offering reforms for operating companies, 
the Commission adopted a similar provision for operating companies, 
recognizing that the new rules could eliminate some incentives issuers 
may have to timely resolve any staff comments on their Exchange Act 
reports.\298\ The Commission observed, in connection with this proposed 
requirement, that this rulemaking similarly may eliminate some 
incentives for certain affected funds to timely resolve staff comments.
---------------------------------------------------------------------------

    \297\ See new Instruction 4.h.(4) to Item 24 of amended Form N-
2. Specifically, such funds will be required to disclose the 
substance of any unresolved written staff comments that the fund 
believes are material and that were received not less than 180 days 
before the end of the fiscal period to which the annual report 
relates. Id.
    \298\ See generally Proposing Release, supra footnote 10, at 
section II.H.2.d.
---------------------------------------------------------------------------

    Two commenters recommended that the Commission not adopt this 
proposed requirement.\299\ One commenter stated that the proposed 
requirement would be inconsistent with Commission efforts to simplify 
disclosure and focus on key information important to investors.\300\ We 
believe, however, that, because the requirement only relates to 
comments that the issuer believes are material and because they will 
relate to information about which the issuer and the Commission staff 
disagree, the disclosure of the comments is likely to be information 
that is important to investors. This commenter also stated that the 
requirement would be at odds with recent statements about the non-
binding nature of staff guidance. However, the provision will not make 
the substance of statements by staff in their comments binding upon the 
public or the Commission. Rather, the Commission, by rule, will require 
affected funds to inform investors about their disagreements with the 
staff in connection with the staff's review of disclosures.
---------------------------------------------------------------------------

    \299\ ICI Comment Letter; Invesco Comment Letter. One commenter 
opposed extending the proposed requirement to additional categories 
of issuers, including mutual funds and ETFs. ICI Comment Letter.
    \300\ ICI Comment Letter.
---------------------------------------------------------------------------

    Two commenters expressed concern that differing views about whether 
a particular comment is ``material'' or ``unresolved'' could result in 
inconsistent disclosure among different funds in similar 
circumstances.\301\ We recognize that analysis of whether a particular 
written comment must be disclosed may involve some subjective judgment 
regarding specific facts and circumstances. Many disclosure 
requirements inherently involve some subjective judgment and can result 
in some variance in the disclosure provided by different funds.
---------------------------------------------------------------------------

    \301\ ICI Comment Letter; Invesco Comment Letter.
---------------------------------------------------------------------------

    These commenters also suggested some alternatives to the proposed 
requirement. For example, one commenter suggested that the Commission, 
rather than require disclosure of material unresolved staff comments, 
issue a stop order to prevent an offering from going forward if 
necessary.\302\ We believe that it is more appropriate to preserve an 
intermediate approach for the Commission, in appropriate circumstances, 
to allow an offering to proceed while informing investors and others 
about material disagreements between the issuer and the Commission's 
staff, so that investors can make an informed judgment about the 
disagreement. Another commenter recommended, as an alternative, that 
the Commission publish its staff's comments and issuer responses.\303\ 
We believe, however, that investors and other interested persons are 
more likely to see and read disclosure of material, unresolved staff 
comments if they appear in a fund's annual report than comments and 
responses published separately.\304\
---------------------------------------------------------------------------

    \302\ ICI Comment Letter.
    \303\ Invesco Comment Letter.
    \304\ Adopting this requirement does not prevent the Commission 
from also publishing staff comments or issuer responses, which may 
supplement this required disclosure. For example, publishing staff 
comments and issuer responses, which the staff currently 
disseminates using the EDGAR system, may also inform investors and 
the market about comments that are promptly resolved. See Press 
Release No. 2004-89; SEC Staff to Publicly Release Comment Letters 
and Responses (June 24, 2004) available at https://www.sec.gov/news/press/2004-89.htm.
---------------------------------------------------------------------------

    In addition, this requirement parallels the current requirement for 
operating companies that use the offering rules.\305\ These commenters, 
however, provide no basis for distinguishing affected funds from those 
operating companies that are already subject to the requirement. After 
considering comments received, and because we continue to believe that 
these disclosure requirements will provide an incentive for affected 
funds to timely resolve staff comments and that investors may value 
information about areas of disagreement that the issuer believes are 
material, we are adopting the requirement as proposed.\306\
---------------------------------------------------------------------------

    \305\ Proposing Release, supra footnote 10, at section II.H.2.d.
    \306\ New Instruction 4.h.(4) to Item 24 of amended Form N-2.
---------------------------------------------------------------------------

3. Current Reporting Requirements for Affected Funds
    As discussed in the Proposing Release, operating companies and BDCs 
are required to promptly report certain events on Form 8-K, while 
registered CEFs generally are not required to report on Form 8-K. The 
Commission proposed to require registered CEFs to report information on 
Form 8-K to enhance parity with operating companies and BDCs, to 
improve information for investors and the market, and to recognize the 
role of Form 8-K reporting in the 2005 offering reform amendments.\307\ 
It also proposed to amend Form 8-K to: (1) Add two new reporting items 
for affected funds on material changes to investment objectives or 
policies and material write-downs of significant investments, and (2) 
adapt the existing reporting requirements and instructions to affected 
funds. As discussed in more detail below, in response to comments, we 
are not adopting the proposed Form 8-K amendments.\308\ However, we 
will continue to consider current reporting more generally as part of 
our ongoing review of the effectiveness of investment company 
disclosure.
---------------------------------------------------------------------------

    \307\ See Proposing Release, supra footnote 10, at section 
II.H.3.a. See also Securities Offering Reform Adopting Release, 
supra footnote 5, at 44726 (describing the availability of ongoing 
information about a public issuer and its securities, including 
current information on Form 8-K, as an important component of the 
offering reforms the Commission adopted for operating companies) and 
44730 (declining to make the benefits of being a reporting issuer, 
seasoned issuer, or WKSI available to voluntary filers and stating 
that ``such issuers should be required to register under the 
Exchange Act, and thus become subject to all of the results of 
registration for all purposes, if they wish to avail themselves of'' 
these benefits).
    \308\ BDCs will continue to be required to report on Form 8-K, 
as they do today.
---------------------------------------------------------------------------

a. Form 8-K Reporting for Registered CEFs
    The Commission proposed to require registered CEFs that are 
reporting companies under section 13(a) or section 15(d) of the 
Exchange Act to report current information on Form 8-K. Commenters 
generally opposed a Form 8-K reporting requirement for registered 
CEFs.\309\ Commenters suggested that registered CEFs should not be 
subject to Form 8-K reporting requirements because the commenters 
believe that: (1) Existing registered CEF

[[Page 33316]]

disclosure is sufficient; \310\ (2) Form 8-K reporting would be costly 
for registered CEFs; \311\ (3) parity with operating companies and BDCs 
is unnecessary in the context of Form 8-K reporting; \312\ and (4) 
investors, analysts, and regulators have not previously indicated that 
registered CEF disclosure is inadequate.\313\
---------------------------------------------------------------------------

    \309\ See ABA Comment Letter; ICI Comment Letter; and Invesco 
Comment Letter.
    \310\ See ABA Comment Letter; ICI Comment Letter; and Invesco 
Comment Letter.
    \311\ See ABA Comment Letter (stating that the cost and 
administrative burden of Form 8-K reporting would outweigh the 
benefits discussed in the Proposing Release of establishing a 
uniform and centralized current reporting regime for registered 
CEFs); ICI Comment Letter (suggesting that registered CEFs already 
have a greater regulatory filing burden than operating companies 
because they report on Forms N-CEN, N-PORT, and N-PX); and Invesco 
Comment Letter.
    \312\ See ICI Comment Letter (suggesting there are reasons for 
registered CEFs to be subject to a different disclosure regime than 
operating companies, including that registered CEFs are highly 
regulated under the Investment Company Act).
    \313\ See ABA Comment Letter and ICI Comment Letter. But see 
White Comment Letter (stating that there should always be a current 
document where an investor can see a fund's strategy, risks, 
performance, and costs each year and suggesting that investors 
should receive notices of any material changes on a more timely 
basis); Proposing Release, supra footnote 10, at n.323 (citing a 
similar comment letter the Commission received in response to the 
Investor Experience Request for Comment).
---------------------------------------------------------------------------

    With respect to existing disclosure practices, commenters stated 
that registered CEFs already provide material updates through other 
required or voluntary mechanisms (e.g., prospectus supplements, press 
releases, shareholder reports, voluntary Form 8-K filings, and website 
disclosure) that result in adequate and timely disclosure of 
information to investors.\314\ One commenter suggested that registered 
CEFs would be unlikely to provide meaningful new information under Form 
8-K beyond what they already disclose under other regulatory 
requirements.\315\ Two commenters expressed concern that Form 8-K 
reporting may not timely inform investors about important fund 
events.\316\ One of these commenters suggested that fund investors are 
more likely to receive timely information through a registered CEF's 
typical practice of issuing a press release about an important event, 
posting the press release to its website, and including information 
about the event in its next shareholder report.\317\
---------------------------------------------------------------------------

    \314\ See ABA Comment Letter; ICI Comment Letter; and Invesco 
Comment Letter. As discussed in the Proposing Release, listed 
registered CEFs may disclose certain information on Form 8-K to 
comply with exchange requirements for listed company disclosure, 
although there are other mechanisms they may use to disclose the 
information (e.g., press releases). See Proposing Release, supra 
footnote 10, at section II.H.3.a. Two commenters pointed to these 
requirements in support of their argument that existing disclosure 
is adequate. ABA Comment Letter and Invesco Comment Letter.
    \315\ See ABA Comment Letter (stating that Form 8-K is largely 
duplicative of information that listed registered CEFs disclose in 
press releases in accordance with exchange rules and that 
continuously-offered registered CEFs disclose in prospectus 
supplements or post-effective amendments under SEC rules).
    \316\ See Invesco Comment Letter and White Comment Letter.
    \317\ See Invesco Comment Letter.
---------------------------------------------------------------------------

    Although they opposed a new Form 8-K reporting requirement, a few 
commenters suggested alternative approaches if we were to require 
registered CEFs to report on Form 8-K. One commenter suggested that, if 
the Commission requires registered CEFs to report on Form 8-K, we 
should require them to report only a subset of Form 8-K items.\318\ 
Another commenter suggested that, rather than require registered CEFs 
to report on Form 8-K, we could require listed registered CEFs to file 
press releases containing material information on Form 8-K, similar to 
how continuously-offered registered CEFs file prospectus supplements on 
EDGAR.\319\ Additionally, one commenter suggested that we require 
registered CEFs to more directly notify investors about material fund 
changes and stated that Form 8-K filings would not provide appropriate 
notice to a fund's investors.\320\
---------------------------------------------------------------------------

    \318\ See ICI Comment Letter.
    \319\ See ABA Comment Letter.
    \320\ See White Comment Letter.
---------------------------------------------------------------------------

    As we recognized in the Proposing Release and as noted by 
commenters, there are differences between the types of events that are 
important to registered CEFs and the types of events that are important 
to operating companies.\321\ Moreover, for those Form 8-K events that 
would be relevant to registered CEFs, we recognize that these funds 
currently may disclose substantially similar information through other 
mechanisms, such as prospectus supplements, post-effective amendments, 
and press releases. We also are sensitive to commenters' concerns about 
the burdens to registered CEFs associated with a new Form 8-K reporting 
requirement, particularly for those registered CEFs that will not 
qualify as WKSIs or be eligible to file short-form registration 
statements under the amendments we are adopting.
---------------------------------------------------------------------------

    \321\ See Proposing Release, supra footnote 10, at text 
following n.260; ABA Comment Letter (suggesting that, as a general 
matter, registered CEFs tend to have a simpler and more transparent 
business than operating companies (e.g., many listed registered CEFs 
publish their NAVs on a daily or weekly basis)); ICI Comment Letter 
(stating that, for example, disclosure about departures of fund 
officers on Form 8-K would not be meaningful for registered CEFs 
because fund officers generally are not actively involved in the 
day-to-day management of a fund's portfolio).
---------------------------------------------------------------------------

    As a result of these considerations, we are persuaded that a new 
Form 8-K reporting requirement for registered CEFs may not 
substantially improve the flow of important current information to 
investors and the market and, as a result, would not justify the 
additional burdens associated with Form 8-K reporting. Therefore, we 
are not adopting the proposed Form 8-K reporting requirements for 
registered CEFs.\322\ However, we will continue to consider whether 
more current reporting requirements that are tailored to registered 
CEFs, or to registered investment companies more generally, may be 
appropriate in connection with our continuing review of investment 
company disclosure effectiveness.\323\
---------------------------------------------------------------------------

    \322\ In addition to the proposed amendments to Form 8-K, we 
also are not adopting the associated proposed amendments to 17 CFR 
240.13a-11 and 240.15d-11 (Exchange Act rule 13a-11 and rule 15d-11) 
because the proposed amendments to those rules were only necessary 
to carry out the proposal to require registered CEFs to report on 
Form 8-K.
    \323\ See Investor Experience Request for Comment, supra 
footnote 274. See also supra footnote 313.
---------------------------------------------------------------------------

    Although registered CEFs generally will not be required to file 
reports on Form 8-K, a registered CEF that is eligible to file a short-
form registration statement may voluntarily file information on Form 8-
K to forward incorporate that information into its registration 
statement or for other purposes (e.g., to publicly disseminate 
information under exchange rules, as applicable).\324\ These voluntary 
Form 8-K filings will not affect a registered CEF's ability to qualify 
as a seasoned fund. This is because the requirements to be current and 
timely with respect to the fund's Exchange Act and Investment Company 
Act reports only apply to materials a fund is required to file.\325\
---------------------------------------------------------------------------

    \324\ Although registered CEFs are only required to file Form 8-
K reports under Item 5.04 (Temporary Suspension of Trading Under 
Registrant's Employee Benefit Plans), as applicable, other Form 8-K 
reports they file on a voluntary basis will be ``filed pursuant to 
Section 13(a) or 15(d) of the Exchange Act'' for purposes of the 
incorporation by reference instructions in Form N-2 that apply to 
funds that are eligible to file short-form registration statements. 
See General Instruction F.3 of amended Form N-2; Exchange Act rule 
13a-11(b)(1) and rule 15d-11(b)(1). Information a registered CEF 
furnishes on a Form 8-K report will not be incorporated by reference 
into the fund's registration statement under this instruction. This 
is consistent with the incorporation by reference regime for 
operating companies on Form S-3, where information voluntarily filed 
on Form 8-K (e.g., under Item 8.01 (Other Events)) is incorporated 
by reference into the company's registration statement while 
furnished Form 8-K reports are not incorporated by reference. See 
also supra footnote 314 (discussing exchange rules requiring listed 
registered CEFs to timely disclose certain information to the 
public).
    \325\ See new General Instruction A.2 of amended Form N-2; 
General Instruction I.A.3 of Form S-3.

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

[[Page 33317]]

b. Other Proposed Amendments to Form 8-K
    We are similarly not adopting the other proposed amendments to Form 
8-K, including the two proposed reporting items regarding material 
changes to investment objectives or policies and material write-
downs.\326\ Although the two proposed reporting items also would have 
applied to BDCs, we are not adopting these current reporting 
requirements for any affected funds. Commenters generally opposed these 
proposed reporting items and argued that existing disclosure is 
adequate.\327\ We will continue to consider the adequacy of affected 
fund disclosure, including the availability and timeliness of 
information about material changes in investment objectives or policies 
and material write-downs of significant investments, as part of our 
ongoing review of the effectiveness of investment company 
disclosure.\328\ Rather than establish new current reporting 
requirements for affected funds on a piecemeal basis in this release, 
we believe it is more appropriate to consider current reporting in 
connection with a broader, systematic review of investment company 
disclosure.
---------------------------------------------------------------------------

    \326\ See Proposing Release, supra footnote 10, at section 
II.H.3.b. Since we are not adopting the proposed items to Form 8-K, 
we also are not amending the safe harbor in Exchange Act rules 13a-
11 and 15d-11 to include those items. See Proposing Release, supra 
footnote 10, at n.289.
    \327\ See ABA Comment Letter (suggesting that neither of the 
proposed items would provide additional important information); ACC 
Comment Letter (opposing the proposed material write-down item for 
BDCs in particular); CBD Comment Letter.
    \328\ See Investor Experience Request for Comment, supra 
footnote 274.
---------------------------------------------------------------------------

4. Online Availability of Information Incorporated by Reference
    We are adopting, as proposed, amendments to Form N-2's General 
Instruction for Incorporation by Reference.\329\ All registered CEFs 
and BDCs currently can backward incorporate their financial information 
from previously-filed Exchange Act reports into the prospectus or SAI. 
However, Form N-2 currently requires that a fund provide to new 
purchasers a copy of all previously-filed materials that the fund 
incorporated by reference into the prospectus and/or SAI.\330\ Under 
the amendments, and as proposed, we are removing the requirement that a 
fund deliver to new investors information that it has incorporated by 
reference into the prospectus or SAI.\331\ These amendments will allow 
the fund to make its prospectus, SAI, and the incorporated materials 
readily available and accessible on a website identified in the fund's 
prospectus and SAI.\332\ Affected funds will also be required to 
provide incorporated materials upon request free of charge. We believe 
this approach will improve the online accessibility of the prospectus 
and SAI and any documents that are incorporated by reference for 
investors that wish to review such information online, and will 
facilitate the efficient use of incorporation by reference by affected 
funds.\333\ The only commenter who addressed this approach supported 
it,\334\ and we are adopting it as proposed.
---------------------------------------------------------------------------

    \329\ See General Instruction F of amended Form N-2.
    \330\ See General Instruction F.3 of amended Form N-2 (requiring 
the material incorporated by reference to be provided with the 
prospectus and/or the SAI to each person to whom the prospectus and/
or the SAI is sent or given, unless the person holds securities of 
the fund and otherwise has received a copy of the material); see 
also Proposing Release, supra footnote 10, at text accompanying 
nn.309-311.
    \331\ We also are amending Form N-2's current disclosure 
requirements for incorporation by reference, by replacing these 
current instructions with a new General Instruction F.4, which 
largely mirrors the disclosure requirements in Item 12(c) of Form S-
3. The new instruction streamlines--but does not substantively 
change (other than the website disclosure provision discussed 
below)--the disclosure requirements for incorporation by reference 
in current Form N-2.
    \332\ New General Instruction F.4.a of amended Form N-2; cf. 
General Instruction VII.F of Form S-1; General Instruction F.4.b.(5) 
of amended Form N-2; cf. Item 12(c)(1)(v) of Form S-1. We are 
amending current General Instruction F.3 in its entirety, and moving 
its requirement directing a fund to state in the prospectus and SAI 
that it will furnish, without charge, a copy of the incorporated 
materials on request, to new General Instruction F.4.b of amended 
Form N-2. We also are conforming certain incorporation by reference 
provisions in Form N-2 to mirror parallel provisions in Form N-1A. 
See new General Instruction F.2.a-c of amended Form N-2; cf. General 
Instruction D.1.(a)-(c) of Form N-1A.
    \333\ See Proposing Release, supra footnote 10, at nn.313-317 
and accompanying text.
    \334\ See SIFMA Comment Letter.
---------------------------------------------------------------------------

5. Amendments to Certain Registered CEFs' Annual Report Disclosure
    We are adopting, largely as proposed, amendments to rule 8b-16(b) 
that are designed to allow investors in registered CEFs that rely on 
the rule to more easily identify and understand key information about 
their investments.\335\ Although rule 8b-16(a) generally requires 
registered investment companies to update their registration statements 
annually, rule 8b-16(b) currently allows registered CEFs to forgo an 
annual update provided that they disclose in their annual reports 
certain key changes that have occurred during the prior year.\336\ 
Disclosures that describe a specific change to a fund strategy or risk 
may not have sufficient context to allow investors to understand the 
effect of such change, potentially leaving shareholders to have to look 
at a series of documents--from the fund's prospectus, which could be 
several years old, plus each subsequent annual report--to understand 
certain key information about the fund, such as its current investment 
strategy or principal risk factors.\337\ Accordingly, we proposed to 
require funds that rely on rule 8b-16(b) to describe any changes in 
enough detail to allow investors to understand each change and how it 
may affect the fund.\338\ For example, as stated in the Proposing 
Release, to the extent a fund's principal investment objectives, 
investment policies or principal risks have changed, the fund should 
describe its objectives, policies or risks before and after the 
change.\339\
---------------------------------------------------------------------------

    \335\ See amended Investment Company Act rule 8b-16.
    \336\ Current rule 8b-16(b) (requiring disclosure in the annual 
report of information that repeats or updates certain key prospectus 
disclosures, specifically: (1) Information about the fund's dividend 
reinvestment plan; (2) material changes in the fund's investment 
objectives or policies that have not been approved by shareholders; 
(3) any change concerning the fund's control provisions that has not 
been approved by shareholders; (4) material changes in the principal 
risk factors associated with an investment in the fund; and (5) any 
portfolio manager changes). Except for information about the fund's 
dividend reinvestment plan (which requires a complete description of 
the plan), the fund must only disclose changes that have occurred 
during the year covered by the annual report.
    \337\ See Proposing Release, supra footnote 10, at n.323 and 
accompanying text. See also Investor Experience Request for Comment, 
supra footnote 274, in which we sought input from individual 
investors on how to enhance fund disclosures.
    \338\ See Proposing Release, supra footnote 10, at 136.
    \339\ Id.
---------------------------------------------------------------------------

    The one commenter to address this aspect of the proposal stated 
that a closed-end fund's annual report should include a full 
description of the fund's current objectives, strategies and risks, as 
many closed-end funds do not maintain a current registration statement, 
which would otherwise include this information.\340\ One

[[Page 33318]]

commenter described difficulties faced by investors in determining an 
affected fund's current investment objectives and policies, with 
another requesting a single location where such key information could 
be found.\341\
---------------------------------------------------------------------------

    \340\ See Peres Comment Letter (noting that ``[i]f there is a 
change to an objective, strategy or risk in the past year, they 
describe the change in the annual report. However, there is no 
complete description of a fund's current objectives, strategies and 
risks. To learn this information, an investor would need to look at 
the fund's most recent registration statement (which could be from 
decades ago) and review each annual report since that time.'').
    The Proposing Release requested comment on whether we should 
adopt different disclosure requirements for funds that rely on rule 
8b-16, including whether we should require such funds to summarize 
in their annual reports certain key information that would be 
required in a current prospectus. See Proposing Release, supra 
footnote 10, at section II.H.5.
    \341\ See ABA Comment Letter (``[M]any Affected Funds were 
organized many years ago, and since the relevant information may be 
spread among the prospectus used for the Affected Fund's most recent 
public offering (which may have taken place years or even decades 
ago), proxy statements and reports to shareholders spanning many 
years, it can be a burdensome undertaking to piece such information 
together.''); see also Dale White Comment Letter (``There should 
always be a current document where an investor can see a fund's 
strategy, risks, performance, and costs each year.'').
---------------------------------------------------------------------------

    As proposed, we are requiring funds that rely on rule 8b-16(b) to 
describe certain key changes in enough detail to allow investors to 
understand each change and how it may affect the fund.\342\ We believe 
that in giving context for a change to one or more of the required 
disclosures, it is particularly effective for a fund to describe 
current information regarding related disclosures, as this approach may 
facilitate a more complete understanding of how a change to one aspect 
of the fund impacts the fund more broadly. Such disclosures must be 
prefaced with a legend clarifying that the disclosures provide only a 
summary of certain changes that have occurred in the past year, which 
may not reflect all of the changes that have occurred since the 
investor purchased the fund.\343\
---------------------------------------------------------------------------

    \342\ See paragraph (e) of amended Investment Company Act rule 
8b-16.
    \343\ Id.
---------------------------------------------------------------------------

    In response to comments and in a change from the proposal, we also 
are requiring any affected fund that relies on rule 8b-16(b) to 
describe the fund's current investment objectives, investment policies, 
and principal risks in its annual report.\344\ These key disclosures 
must be provided, even if there were no changes in the past year. This 
will ensure that investors can access in a single location current 
information about key aspects of the fund in which they invest. We 
believe that funds could increase the effectiveness of this disclosure 
by presenting it concisely, in accordance with ``plain English'' 
principles for organization, wording, and design. We similarly 
encourage funds to tailor their disclosures to how the fund operates 
rather than rely on generic, standard disclosures about the fund's 
investment policies and risks. Finally, we encourage funds to describe 
principal risks in order of importance, with most significant risks 
appearing first (i.e., not listing risks in alphabetical order).
---------------------------------------------------------------------------

    \344\ See amended rule 8b-16(b)(2), (4).
---------------------------------------------------------------------------

J. Effective and Compliance Dates

    Effective Dates. The final rule will become effective on August 1, 
2020. While we proposed that the rule would become effective 60 days 
from publication in the Federal Register, we are establishing a fixed 
date so that the amendments to certain rules and forms adopted pursuant 
to the Variable Contract Summary Prospectus Adopting Release will be 
effective prior to the amendments to the same rules and forms adopted 
herein.\345\ The August 1, 2020 effective date will apply to all 
aspects of the final rule, except for the following:
---------------------------------------------------------------------------

    \345\ See Updated Disclosure Requirements and Summary Prospectus 
for Variable Annuity and Variable Life Insurance Contracts, 
Investment Company Act Release No. 33814 (March 11, 2020) 
(``Variable Contract Summary Prospectus Adopting Release'').
---------------------------------------------------------------------------

     Rules 23c-3, 24f-2, and Form 24F-2. The amendments to 
rules 23c-3, 24f-2, and Form 24F-2 \346\ will become effective August 
1, 2021 (one year after other aspects of the final rule take effect, as 
proposed). One commenter suggested making the amendments to rules 23c-3 
and 24f-2 immediately effective for new interval funds so they can pay 
registration fees based on the net issuance of shares sold during their 
initial fiscal year, and allow existing funds to use the new payment 
method as soon as possible thereafter.\347\ While we agree that 
interval funds should be able to calculate fees on Form 24F-2 as soon 
as possible, as proposed, the amendments to rules 23c-3 and 24f-2 will 
become effective one year after the final rule's effective date to 
provide sufficient time to modify the Commission's systems to accept 
such filings from interval funds.\348\
---------------------------------------------------------------------------

    \346\ See supra section II.G.
    \347\ See ICI Comment Letter.
    \348\ To facilitate the transition to calculating fees on Form 
24F-2, an interval fund's fee calculation should exclude excess 
shares that were registered under the fund's last registration 
statement on Form N-2 that remain unsold prior to the effectiveness 
of rule 24f-2 as applied to interval funds.
---------------------------------------------------------------------------

     Rules 456 and 457 and Forms S-1, S-3, F-1 and F-3: The 
amendments to rules 456 and 457 and Forms S-1, S-3, F-1 and F-3 under 
the Securities Act will become effective August 1, 2021.
    Compliance Dates. We are adopting compliance dates for certain new 
requirements to provide a transition period after the effective date of 
the final rule.
     MDFP. As proposed, an annual report filed by a registered 
CEF one year or more after the effective date of the final rule will be 
required to include the MDFP disclosures.\349\ We received no comments 
on this proposed compliance period. Affected funds must comply with 
this requirement by August 1, 2021.
---------------------------------------------------------------------------

    \349\ See supra section II.H.2.b.
---------------------------------------------------------------------------

     Structured Data Requirements (Financial Statement, Cover 
Page, and Prospectus Information). We proposed that all affected funds 
subject to the Inline XBRL structured data reporting requirements for 
financial statement, registration statement cover page, and prospectus 
information that are eligible to file a short-form registration 
statement would be required to comply with those provisions 18 months 
after the effective date, and all other affected funds to comply 24 
months after the effective date. The one commenter who addressed this 
aspect of the release recommended that any new Inline XBRL requirements 
have a compliance date later than that required for open-end 
funds.\350\ We are extending the compliance period by an additional six 
months to align more closely with the Inline XBRL compliance periods 
for other fund registrants.\351\ Accordingly, affected funds that are 
eligible to file a short-form registration statement will be required 
to comply with those provisions 24 months after the effective date, or 
August 1, 2022. All other affected funds subject to these requirements 
must comply 30 months after the effective date, or February 1, 2023. 
Affected funds will be permitted to file in Inline XBRL prior to the 
compliance date once EDGAR has been modified to accept submissions in 
Inline XBRL for all forms subject to the amendments, which is 
anticipated to be March 2021. Notice of EDGAR system readiness to 
accept filings in Inline XBRL will be provided in a manner similar to 
notices of taxonomy updates and EDGAR Filer Manual updates.
---------------------------------------------------------------------------

    \350\ See ICI Comment Letter (citing Inline XBRL Adopting 
Release, supra footnote 250, which requires open-end funds to comply 
with the Inline XBRL requirements on September 17, 2020 (24 months 
post-effective date) for ``large fund groups'' and September 17, 
2021 (36 months post-effective date) for ``small fund groups'').
    \351\ Id.; see also Variable Contract Summary Prospectus 
Adopting Release, supra footnote 345 (requiring variable contracts 
to comply with the Inline XBRL requirements on January 1, 2023 (30 
months post-effective date)).
---------------------------------------------------------------------------

     Structured Data Requirements (Form 24F-2). As proposed, 
all filers on Form 24F-2 (including existing Form 24F-2 filers, such as 
open-end funds and unit investment trusts, as well as interval funds) 
will be required to file reports on the form in an XML structured data 
format 18 months after the effective date, or February 1,

[[Page 33319]]

2022.\352\ The one commenter who addressed the proposed 18-month 
transition period supported it.\353\
---------------------------------------------------------------------------

    \352\ See supra section II.H.1.d.
    \353\ See ICI Comment Letter.
---------------------------------------------------------------------------

III. Economic Analysis

    We are adopting amendments to our rules designed to carry out the 
requirements of section 803 of the BDC Act and section 509 of the 
Registered CEF Act and tailor the disclosure and regulatory framework 
for affected funds in light of the amendments to the offering rules 
applicable to them. Currently, affected funds face regulatory 
impediments to capital formation as they are not able to use the 
flexible and less costly offering process that operating companies use 
when conducting registered securities offerings. This may hinder 
affected funds' ability to raise capital, take advantage of favorable 
market conditions as operating companies do, and enjoy lower cost of 
capital and lower offering costs. Additionally, because of existing 
rules, affected funds generally are unable to communicate about an 
offering before a registration statement is filed, and their post-
filing communications are subject to prospectus liability under section 
12 of the Securities Act (or must be accompanied or preceded by the 
statutory prospectus). The final rule will provide incremental 
flexibility to funds in their communications, which may increase the 
flow of information to investors. As discussed in detail above, the 
final rule will affect numerous distinct aspects of how our securities 
offering and communications rules apply to affected funds.\354\
---------------------------------------------------------------------------

    \354\ See supra section I for summary of final rule.
---------------------------------------------------------------------------

A. Introduction and Baseline

    We are sensitive to the economic effects that may result from the 
final rule, including the benefits, costs, and the effects on 
efficiency, competition, and capital formation. Section 3(f) of the 
Exchange Act, section 2(b) of the Securities Act, and section 2(c) of 
the Investment Company Act state that when engaging in rulemaking that 
requires us to consider or determine whether an action is necessary or 
appropriate in (or, with respect to the Investment Company Act, 
consistent with) the public interest, we must consider, in addition to 
the protection of investors, whether the action will promote 
efficiency, competition, and capital formation. Additionally, section 
23(a)(2) of the Exchange Act requires us, when making rules or 
regulations under the Exchange Act, to consider, among other matters, 
the impact that any such rule or regulation would have on competition 
and states that the Commission shall not adopt any such rule or 
regulation which would impose a burden on competition that is not 
necessary or appropriate in furtherance of the Exchange Act.
    We have considered the potential costs and benefits that would 
result from the final rule, as well as the potential effects on 
efficiency, competition, and capital formation. Many of the potential 
economic effects of the final rule would stem from the statutory 
mandates, while others would stem from the discretion we are 
exercising. We discuss the potential economic effects of the amendments 
to implement the statutory mandates in sections III.B and III.C. We 
considered certain alternatives to our approach to implementing the 
statutory mandates, as discussed in section III.D. We are also adopting 
certain other amendments to tailor affected funds' disclosure and 
regulatory framework. We discuss the potential economic effects of 
these discretionary amendments, as well as reasonable alternatives to 
these provisions, in section III.E. Where possible, we have attempted 
to quantify the costs, benefits, and effects on efficiency, 
competition, and capital formation expected to result from the final 
rule. In some cases, however, we are unable to quantify the economic 
effects because we lack the information necessary to provide a 
reasonable and reliable estimate.
    The baseline we use to analyze the potential effects of the final 
rule is the current set of legal requirements and market practices. The 
final rule likely will have a significant impact on the security 
offering requirements and disclosure practices of affected funds. The 
overall magnitude of the benefits and the costs associated with the 
final rule will depend on many factors, including the number of 
affected funds that rely on the final rule. We recognize that some 
affected funds would not satisfy the conditions in certain of the 
amendments (e.g., those limited to WKSIs or funds that file a short-
form registration statement on Form N-2), and other affected funds may 
satisfy the conditions but choose not to rely on the final rule. The 
discussion below describes our understanding of the markets and issuers 
that will be affected by the final rule.
1. Number of Affected Funds
    The final rule will affect BDCs and registered CEFs. As of June 30, 
2019, there were 791 affected funds, including 105 BDCs and 686 
registered CEFs. To estimate the number of BDCs, we use data from Form 
10-K and Form 10-Q filings as of June 30, 2019, the latest data 
available.\355\ We identify 51 listed BDCs and 54 unlisted BDCs. The 
average net assets of the listed BDCs is approximately $820 million, 
and the average of their total assets is $1.5 billion. Based on trading 
data as of June 30, 2019, 44 of the listed BDCs have public float 
greater than $75 million (i.e., one of the transaction requirement 
thresholds for primary offerings under the short-form registration 
instruction) and 15 of those BDCs have public float greater than $700 
million (i.e., the WKSI public float threshold).\356\
---------------------------------------------------------------------------

    \355\ The estimated number of BDCs includes BDCs that have not 
registered a securities offering on Form N-2. Certain of our 
amendments, such as the requirement to tag certain Form N-2 
prospectus disclosure items in Inline XBRL, will only apply to 
affected funds that have filed a registration statement on Form N-2. 
As a result, our quantitative estimates of the costs and paperwork 
burdens of these amendments with respect to BDCs may be over-
estimates in certain respects.
    \356\ The data (as of June 30, 2019) on prices and shares 
outstanding, which are used to calculate the public float, is taken 
from the Center for Research of Securities Prices (``CRSP'') 
database. CRSP data on shares outstanding includes all publicly held 
shares.
---------------------------------------------------------------------------

    We use data from Morningstar and SEC filings to estimate the number 
of registered CEFs.\357\ We identify 497 registered CEFs that were 
listed on an exchange as of June 30, 2019, including 1 interval fund. 
There were 189 unlisted registered CEFs as of June 30, 2019, including 
60 interval funds. The average net assets of the listed registered CEFs 
is approximately $551 million, while the average net assets of the 
unlisted registered CEFs is approximately $382 million.\358\ Based on 
trading data as of June 30, 2019, 455 of the listed registered CEFs 
have public float greater than $75 million, and 85 of those funds have 
public float greater than $700 million.\359\ Information about the 
types

[[Page 33320]]

of offerings conducted by different categories of affected funds for 
the period of July 1, 2014--June 30, 2019 is reflected in the below 
table.\360\
---------------------------------------------------------------------------

    \357\ The estimated number of registered CEFs includes 
registered CEFs that have not registered a securities offering under 
the Securities Act. Certain of our amendments, such as the 
structured data requirements, will apply somewhat differently to 
these registered CEFs and may impose fewer burdens on them. For 
example, a registration statement that is filed under only the 
Investment Company Act is not required to include financial 
highlights information under Item 4 of Form N-2, while registered 
CEFs that file a registration statement under the Securities Act 
must disclose financial highlights information and tag that 
information in Inline XBRL. See General Instructions G and H of 
amended Form N-2. Thus, our quantitative estimates of the costs and 
paperwork burdens of certain of the amendments with respect to 
registered CEFs may be over-estimates in certain respects.
    \358\ The average of net assets of registered interval funds is 
$520 million.
    \359\ This includes the listed interval fund, which had public 
float of approximately $73 million as of June 30, 2019. Data on 
prices and shares outstanding, which is used to calculate the public 
float, is taken from CRSP.
    \360\ Data on registered offerings (initial public offerings, 
equity offerings by seasoned issuers, convertible debt offerings, 
and public debt offerings) for BDCs and listed registered CEFs is 
taken from Securities Data Corporation's New Issues database 
(Thomson Financial). Data on Regulation D offerings was collected 
from all Form D filings (new filings and amendments) on EDGAR. Data 
on registered offerings for unlisted registered CEFs was collected 
from Form N-2 and Form N-CSR filings on EDGAR.

                                                                         Table 3
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                              Listed registered     Unlisted  registered
         Types of offerings            Offering statistics         Listed BDCs           Unlisted BDCs               CEFs                   CEFs
--------------------------------------------------------------------------------------------------------------------------------------------------------
Registered offerings...............  Number of offerings...  113...................  24...................  26...................  137
                                     Total amount raised...  $12.2 bil.............  $1.7 bil.............  $5.2 bil.............  $20.3 bil
                                     Average (median)        $107.9 mil ($60.0 mil)  $7.8 mil ($7.2 mil)..  $201.3 mil ($103.8     $176.3 mil ($31.0
                                      offering amount.                                                       mil).                  mil)
Regulation D offerings.............  Number of offerings...  21....................  67...................  1....................  165
                                     Total amount raised...  $12.3 bil.............  $9.1 bil.............  $15.1 mil............  $7.5 bil
                                     Average (median)        $584.7 mil ($100 mil).  $135.0 mil ($50.0      $15.1 mil ($15.1 mil)  $45.6 mil ($6.1 mil)
                                      offering amount.                                mil).
--------------------------------------------------------------------------------------------------------------------------------------------------------

    As of September 2019, there were 7,995 mutual funds, 2,076 ETFs, 
and 4,758 UITs. Thus, together with the 791 affected funds, there is a 
total of 15,620 funds, affected and non-affected. This means that 
affected funds represent about 5.1% of the total number of funds. As of 
September 2019, mutual funds had approximately $20,156 billion in 
assets, ETFs had approximately $4,024 billion in assets, UITs had 
approximately $76 billion in assets, and affected funds had 
approximately $459 billion in assets. Thus, affected funds represent 
about 1.8% of total investment company assets.
    We use data from Morningstar and SEC filings to estimate the number 
of affected ETPs. We identify 68 such ETPs as of December 31, 2019.
2. Current Securities Offering Requirements for Affected Funds
    The securities offering process for affected funds at present 
differs from that for operating companies. Affected funds register 
their securities offerings on Form N-2, while operating companies use 
other forms (e.g., Form S-1 or Form S-3). As discussed in more detail 
above in sections II.B, II.C, and II.F, registered investment companies 
and BDCs are excluded from certain offering and communications rules 
available to operating companies.
    Affected funds currently are expressly excluded from the WKSI 
definition. As a result, even if they would otherwise meet the WKSI 
definition, they are unable to, for example, file an automatic shelf 
registration statement or communicate about an offering before filing a 
registration statement.\361\
---------------------------------------------------------------------------

    \361\ See supra section II.C.
---------------------------------------------------------------------------

    Affected funds currently can conduct shelf offerings under rule 
415(a)(1)(x) if they meet the applicable eligibility criteria for Form 
S-3, even though affected funds register their securities offerings on 
Form N-2. Affected funds conducting shelf offerings, however, currently 
experience certain burdens not faced by operating companies.\362\ For 
example, affected funds conducting shelf offerings currently must file 
post-effective amendments to make certain updates to their registration 
statements, while operating companies conducting shelf offerings may 
update their registration statements through forward incorporation by 
reference. As a result, affected funds can incur additional expense or 
delay for shelf offerings, which can affect the timing of their 
capital-raising. Similarly, different rules apply to affected fund 
communications as opposed to operating company communications.\363\ 
These differences can impose additional costs or constraints on 
affected funds or others because, for example, underwriters may be more 
familiar with the operating company rules. Further, affected funds 
currently are required to deliver a final prospectus to investors.\364\ 
Final prospectuses can be lengthy, particularly for BDCs because they 
generally do not take advantage of backward incorporation by reference 
currently permitted for certain financial and related information. For 
example, the median page length of prospectuses filed by listed BDCs is 
approximately 234 pages.\365\
---------------------------------------------------------------------------

    \362\ See supra section II.B.1.
    \363\ See supra section II.F.
    \364\ See supra section II.E.
    \365\ This estimate is based on recent Form N-2 filings of the 
49 listed BDCs. BDCs generally do not rely on existing Form N-2 
backward incorporation by reference provisions because the form 
requires affected funds to provide to new purchasers a copy of all 
previously-filed materials that the fund incorporated by reference 
into the prospectus and/or SAI.
---------------------------------------------------------------------------

3. Current Disclosure Obligations of Affected Funds
    Affected funds differ in their periodic and current reporting 
obligations. Like operating companies, BDCs file annual reports with 
audited financials on Form 10-K, quarterly reports with unaudited 
financials on Form 10-Q, and current reports on Form 8-K. Registered 
CEFs file annual reports to shareholders with audited financials and 
semi-annual reports to shareholders with unaudited financials on Form 
N-CSR. Listed registered CEFs are also subject to exchange rules that 
require listed issuers to provide the market current information in 
response to certain events (e.g., dividends announcements through a 
press release or report on Form 8-K).\366\
---------------------------------------------------------------------------

    \366\ See supra footnote 314.
---------------------------------------------------------------------------

B. Potential Benefits Resulting From the Proposed Implementation of the 
Statutory Mandates

    As discussed, the amendments to implement the statutory mandates 
are designed to provide securities offering parity between affected 
funds and operating companies and streamline the registration process 
for BDCs and registered CEFs, consistent with the BDC Act and the 
Registered CEF Act. We believe that the final rule will achieve this 
goal and consequently result in significant benefits in a number of 
areas, including by improving access to the public capital markets and 
possibly lowering the cost of capital by, among other things, modifying 
our rules related to affected funds' ability to qualify as WKSIs, to 
use the full shelf registration process, and to engage in

[[Page 33321]]

certain communications during a registered offering.\367\ Additionally, 
as discussed below, we believe that the final rule will provide 
benefits to investors as well, including by increasing the flow of 
valuable information that could be available to investors to inform 
their investment decisions. Finally, we believe that the final rule 
will provide cost-saving options to affected fund issuers and 
underwriters.
---------------------------------------------------------------------------

    \367\ See also infra section III.E (discussing benefits 
associated with our discretionary rule amendments).
---------------------------------------------------------------------------

1. Improved Access to Capital and Lower Cost of Capital
    We anticipate that the final rule will facilitate capital formation 
and possibly lower the cost of capital by improving access to the 
public capital markets for affected funds. The rule is designed to 
reduce regulatory impediments to capital formation and provide more 
flexibility to these funds to conduct registered securities offerings. 
The amount of flexibility accorded by the final rule will depend on the 
characteristics of the affected fund, consistent with our rules' 
treatment of similarly-situated operating companies. For example, and 
as explained below, certain affected funds like large listed BDCs and 
large listed registered CEFs are expected to benefit more from the 
final rule than unlisted BDCs and unlisted registered CEFs, including 
unlisted interval funds. The final rule will provide the most 
flexibility under the communications rules and the automatic shelf 
registration system to eligible WKSIs. Other affected funds, such as 
seasoned affected funds, also will benefit, albeit to a lesser degree, 
from the other revisions to the offering process and our communications 
rules.
a. Benefits From WKSI Status
    The largest increase in capital formation and reduction in cost of 
capital that the final rule could generate will come from allowing 
affected funds to obtain WKSI status. Affected funds that qualify as 
WKSIs will enjoy additional flexibility compared to affected funds that 
are non-WKSIs.\368\ There are 100 affected funds (15 listed BDCs and 85 
listed registered CEFs) that meet the $700 million dollar public float 
criterion as of June 30, 2019.\369\ A shelf registration statement and 
any subsequent amendments filed by a WKSI are automatically effective 
upon filing. This flexibility will allow affected funds that qualify as 
WKSIs to promptly tap favorable conditions in the public market, to 
structure terms of securities on a real-time basis to accommodate 
investor demand, and to determine or change the plan of distribution in 
response to changing market conditions. For example, because affected 
funds typically trade at a discount to their NAV,\370\ affected funds 
that are WKSIs will be able to act more quickly to raise capital when 
their shares are trading at a premium,\371\ thus increasing the amount 
of capital raised and enhancing capital formation.
---------------------------------------------------------------------------

    \368\ See supra section II.C.
    \369\ See supra section III.A.1.
    \370\ See, e.g., Jonathan B. Berk and Richard Stanton, 
Managerial Ability, Compensation, and the Closed-End Fund Discount, 
Journal of Finance, Vol. 62, 529-556 (2007); Jeffrey Pontiff, Costly 
Arbitrage: Evidence from Closed-End Funds, Quarterly Journal of 
Economics, Vol. 111, 1135-1151 (1996); Charles M. C. Lee, Andrei 
Shleifer, and Richard H. Thaler, Investor Sentiment and the Closed-
End Fund Puzzle, Journal of Finance Vol. 46, 76-110 (1991).
    \371\ See supra footnote 37 (discussing restrictions on affected 
funds' ability to sell their shares at a price below NAV).
---------------------------------------------------------------------------

    Additionally, WKSIs are not required to pay any registration fees 
at the time of filing a registration statement. They are only required 
to pay the registration filing fee at the time securities are taken 
down and sold off the shelf registration statement. This will provide 
additional flexibility to qualifying affected funds in that they need 
only incur such filing fees if and when they decide to proceed with an 
offering. The final rule may also lower the cost of capital because it 
will provide significant flexibility to affected funds that are WKSIs 
and their underwriters in marketing securities. The final 
communications rules will allow these funds to communicate at any time 
regarding an offering.
    Requiring an affected fund to have at least $700 million in public 
float to qualify as a WKSI will avoid providing affected funds with an 
advantage in the competition for capital over certain operating 
companies. For example, a lower public float threshold for affected 
funds would provide them with a competitive advantage over operating 
companies that may have similar characteristics to affected funds, such 
as listed REITs, but have public float below $700 million. In a similar 
vein, the use of alternative eligibility criteria for affected funds to 
qualify as WKSIs would put them at competitive advantage compared to 
similar operating companies without public float, such as unlisted 
REITs. Moreover, reducing the $700 million threshold or providing 
alternative eligibility criteria for affected funds to qualify as WKSIs 
would likely lead to potential higher incidences of disclosure and fund 
practices that may not comply with applicable law due to reduced staff 
review.\372\
---------------------------------------------------------------------------

    \372\ See also infra section III.D (discussing considerations 
related to an alternative of modifying the public float standards in 
the WKSI definition by changing the required level of public float 
or providing alternative eligibility criteria).
---------------------------------------------------------------------------

    Given the important benefits that WKSI status provides, and the 
fact that currently only few affected funds would qualify as WKSIs, it 
is possible that advisers to some affected funds may try, through 
various means, including raising additional capital and mergers and 
acquisitions, to increase their funds' public float to the WKSI 
threshold. Thus, the possible effects of the rule may include increased 
fund size and consolidation of affected funds. Such developments may 
increase efficiency by allowing the larger resulting funds to benefit 
from improved access and lower cost of capital. We also recognize that 
consolidation may be driven by other factors as well, in combination 
with the effects of the rule, and typically would be subject to certain 
approvals by a fund's board of directors or shareholders.\373\ 
Potential consolidation and increases in fund size could also reduce 
costs to investors by, for example, allowing an affected fund to 
realize greater efficiencies and reduce its total operating expenses 
over time. However, consolidation also could inhibit competition and 
negatively affect the number of investment opportunities available to 
investors if it leads to a reduction of the number of strategies funds 
employ. It is possible that new funds will enter the market thereby 
increasing competition and investment opportunities. Potential 
consolidation of affected funds could make it more difficult for new or 
smaller funds to compete since funds with larger amounts of assets may 
have better access to certain investment opportunities or may be able 
to offer lower costs to investors. Smaller funds, however, may have 
better access to investment opportunities in smaller companies because 
these investments may be too small to be economically viable for larger 
funds. At present, we are not able to estimate the effects of these 
competitive dynamics.
---------------------------------------------------------------------------

    \373\ See, e.g., 17 CFR 270.17a-8 (Investment Company Act rule 
17a-8).
---------------------------------------------------------------------------

b. Benefits From Shelf Registration
    Other provisions of the final rule could also enhance capital 
formation and lower the cost of offerings for affected funds that 
qualify as seasoned funds and file a short-form registration statement 
on Form N-2.\374\ For example,

[[Page 33322]]

the final rule generally allows these funds to more efficiently use the 
shelf registration process if, like operating companies, they meet the 
eligibility requirements of Form S-3.\375\ As of June 30, 2019, there 
were 499 affected funds that met the $75 million dollar public float 
criterion for primary offerings under Form S-3 (which criterion is 
incorporated into the short-form registration instruction of Form N-
2).\376\ Affected funds that qualify will bear fewer costs associated 
with updating the information in their registration statements because 
information in the fund's Exchange Act reports will be incorporated by 
reference into the fund's registration statement. For example, for PRA 
purposes, we estimate that eligible affected funds will file 
approximately 128 fewer post-effective amendments annually as a result 
of the amendments, resulting in an annual aggregate cost reduction of 
approximately $5,726,592 for these funds.\377\ Additionally, we 
understand that currently BDCs often file prospectus supplements close-
in-time to filing their current and periodic Exchange Act reports to 
make sure the BDC's prospectus disclosure provides the same information 
as that disclosed in its Exchange Act reports. Under the final rule, 
eligible BDCs will no longer file these prospectus supplements since 
their Exchange Act reports will be incorporated by reference into their 
registration statements. As a result, an eligible BDC may, on average, 
file approximately 14 fewer prospectus supplements on an annual basis 
under the rule.\378\ We anticipate that eligible registered CEFs also 
will be able to make fewer prospectus supplement filings under the 
final rule, although they likely will not experience as large of a 
reduction in filings since, among other things, they file periodic 
reports on a semi-annual basis (rather than quarterly) and generally 
are not required to report on Form 8-K. While we believe that affected 
funds will likely file fewer prospectus supplements under the final 
amendments, we are unable to estimate any reduction in the number of 
prospectus supplements that affected funds will file under the final 
rule, and any associated cost savings for affected funds, due to 
certain counterbalancing factors. For example, if the final rule causes 
affected funds to increase their capital-raising activities, they may 
need to update their prospectuses more often and may file more 
prospectus supplements as a result. However, if affected funds begin to 
use their Exchange Act reports to update their prospectuses, as 
permitted under the final amendments, they may file fewer prospectus 
supplements.\379\ On average, we believe that affected funds will 
likely file fewer prospectus supplements under the final amendments 
since they will be able to update their prospectus more efficiently by 
forward incorporating their Exchange Act reports, although an affected 
fund that greatly increases its capital-raising activities may not 
experience the same reduction in filing burdens.
---------------------------------------------------------------------------

    \374\ See supra section II.B.
    \375\ The short-form registration instruction refers to the 
eligibility criteria in Form S-3, with additional references to 
reporting requirements under the Investment Company Act.
    \376\ See supra section III.A.1.
    \377\ See infra section IV.B.1. For purposes of the PRA, we 
estimate that the hour burden of preparing and filing a post-
effective amendment is 125 hours. Reducing the number of post-
effective amendments by 128 filings would decrease the aggregate 
annual burden of Form N-2 by 16,000 hours (125 hours x 128 post-
effective amendments = 16,000 hours). We estimate that the monetized 
internal burden is $33,625 per post-effective amendment and the 
external burden is $11,114 per post-effective amendment. See infra 
section IV.B.1. The total annual cost is calculated by adding the 
monetized internal burden ($33,625 x 128 post-effective amendments = 
$4,304,000) to the cost of outside professionals ($11,114 x 128 
post-effective amendments = $1,422,592). Although we have increased 
the expected reduction in the number of post-effective amendments 
discussed in the Proposing Release from 112 to 128 filings, the 
estimated annual aggregate cost reduction has decreased from 
$7,943,376 to $5,726,592 to better recognize how we have monetized 
internal burdens for purposes of the PRA. See Proposing Release, 
supra footnote 10, at n.359 and accompanying text; infra section 
IV.B.1.
    \378\ This analysis assumes that a BDC would file a prospectus 
supplement for each Form 10-Q filing (3 filings per year), Form 10-K 
filing (1 filing per year), and Form 8-K filing (estimated to be 10 
filings per year), for a total of 14 periodic and current reports 
per year. See Proposing Release, supra footnote 10, at n.415 and 
accompanying text (discussing the estimated number of Form 8-K 
filings per BDC per year).
    \379\ See supra sections II.B.3.e and II.I.2.a.
---------------------------------------------------------------------------

    In general, we believe affected funds that qualify for the short-
form registration instruction will experience cost savings associated 
with making fewer filings and will be able to use a more efficient 
process to update their prospectus disclosure. This will decrease the 
costs of eligible funds' registered offerings and will also allow them 
to act more quickly to take advantage of favorable market conditions 
(e.g., when trading at a premium). Certain seasoned funds registering 
shelf offerings also will be able to omit certain information from 
their prospectuses and use the same process as operating companies to 
provide omitted information by filing a prospectus supplement, which 
will generally make the shelf registration process less costly for 
these funds as compared to the baseline.
    The final rule also may provide incremental cost savings to 
affected funds that are eligible to file a short-form registration 
statement in certain other respects. For example, the final rule will 
reduce the costs of these funds seeking shareholder approval for 
proposals to authorize, issue, modify, or exchange securities by 
allowing them to incorporate by reference certain materials rather than 
delivering these materials to security holders with the proxy 
statement.\380\ We do not anticipate that these cost savings will be 
substantial, however, as we understand that affected funds do not often 
make these types of proposals to security holders. Affected funds that 
are eligible to file a short-form registration statement also could 
experience modest cost savings from the amendment to rule 418 since 
they will no longer be required by that rule to furnish certain 
information to the Commission or its staff promptly on request.\381\
---------------------------------------------------------------------------

    \380\ See supra section II.G.2.
    \381\ See supra section II.G.1.
---------------------------------------------------------------------------

c. Other Benefits for Affected Funds
    The final rule will generate other benefits for affected funds 
generally, regardless of whether they are WKSIs or seasoned funds. For 
example, the amendment to require affected funds to follow the same 
process that operating companies follow to file prospectuses under rule 
424 will require that affected funds file prospectus supplements when 
changes from or additions to a previously filed prospectus are 
substantive, whereas currently they are required to file every 
prospectus that varies from any previously filed prospectus under rule 
497.\382\ Rule 424 also is designed to work together with rule 
415(a)(1)(x), and provides additional time for an issuer to file a 
prospectus. This change could modestly reduce filing burdens and should 
facilitate eligible funds using the shelf registration process 
efficiently and in parity with operating companies. Also, the final 
rule allows an affected fund to satisfy its obligation to deliver a 
final prospectus by filing it with the Commission and complying with 
certain other requirements, thus decreasing the cost of the 
offering.\383\ For example, the final rule will permit affected funds 
to save on printing and mailing costs for delivering the final 
prospectus in paper.\384\
---------------------------------------------------------------------------

    \382\ See supra section II.B.3.d.
    \383\ See supra section II.D.
    \384\ Because a fund is not required to report the extent to 
which it relies on Commission guidance, we lack information to 
estimate the percentage of funds that solely or predominantly rely 
on electronic delivery under existing Commission guidance. See, 
e.g., Use of Electronic Media for Delivery Purposes, Investment 
Company Act Release No. 21399 (Oct. 6, 1995) [60 FR 53458 (Oct. 13, 
1995)]. Affected funds that rely to a greater extent on electronic 
delivery of final prospectuses under existing Commission guidance 
may realize smaller net cost savings under the rule.

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

[[Page 33323]]

    In general, commenters stated that the rule will generate benefits 
for affected funds. Several commenters stated that the proposed rule 
would lead to a more efficient capital-raising process.\385\ One 
commenter suggested that the proposed rule could also help encourage 
product development that would expand the universe of registered CEFs, 
but did not elaborate on the specific aspects of the rulemaking that 
would encourage product development.\386\
---------------------------------------------------------------------------

    \385\ See ACC Comment Letter; CBD Comment Letter; SIFMA Comment 
Letter.
    \386\ See Invesco Comment Letter.
---------------------------------------------------------------------------

d. Benefits for Other Parties
    The lower costs of registered offerings resulting from the final 
rule should benefit investors in affected funds because funds bear 
offering expenses. Lowering offering expenses may, all else equal, 
reduce the size of the discount or increase the size of the premium at 
which shares of the affected funds trade. Two commenters expressed 
similar views, arguing that the proposed rule would provide cost 
savings to funds' shareholders.\387\
---------------------------------------------------------------------------

    \387\ See ICI Comment Letter; Invesco Comment Letter.
---------------------------------------------------------------------------

    In addition, the final rule could reduce the cost to underwriters 
of participating in registered offerings of affected funds, and these 
potential cost savings could be passed on to the affected funds. Based 
on the sheer volume and number of transactions,\388\ underwriters may 
have more expertise and established procedures for operating companies' 
registered offerings, which are subject to the rules we are extending 
to affected funds. In contrast, underwriters probably have less, or 
more concentrated, expertise regarding the current requirements for 
offerings by affected funds. Standardization in the registered offering 
space, by making the offerings of affected funds more similar to those 
of operating companies, could make it easier for underwriters to 
execute such offerings and may decrease their compliance costs. If 
underwriters pass some of the cost savings on to affected funds and 
their investors, this could result in cheaper registered offerings for 
affected funds, thus encouraging them to raise more capital, which 
would lead to enhanced capital formation. Lastly, standardization may 
encourage a broader set of underwriters to participate in this market, 
potentially decreasing costs for affected funds and investors in these 
funds. One commenter agreed that the proposed rule would make it easier 
for underwriters to execute offerings by affected funds, which could 
lead to decreased costs.\389\
---------------------------------------------------------------------------

    \388\ For example, in 2017 non-fund issuers raised approximately 
$1.3 trillion in 1,846 registered debt offerings and $184 billion in 
976 registered equity offerings. See Capital Raising in the U.S.: An 
Analysis of the Market for Unregistered Securities Offerings, 2009-
2017, Division of Economic and Risk Analysis White Paper (Aug. 1, 
2018), available at https://www.sec.gov/dera/staff-papers/white-papers/dera_white_paper_regulation_d_082018.
    \389\ See SIFMA Comment Letter.
---------------------------------------------------------------------------

    The final rule could level the securities offering playing field 
between affected funds and operating companies and streamline the 
registration process for affected funds, consequently making them 
potentially more competitive in the market for capital raising. The 
final rule may also make certain affected funds more competitive 
compared to affected funds that either cannot or choose not to rely on 
these amendments. Thus, the final rule will likely enhance competition 
in the public capital markets. The increased competition for capital in 
turn could lead to potentially better allocation of capital. The final 
rule may also benefit companies in which affected funds invest. Small 
and mid-size companies, because of their size, type of assets, risk 
profile, and the general lack of information about their activities and 
financial condition, typically find it more difficult to raise funds 
from traditional sources of capital such as bank loans and registered 
offerings.\390\ This difficulty in sourcing more traditional financing 
constrains their ability to invest in profitable projects and grow. To 
the extent that the final rule improves capital-raising opportunities 
for affected funds that invest in these companies, this may result in 
investments in a greater number of small to mid-size U.S. companies, 
thus alleviating financial constraints of such companies and 
contributing to economic growth generally.\391\ Commenters generally 
agreed that the proposed rule would facilitate capital formation, 
especially for small to mid-size businesses.\392\ One commenter stated 
that the proposed rule could potentially stimulate economic 
growth.\393\
---------------------------------------------------------------------------

    \390\ See, e.g., Alan Berger and Gregory Udell, The Economics of 
Small Business Finance: The Roles of Private Equity and Debt Markets 
in the Financial Growth Cycle, Journal of Banking and Finance, Vol. 
22, 613-673 (1998); Meghana Ayyagari, Asli Demirg[uuml][ccedil]-
Kunt, and Vojislav Maksimovic, How Important are Financing 
Constraints? The Role of Finance in the Business Environment, World 
Bank Mimeo (2005); Crowdfunding, Securities Act Release No. 9974 
(Oct. 30, 2015) [80 FR 71388 (Nov. 16, 2015)].
    \391\ See, e.g., Torsten Beck, Asli Demirg[uuml][ccedil]-Kunt, 
and Ross Levine, SMEs, Growth, and Poverty: Cross-Country Evidence, 
Journal of Economic Growth, Vol. 10, 197-227 (2005); Ryan Decker, 
John Haltiwanger, Ron Jarmin, and Javier Miranda, The Role of 
Entrepreneurship in U.S. Job Creation and Economic Dynamism, Journal 
of Economic Perspectives, July, 3-24 (2014).
    \392\ See SIFMA Comment Letter; ACC Comment Letter; CBD Comment 
Letter.
    \393\ See ICI Comment Letter.
---------------------------------------------------------------------------

2. Facilitated Communication With Investors
    The final rule will provide incremental flexibility to funds in 
their communications, which may increase the flow of information to 
investors.\394\ Currently, affected funds generally are unable to 
communicate about an offering before a registration statement is filed, 
and their post-filing communications are subject to prospectus 
liability under section 12 of the Securities Act (or must be 
accompanied or preceded by the statutory prospectus).\395\
---------------------------------------------------------------------------

    \394\ See supra section II.F.
    \395\ But see supra footnote 144 (explaining that affected funds 
currently are permitted to engage in certain pre-filing test-the-
waters communications under Securities Act rule 163B).
---------------------------------------------------------------------------

    This standardization in the communications processes of affected 
funds, by making them similar to those of operating companies, will 
make it easier for underwriters to execute offerings by affected funds 
and thus may decrease their compliance costs, which in turn may lead to 
lower offering costs and potentially enhance capital formation. 
Additionally, under the final rule, affected funds that qualify as 
WKSIs can engage in the widest range of communications, including free 
writing prospectus communications about an offering with any party 
before a registration statement is filed. More generally, affected 
funds will be able to engage in certain other pre-filing 
communications, use free writing prospectuses after a registration 
statement is filed, and use certain communications that are not subject 
to prospectus liability. The changes in the communications rules for 
affected funds may increase the amount of valuable information that 
could be provided to investors before they make investment decisions, 
particularly with respect to WKSIs. We believe that more information 
could be provided on a timelier basis because the amendments will 
eliminate regulatory barriers to the dissemination of that information, 
and the markets may provide incentives for issuers, underwriters, and 
broker-dealers to produce additional

[[Page 33324]]

information. We also believe that the increased flexibility of affected 
funds in their communications with investors under the free writing 
prospectus rules will maintain appropriate investor protection, 
consistent with the protections that apply to affected funds' 
communications under rule 482. For example, the rules that allow 
affected funds to use free writing prospectuses are designed to assure 
that written issuer-provided or issuer-used information is publicly 
available. Additionally, the free writing prospectus will be a section 
10(b) prospectus under the Securities Act and, as such, will be subject 
to liability under section 12(a)(2) as well as the anti-fraud 
provisions of the Federal securities laws.
    Increased information flow can help promote efficient capital 
markets because the market may be able to value securities more 
accurately. For example, the final rule will permit broker-dealers to 
disseminate research about an affected fund if certain conditions are 
met. While broker-dealers currently may disseminate such research under 
rule 482, the amendments to rule 138 will likely reduce certain costs 
to broker-dealers associated with rule 482 (e.g., filing costs and 
concerns associated with prospectus liability). This could allow more 
valuable information about affected funds to reach potential investors. 
Another benefit of increasing the information flow is that investors 
may become better informed in making portfolio allocation decisions in 
accordance with their particular risk-return profiles. In addition, the 
final rule may benefit broker-dealers who provide research reports on 
affected funds by reducing their potential liability exposure 
associated with such reports, relative to the baseline, which may 
encourage them to provide additional research and enhance information 
flow. Commenters generally agreed that the proposed rule would provide 
more flexibility for affected funds to communicate and would increase 
information flow.\396\
---------------------------------------------------------------------------

    \396\ See ACC Comment Letter; ICI Comment Letter; Invesco 
Comment Letter.
---------------------------------------------------------------------------

C. Potential Costs Resulting From the Proposed Implementation of the 
Statutory Mandates

1. Compliance Costs
    The amendments we are adopting to implement the statutory mandates 
could increase affected funds' compliance costs in certain 
respects.\397\ We also are cognizant of the fact that such an increase 
could be passed on to funds' investors. A potential cost of the final 
rule is that affected funds could incur increased filing or 
recordkeeping costs associated with issuer free writing 
prospectuses,\398\ although affected funds currently face many of the 
same filing and recordkeeping costs under rule 482. For example, the 
ability of affected funds that qualify as WKSIs to use free writing 
prospectuses may increase the level of these funds' current 
communications (including certain communications prior to filing a 
registration statement that are presently prohibited), thus increasing 
the funds' filing and recordkeeping costs.\399\ We estimate that 
affected funds that are WKSIs would have additional annual filing and 
recordkeeping costs of $200 per affected fund for free writing 
prospectuses used before the fund files a registration statement.\400\ 
To the extent affected funds use free writing prospectuses for 
communications that currently occur under rule 482, the costs 
associated with free writing prospectuses could increase, and the costs 
associated with rule 482 advertisements could decrease. We are unable 
to predict, however, whether affected funds will be more likely to use 
free writing prospectuses than rule 482 communications or to engage in 
more communications with investors in practice as a result of the 
amendments.
---------------------------------------------------------------------------

    \397\ See also infra section III.E (discussing compliance and 
other costs associated with the proposed discretionary amendments).
    \398\ See supra section II.F.1; infra section IV.B.4 (estimating 
the annual paperwork burden for free writing prospectuses under 
rules 163 and 433 for purposes of the PRA).
    \399\ But see infra Table 14 footnote 1 (discussing that only 10 
WKSIs relied on rule 163 for the Commission's 2017 fiscal year).
    \400\ For purposes of the PRA, we estimate that, on average, 
affected funds that are eligible to be WKSIs (estimated as 100 
funds) would file two free writing prospectuses under the proposed 
amendments to rule 163 each year. We estimate the total incremental 
burden would be approximately 0.125 hours and $150 for the service 
of outside professionals. See infra section IV.B.4. We monetize the 
internal burden of preparing and filing a free writing prospectus by 
multiplying the burden hours by an estimated wage rate of $400 per 
hour (0.125 x $400 = $50). The estimated wage figure is based on 
analysis in previous rulemakings. The total annual cost is 
calculated by adding the monetized internal burden ($50) to the cost 
of outside professionals ($150).
---------------------------------------------------------------------------

    Affected funds could also incur costs associated with adjusting 
their internal procedures for filing prospectus supplements.\401\ Such 
costs could stem from the need to augment funds' information technology 
systems or train funds' employees, although, as recognized above, 
affected funds likely will be able to file fewer prospectus supplements 
under the final rule.
---------------------------------------------------------------------------

    \401\ See supra section II.B.3.d.
---------------------------------------------------------------------------

    Parties that will be required to provide notices under rule 
173,\402\ including underwriters and dealers in certain circumstances, 
may incur additional costs due to the requirement to notify affected 
fund investors that they have purchased shares in a registered 
offering. In addition, these same parties may incur costs to establish 
procedures for receiving and complying with requests for final 
prospectuses. We believe that providing the notice to investors will 
not impose a significant incremental cost because the notice can 
consist of a pre-printed message that is automatically delivered with 
or as part of the confirmation required by 17 CFR 240.10b-10 (Exchange 
Act rule 10b-10). Accordingly, we estimate that the cost of complying 
with rule 173 will be approximately $0.05 per notice.\403\ We estimate 
the annual cost of providing the notification will be approximately 
$831,729.\404\ For the parties that are required to provide such 
notices, these additional costs of complying with rule 173 will be 
mitigated to a certain degree by the elimination of the requirement to 
supply a final prospectus to each investor.
---------------------------------------------------------------------------

    \402\ See supra section II.D.
    \403\ The Commission has estimated the cost per rule 173 notice 
to be $0.05 for operating companies. See Securities Offering Reform 
Adopting Release, supra footnote 5, at 44795. We assume the same 
cost will apply to rule 173 notices provided to affected fund 
investors.
    \404\ For the purpose of the PRA, we estimate that there will be 
43,546 notices per year per affected fund with an effective 
Securities Act registration statement (estimated as 382 affected 
funds). The annual cost of providing rule 173 notification is 
calculated as the number of affected funds (382) x the number of 
notices per year (43,546) x the cost per notice ($0.05). See infra 
section IV.B.5.
---------------------------------------------------------------------------

2. Other Costs
    Under the final rule, affected funds that qualify as WKSIs will be 
able to file shelf registration statements and post-effective 
amendments that become automatically effective. To the extent that 
investors previously benefited from the Commission staff's review of 
these filings before they become effective, allowing these filings of 
affected funds that are WKSIs to become automatically effective may 
eliminate such reviews and, as a result, possibly increase the costs to 
investors. Allowing affected funds that file short-form registration 
statements on Form N-2 to forward incorporate by reference could have a 
similar potential impact on investors. However, issuers will still face 
liability under the Federal securities laws for registration statement 
disclosures (e.g., sections 12 and 17 of the Securities Act and section 
10(b) of the Exchange Act

[[Page 33325]]

and 17 CFR 240.10b-10 (rule 10b-5 under the Exchange Act)), which may 
ameliorate the potential costs associated with reduced staff 
review.\405\
---------------------------------------------------------------------------

    \405\ Certain of our discretionary amendments may also 
ameliorate these costs. See infra section III.E.3 (discussing the 
benefits and costs of the requirement to disclose material 
unresolved staff comments) and section III.E.2 (discussing the 
benefits and costs of the structured data requirements).
---------------------------------------------------------------------------

    More generally, allowing forward incorporation by reference under 
the short-form registration instruction could increase the analytical 
burden and search costs for potential investors. Currently, affected 
funds provide required information in the prospectus that is delivered 
to investors, and forward incorporation by reference is not allowed. 
Under the amendments, instead of having all the information available 
in one location, investors may need to separately access on a website 
or request the incorporated materials. As a result, costs to investors 
for assembling and assimilating necessary information could increase, 
with a potentially stronger effect for retail investors (e.g., because 
they generally may not have the technical capabilities or monetary 
resources to efficiently search through several information sources). 
We do not have data to assess if, and to what extent, this revision 
will burden investors.
    However, an affected fund making a shelf offering under rule 
415(a)(1)(x) is required to file a new registration statement every 
three years, which provides investors with a periodic update of 
consolidated information.\406\ The final rule will require that 
affected funds provide in their annual reports certain information 
currently disclosed in their prospectuses to make the information more 
readily available in one document for investors.\407\ Further, 
Securities Act Forms S-3 and F-3 have long permitted incorporation by 
reference from the issuer's Exchange Act reports, and investors have 
not indicated they are unduly burdened when investing in offerings 
registered on these Forms.\408\ Studies have shown, however, that the 
majority of investors in operating companies are institutional 
investors, whereas the majority of investors in the securities of 
affected funds are retail investors, who may face relatively higher 
costs associated with searching for information distributed across 
multiple documents.\409\ In addition, the requirement to backward and 
forward incorporate by reference certain information into a short-form 
registration statement could increase an affected fund's liability with 
respect to information that has not previously been incorporated into 
its registration statement because this information will now be part of 
the registration statement. This could increase costs for relevant 
funds, including potential legal costs (e.g., those associated with 
additional review of materials that would be incorporated by reference 
into the fund's registration statement, or counsel and other costs in 
connection with potential legal actions). These potential cost 
increases could be passed on to investors of affected funds.
---------------------------------------------------------------------------

    \406\ See supra footnote 29.
    \407\ See supra section II.I.2.a.
    \408\ See Securities Offering Reform Adopting Release, supra 
footnote 5, at 44796.
    \409\ The average institutional holding is estimated to be 
approximately 30% for BDCs and 21% for registered CEFs. See Covered 
Investment Fund Research Reports Adopting Release, supra footnote 
101, at 64199. The institutional ownership of U.S. public equities 
was approximately 67% as of 2010. See Marshall E. Blume and Donald 
B. Keim, Institutional Investors and Stock Market Liquidity: Trends 
and Relationships, Working Paper, The Wharton School, University of 
Pennsylvania (Aug. 21, 2012).
---------------------------------------------------------------------------

    The final rule will allow an affected fund to not deliver final 
prospectuses directly to investors if the fund files the final 
prospectus with the Commission and certain other conditions are 
satisfied. We acknowledge, however, that while this procedure has 
become commonplace in many aspects of our capital markets, there may be 
some investors who would prefer to receive the prospectus directly. 
While an investor could request a copy of the final prospectus under 
rule 173, there will be burdens on an investor to make such a request 
(e.g., loss of time while making the request and a delay in receiving 
the prospectus). Thus, investors without home internet access, 
depending on their ability and preference to access fund information 
electronically, might experience a reduction in their ability to access 
a fund's final prospectus. To the extent that a reduction in this 
information by such investors decreases how informed they are about 
affected funds, it could potentially decrease their ability to 
efficiently allocate capital across affected funds and other 
investments. However, an investor's purchase commitment and the 
resulting contract of sale of securities to the investor in the 
offering generally occur before the final prospectus is required to be 
delivered under the Securities Act, and this is commonplace in other 
parts of our capital markets. Moreover, for sales occurring in the 
secondary market, as a result of our existing rules, investors in 
securities of reporting issuers generally are not delivered a final 
prospectus.\410\
---------------------------------------------------------------------------

    \410\ See Securities Offering Reform Adopting Release, supra 
footnote 5, at 44782.
---------------------------------------------------------------------------

D. Alternatives to Adopted Approach To Implementing Statutory Mandates

    We considered certain alternative approaches to implementing the 
directives in the BDC Act and Registered CEF Act to allow affected 
funds to use the securities offering rules that are available to 
operating companies. Although the BDC Act identifies certain required 
amendments to our rules and forms, we could have, for example, made 
additional modifications to the relevant provisions for affected funds 
or further revised the current registration and offering framework 
affected funds use.
    For example, as discussed above, we considered modifying the public 
float standards in the WKSI definition or the short-form registration 
instruction by changing the required level of public float or providing 
alternative eligibility criteria, such as the aggregate NAV of a 
certain size for funds whose shares are not traded on an exchange.\411\ 
Several commenters supported changing the public float standards in the 
WKSI definition for affected funds.\412\ These alternatives could have 
allowed more affected funds to qualify as WKSIs or to file short-form 
registration statements, with the associated benefits (e.g., lower 
costs of registered offerings) and costs (e.g., potential higher 
incidence of disclosure and fund practices that may not comply with 
applicable law due to reduced staff review) discussed above. For 
example, most interval funds do not list their securities on an 
exchange and do not have ``public float,'' and these alternatives 
therefore could have permitted these interval funds, as well as other 
unlisted affected funds, to qualify as WKSIs or file short-form 
registration statements. However, modifying the eligibility criteria in 
the WKSI definition or the short-form registration instruction could 
give affected funds that do not have the requisite public float under 
the current WKSI definition or Form S-3 eligibility requirements an 
advantage over certain operating companies that do not have public 
float or do not meet the $700 million public float requirement.
In addition, certain of the benefits that flow from WKSI status or the 
ability to use a short-form registration statement may be less relevant 
to unlisted affected funds that engage in continuous

[[Page 33326]]

offerings.\413\ Further, interval funds already have a tailored 
registration process that provides similar efficiencies. For example, 
certain of an interval fund's post-effective amendments are immediately 
effective upon filing (e.g., filings solely to update the fund's 
financial statements or to make non-material changes), while other 
post-effective amendments (e.g., filings to make material changes) are 
automatically effective 60 days after filing unless the fund designates 
a later date for effectiveness. In addition, we are extending this 
process to allow other continuously-offered unlisted affected funds to 
file immediately-effective post-effective amendments under the same 
circumstances as interval funds. Specifically, we are amending rule 486 
to allow certain unlisted continuously-offered affected funds to 
maintain effective registration statements in a more efficient and 
cost-effective manner. We believe that amended rule 486 will provide 
these funds with benefits that are similar to the benefits we are 
providing to affected funds that qualify to file short-form 
registration statements or as WKSIs. Interval funds and other 
continuously-offered unlisted affected funds, however, will not 
experience the same efficiencies as affected funds that qualify to file 
short-form registration statements or as WKSIs when they make material 
changes to their registration statements. This is because these filings 
by interval funds and other continuously-offered unlisted affected will 
be subject to staff review and will not be immediately effective upon 
filing.
---------------------------------------------------------------------------

    \411\ See supra section II.C.
    \412\ See, e.g., ICI Comment Letter; ABA Comment Letter; Dechert 
Comment Letter; CBD Comment Letter; TIAA Comment Letter.
    \413\ See supra paragraph accompanying footnotes 50-51.
---------------------------------------------------------------------------

    Under the BDC Act and the Registered CEF Act, we could have 
extended the final rule only to BDCs, listed registered CEFs, and 
interval funds. Under this approach, unlisted registered CEFs would not 
have been able to take advantage of certain benefits of the amendments 
that would otherwise be available to unlisted BDCs, such as the cost 
savings associated with the final prospectus delivery reforms.\414\ 
This alternative also could have saved unlisted registered CEFs certain 
compliance costs stemming from the proposed rulemaking, such as the 
requirement to tag certain prospectus information using Inline XBRL. 
However, excluding unlisted registered CEFs from the final rule could 
create unnecessary competitive disparities between unlisted registered 
CEFs and unlisted BDCs and would not provide investors in unlisted 
registered CEFs with the benefits of the new investor protections we 
are adopting.
---------------------------------------------------------------------------

    \414\ As previously recognized, unlisted registered CEFs would 
not be eligible for certain of the amendments. See supra section 
II.A.
---------------------------------------------------------------------------

E. Discussion of Discretionary Choices

    We discuss below the discretionary amendments that we are adopting, 
in light of the changes to implement the BDC Act and Registered CEF Act 
and the associated benefits and costs of those choices. We have tried 
to quantify the impact of each of the amendments, but in many cases, 
reliable, empirical evidence about the effects is not readily available 
to the Commission.
    With respect to the proposed discretionary amendments, one 
commenter stated that the proposal would impose regulatory and 
compliance costs on unlisted affected funds, while at the same time 
providing unlisted interval funds with only small benefits and 
providing no benefits to other unlisted affected funds (e.g., tender 
offer funds).\415\ We believe interval funds and other continuously-
offered unlisted affected funds will directly benefit from two of our 
discretionary amendments.\416\ While the final rule also imposes 
certain costs on these funds, we believe those costs are warranted, as 
discussed in detail below. Moreover, we are not at this time adopting 
the proposed new reporting requirements on Form 8-K that would have 
imposed costs on unlisted affected funds.\417\
---------------------------------------------------------------------------

    \415\ See ABA Comment Letter.
    \416\ See infra sections III.E.1 and III.E.5.
    \417\ See supra section II.I.3.
---------------------------------------------------------------------------

1. New Registration Fee Payment Method for Interval Funds and Issuers 
of Certain Exchange-Traded Products
    We are adopting a modernized approach to registration fee payment 
for interval funds that will require them to pay securities 
registration fees using the same method that mutual funds and ETFs use 
today. In response to comments, we also are allowing certain ETPs that 
are not registered under the Investment Company Act to use a similar 
method to pay registration fees.
    With respect to interval funds, the final rule requires these funds 
to pay their registration fees on a net basis once a year, rather than 
having to pay registration fees when the fund files its registration 
statement.\418\ We believe this approach will make the registration fee 
payment process for interval funds more efficient. For example, it will 
avoid the possibility that an interval fund will inadvertently sell 
more shares than it has registered  and will not require the issuer to 
periodically register new shares.
---------------------------------------------------------------------------

    \418\ See supra section II.G.3.
    \419\ The estimates are based on data collected for interval 
funds that were active as of June 30, 2018. We used their Form N-2 
filings and Form N-CSR filings to identify current registration 
fees, proceeds from shares issued, and cost of shares repurchased.
---------------------------------------------------------------------------

    We believe the final rule could also benefit interval funds by 
reducing their initial registration fees. In the table below, we have 
attempted to quantify the potential initial cost-savings for interval 
funds under the modernized approach to registration fee payment over a 
3-year period.\419\

                                 Table 4
------------------------------------------------------------------------
                                                      Estimated average
                                 Current average      registration fee
                                registration fee      that will be paid
                               (paid upon filing)   under the amendments
                                       \1\           (paid at the end of
                                                    the fiscal year) \2\
------------------------------------------------------------------------
Year 1......................               $31,501                $8,376
Year 2......................  ....................                 7,015
Year 3......................  ....................                22,445
------------------------------------------------------------------------
Notes:
\1.\ The current average registration fee paid in year 1 is the average
  of the actual fees reported by the interval funds in the Calculation
  of Registration Fee table in Form N-2 in the year of registration with
  the Commission. For purposes of this analysis, we assume that interval
  funds did not register additional securities in years 2 or 3. If they
  did, the average registration fees under the current framework would
  be higher than $31,501.

[[Page 33327]]

 
\2.\ For each of the interval funds, the fees in years 1, 2, and 3 are
  estimated as [(dollar proceeds from shares issued + dollar cost of
  shares repurchased) / $1,000,000] x $129.80. The $129.80 is the fee
  rate (per million dollars) that funds pay to register shares for
  fiscal year 2020. Then we calculate the average fees per year.

    Under the current regime, an interval fund would pay on average 
$31,501 at the time of filing, and then issue and repurchase securities 
over time. Under the regime we are adopting, the interval fund will pay 
its registration fees on a net basis once a year. Since the final rule 
allows interval funds to shift more of the fee payments to the future, 
it will decrease their cost of offering securities. An interval fund 
will, however, be required to annually file Form 24F-2.\420\ We 
estimate the annual burden of filing Form 24F-2 for interval funds will 
be $140 per fund.\421\
---------------------------------------------------------------------------

    \420\ As discussed below, interval funds and other funds that 
file on Form 24F-2 will be required to file the form in a structured 
XML format under the amendments.
    \421\ For PRA purposes, we estimate an annual burden per 
respondent of filing Form 24F-2 of two hours. See infra section 
IV.B.6. At an estimated wage rate of $70 per hour, the annual dollar 
cost for filing Form 24F-2 is $140 (2 hours x $70 per hour). This 
estimate does not account for burdens associated with filing Form 
24F-2 in a structured XML format, which are discussed infra in 
section III.E.2.
---------------------------------------------------------------------------

    We believe the final rule will provide similar benefits to certain 
ETPs that are not registered under the Investment Company Act by 
allowing these ETPs to elect to register an indeterminate number of 
securities and to pay registration fees in arrears on an annual net 
basis. Since now ETPs pay registration fees in advance whether or not 
they sell any securities and may not factor in redemptions in reducing 
the amount of the registration fees owed, this change will allow them 
to reduce their registration fees and shift their payment obligations 
into future periods. The amendments will also avoid the possibility 
that such an ETP will inadvertently sell more shares than it has 
registered and will not require the issuer to periodically register new 
shares. Moreover, the amendments will allow ETPs that are not 
registered under the Investment Company Act to use a similar 
registration fee payment method as ETFs that are registered under the 
Investment Company Act.
    As an alternative, we considered allowing a wider range of affected 
funds, such as registered CEFs that are tender offer funds, to rely on 
rule 24f-2. This approach would have extended the benefits of rule 24f-
2 to additional affected funds. However, as discussed above, interval 
funds have structural similarities to mutual funds and ETFs that other 
affected funds do not. In particular, interval funds routinely 
repurchase shares at NAV and are required to periodically offer to 
repurchase their shares, and therefore are more likely to realize the 
operational benefits of computing registration fees on a net annual 
basis than are funds that are not required to periodically offer to 
repurchase their shares at NAV.
2. Structured Data Requirements
    The final rule includes new structured data reporting requirements 
for affected funds. Specifically, all affected funds will be required 
to tag in Inline XBRL format certain Form N-2 prospectus disclosure 
items. All affected funds also will be required to tag the information 
on the cover page of Form N-2 using Inline XBRL. Finally, BDCs will be 
required to tag financial statement information using Inline XBRL.
    Under the final rule, affected funds will be required to tag the 
following Form N-2 prospectus disclosure items using Inline XBRL: Fee 
Table; Senior Securities Table; Investment Objectives and Policies; 
Risk Factors; Share Price Data; and Capital Stock, Long-Term Debt, and 
Other Securities.\422\ These items provide important information about 
an affected fund's key features, costs, and risks and may be 
particularly useful to investors to inform their investment decisions. 
With respect to the requirement that BDCs tag financial statement 
information, unlike operating companies and registered investment 
companies, BDCs currently are not required to report any structured 
data.\423\ This requirement will extend to BDCs a requirement that 
currently applies to operating companies.
---------------------------------------------------------------------------

    \422\ See supra section II.I.1.c.
    \423\ See supra section II.I.1.a.
---------------------------------------------------------------------------

    Requiring BDCs to tag financial statement information using Inline 
XBRL, and all affected funds to tag in Inline XBRL format certain 
important prospectus disclosure items, will provide important benefits 
to investors seeking to access information about affected funds, both 
directly and through information intermediaries such as data 
aggregators and financial analysts. Providing a standardized, 
interactive, computer-based framework for reporting could further 
facilitate more efficient investor comparisons of important information 
across affected funds by making it easier to aggregate and analyze 
information through automated means, which could increase competition 
for investor capital. The Inline XBRL tagging requirements may also 
potentially increase the efficiency of capital formation to the extent 
that making disclosures available in a structured format reduces some 
of the information barriers facing prospective investors and makes it 
easier for affected funds to attract investors. One commenter expressed 
similar views.\424\
---------------------------------------------------------------------------

    \424\ See Calcbench Comment Letter.
---------------------------------------------------------------------------

    Smaller affected funds in particular may benefit more from enhanced 
exposure to investors. To the extent that reporting the disclosures in 
a structured format increases the availability, or reduces the cost of 
collecting and analyzing, key information about affected funds, smaller 
affected funds may benefit from improved coverage by information 
intermediaries. Further, requiring affected funds to tag certain 
prospectus disclosures using Inline XBRL would facilitate monitoring of 
these disclosures by investors and information intermediaries, 
potentially increasing transparency and mitigating the potential 
informational costs stemming from other aspects of the proposal such as 
automatic shelf registration statements for WKSIs and short-form 
registration statements for eligible funds, which may result in 
required disclosures being distributed across multiple regulatory 
filings and could thereby affect investor protection.\425\
---------------------------------------------------------------------------

    \425\ See supra section III.C.2 (discussing these costs).
---------------------------------------------------------------------------

    The cover page tagging requirement includes new check boxes that 
will help identify whether a registration statement is, for example, an 
automatic shelf registration statement or a short-form registration 
statement.\426\ We already require registrants to tag all of the 
information on the cover page of Form 10-K, Form 10-Q, Form 8-K, Form 
20-F, and Form 40-F using Inline XBRL.\427\ The requirement to tag the 
Form N-2 cover page in Inline XBRL is expected to benefit investors by 
enabling investors and information intermediaries to automate their use 
of the cover page information, including company name, the Act or Acts 
to which the registration statement relates, and check boxes relating 
to the effectiveness of the registration statement. This will enhance 
the ability of investors and information intermediaries to identify, 
count, sort, and analyze registrants and disclosures

[[Page 33328]]

to the extent these data points otherwise would be formatted, for 
example, in HTML. The check boxes, which are required to be tagged in 
Inline XBRL format, will allow investors and information intermediaries 
to distinguish between different categories of registration statements 
in much the same way they are currently able to do for operating 
companies. The availability of information in Inline XBRL could enable 
investors and information intermediaries to capture and analyze cover 
page information more quickly and at a lower cost, as well as to search 
and analyze the information dynamically. It could also facilitate 
comparison of information across filers and reporting periods.
---------------------------------------------------------------------------

    \426\ See supra section II.I.1.b.
    \427\ See FAST Act Modernization Adopting Release, supra 
footnote 66.
---------------------------------------------------------------------------

    Affected funds will incur some costs to tag and review the required 
information in Inline XBRL. Some filers may perform the tagging in-
house while others may retain outside service providers. We expect 
filers will incur costs for the fees of the outside service providers. 
Various XBRL preparation solutions have been developed and used by 
operating companies and open-end fund filers, and some evidence 
suggests that, for operating companies, XBRL tagging costs have 
decreased over time.\428\ While this evidence is specific to XBRL 
tagging costs rather than Inline XBRL tagging costs, because Inline 
XBRL allows filers to embed XBRL data directly into an HTML document, 
we expect Inline XBRL costs to be even lower than XBRL costs since 
Inline XBRL eliminates the need to tag a copy of the information in a 
separate XBRL exhibit. Costs of Inline XBRL preparation may depend on 
the familiarity of the filer and/or its service provider with Inline 
XBRL. Filers that currently report information in Inline XBRL for other 
investment products they offer, such as open-end funds, filing affected 
fund information in Inline XBRL under the amendments will likely incur 
lower costs of compliance than filers adopting Inline XBRL for the 
first time. Those registrants affected by the requirement that have not 
had experience structuring disclosures in other contexts will likely 
incur initial costs to acquire the necessary expertise and/or software 
as well as ongoing costs of tagging required information in Inline 
XBRL, and any fixed costs of complying with the Inline XBRL requirement 
may have a relatively greater impact on smaller filers. On an ongoing 
basis, registrants are expected to expend time to tag and review the 
tagged information in Inline XBRL using their in-house staff. Some 
registrants may also incur an initial cost to license filing 
preparation software with Inline XBRL capabilities from a software 
vendor, and some may also incur an ongoing licensing cost. Other 
registrants may incur an initial cost to modify their existing filing 
preparation software to accommodate Inline XBRL preparation. Some 
registrants will incur the costs of filing agent services to rely on a 
filing agent to prepare their Inline XBRL filings. Initial costs 
involving investments in expertise and modifications to disclosure 
preparation solutions, or switching to a different software vendor or 
outside service provider, may result in a higher compliance cost during 
the first year of using Inline XBRL than in subsequent years.
---------------------------------------------------------------------------

    \428\ See, e.g., Michael Cohn, AICPA sees 45% drop in XBRL costs 
for small companies, Accounting Today (Aug. 15, 2018), available at 
https://www.accountingtoday.com/news/aicpa-sees-45-drop-in-xbrl-costs-for-small-reporting-companies (stating that, according to an 
updated survey by AICPA and XBRL US, the cost of formatting 
financial statements in XBRL for smaller reporting companies has 
declined 45% since 2014 and that 68.6% of the companies paid $5,500 
or less on an annual basis (as compared to 29.9% of companies in the 
2014 survey) for fully outsourced creation and filing solutions for 
their XBRL filings, while 11.8% of the companies surveyed paid 
annual costs between $5,500 to as much as $8,000 for their full-
service outsourced solutions).
---------------------------------------------------------------------------

    The costs of compliance with the Inline XBRL requirements are 
likely to vary across registrants. On average we estimate that the 
compliance cost to BDCs of tagging financial statement information, 
certain prospectus disclosure items, and Form N-2 cover page 
information using Inline XBRL will be approximately $161,179 per BDC 
per year in the 3 years following the adoption of the rule.\429\ We 
estimate that the compliance cost to registered CEFs of tagging in 
Inline XBRL format certain prospectus disclosure items and tagging Form 
N-2 cover page information will be approximately $8,855 per registered 
CEF per year in the 3 years following the adoption of the rule.\430\ We 
note that some recent surveys based on operating companies suggest that 
these current PRA-based burden estimates may be overstated with respect 
to affected funds, and particularly smaller affected funds.\431\
---------------------------------------------------------------------------

    \429\ For BDCs, for the purposes of the PRA, we estimated the 
average annual compliance costs in the 3 years following the 
adoption of the rule to be 33,028 burden hours of in-house Inline 
XBRL preparation (31,095 burden hours for tagging financial 
statement information, 1,828 burden hours for certain prospectus 
disclosure items, and 105 burden hours for Form N-2 cover page 
information using Inline XBRL) and $3,712,565 in outside services 
($3,555,931 for tagging financial statement information, $156,634 
for certain prospectus disclosure items, and $0 for Form N-2 cover 
page information using Inline XBRL). See infra section IV.B.2. We 
monetize the burden of in-house Inline XBRL preparation by 
multiplying the burden hours by an estimated wage rate of $400 per 
hour (33,028 x $400 = $13,211,200). The estimated wage figure is 
based on analysis in previous rulemakings. The average cost per BDC 
is calculated by adding the monetized internal burden ($13,211,200) 
to the cost of outside services ($3,712,565) and dividing by the 
number of BDCs (105). See also supra footnote 355.
    \430\ For registered CEFs, for the purposes of the PRA, we 
estimated the average annual compliance costs in the 3 years 
following the adoption of the rule to be 12,628 burden hours of in-
house Inline XBRL preparation (686 burden hours for Form N-2 cover 
page information using Inline XBRL and 11,942 burden hours for 
certain prospectus disclosure items) and $1,023,345 in outside 
services ($0 for Form N-2 cover page information using Inline XBRL 
and $1,023,345 for certain prospectus disclosure items). See infra 
section IV.B.2. We monetize the burden of in-house Inline XBRL 
preparation by multiplying the burden hours by an estimated wage 
rate of $400 per hour (12,628 x $400 = $5,051,200). The estimated 
wage figure is based on analysis in previous rulemakings. The 
average cost per registered CEF is calculated by adding the 
monetized internal burden ($5,051,200) to the cost of outside 
services ($1,023,345) and dividing by the number of registered CEFs 
(686).
    \431\ See American Institute of CPAs, XBRL Costs for Small 
Companies Have Declined 45%, According to AICPA Study (Aug. 18, 
2018), available at https://www.aicpa.org/press/pressreleases/2018/xbrl-costs-have-declined-according-to-aicpa-study.html; CFA 
Institute, The Cost of Structured Data: Myth vs. Reality (2017), 
available at https://www.cfainstitute.org/-/media/documents/survey/the-cost-of-structured-data-myth-vs-reality-august-2017.ashx.
---------------------------------------------------------------------------

    One commenter cited a study by the European Securities and Markets 
Authority estimating the cost of preparing Inline XBRL in-house to be 
on average around 8,200 euros for the first filing and 2,400 euros for 
each subsequent filing.\432\ In case of outsourcing, the study 
estimates the costs to be on average around 13,000 euros for the first 
filing and 4,600 euros for each subsequent filing. However, we do not 
believe that these figures the commenter cited are salient to the 
structured data requirements we are adopting. For example, although not 
cited by the commenter, the same study mentions that in the United 
States, because of the detailed tagging and extended taxonomy, the 
average costs for outsourcing the preparation of the financial 
statements in XBRL is higher, between 9,000 euros and 19,000 
euros.\433\
---------------------------------------------------------------------------

    \432\ See XBRL US Comment Letter.
    \433\ See European Securities and Markets Authority, Feedback 
Statement on the Consultation Paper on the Regulatory Technical 
Standard on the European Single Electronic Format (ESEF) (Dec. 21, 
2016), available at https://www.esma.europa.eu/sites/default/files/library/2016-1668_esma_feedback_statement_on_the_rts_on_esef_0.pdf.
---------------------------------------------------------------------------

    As an alternative, we could have allowed but not required affected 
funds to present cover page, financial statement, and certain 
prospectus disclosure information in Inline XBRL. Compared to the final 
rule, a fully voluntary Inline XBRL program would

[[Page 33329]]

lower costs for those filers that do not find Inline XBRL to be cost 
efficient. We also could have required Inline XBRL tagging only for a 
subset of affected funds--for example, affected funds that file short-
form registration statements on Form N-2 or WKSIs. We also could have 
permitted more than one structured data format or left the precise 
format unspecified. However, a voluntary program or the use of multiple 
structured data formats would also reduce potential data quality 
benefits compared to mandatory Inline XBRL, as would a program that 
captures only a subset of affected funds. If the information were not 
submitted by all affected funds in a standardized, structured, machine-
readable format, investors who seek to instantly analyze, aggregate, 
and compare the data would have to incur the costs of paying a third-
party service provider to manually rekey the data, review the data for 
data quality problems during the duplication process, and disseminate 
the data to the investors.\434\ Alternatively, investors unwilling to 
pay a third-party service provider would have to incur the time to do 
that process themselves. In either scenario, the data would not be 
usable in as timely a manner as if it were made machine-readable in a 
standardized format. In addition, under a voluntary program, data that 
is not submitted in Inline XBRL would not be validated, thus decreasing 
the overall data quality of the data submitted. Unlike the machine-
readable Inline XBRL format, data submitted in unstructured formats 
(e.g., HTML, ASCII) is not machine-readable at the element level and 
thereby cannot be validated by EDGAR in any way. Thus, data submitted 
in the HTML format by affected funds that opted not to use Inline XBRL 
and XBRL data submitted by other affected funds could be different due 
to the level of pre-submission validation activities. Poor data quality 
reduces any data user's ability to meaningfully analyze, aggregate, and 
compare data. One commenter supported the use of Inline XBRL compared 
to unstructured formats, arguing that Inline XBRL data is significantly 
less expensive to process and more timely than unstructured data.\435\
---------------------------------------------------------------------------

    \434\ Some studies have shown that investors use XBRL files 
often, even preferring them to non-XBRL files when both are 
available. See Yu Cong, Hui Du, and Miklos A. Vasarhelyi, Are XBRL 
Files Being Accessed? Evidence from the SEC EDGAR Log File Dataset, 
Journal of Information Systems, Vol. 32-3, 23-29 (2018).
    \435\ See XBRL US Comment Letter.
---------------------------------------------------------------------------

    As another alternative, we could have required the disclosures to 
be filed in a different structured format, such as the XBRL or XML 
format. Compared to the Inline XBRL requirement that we are adopting, 
using the XBRL format would entail duplicative entry, which can 
adversely affect the quality and usability of the structured data as 
well as the efficiency and cost of preparation and review of the 
structured data. Compared to the requirement to use Inline XBRL, the 
alternative of requiring affected funds to use XML could result in 
lower costs. However, compared to the amendments, XML would provide 
less flexibility in tagging complex information as well as less 
extensive data quality validation capabilities. Given the complexity of 
the information required to be tagged and its importance to investors, 
we believe the benefits of using Inline XBRL outweigh the higher costs 
compared to XML.\436\ One commenter supported using Inline XBRL 
compared to XML, arguing that financial information is more efficiently 
reported in Inline XBRL.\437\
---------------------------------------------------------------------------

    \436\ In contrast, the information provided in Form 24F-2 is 
less complex and is generally only used by fund issuers and 
Commission staff for purposes of calculating certain registered 
investment companies' registration fees, so we have proposed to 
require Form 24F-2 information in a structured XML format rather 
than Inline XBRL.
    \437\ See XBRL US Comment Letter.
---------------------------------------------------------------------------

    As another alternative, we could have expanded the scope of 
prospectus disclosure information required to be tagged in Inline XBRL 
under the final rule. Compared to the final rule, this alternative 
would improve the timeliness and usability of the required disclosure 
information, but would potentially impose additional costs on affected 
funds. To the extent that the other required prospectus disclosures of 
affected funds contain information that is more specific to individual 
funds without sufficient comparability or aggregation utility, the 
benefits of having those additional required disclosures in a 
structured format may be lower than the more limited subset of 
disclosures that we are requiring affected funds to file in Inline 
XBRL. As another alternative, we could have narrowed the scope of 
prospectus disclosure information required to be tagged in Inline XBRL 
under the rule. Compared to the final rule, this alternative could 
decrease the timeliness and usability of the information required to be 
disclosed, but could also potentially reduce costs for registrants. 
Overall, the prospectus disclosures that affected funds will be 
required to tag in Inline XBRL largely parallel the information that 
mutual funds and ETFs are required to disclose. We also believe these 
disclosures represent the information that will be most useful for 
investors that seek to use structured data to assist with investment 
decisions regarding affected funds.
    We also are requiring issuers that file Form 24F-2 (including 
mutual funds and ETFs, as well as interval funds) to submit the form in 
a structured XML format.\438\ We believe using a structured data format 
will make it easier for issuers to accurately prepare and submit the 
information Form 24F-2 requires and will make the submitted information 
more useful to Commission staff. Automated validation processes could 
help issuers compute registration fees accurately before submitting the 
filing, which could reduce administrative burdens associated with 
correcting inaccurate filings. A structured filing format could also 
facilitate pre-population of previously-filed information. We estimate 
the cost of tagging Form 24F-2 in a structured XML format to be $542 
per fund.\439\
---------------------------------------------------------------------------

    \438\ See supra section II.I.1.d.
    \439\ We assume that the burden of tagging Form 24F-2 in a 
structured XML format would be 2 hours for each filing. See infra 
section IV.B.6. At an estimated wage rate of $271 per hour, the 
dollar cost for filing Form 24F-2 in a structured XML format is $542 
(2 hours x $271 per hour) per fund.
---------------------------------------------------------------------------

3. Periodic Reporting Requirements
    We are adopting certain new annual report requirements for affected 
funds that file a short-form registration statement on Form N-2. These 
funds must include in their annual reports certain information that 
they currently disclose in their prospectus--a table of fees and 
expenses, share price information, and a table of senior securities--
and a discussion of material unresolved staff comments.\440\ In 
addition, all BDCs will be required to include financial highlights in 
their registration statements and annual reports.\441\ We also are 
requiring all registered CEFs to provide management's discussion of 
fund performance in their annual reports.\442\ Finally, registered CEFs 
that rely on rule 8b-16(b) under the Investment Company Act to avoid 
annually updating their registration statements will be required to 
describe in their annual reports the fund's current investment 
objectives and policies, and principal risks, and to provide more 
expansive disclosure about certain key changes that occurred during the 
relevant year in enough detail to allow investors to understand each 
change and how it may affect the fund.\443\ We believe these 
requirements will promote

[[Page 33330]]

investor protection by making important information more readily 
accessible to investors.
---------------------------------------------------------------------------

    \440\ See supra section II.I.2.a and section II.I.2.d.
    \441\ See supra section II.I.2.c.
    \442\ See supra section II.I.2.b.
    \443\ See supra section II.I.5.
---------------------------------------------------------------------------

    With respect to affected funds filing short-form registration 
statements on Form N-2, the annual report requirements will compile 
certain information that is already available in a fund's registration 
statement. This could be beneficial to some investors in these funds 
since information will be readily available in one document instead of 
investors needing to compile it from several sources. As previously 
discussed, given the ability of affected funds to use forward 
incorporation by reference under the short-form registration 
instruction, these funds' annual reports may become a more convenient 
and comprehensive source of information about a particular seasoned 
fund, relative to that fund's registration statement. At the same time, 
the annual report requirements may increase the compliance costs for 
seasoned funds because new information items will have to be added to 
the annual report. However, because the annual report will be 
incorporated by reference into the fund's prospectus, requiring 
disclosure in both the prospectus and annual report should not require 
duplicative disclosure. Moreover, specifying identical disclosure 
requirements in both places may facilitate forward incorporation by 
reference, by making clear that the same required disclosure will 
satisfy both requirements. Alternatively, we could have required 
affected funds to include in their annual reports more or less 
information from their registration statements. While requiring less 
information would reduce costs to affected funds by reducing the amount 
of required annual report disclosure, it could also make it more 
difficult for investors to find important fund information. Requiring 
affected funds to include more prospectus information in their annual 
reports could increase the length and complexity of annual reports and 
make them less useful to investors overall. This alternative would also 
increase affected funds' compliance costs.
    The requirement to disclose material unresolved staff comments in 
the annual report is designed to mitigate the concern that other 
aspects of the amendments may reduce certain affected funds' incentives 
to resolve staff comments in a timely manner. We believe disclosure of 
material unresolved staff comments will likely provide important 
information to investors. This requirement may, however, impose certain 
compliance costs to the extent a seasoned fund does not timely resolve 
staff comments and hence will be required to provide such disclosure. 
We do not believe these disclosure costs will be significant because 
the information will be readily available to the affected fund. We 
recognize, however, there could be some costs to affected funds 
associated with compliance and legal review to the extent an affected 
fund wants to provide additional information in its annual report 
disclosure beyond that provided in the fund's written response to the 
staff's comment (which would typically already be publicly available on 
EDGAR). We also recognize, as some commenters suggested, that 
determining whether a particular comment is ``material'' or 
``unresolved'' involves some subjective judgment, which may contribute 
to compliance and legal costs.\444\
---------------------------------------------------------------------------

    \444\ See ICI Comment Letter; Invesco Comment Letter.
---------------------------------------------------------------------------

    With respect to the requirement that BDCs provide financial 
highlights information, we believe investors will benefit from 
disclosure summarizing a BDC's financial statements. We believe the 
costs associated with this requirement should be minimal since we 
understand that it is general market practice for BDCs to include this 
information in their registration statements.
    We believe the requirement for registered CEFs to include MDFP 
disclosure in their annual shareholder reports will be beneficial to 
investors by helping them assess a fund's performance over the prior 
year and complementing other information in the report, which may make 
the annual report disclosure more understandable as a whole. This 
requirement will also promote parity between different types of funds, 
as open-end funds and BDCs are already required to provide similar 
disclosure in their annual reports. This requirement will likely 
increase compliance burdens for registered CEFs, to the extent they do 
not voluntarily provide MDFP disclosure already. We believe that a 
majority of registered CEFs already provide MDFP-like disclosure in 
their annual shareholder reports. We estimate the annual cost of 
providing MDFP disclosure to be $6,400 per registered CEF,\445\ 
although this cost will likely be lower for affected funds that already 
provide MDFP-like disclosure.
---------------------------------------------------------------------------

    \445\ For the purpose of the PRA, we estimate that the proposed 
amendments to require registered CEFs to provide MDFP in their 
annual reports will result in an additional 16 burden hours for 
registered CEFs. See infra section IV.B.3. We monetize the internal 
burden by multiplying the burden hours by an estimated wage rate of 
$400 per hour (16 x $400 = $6,400).
---------------------------------------------------------------------------

    We considered adopting additional MDFP requirements, such as 
requirements to: (1) Disclose the impact of particular investments 
(including large positions and/or significant investments) or 
investment types that contributed to or detracted from performance; (2) 
explain a fund's performance in relation to its index; (3) explain how 
the use of leverage affected fund performance; (4) explain the reason 
for and effect of any large cash or temporary defensive positions on 
fund performance; (5) explain the effect of any tax strategies, or the 
effects of taxes, on fund performance; (6) explain the effect of non-
recurring or non-cash income on fund performance; (7) include general 
discussion of purchases and sales of fund shares and the effects of any 
share repurchases or tender offers on fund performance; and/or (8) 
disclose whether the fund has high portfolio turnover and the effect of 
portfolio turnover on fund performance. We also considered changing the 
average annual total return table to provide additional or more useful 
information to investors, such as requiring total return based on per-
share NAV, in addition to total return based on current market price. 
Although one or more of these changes could result in additional, 
potentially helpful information for investors, we also considered the 
administrative costs that additional disclosure requirements would 
impose and have determined not to adopt them at this time.
    Under the amendments to rule 8b-16, registered CEFs relying on 
paragraph (b) of the rule must describe in their annual reports the 
fund's current investment objectives and policies, and principal risks, 
and certain key changes that occurred during the relevant year in 
enough detail to allow investors to understand each change and how it 
may affect the fund. We estimate that approximately 521 registered CEFs 
relied on rule 8b-16 as of December 31, 2019 and will therefore provide 
the new disclosure.\446\ These registered CEFs also will be required to 
preface disclosure of these key changes with a legend clarifying that 
the disclosures provide only a summary of certain changes that have 
occurred in the past year, and that the summary may not reflect all of 
the changes that have occurred. We believe these new disclosure 
requirements will allow investors in funds relying on rule 8b-16(b) to 
more easily identify and understand key information about their

[[Page 33331]]

investments by providing such information in one place. Because these 
funds are already required to disclose in their annual reports the 
enumerated changes to specified Form N-2 disclosure items--and 
therefore already must have and maintain, among other things, updated 
information about the investment objectives, policies and principal 
risks that we are requiring them to disclose in full--the new 
requirement will likely add only a small incremental compliance burden.
---------------------------------------------------------------------------

    \446\ See infra footnote 561.
---------------------------------------------------------------------------

4. Discretionary Amendments to Incorporation by Reference Requirements
    The final rule will modernize Form N-2's requirements for backward 
incorporation by reference for all affected funds.\447\ Specifically, 
we are requiring that an affected fund make information that is 
incorporated by reference into its prospectus or SAI, as well as the 
corresponding prospectus and SAI, readily available and accessible on a 
website maintained by or for the fund and identified in the fund's 
prospectus or SAI.
---------------------------------------------------------------------------

    \447\ See supra section II.I.4.
---------------------------------------------------------------------------

    We believe this new requirement will improve the information's 
online accessibility for investors. In particular, this new requirement 
will make the incorporated information, prospectus, and SAI more 
accessible to retail investors online because we believe they may be 
more inclined to look at a fund's website for information than to 
search the EDGAR system.\448\ We recognize that investors without home 
internet access, depending on their ability and preference to access 
fund information electronically, might experience a reduction in their 
ability to access information that is incorporated by reference into 
its prospectus or SAI. However, affected funds will also be required to 
provide incorporated materials upon request free of charge, in 
recognition that some investors may prefer to review these materials in 
paper.\449\
---------------------------------------------------------------------------

    \448\ For example, results from 2011 investor testing sponsored 
by the Commission suggest that an investor looking for a fund's 
annual report is most likely to seek it out on the fund's website. 
See Investor Testing of Selected Mutual Fund Annual Reports (Feb. 9, 
2012), available at https://www.sec.gov/comments/s7-08-15/s70815-3.pdf. Additionally, a 2018 report by the Investment Company 
Institute suggests that over 90% of U.S. households owning mutual 
funds used the internet extensively. See ICI Research Perspective, 
Ownership of Mutual Funds, Shareholder Sentiment, and Use of the 
internet, 2019 (Oct. 2019), available at https://www.ici.org/pdf/per25-08.pdf.
    \449\ See supra paragraph accompanying footnote 410 (recognizing 
the effects of allowing affected funds to not deliver final 
prospectuses directly to investors if they meet certain 
requirements).
---------------------------------------------------------------------------

    This amendment also will facilitate the efficient use of 
incorporation by reference by affected funds. For example, if an 
investor requested a copy of the affected fund's prospectus in 
accordance with rule 173, the fund would in some cases need to deliver 
a much longer document if we did not amend Form N-2's backward 
incorporation by reference provisions.\450\ We do not, however, expect 
that the backward incorporation by reference amendment will 
substantially reduce the amount of information affected funds deliver 
to investors by mail or electronically. This is because we expect that 
most affected funds will rely on rules 172 and 173 to satisfy their 
prospectus delivery obligations. An issuer that uses these rules will 
satisfy its final prospectus delivery obligations by filing the 
prospectus with the Commission rather than delivering the prospectus 
and any incorporated material to investors.\451\
---------------------------------------------------------------------------

    \450\ See, e.g., supra footnote 365 and accompanying text.
    \451\ See supra section II.D.
---------------------------------------------------------------------------

    We do not believe the requirement to make a fund's prospectus, SAI, 
and incorporated materials available on a website will generate 
significant compliance costs for affected funds because many funds 
currently post their annual and semi-annual reports and other fund 
information on their websites. We estimate the annual cost to comply 
with the website posting requirements to be $496 per fund.\452\
---------------------------------------------------------------------------

    \452\ For the purpose of the PRA, we estimate an average burden 
to comply with the website posting requirements of 2 hours per fund. 
See infra section IV.B.1. The expected compliance cost associated 
with the proposed website posting requirements is calculated by 
multiplying the 2-hour burden by the estimated hourly wage based on 
published rates for webmasters ($248).
---------------------------------------------------------------------------

    Affected funds may also incur printing and mailing costs under the 
final rule if some investors request paper copies of the prospectus 
\453\ or of the information that has been incorporated by reference 
into the prospectus or SAI but not delivered with the prospectus or 
SAI.\454\ In another release, the Commission estimated that the annual 
printing and mailing cost associated with providing copies of 
prospectuses and other documents upon request would be approximately 
$500 per registrant.\455\ We are similarly adopting a requirement to 
send prospectuses and related information in this release, and we have 
no reason to assume significant differences in the average lengths of 
the associated materials or the frequency of investor requests under 
the amendments we are adopting. We estimate that the printing and 
mailing costs associated with the new requirements will be 
approximately $750 per fund in recognition that the requirement to 
deliver information that has been incorporated by reference may result 
in greater overall costs since affected funds that are eligible to file 
short-form registration statements under the final rule will be able to 
use incorporation by reference more frequently.\456\ We anticipate, 
however, that investors may be less likely to request copies of 
materials that have been incorporated by reference into an affected 
fund's prospectus or SAI, so we believe this requirement will only 
incrementally increase costs.
---------------------------------------------------------------------------

    \453\ See supra footnote 153.
    \454\ See supra section II.I.4.
    \455\ See Variable Contract Summary Prospectus Adopting Release, 
supra footnote 345, at n.1233 and accompanying text.
    \456\ We requested data regarding how often investors may 
request copies of prospectuses or incorporated materials, how many 
materials affected funds would incorporate by reference into their 
prospectuses or SAIs, and how lengthy those materials would be. 
Commenters did not provide any data in response.
---------------------------------------------------------------------------

    Alternatively, we could have retained Form N-2's current backward 
incorporation by reference requirements and continued to require funds 
to deliver incorporated materials to new investors. Because current 
General Instruction F of Form N-2 does not require affected funds to 
make incorporated materials available online, funds would not have to 
incur costs associated with website posting. However, because affected 
funds that choose to rely on rules 172 and 173 will be deemed to have 
delivered their disclosures upon filing with the Commission instead of 
giving them to investors, the current backward incorporation delivery 
requirement will not result in delivery of incorporated materials to a 
fund's investors, thus making less accessible the disclosure materials 
that might affect their investment decision.
    We are also modifying Form N-14 to decrease the disclosure burden 
of the form and reduce the length of Form N-14 prospectuses in certain 
circumstances.\457\ The amendments will allow BDCs to incorporate by 
reference to the same extent as registered CEFs. This will provide for 
more consistent treatment between registered CEFs and BDCs. We also are 
eliminating the requirement that registrants file with the Form N-14 
registration statement the documents containing the information that is 
incorporated by reference into the prospectus or SAI, thus decreasing

[[Page 33332]]

compliance costs. Commenters generally supported these changes.\458\
---------------------------------------------------------------------------

    \457\ See supra section II.B.3.b.
    \458\ See Dechert Comment Letter; IPA Comment Letter.
---------------------------------------------------------------------------

5. Automatic or Immediate Effectiveness of Filings by Affected Funds 
Conducting Certain Continuous Offerings
    In response to comments, the final rule will allow any registered 
CEF or BDC that conducts continuous offerings under rule 415(a)(1)(ix) 
to file post-effective amendments and certain registration statements 
that become effective immediately upon filing or automatically 60 days 
after filing.\459\ We believe this rule amendment will allow these 
unlisted continuously-offered affected funds to maintain effective 
registration statements in a more efficient, cost-effective manner, 
similar to the benefits the final rule provides to affected funds that 
file short-form registration statements or qualify as WKSIs. Under the 
amendments, continuously-offered unlisted affected funds, which 
generally will not qualify as WKSIs or be eligible to file short-form 
registration statements because they do not have public float, will be 
able to more efficiently update their financial statements under 
section 10(a)(3) of the Securities Act to maintain effective 
registration statements while they engage in continuous offerings. One 
commenter stated that allowing continuously-offered unlisted affected 
funds to rely on rule 486 would benefit investors in these funds by 
allowing the funds to avoid the time and expense of an annual staff 
review of registration statements where no changes are made beyond 
immaterial updates and updates to audited financial information.\460\
---------------------------------------------------------------------------

    \459\ See supra section II.D.
    \460\ See ABA Comment Letter.
---------------------------------------------------------------------------

    As an alternative, we could have continued to limit rule 486 to 
interval funds. Such an alternative would have made it less efficient 
for certain continuously-offered unlisted affected funds to update 
their financial statements or make other changes to their registration 
statements relative to the processes available to all other funds that 
conduct continuous or delayed offerings under the Commission's rules.

IV. Paperwork Reduction Act Analysis

    A. Background
    Certain provisions of the final amendments contain ``collection of 
information'' requirements within the meaning of the Paperwork 
Reduction Act of 1995 (PRA).\461\ We are submitting the final 
amendments to the Office of Management and Budget (OMB) for review in 
accordance with 44 U.S.C. 3507(d) and 5 CFR 1320.11. The hours and 
costs associated with preparing disclosure, filing forms, and retaining 
records constitute reporting and cost burdens imposed by the 
collections of information. An agency may not conduct or sponsor, and a 
person is not required to respond to, a collection of information 
unless it displays a currently valid control number. The titles for the 
collection of information are summarized in Table 5 below.
---------------------------------------------------------------------------

    \461\ 44 U.S.C. 3501 et seq.

                   Table 5--Collections of Information
------------------------------------------------------------------------
                                                            OMB control
                          Title                                 No.
------------------------------------------------------------------------
Form N-2................................................       3235-0026
Investment Company Interactive Data \1\.................       3235-0642
Rule 30e-1..............................................       3235-0025
Form 10-K...............................................       3235-0063
Family of rules under section 8(b) of the Investment           3235-0176
 Company Act of 1940 \2\................................
Rule 163................................................       3235-0619
Rule 433................................................       3235-0617
Rule 173................................................       3235-0618
Form 24F-2..............................................       3235-0456
Form S-1................................................       3235-0065
Form S-3................................................      3235- 0073
Form N[dash]14..........................................       3235-0336
Form F-1................................................       3235-0258
Form F-3................................................       3235-0256
------------------------------------------------------------------------
Notes:
\1.\ Recently, we issued a release that, among other things, retitled
  this collection of information (previously, ``Mutual Fund Interactive
  Data'') ``Investment Company Interactive Data.'' See Variable Contract
  Summary Prospectus Adopting Release, supra footnote 345.
\2.\ The paperwork burdens for the rules under section 8(b) of the
  Investment Company Act are imposed through the forms and reports that
  are subject to the requirements in these rules and are reflected in
  the PRA burdens of those documents. To avoid a PRA inventory
  reflecting duplicative burdens and for administrative convenience, we
  assign a one-hour burden to these rules.

    The rules, forms, and regulations listed above were adopted under 
the Securities Act, the Exchange Act, or the Investment Company Act. 
They set forth the disclosure requirements for registration statements, 
prospectuses, periodic reports, and certified shareholder reports that 
are prepared by registrants to help investors make informed investment 
and voting decisions. They also permit additional communications by 
registrants during a registered offering. The final amendments will 
allow affected funds to use the securities offering rules that are 
already available to operating companies. In addition, the final rule 
includes amendments to our rules and forms intended to tailor the 
disclosure and regulatory framework to affected funds.
    The Investment Company Interactive Data collection of information 
references current requirements for certain registered investment 
companies to submit to the Commission information included in their 
registration statements, or information included in or amended by any 
post-effective amendments to such registration statements, in response 
to certain form items in interactive data format. It also references 
the requirement for funds to submit an Interactive Data File to the 
Commission for any form of prospectus filed pursuant to rule 497(c) or 
(e) that includes information in response to certain form items. The 
final amendment will include several new structured data requirements, 
including requirements for: (1) BDCs to submit financial statement 
information using Inline XBRL format; (2) affected funds to include 
structured cover page information in their registration statements on 
Form N-2 using Inline XBRL format; and (3) affected funds to tag 
certain prospectus information using Inline XBRL format.\462\ Although 
the interactive data filing requirements are included in the Form N-2 
instructions, we are separately reflecting the hour and cost burdens 
for these requirements in the burden estimate for Investment Company 
Interactive Data and not in the estimate for Form N-2.
---------------------------------------------------------------------------

    \462\ We are also adopting new requirements for funds that file 
on Form 24F-2 to submit the form in XML format. We account for the 
burdens associated with this requirement in infra section IV.B.6.
---------------------------------------------------------------------------

    The information collection requirements related to registration 
statements and Exchange Act reports are mandatory. In addition, there 
is no mandatory retention period for the information disclosed, and the 
information gathered will be made publicly available. The information 
collection requirements related to the communications and prospectus 
delivery rules we are adopting apply only to affected funds and other 
offering participants choosing to rely on them. There will be a 
mandatory record retention period with respect to the communications 
and prospectus delivery information collections. Under rule 433, 
issuers and offering participants must retain all free writing 
prospectuses that have been used, for three years following the date of 
the initial bona fide offering of the securities in question that were 
not filed with the Commission. Moreover, free writing prospectuses that 
are made by or on behalf of an affected fund, and free

[[Page 33333]]

writing prospectuses that are broadly disseminated by another offering 
participant, will have to be filed and will be publicly available on 
EDGAR, whereas free writing prospectuses prepared by or on behalf of, 
or used or referred to, by offering participants other than the issuer 
will not have to be filed.

B. Summary of the Amendments and Impact on Information Collections

    We are amending several rules and forms to modify the registration, 
communications, and offering processes for affected funds under the 
Securities Act and Investment Company Act. The amendments are designed 
to carry out the requirements of section 803 of the BDC Act and section 
509 of the Registered CEF Act. The amendments generally will allow 
affected funds to use the securities offering rules that are already 
available to operating companies.
    The amendments principally affect five aspects of the application 
of our securities offering rules to affected funds. First, the 
amendments will streamline the registration process under the 
Securities Act for affected funds to allow them to sell securities more 
quickly and efficiently under a shelf registration process tailored to 
affected funds. Second, the amendments will allow affected funds to 
qualify as WKSIs under rule 405 under the Securities Act. Third, the 
amendments will allow affected funds to satisfy final prospectus 
delivery requirements using the same method as operating companies. 
Fourth, the amendments will allow affected funds to use communications 
rules currently available to operating companies, such as the use of 
the safe harbors for disseminating certain factual business 
information, forward-looking information, a ``free writing 
prospectus,'' and broker-dealer research reports. Finally, the 
amendments will tailor affected funds' disclosure and regulatory 
framework in light of the amendments to the offering rules applicable 
to them. These amendments include new structured data requirements, new 
disclosure requirements for annual reports, and a requirement for 
interval funds to pay securities registration fees using the same 
method that mutual funds and ETFs use today.
    We anticipate that several provisions of the amendments will 
increase the burdens and costs for affected funds that will be subject 
to the amendments. We have estimated the average number of hours an 
affected fund will spend to prepare and file the information 
collections and the average hourly rate for the services of outside 
professionals. In deriving our estimates, we recognize that the burdens 
will likely vary among individual affected funds based on a number of 
factors, including their size and the nature of their investment 
activities.\463\ In addition, some affected funds may experience costs 
in excess of our estimates, and some may experience less than the 
estimated average costs.
---------------------------------------------------------------------------

    \463\ See supra footnotes 355 and 357.
---------------------------------------------------------------------------

    In addition to these amendments relating to affected funds, we are 
amending several rules and forms to enable certain ETPs that are not 
registered under the Investment Company Act to elect to register 
offerings of an indeterminate amount of exchange-traded vehicle 
securities and pay registration fees for these offerings on an annual 
net basis. We have estimated the average number of additional hours 
that such ETPs will spend when filing registration statements for these 
offerings to prepare and file the information collections and the 
average hourly rate for the services of outside professionals. We 
anticipate that the amendments will result in a decrease in the number 
of registration statements filed by these issuers and that, overall, 
these amendments will reduce the burdens and costs for these issuers.
1. Amendments to Form N-2 Registration Statement
    Form N-2 is the form used by an affected fund to register offerings 
under the Securities Act and, as applicable, to register as an 
investment company under the Investment Company Act.
    The amendments to Form N-2 will increase the existing disclosure 
burdens of the form by requiring:
     Affected funds to use new check boxes on the cover page to 
provide information about the fund, the purpose of the filing, and the 
type of offering, including whether the form is being used for 
automatic shelf registration; \464\
---------------------------------------------------------------------------

    \464\ See supra section II.I.1.b; see also amended cover page of 
Form N-2.
---------------------------------------------------------------------------

     BDCs to include financial highlights disclosure in their 
registration statements, as registered CEFs are currently required to 
do; \465\
---------------------------------------------------------------------------

    \465\ See supra section II.I.2.c; see also Instruction 1 to Item 
4 of amended Form N-2.
---------------------------------------------------------------------------

     Affected funds to provide new undertakings to be furnished 
in registration statements being filed pursuant to rule 415; \466\ and
---------------------------------------------------------------------------

    \466\ See supra footnote 63 and accompanying paragraph; see also 
Items 34.3-7 of amended Form N-2.
---------------------------------------------------------------------------

     Affected funds to make certain documents available online 
if they incorporate them by reference, including the prospectus, SAI, 
and any Exchange Act reports filed under section 13 or section 15(d) of 
the Exchange Act that are incorporated by reference into the fund's 
prospectus or SAI.\467\
---------------------------------------------------------------------------

    \467\ See supra section II.I.4; see also General Instruction 
F.4.a of amended Form N-2.
---------------------------------------------------------------------------

    At the same time, the amendments to Form N-2 will decrease existing 
burdens for the form by:
     Permitting eligible affected funds to forward incorporate 
by reference Exchange Act reports, which will reduce the need for such 
funds to file a post-effective amendment or a prospectus supplement to 
update information in the registration statement.\468\
---------------------------------------------------------------------------

    \468\ See supra section II.B.3.e; see also General Instruction 
F.3.b of amended Form N-2.

                             Table 6--Currently Approved Form N-2 PRA Estimates \1\
----------------------------------------------------------------------------------------------------------------
                                   Internal                                Cost of internal     Annual external
                                    burden             Wage rate \2\            burden            cost burden
----------------------------------------------------------------------------------------------------------------
                                    Burden per Initial Registration Statement
----------------------------------------------------------------------------------------------------------------
Total burden per registration      517.6 hours   x   $269 (blended      $139,234.............  $32,241
 statement.                                           rate of $365 for
                                                      compliance
                                                      attorney and
                                                      $172 for
                                                      intermediate
                                                      accountant).
Number of annual initial                 x 136       .................  x 136................  x 136
 registration statements.
                               ---------------------------------------------------------------------------------

[[Page 33334]]

 
    Total annual burden.......    70,394 hours       .................  $18,935,824..........  $4,384,776
----------------------------------------------------------------------------------------------------------------
                                       Burden per Post-Effective Amendment
----------------------------------------------------------------------------------------------------------------
Total burden per post-               125 hours   x   $269 (blended      $33,625..............  $11,114
 effective amendment.                                 rate of $365 for
                                                      compliance
                                                      attorney and
                                                      $172 for
                                                      intermediate
                                                      accountant).
Number of annual post-                    x 30  ...  .................  x 30.................  x 30
 effective amendments.
                               ---------------------------------------------------------------------------------
    Total annual burden.......     3,751 hours       .................  $1,008,750...........  $333,420
                               ---------------------------------------------------------------------------------
                                                  Total Burden
----------------------------------------------------------------------------------------------------------------
Total initial registration        70,394 hours       .................  $18,935,824..........  $4,384,776
 statement burden.
Total post-effective amendment     3,751 hours       .................  $1,008,750...........  $333,420
 burden.
                               ---------------------------------------------------------------------------------
    Total annual burden.......    74,145 hours       .................  19,944,574...........  4,718,196
----------------------------------------------------------------------------------------------------------------
Notes:
\1.\ These estimates were previously submitted to OMB in connection with a revision of the then-currently-
  approved collection in 2020.
\2.\ Derived from SIFMA's Management & Professional Earnings in the Securities Industry 2013 (modified to
  account for an 1,800[dash]hour work year; multiplied by 5.35 to account for bonuses, firm size, employee
  benefits and overheard, and adjusted for inflation).


                                  Table 7--Proposed Form N-2 PRA Estimates \1\
----------------------------------------------------------------------------------------------------------------
                                   Internal                                Cost of internal     Annual external
                                    burden             Wage rate \2\            burden            cost burden
----------------------------------------------------------------------------------------------------------------
                                    Burden for Initial Registration Statement
----------------------------------------------------------------------------------------------------------------
Preparing and filing initial      171.67 hours   x   $401 (attorney)..  $68,838.33...........  $31,941
 registration statement.
                                  171.67 hours   x   $210 (paralegal).  $36,050..............  .................
                                  171.67 hours   x   $449 (assistant    $77,078.33...........  .................
                                                      general counsel).
Total burden per registration        515 hours       .................  $181,966.67..........  $31,941
 statement.
Number of annual initial                 x 138       .................  x 138................  x 138
 registration statements.
                               ---------------------------------------------------------------------------------
    Total annual burden.......    71,070 hours       .................  $25,111,399.08.......  $4,407,858
----------------------------------------------------------------------------------------------------------------
                                       Burden for Post-Effective Amendment
----------------------------------------------------------------------------------------------------------------
Preparing and filing post-         35.67 hours   x   $401 (attorney)..  $14,302.33...........  $10,814
 effective amendments.
                                   35.67 hours   x   $210 (paralegal).  $7,490...............  .................
                                   35.67 hours   x   $449 (assistant    $16,014.33...........  .................
                                                      general counsel).
Total burden per post-               107 hours       .................  $37,806.67...........  $10,814
 effective amendment.
Number of annual post-                   x 190       .................  x 190................  x 190
 effective amendments.
                               ---------------------------------------------------------------------------------
    Total annual burden.......    20,330 hours       .................  $7,183,266.70........  $2,054,660
----------------------------------------------------------------------------------------------------------------
                                      Additional Burden for Affected Funds
----------------------------------------------------------------------------------------------------------------
Proposed new check box                  0.1667   x   $352 (compliance   $58.67...............  $0
 requirements.                                        attorney).
                                        0.1667   x   $319 (senior       $53.17...............  .................
                                                      programmer).
                                        0.1667   x   $239 (webmaster).  $39.83...............  .................
Proposed online availability        0.67 hours   x   $352 (compliance   $234.67..............
 requirement.                                         attorney).
                                    0.67 hours   x   $319 (senior       $212.67..............  $0
                                                      programmer).
                                    0.67 hours   x   $239 (webmaster).  $159.33..............  .................
Total additional burden per          2.5 hours       .................  $758.33..............  $0
 affected fund.
Number of affected funds......           x 807       .................  x 807................  x 807
                               ---------------------------------------------------------------------------------
    Total annual burden.......     2,018 hours       .................  $611,975.............  $0
----------------------------------------------------------------------------------------------------------------
                                           Additional Burden for BDCS
----------------------------------------------------------------------------------------------------------------
Financial highlights                 0.5 hours   x   $352 (compliance   $176.................  $0
 requirement.                                         attorney).
                                     0.5 hours   x   $319 (senior       $159.50..............  .................
                                                      programmer).

[[Page 33335]]

 
                                     0.5 hours   x   $239 (webmaster).  $119.50..............  .................
Total additional burden per          1.5 hours       .................  $455.................  $0
 BDC.
Number of BDCs................           x 103       .................  x 103................  x 103
                               ---------------------------------------------------------------------------------
    Total annual burden.......       155 hours       .................  $46,865..............  $0
----------------------------------------------------------------------------------------------------------------
                                                  Total Burden
----------------------------------------------------------------------------------------------------------------
Total initial registration        71,070 hours       .................  $25,111,399.08.......  $4,407,858
 statement burden.
Total post-effective amendment    20,330 hours       .................  $7,183,266.70........  $2,054,660
 burden.
Total additional burden for        2,018 hours       .................  $611,975.............  $0
 affected funds.
Total additional burden for          155 hours       .................  $46,865..............  $0
 BDCs.
                               ---------------------------------------------------------------------------------
    Total annual burden.......    93,573 hours       .................  $32,953,505.78.......  $6,462,518
----------------------------------------------------------------------------------------------------------------
Notes:
\1.\ See Proposing Release, supra footnote 10, at section IV.B.1.
\2.\ See supra Table 6, at footnote 2.


                                      Table 8--Final Form N-2 PRA Estimates
----------------------------------------------------------------------------------------------------------------
                                   Internal                                Cost of internal     Annual external
                                    burden             Wage rate \1\            burden            cost burden
----------------------------------------------------------------------------------------------------------------
                                    Burden for Initial Registration Statement
----------------------------------------------------------------------------------------------------------------
Total burden per registration      517.6 hours   x   $269 (blended      $139,234.............  $32,241
 statement.                                           rate of $365 for
                                                      compliance
                                                      attorney and
                                                      $172 for
                                                      intermediate
                                                      accountant).
Number of annual initial          x 140\2\ \3\                          x 140 \2\ \3\........  x 140 \2\ \3\
 registration statements.
                               ---------------------------------------------------------------------------------
    Total annual burden.......    72,464 hours                          $19,492,760..........  $4,513,740
----------------------------------------------------------------------------------------------------------------
                                       Burden for Post-Effective Amendment
----------------------------------------------------------------------------------------------------------------
Total burden per post-               125 hours   x   $269 (blended      $33,625..............  $11,114
 effective amendment.                                 rate of $365 for
                                                      compliance
                                                      attorney and
                                                      $172 for
                                                      intermediate
                                                      accountant).
Number of annual post-             x 158\2, 4\                          x 158 \2\ \4\........  x 158 \2\ \4\
 effective amendments.
                               ---------------------------------------------------------------------------------
    Total annual burden.......    19,750 hours                          $5,312,750...........  $1,756,012
----------------------------------------------------------------------------------------------------------------
                                      Additional Burden for Affected Funds
----------------------------------------------------------------------------------------------------------------
New check box requirements....    0.1667 hours   x   $365 (compliance   $60.85...............  $0
                                                      attorney) \2\.
                                  0.1667 hours   x   $331 (senior       $55.18...............  .................
                                                      programmer) \2\.
                                  0.1667 hours   x   $248 (webmaster)   $41.34...............  .................
                                                      \2\.
Online availability                    2 hours   x   $248 (webmaster)   $496.................  $0
 requirement.                                         \2\ \4\.
Total additional burden per          2.5 hours                          $653.37..............  $0
 affected fund.
Number of affected funds......           x 791                          x 791................  x 791
                               ---------------------------------------------------------------------------------
    Total annual burden.......     1,978 hours                          $516,815.67..........  $0
----------------------------------------------------------------------------------------------------------------
                                           Additional Burden for BDCS
----------------------------------------------------------------------------------------------------------------
Financial highlights                 0.5 hours   x   $365 (compliance   $182.50..............  $0
 requirement.                                         attorney) \2\.
                                     0.5 hours   x   $331 (senior       $165.50..............
                                                      programmer) \2\.
                                     0.5 hours   x   $248 (webmaster)   $124.................
                                                      \2\.
Total additional burden per          1.5 hours                          $472.................  $0
 BDC.
                               ---------------------------------------------------------------------------------
Number of BDCs................           x 105                          x 105................  x 105
                               ---------------------------------------------------------------------------------
    Total annual burden.......       158 hours                          49,560...............  $0
----------------------------------------------------------------------------------------------------------------
                                                  Total Burden
----------------------------------------------------------------------------------------------------------------
Total initial registration        72,464 hours                          $19,492,760..........  $4,513,740
 statement burden.
Total post-effective amendment    19,750 hours  ...  .................  5,312,750............  1,756,012
 burden.
Total additional burden for        1,978 hours  ...  .................  516,815.67...........  0
 affected funds.

[[Page 33336]]

 
Total additional burden for          158 hours  ...  .................  49,560...............  0
 BDCs.
    Total annual burden.......    94,350 hours                          $25,371,885.70.......  $6,269,752
----------------------------------------------------------------------------------------------------------------
Notes:
\1.\ See supra Table 6, at footnote 2. In a change from the Proposing Release, we have revised the wage rate
  categories for existing Form N-2 burdens, consistent with the currently-approved Form N-2 PRA burden
  estimates.
\2.\ Estimate revised to reflect updated industry data.
\3.\ We considered whether deeming interval funds to have registered an indefinite number of shares under the
  amendments to rules 23c-3 and 24f-2 will result in fewer registration statement filings since these funds will
  no longer need to file registration statements to register additional shares. Based on staff analysis of
  interval fund filings between January 1, 2017 and December 31, 2019, interval funds very rarely filed
  registrations statements on Form N-2 solely to register additional shares (i.e., the filing typically also
  updated the fund's financial statements or included other changes). On average, interval funds filed seven
  Form N-2 registration statements each year during this period that, among other things, registered additional
  shares. As a result, for purposes of this PRA estimate, we are not reducing the estimated number of Form N-2
  filings to account for the change in how interval funds register additional shares.
\4.\ Estimate revised to reflect the average number of post-effective amendments filed between January 1, 2017
  and December 31, 2019 (286 post-effective amendments), minus an estimated reduction of 128 post-effective
  amendments resulting from the ability of affected funds that are eligible to file short-form registration
  statements to forward incorporate by reference information into their registration statements. The estimated
  reduction in the number of post-effective amendment filings has been increased from 112 to 128 filings to
  account for an increase in the percentage of affected funds that will be eligible to file short-form
  registration statements (based on updated industry data) and to account for post-effective amendments under
  rule 486(b) filed by funds that have received relevant staff no-action letters (an average of approximately 29
  filings per year over the three-year period). See supra Section II.D (discussing relevant staff no-action
  letters); Proposing Release, supra footnote 10, at n.447 (discussing the initial estimated reduction in the
  number of post-effective amendments of 112).

    Table 6 above summarizes the current PRA estimates associated with 
the requirements of Form N-2. Table 7 summarized the proposed PRA 
estimates included in the Proposing Release.\469\ Table 8 summarizes 
the final PRA estimates associated with Form N-2 as amended. We did not 
receive public comment on our proposed PRA estimates, but we are 
revising our estimates as a result of updated industry data. 
Specifically, we are revising the estimated wage rates, the estimated 
number of affected funds, and the estimated number of annual initial 
registration statement and post-effective amendment filings to reflect 
updated industry data.
---------------------------------------------------------------------------

    \469\ See Proposing Release, supra footnote 10, at section 
IV.B.1.
---------------------------------------------------------------------------

    As summarized in Table 8 above, we estimate that the total hour 
burdens and time costs associated with Form N-2 will be an aggregate 
annual burden of 94,350 hours at an aggregate annual cost of internal 
burden of $25,371,886. We estimate an aggregate annual external time 
cost of $6,269,752.
2. Structured Data Reporting Requirements
    We are amending Form N-2, as well as Regulation S-K and Regulation 
S-T,\470\ to require certain new structured data reporting requirements 
for registered CEFs and BDCs.\471\ Specifically, the amendments will 
require:
---------------------------------------------------------------------------

    \470\ See 17 CFR part 229 [OMB Control No. 3235-0071] 
(Regulation S-K specifies the requirements for exhibits to 
registration statements and reports); 17 CFR part 232 [OMB Control 
No. 3235-0424] (Regulation S-T specifies the requirements that 
govern the electronic submission of documents). Specifically, we are 
amending rule 601 of Regulation S-K, and rules 11 and 405 of 
Regulation S-T. The additional collection of information burden that 
will result from the amendments to rule 601 of Regulation S-K, rules 
11 and 405 of Regulation S-T, and Forms N-2 and N-CSR to require 
structured data reporting for affected funds are included in our 
burden estimates for the ``Investment Company Interactive Data'' 
collection of information, and do not impose any separate burden 
aside from that described in our discussion of the burden estimates 
for this collection of information.
    \471\ We also are amending Form 24F-2 to require submission of 
this filing in a structured XML format. We discuss the PRA burdens 
of this and other amendments to the form below. See infra section 
IV.B.6.
---------------------------------------------------------------------------

     BDCs to submit financial statement information using 
Inline XBRL format, as is currently required of operating 
companies.\472\ The respondents for this collection of information are 
an estimated 105 BDCs.
---------------------------------------------------------------------------

    \472\ See supra section II.I.1.a; see also amended rule 
601(b)(101) of Regulation S-K; amended rule 405(b)(3)(i) of 
Regulation of S-T.
---------------------------------------------------------------------------

     Affected funds to include structured cover page 
information in their registration statements on Form N-2 using Inline 
XBRL, including the tagging of the new check boxes to the cover page of 
Form N-2.\473\ The respondents for this collection of information are 
an estimated 791 affected funds. As demonstrated in Table 9 below, we 
do not believe the cover page tagging requirement will result in 
significant additional burdens for affected funds.
---------------------------------------------------------------------------

    \473\ See supra section II.I.1.b; see also General Instruction 
I.1 of amended Form N-2; amended rule 405(b)(3)(ii) of Regulation S-
T.
---------------------------------------------------------------------------

     Affected funds to tag certain Form N-2 disclosure items 
using Inline XBRL.\474\ The respondents for this collection of 
information are an estimated 791 affected funds.
---------------------------------------------------------------------------

    \474\ See supra section II.I.1.c; see also General Instruction 
I.2-3 of amended Form N-2; amended rule 405(b)(3)(iii) of Regulation 
S-T. The amendments will require the following prospectus disclosure 
items be tagged using Inline XBRL: Fee Table; Senior Securities 
Table; Investment Objectives and Policies; Risk Factors; Share Price 
Data; and Capital Stock, Long-Term Debt, and Other Securities.
    A seasoned fund filing a short-form registration statement on 
Form N-2 also will be required to tag any information that is 
incorporated by reference from an Exchange Act report, such as those 
on Form N-CSR, 10-K, 10-Q, or 8-K, in response to a disclosure item 
of the registration statement that is required to be tagged. See 
supra footnote 241 and accompanying text.
---------------------------------------------------------------------------

    The purposes of these information collections are to make financial 
information easier for investors to analyze and to help automate 
regulatory filings and business information processing, and to reduce 
the current disparity between operating companies and BDCs with respect 
to the accessibility of information they provide to the market. These 
collections of information are mandatory for the relevant respondents, 
discussed for each collection below. Confidential information will not 
be disclosed pursuant to these new reporting requirements.

[[Page 33337]]



                       Table 9--Proposed and Final Structured Data Reporting PRA Analysis
----------------------------------------------------------------------------------------------------------------
                                                                             Initial cost
                                 Initial hours       Annual hours \1\           burden       Annual cost burden
----------------------------------------------------------------------------------------------------------------
                                             PROPOSED ESTIMATES \2\
----------------------------------------------------------------------------------------------------------------
BDC Financial Statement                     81  65.81 hours...............       $9,262.50  $7,525.78
 Information--Per BDC Response
 (I).
Number of BDC Responses Per     ..............  x 463.5 \2\...............  ..............  x 463.5 \2\
 Year.
    Total Annual Burden.......  ..............  30,503 hours..............  ..............  $3,488,199.03
Affected Funds Cover Page                    0  1 hour....................              $0  $0
 Information on Form N 2--Per
 Affected Fund Response (II).
Number of Affected Fund         ..............  x 807.....................  ..............  x 807
 Responses Per Year.
    Total Annual Burden.......  ..............  807 hours.................  ..............  $0
Affected Funds Form N-2                  15.25  12.8 hours................       $1,350.00  $1,096.88
 Disclosure Items--Per
 Affected Fund Response (III).
Number of Affected Fund         ..............  x 1097.5..................  ..............  x 1097.5
 Responses Per Year.
    Total Annual Burden.......  ..............  14,048.26 hours...........  ..............  $1,203,825.80
    Combined Total Annual       ..............  45,358.26 hours...........  ..............  $4,692,024.83
     Burden.
----------------------------------------------------------------------------------------------------------------
                                                 FINAL ESTIMATES
----------------------------------------------------------------------------------------------------------------
BDC Financial Statement               81 hours  65.81.....................       $9,262.50  $7,525.78
 Information--Per BDC Response
 (I).
Number of BDC Responses Per     ..............  x 472.5...................  ..............  x 472.5
 Year.
    Total Annual Burden.......  ..............  31,095 hours..............  ..............  $3,555,931
Affected Funds Cover Page       ..............  1 hour....................  ..............  $0
 Information on Form N-2--Per
 Affected Fund Response (II).
Number of Affected Fund         ..............  x 791.....................  ..............  x 791
 Responses Per Year.
    Total Annual Burden.......  ..............  791 hours.................  ..............  $0
Affected Funds Form N-2                  15.25  12.8 hours................       $1,350.00  $1,097
 Disclosure Items (III).
Number of Affected Fund         ..............  x 1,076...................  ..............  x 1,076
 Responses Per Year.
    Total Annual Burden.......  ..............  13,773 hours..............  ..............  $1,180,372
    Combined Total Annual       ..............  45,659 hours..............  ..............  $4,736,303
     Burden.
----------------------------------------------------------------------------------------------------------------
Notes:
\1.\ Includes initial and ongoing burden estimates annualized over a three-year period. Here, as discussed in
  the Proposing Release, supra footnote 10, at section V.B.2, we assumed that the one-time cost would result in
  a 50% incremental increase in the internal burdens and external costs of the BDC financial information and
  Form N-2 disclosure requirements (items I and III in the chart above) during the first year, and would
  subsequently decline in the second and third years by 75% from the immediately-preceding year.
\2.\ The proposed estimates are discussed in additional detail in the Proposing Release, supra footnote 10, at
  section V.B.2.

    Table 9 summarizes the proposed PRA estimates included in the 
Proposing Release and the final PRA estimates for the structured data 
reporting requirements. We did not receive public comment on our 
proposed PRA estimates, but we are revising our estimates as a result 
of updated industry data. Specifically, we are revising the estimated 
number of BDCs and affected funds to reflect updated industry data.
    As summarized in Table 9, we estimate that the total hour burdens 
and time costs associated with the structured data reporting 
requirements will be an aggregate annual burden of 45,659 hours. We 
estimate an aggregate annual external time cost of $4,736,303.
3. New Annual Reporting Requirements Under Rule 30e-1 and Exchange Act 
Periodic Reporting Requirements for BDCs
    Several of the amendments, such as the amendments that would allow 
certain affected funds to use an automatic shelf registration statement 
or to forward incorporate by reference Exchange Act reports, may raise 
the importance of an affected fund's Exchange Act reports to 
investors.\475\ In light of this, we are adopting new disclosure 
requirements for affected funds' annual reports. Specifically, we are 
amending:
---------------------------------------------------------------------------

    \475\ See supra section II.I.2.
---------------------------------------------------------------------------

     Form N-2 to require affected funds using the short-form 
registration statement to disclose in their annual reports a fee and 
expense table, share price data, a senior securities table, and 
unresolved staff comments regarding the fund's periodic or current 
reports or registration statement; \476\
---------------------------------------------------------------------------

    \476\ See supra section II.I.2.a; see also new Instructions 
4.h.(1) (senior securities table), 4.h.(2) (fee and expense table), 
4.h.(3) (share price data), and 4.h.(4) (unresolved staff comments) 
to Item 24 of amended Form N-2.
---------------------------------------------------------------------------

     Form N-2 to require registered CEFs to provide MDFP in 
their annual reports; \477\
---------------------------------------------------------------------------

    \477\ See supra section II.I.2.b; see also new Instruction 4.g 
to Item 24 of amended Form N-2.
---------------------------------------------------------------------------

     Form N-2 to require BDCs to include financial highlights 
in their annual reports on Form 10-K; \478\ and
---------------------------------------------------------------------------

    \478\ See supra section II.I.2.c; see also Instruction 1 to Item 
4 of amended Form N-2; new Instruction 10 to Item 24 of amended Form 
N-2. As discussed above, BDCs also will be required to include 
financial highlights in their registration statements on Form N-2. 
See supra section IV.B.1.
---------------------------------------------------------------------------

     Rule 8b-16 to require a registered CEF that relies on 
paragraph (b) of that rule to describe in its annual reports its 
current investment objectives and policies, and principal risks, and 
certain key changes that occurred during the relevant year in enough 
detail to allow investors to understand each change and how it may 
affect the fund.\479\
---------------------------------------------------------------------------

    \479\ See supra section II.I.5; see also amended rule 8b-16.
---------------------------------------------------------------------------

    The collection of information burdens under these amendments 
correspond to information collections under rule 30e-1 for registered 
CEFs and Form 10-K for BDCs. Rule 30e-1 generally requires registered 
investment companies to transmit to their shareholders, at least semi-
annually, reports containing the information that is required to be 
included in such reports by the fund's registration statement form 
under the Investment Company Act. BDCs, like operating companies, are 
required to file annual reports on Form 10-K pursuant to section 13 or 
15(d) of the Exchange Act.
    The burden estimates were calculated by multiplying the estimated 
number of responses by the estimated average amount of time it would 
take an affected

[[Page 33338]]

fund to prepare and review disclosure required under the amendments. 
For purposes of the PRA, the burden is allocated between internal 
burden hours and outside professional costs. For these purposes, we 
estimate that 75% of the burden of preparing annual reports under rule 
30e-1 and on Form 10-K is undertaken by the fund internally, while 25% 
of this burden is undertaken by outside professionals, such as outside 
counsel and independent auditors, retained by the fund at an average 
cost of $400 per hour.\480\
---------------------------------------------------------------------------

    \480\ We recognize that the costs of retaining outside 
professionals may vary depending on the nature of the professional 
services but, for purposes of this PRA analysis for rule 30e-1 and 
Form 10-K, we estimate that such costs would be an average of $400 
per hour. This estimate is based on consultations with several 
registrants, law firms, and persons who regularly assist registrants 
in preparing and filing reports with the Commission.

                                                    Table 10--Rule 30e-1 Incremental Burden Estimates
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                            Increase in     Increase in
                                                             Number of      Burden hour     Increase in     Increase in    professional    professional
                                                             estimated     increase per    burden hours    company hours     hours for       costs for
                                                             affected         current       for current    for  current       current         current
                                                             responses       affected        affected        affected        affected        affected
                                                                             response        responses       responses       responses       responses
                                                                     (A)             (B)     (C) = (A) x     (D) = (C) x     (E) = (C) x     (F) = (E) x
                                                                                                     (B)            0.75            0.25            $400
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                 PROPOSED ESTIMATES \1\
--------------------------------------------------------------------------------------------------------------------------------------------------------
MDFP requirement........................................             704              16          11,264           8,448           2,816      $1,126,400
Requirements to disclose fee and expense table, share                457               3           1,371           1,028             343         137,200
 price data, a senior securities table, and unresolved
 staff comments.........................................
Amendments to rule 8b-16(b).............................             704               4           2,816           2,112             704         281,600
--------------------------------------------------------------------------------------------------------------------------------------------------------
    Total estimated burdens.............................                           11,588 hours                           ..............  \2\ $1,545,200
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                     FINAL ESTIMATES
--------------------------------------------------------------------------------------------------------------------------------------------------------
MDFP requirement........................................         \3\ 686              16          10,976           8,232           2,744       1,097,600
Requirements to disclose fee and expense table, share            \3\ 455               3           1,365           1,024             341         136,400
 price data, a senior securities table, and unresolved
 staff comments.........................................
Amendments to rule 8b-16(b).............................     \3\ \4\ 521           \5\ 5           2,605           1,954             651         260,400
--------------------------------------------------------------------------------------------------------------------------------------------------------
    Total estimated burdens.............................                                   11,210 hours                                        1,494,400
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:
\1.\ See Proposing Release, supra footnote 10, at section V.B.3.
\2.\ The Proposing Release reflected an estimate of $1,545,100. Since we are rounding internal burden and external cost estimates to the nearest whole
  number in this section, this table reflects an estimated annual cost burden of $1,545,200.
\3.\ Revised to reflect updated industry data.
\4.\ Revised to recognize that not all registered CEFs rely on rule 8b-16(b).
\5.\ Revised to reflect a change from the proposed requirements.

    Table 10 summarizes the proposed incremental PRA burden estimates 
and the final incremental PRA burden estimates associated with the new 
annual report requirements for registered CEFs. We did not receive 
comments on our proposed estimates, but we have revised them as a 
result of updated industry data and changes to the proposed amendments. 
Specifically, we are revising the estimated number of registered CEFs 
that will be subject to the new annual report requirements to reflect 
updated industry data and the estimated burden hours associated with 
the amendments to rule 8b-16(b). As summarized in Table 10 above, the 
revised additional burdens associated with the new annual report 
requirements for registered CEFs for purposes of the rule 30e-1 
collection of information is 11,210 hours for internal time and 
external costs of $1,494,400.

[[Page 33339]]



                                                    Table 11--Form 10-K Incremental Burden Estimates
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                            Increase in     Increase in
                                                             Number of      Burden hour     Increase in     Increase in    professional    professional
                                                             estimated     increase per    burden hours    company hours     hours for       costs for
                                                             affected         current       for current    for  current       current         current
                                                             responses       affected        affected        affected        affected        affected
                                                                             response        responses       responses       responses       responses
                                                                     (A)             (B)     (C) = (A) x     (D) = (C) x     (E) = (C) x     (F) = (E) x
                                                                                                     (B)            0.75            0.25            $400
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                 PROPOSED ESTIMATES \1\
--------------------------------------------------------------------------------------------------------------------------------------------------------
Requirements to disclose fee and expense table, share                 43               3             129              97              32         $12,800
 price data, a senior securities table, and unresolved
 staff comments.........................................
Financial highlights requirement........................             103             1.5             155             116              39          15,600
                                                         -----------------------------------------------------------------------------------------------
    Total estimated burdens.............................                                     213 hours                                            28,400
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                     FINAL ESTIMATES
--------------------------------------------------------------------------------------------------------------------------------------------------------
Requirements to disclose fee and expense table, share             \2\ 44               3             132              99              33          13,200
 price data, a senior securities table, and unresolved
 staff comments.........................................
Financial highlights requirement........................         \2\ 105             1.5             158             119              40          16,000
                                                         -----------------------------------------------------------------------------------------------
    Total estimated burdens.............................                                     218 hours                                            29,200
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:
\1.\ See Proposing Release, supra footnote 10, at section V.B.3.
\2.\ Revised to reflect updated industry data.

    Table 11 summarizes the proposed incremental PRA burden estimates 
and the final incremental PRA burden estimates associated with the new 
annual report requirements for BDCs. We did not receive comments on our 
proposed estimates, but we have revised them as a result of updated 
industry data. Specifically, we are revising the estimated number of 
BDCs that will be subject to the new annual report requirements to 
reflect updated industry data. As summarized in Table 11 above, the 
revised additional burdens associated with the new annual report 
requirements for BDCs for purposes of the Form 10-K collection of 
information is 218 hours for internal time and external costs of 
$29,200.

                                                      Table 12--Requested Paperwork Burden Under the Amendments to Annual Report Disclosure
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                    Increase in
             Rule or form              Current annual      Current       Current cost      Number of  affected      Increase in    professional       Annual       Burden hours     Cost burden
                                          responses     burden hours        burden              responses          company hours       costs         responses
                                                  (A)             (B)               (C)  (D)....................             (E)             (F)       (G) = (A)     (H) = (B) +     (I) = (C) +
                                                                                                                                                                             (E)             (F)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                      Current Burden \1\
                                                        Program Change
                                                  Requested Change in Burden
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
30e-1................................          23,784       1,028,658      $147,750,391  Varies (see Table 10)            11,210      $1,494,400          23,784       1,039,868    $149,244,791
                                                                                          \2\.
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
10-K.................................           8,137      14,198,780    $1,895,224,719  Varies (see Table 11)               218         $29,200           8,137      14,198,998   1,895,253,919
                                                                                          \2\.
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:
\1.\ The rule 30e-1 estimates are based on the last time the rule's information collections were approved, pursuant to a submission for a PRA extension in 2019. The Form 10-K estimates are
  based on the last time the form's information collections were approved, pursuant to a submission for a PRA extension in 2019.
\2.\ As reflected in Table 10 and Table 11, the number of registered CEFs and the number of BDCs that will need to comply with the new annual report disclosure requirements will vary depending
  on the type of new disclosure, although all registered CEFs (686) and all BDCs (105) will be required to provide some additional annual report disclosure.

    As summarized above in Table 12, the revised aggregate estimates, 
including the new amendments, for rule 30e-1 are 1,039,868 hours and 
$149,244,791 in external costs. The revised aggregate estimates for 
Form 10-K, including the new amendments, are 14,198,998 hours and 
$1,895,253,919 in external costs.
4. Securities Offering Communications
    Rule 163 permits WKSIs to make unrestricted oral and written offers 
before filing a registration statement, but any written offer will be 
considered a free writing prospectus and will generally have to be 
filed upon filing a registration statement or amendment covering the 
securities. Rule 433 governs the use of free writing prospectuses by 
WKSIs and non-WKSI issuers after the filing of a registration 
statement. A free writing prospectus used by or on behalf of an 
affected fund, or free writing prospectuses that are broadly 
disseminated by another offering participant, are required to be filed 
with the Commission. We have adopted amendments to rules 163 and 433 
that will permit affected funds to

[[Page 33340]]

rely on these rules to use a free writing prospectus.
    We did not receive public comment on our proposed estimates, but we 
have revised them as a result of updated industry data. Specifically, 
we are revising the estimated number of firms that will be subject to 
the rule to reflect updated industry data.
    The burden estimates were calculated by multiplying the estimated 
number of responses by the estimated average amount of time it would 
take a registrant to prepare and review disclosure required under the 
proposed amendments. For purposes of the PRA, the burden is to be 
allocated between internal burden hours and outside professional costs. 
Table 13 below sets forth the percentage estimates we typically use for 
the burden allocation for each rule.\481\ We also estimate that the 
average cost of retaining outside professional to be $400 per 
hour.\482\
---------------------------------------------------------------------------

    \481\ We estimate that 25% of the burden of preparing and filing 
a free writing prospectus pursuant to rule 163 or rule 433 is 
undertaken by the issuer internally and that 75% of the burden is 
undertaken by outside professionals retained by the issuer.
    \482\ We recognize the costs of retaining outside professionals 
may vary depending on the nature of the professional services, but 
for purposes of this PRA analysis, we estimate that such costs would 
be an average of $400 per hour. This estimate is based on 
consultations with several registrants, law firms, and other persons 
who regularly assist registrants in preparing and filing reports 
with the Commission.

 Table 13--Standard Estimated Burden Allocation for Securities Act Rules
                               163 and 433
------------------------------------------------------------------------
                                                              Outside
                                             Internal      professionals
------------------------------------------------------------------------
                       ESTIMATED BURDEN ALLOCATION
------------------------------------------------------------------------
Rule 163................................             25%             75%
Rule 433................................             25%             75%
------------------------------------------------------------------------

    The table below illustrates the incremental change to the total 
annual compliance burden of affected rules, in hours and costs, as a 
result of the proposed amendments.

                 Table 14--Calculation of the Incremental Change in Burden Estimates of Current Responses Resulting from the Amendments
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                              Burden hour      Increase in                                                 Increase in
                                               Number of     increase per     burden hours    Increase in company      Increase in        professional
                                               estimated        current        for current      hours for current   professional hours      costs for
                                               affected        affected         affected       affected responses      for current       current affect
                                               responses       response         responses                           affected responses      responses
                                                   (A) 1 2         (B) \3\   (C) = (A) x (B)     (D) = (C) x 0.25     (E) = (C) x 0.75       (F) = (E) x
                                                                                                          or 0.75              or 0.25              $400
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                         Incremental Change in Burden Estimates
--------------------------------------------------------------------------------------------------------------------------------------------------------
163.......................................               2            0.25              0.50                0.125                0.375              $150
433.......................................           4,271            1.28             5,467                1,367                4,100        $1,640,000
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:
\1.\ For a number of reasons, many issuers that are currently eligible to be WKSIs do not make use of free writing prospectuses in reliance on rule 163.
  At the time the Commission adopted rule 163, it estimated that 53 free writing prospectuses would be filed under rule 163 per year. However, during
  the Commission's 2017 fiscal year, only 10 free writing prospectuses in reliance on rule 163 were filed with the Commission. We estimate that 100
  affected funds would be eligible to be WKSIs. See supra section III.A.1. If current practices regarding the use of free writing prospectuses under
  rule 163 continue with respect to affected funds, we do not believe that these affected funds would significantly increase the number of free writing
  prospectuses under rule 163. Accordingly, we estimate that, on average, affected funds that are eligible to be WKSIs would file 2 free writing
  prospectuses under the amendments to rule 163 each year.
\2.\ The most recent data that we have available shows that each operating company files an average of approximately 5.4 free writing prospectuses per
  year in reliance on rule 433. We estimate that there will be 791 affected funds filing approximately 4,271 free writing prospectuses. See supra
  section III.A.1.
\3.\ The burden hour estimates for rules 163 and 433 are based on the last time the rules' information collections were approved, pursuant to a
  submission for a PRA extension in 2017. The conditions under rule 433 to use a free writing prospectus, require a free writing prospectus to contain
  more information and contribute to the greater burden hour than for a rule 163 free writing prospectus.

    The following table summarizes the requested paperwork burden, 
including the estimated total reporting burdens and costs, under the 
proposed amendments.

[[Page 33341]]



                                                  Table 15--Requested Paperwork Burden Under the Amendments to Securities Act Rules 163 and 433
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                      Current      Current                  Number of   Increase in   Increase in
                                                                       annual       burden      Current      affected     company    professional     Annual      Burden hours     Cost burden
                                                                     responses      hours     cost burden   responses      hours         costs      responses
                                                                            (A)          (B)          (C)          (D)          (E)           (F)    (G) = (A)  (H) = (B) + (E)  (I) = (C) + (F)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                Current Burden
                                                                                Program Change
                                                                          Requested Change in Burden
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
163...............................................................           10            1         $720            2        0.125          $150           12            1.125             $870
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
433...............................................................       15,700        5,024   $6,028,800        4,271        1,367    $1,640,000       19,971            6,391       $7,668,800
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

    As summarized above in Table 15, the revised aggregate estimates, 
including the new amendments, for rule 163 are 1.125 hours, and $870 in 
external costs. The revised aggregate estimates for rule 433, including 
the new amendments, are 6,391 hours and $7,669,017 in external costs.
5. Prospectus Delivery Requirements
    Rule 173 requires the delivery of a copy of a final prospectus, or 
in lieu of a final prospectus, a notice to purchasers stating that a 
sale of securities was made based on a registration statement or in a 
transaction in which a final prospectus would have been required to 
have been delivered in the absence of rule 172.\483\ We have adopted 
amendments to rule 173 to remove the exclusion for offerings of 
affected funds.\484\
---------------------------------------------------------------------------

    \483\ See supra footnote 153.
    \484\ See supra section II.D.
---------------------------------------------------------------------------

    We did not receive public comment on our proposed PRA estimates for 
rule 173. We have revised our estimates regarding the number of funds 
likely to rely on rule 173, and to reflect updated industry data.\485\ 
Specifically, based on a review of Form N-2 filings made with the 
Commission, we are revising downward the proposed estimate of the 
number of affected funds expected to rely on rule 173 as a result of 
the amendments, and thus incur burdens associated with the rule.
---------------------------------------------------------------------------

    \485\ This estimate is based on the last time rule 173's 
information collections were approved, in 2017.
---------------------------------------------------------------------------

    The burden estimates were calculated by multiplying the estimated 
number of registrants likely to rely on rule 173 by the number of 
responses per registrant by the estimated time it would take compile 
the necessary information and data, prepare and review disclosure, file 
documents and retain records for issuers that choose to rely on rule 
173. We assume, similar to operating companies that rely on rule 173, 
that each affected fund will incur 100% of the burden. The table below 
illustrates the incremental change to the total annual burden for 
affected funds as a result of the amendments.

            Table 16--Rule 173 (Calculation of the Incremental Change in Burden Estimates of Current Responses Resulting from the Amendments)
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                         Increase in       Increase in
                                                                    Number of      Burden hour per  Burden hours for    professional      professional
                                                                    estimated     current affected  current affected      hours for         costs for
                                                                    affected          response          responses     current affected   current affect
                                                                    responses                                             responses         responses
                                                                         (A) \1\           (B) \2\   (C) = (A) x (B)
--------------------------------------------------------------------------------------------------------------------------------------------------------
173...........................................................        16,634,572            0.0167           277,797                 0                $0
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:
\1.\ In the Proposing Release we estimated that all 807 affected funds would rely on rule 173. See supra footnote 10 at section V.B.5. However, because
  only a fund with an effective Securities Act registration statement may rely on rule 173, we are revising our estimates. Based on our staff's review
  of Form N-2 Securities Act registration statements filed annually between 2017 and 2019, we estimate 382 annual filings, each by a different affected
  fund. We estimate that each such fund will provide 43,546 responses annually, for a total of 16,634,572 annual responses per year (382 funds x 43,546
  responses annually = 16,634,572).
\2.\ The estimated burden hour per response of 0.0167 hours derives from the most recently-approved rule 173 PRA submission (2017).

    The following table summarizes the total PRA burden, including the 
estimated total reporting burdens and costs, for rule 173 as a result 
of the amendments. As reflected below, the revised aggregate hourly 
burden associated with rule 173 as a result of the amendments is 
4,159,688 internal burden hours, with no external costs.

                                          Table 17--Rule 173 (Requested Paperwork Burden Under the Amendments)
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                     Current      Current                   Number of   Increase in   Increase in
                                      annual       burden      Current      affected      company    professional     Annual       Burden    Cost burden
                                    responses      hours     cost burden    responses      hours         costs      responses      hours
                                           (A)          (B)          (C)           (D)          (E)           (F)    (A) + (D)    (B) + (E)    (C) + (F)
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                               Current Burden
                                               Program Change
                                         Requested Change in Burden
--------------------------------------------------------------------------------------------------------------------------------------------------------
173..............................  232,448,548    3,881,891           $0  + 16,634,572    + 277,797            $0  249,083,120    4,159,688           $0
--------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 33342]]

6. Form 24F-2
    Rule 24f-2 requires any open-end management company, unit 
investment trust, or face-amount certificate company deemed to have 
registered an indefinite amount of securities to file a Form 24F-2 not 
later than 90 days after the end of any fiscal year in which it has 
publicly offered such securities. Form 24F-2 is the annual notice of 
securities sold by these funds that accompanies the payment of 
registration fees with respect to the securities sold during the fiscal 
year, net of securities redeemed or repurchased during the year. We are 
amending rules 23c-3 and 24f-2 so that interval funds will pay 
registration fees on the same annual basis using Form 24F-2. We are 
also adopting a requirement that funds submit reports on Form 24F-2 in 
an XML structured data format.

                                       Table 18--Form 24F-2 PRA Estimates
----------------------------------------------------------------------------------------------------------------
                                                                                          Cost of       Annual
                                         Internal burden           Wage rate \1\          internal     external
                                                                                           burden    cost burden
----------------------------------------------------------------------------------------------------------------
                                        Currently Approved Estimates \2\
----------------------------------------------------------------------------------------------------------------
Clerical work to file Form 24F[dash]2..         2 hours   x  $66 (compliance clerk)...         $132           $0
Number of annual responses.............         x 7,284      .........................      x 7,284      x 7,284
                                        ------------------------------------------------------------------------
    Total annual burden................    14,568 hours      .........................    *$961,488           $0
----------------------------------------------------------------------------------------------------------------
                                             Proposed Estimates \3\
----------------------------------------------------------------------------------------------------------------
Clerical work to file Form 24F-2.......         2 hours   x  $67 (compliance clerk)...         $134           $0
Submission in a structured data format.         2 hours   x  $261 (programmer)........         $522           $0
Total annual burden per response.......         4 hours      .........................         $656           $0
Number of annual responses.............         x 6,177      .........................      x 6,177      x 6,177
                                        ------------------------------------------------------------------------
    Total annual burden................    24,708 hours      .........................   $4,052,112           $0
----------------------------------------------------------------------------------------------------------------
                                                 Final Estimates
----------------------------------------------------------------------------------------------------------------
Clerical work to file Form 24F-2.......         2 hours   x  $70 (compliance clerk)            $140           $0
                                                              \4\.
Submission in a structured data format.         2 hours   x  $271 (programmer) \4\....         $542           $0
Total annual burden per response.......         4 hours      .........................         $682           $0
Number of annual responses.............      x 6,794\4\      .........................  \4\ x 6,794  \4\ x 6,794
                                        ------------------------------------------------------------------------
    Total annual burden................    27,176 hours      .........................   $4,633,508           $0
----------------------------------------------------------------------------------------------------------------
Notes:
\1.\ See supra Table 6, at footnote 2.
\2.\ This estimate was previously submitted to OMB in connection with the renewal of approval for the collection
  of information required by Form 24F[dash]2 in 2018.
\3.\ Proposing Release, supra footnote 10, at section IV.B.7.
\4.\ Estimate revised to reflect updated data. Based on a review of Form 24F-2 filings for the period 2017-2019,
  the staff estimates that 6,741 filings will be made annually, and that 53 interval funds (representing the 3-
  year average of interval funds registered with the Commission) will file Form 24F-2 as a result of the final
  amendments (6,741 + 53 = 6,794).

    Table 18 above summarizes the current PRA estimates, the proposed 
PRA estimates, and the final PRA estimates associated with the 
requirement to file reports on Form 24F-2.\486\ We did not receive 
public comment on our proposed estimates, but we have revised them as a 
result of updated industry data. Specifically, we are revising the 
estimated wage rates and estimated number of funds that will be subject 
to the requirements of Form 24F-2 to reflect updated industry data. As 
summarized in Table 18 above, the revised aggregate estimates for Form 
24F-2, including the new amendments, are 27,176 hours, with no external 
costs.
---------------------------------------------------------------------------

    \486\ See Proposing Release, supra footnote 10, at section 
IV.B.7.
---------------------------------------------------------------------------

7. Amendments Permitting the Registration of Offerings of an 
Indeterminate Number of Exchange-Traded Vehicle Securities and the 
Payment of Registration Fees for Such Offerings on an Annual Net Basis
    The amendments to certain Securities Act rules and to Forms S-1, S-
3, F-1 and F-3 will allow issuers of exchange-traded vehicle securities 
to elect to register offerings of an indeterminate number of such 
securities and pay registration fees for these offerings on an annual 
net basis. We estimate that the amendments will increase the paperwork 
burden for registration statements on Form S-1 and Form S-3 for such 
offerings due to the requirement to calculate and pay registration fees 
on an annual net basis within 90 days after the end of the fiscal 
year.\487\ However, because these issuers will have the ability to 
elect to register offerings of an indeterminate number of such 
securities, we also estimate that the amendments will result in a 
decrease in the number of registration statements on these forms filed 
by these issuers and that, overall, the amendments will reduce the 
paperwork burdens associated with Form S-1 and Form S-3. The amendments 
to Forms F-1 and F-3 are not expected to affect the burdens associated 
with those forms, in that we do not anticipate that any issuers at this 
time will use Form F-1 or Form F-3 to register offerings of an 
indeterminate number of exchange-

[[Page 33343]]

traded vehicle securities and pay registration fees for these offerings 
on an annual net basis.
---------------------------------------------------------------------------

    \487\ The paperwork burdens for 17 CFR 230.400 through 230.498A 
(Regulation C) are imposed through the forms, schedules and reports 
that are subject to the requirements in these regulations and are 
reflected in the analysis of those documents. To avoid a PRA 
inventory reflecting duplicative burdens and for administrative 
convenience, we assign a one-hour burden to Regulation C.
---------------------------------------------------------------------------

    Based on a review of registration statements filed by ETPs for the 
period 2017-2019, the staff estimates that, after the effectiveness of 
these amendments, an average of five registration statements on each of 
Form S-1 and Form S-3 will be filed each year for offerings of an 
indeterminate number of exchange-traded vehicle securities with the 
payment of registration fees on an annual net basis.\488\ We estimate 
that the incremental increase in burden for these registration 
statements will be two hours, consistent with the estimated burden for 
Form 24F-2. We would expect there to be only a minimal initial burden 
of establishing a system for calculating fee payments in this manner, 
in that these issuers already track the issuances and redemptions of 
their securities on an ongoing basis. When paying registration fees, 
these issuers will file prospectus supplements under rule 424 and 
provide disclosures modeled after Form 24F-2. We estimate that, in 
filing these prospectus supplements in connection with registration 
statements on Form S-1 or Form S-3, 25% of the burden of preparation is 
carried by the issuer internally and that 75% of the burden of 
preparation is carried by outside professionals retained by the issuer 
at an average cost of $400 per hour.
---------------------------------------------------------------------------

    \488\ While we believe that the number of such registration 
statements to register an indeterminate number of exchange-traded 
vehicle securities will be higher immediately following the 
effectiveness of these amendments, we estimate that the number of 
registration statements for such offerings after this initial period 
will average a total of approximately 10 registration statements 
each year.

                                                     Table 19--Incremental Paperwork Burden Under the Amendments for Registration Statements
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                              Current burden                                Estimated increase in burden for affected responses
                                                                 -------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                                                       Change in
                                                                                                           Estimated   Burden hour     Change in       Change in     professional     Change in
                                                                     Annual       Burden        Costs      number of    change per   burden hours    company hours     hours for    professional
                                                                    reponses      hours                     affected     affected    for affected    for affected      affected         costs
                                                                                                           responses     response      responses       responses       responses
                                                                  ...........  ...........  ............          (A)          (B)     (C) = (A) x     (D) = (C) x     (E) = (C) x
                                                                                                                                               (B)            0.25            0.75
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
S-1.............................................................          901      147,208  $180,319,975            5            2              10             2.5             7.5        $3,000
S-3.............................................................        1,657      193,626   236,198,036            5            2              10             2.5             7.5         3,000
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

    In addition, we estimate that seven fewer Forms S-1 and ten fewer 
Forms S-3 will be filed by these issuers each year as a result of the 
ability to register offerings of an indeterminate number of exchange-
traded vehicle securities, which could result in lower costs for these 
issuers through a reduction in the number of registration statements 
filed by these issuers.

                          Table 20--Estimated Decrease in Burden as a Result of the Decrease in the Number of Annual Responses
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                     Current burden                     Estimated decrease in burden as a result of the
                                                   ---------------------------------------------------     decrease in the number of annual responses
                                                                                                      --------------------------------------------------
                                                                                                          Estimated
                                                        Annual                                           decrease in      Estimated
                                                       reponses      Burden hours         Costs         the number of    decrease in       Estimated
                                                                                                           annual       burden hours   decrease in costs
                                                                                                          responses
--------------------------------------------------------------------------------------------------------------------------------------------------------
S-1...............................................             901         147,208       $180,319,975               7           1,144         $1,400,932
S-3...............................................           1,657         193,626        236,198,036              10           1,169          1,425,456
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The following table illustrates the total annual compliance burden, 
in hours and in costs, of the affected collections of information 
resulting from the amendments to these forms.

      Table 21--Current and Revised Burdens Under the Amendments to Securities Act Registration Statements
----------------------------------------------------------------------------------------------------------------
                                                      Current burden                     Revised burden
                                           ---------------------------------------------------------------------
                                             Burden hours         Costs         Burden hours         Costs
                                                       (A)                (B)             (C)                (D)
----------------------------------------------------------------------------------------------------------------
S-1.......................................         147,208       $180,319,975         146,067       $178,922,043
S-3.......................................         193,626        236,198,036         192,460        234,775,580
F-1.......................................          26,692         32,275,375          26,692         32,275,375
F-3.......................................           4,441          5,703,600           4,441          5,703,600
----------------------------------------------------------------------------------------------------------------


[[Page 33344]]

8. Amendments to Form N-14
    Form N-14 is the form used by an affected fund for the registration 
of securities issued in business combination transactions. The 
amendments to Form N-14 will decrease the existing disclosure burden of 
the form by allowing BDCs to incorporate by reference to the same 
extent as is currently permitted for registered CEFs and eliminating 
the requirement for affected funds to file with the Form N-14 
registration statement the documents that contain the information that 
is incorporated by reference into the prospectus or SAI.\489\
---------------------------------------------------------------------------

    \489\ See supra section II.B.3.b.

                            Table 22--Currently Approved Form N-14 PRA Estimates \1\
----------------------------------------------------------------------------------------------------------------
                                                                                          Cost of       Annual
                                         Internal burden           Wage rate \2\          internal     external
                                                                                           burden    cost burden
----------------------------------------------------------------------------------------------------------------
                                            Burden per Initial Filing
----------------------------------------------------------------------------------------------------------------
                                              310 hours   x  $401 (attorney)..........     $124,310      $27,500
Preparing and filing initial filing....       248 hours   x  $209 (senior accountant).      $51,832
                                               62 hours   x  $210 (paralegal).........      $13,020
Total burden per initial filing........       620 hours      .........................     $189,162      $27,500
Number of annual initial filings.......           x 156      .........................        x 156        x 156
                                        ------------------------------------------------------------------------
    Total annual burden................    96,720 hours      .........................  $29,509,272   $4,290,000
----------------------------------------------------------------------------------------------------------------
                                              Burden per Amendment
----------------------------------------------------------------------------------------------------------------
                                              150 hours   x  $401 (attorney)..........      $60,150  ...........
Preparing and filing amendments........       120 hours   x  $209 (senior accountant).      $25,080      $16,000
                                               30 hours   x  $210 (paralegal).........       $6,300  ...........
Total burden per amendment.............       300 hours      .........................      $91,530      $16,000
Number of annual amendments............            x 97      .........................         x 97         x 97
                                        ------------------------------------------------------------------------
    Total annual burden................    29,100 hours      .........................   $8,878,410   $1,552,000
----------------------------------------------------------------------------------------------------------------
                                                  Total Burden
----------------------------------------------------------------------------------------------------------------
Total initial filing burden............    96,720 hours      .........................  $29,509,272   $4,290,000
Total amendment burden.................    29,100 hours      .........................   $8,878,410   $1,552,000
                                        ------------------------------------------------------------------------
    Total annual burden................   125,820 hours      .........................  $38,387,682   $5,842,000
----------------------------------------------------------------------------------------------------------------
Notes:
\1.\ These estimates were previously submitted to OMB in connection with the renewal of approval for the
  collection of information required by Form N[dash]2 in 2019.
\2.\ See supra Table 6, at footnote 2.


                                     Table 23--Final Form N-14 PRA Estimates
----------------------------------------------------------------------------------------------------------------
                                                                                          Cost of       Annual
                                         Internal burden           Wage rate \2\          internal     external
                                                                                           burden    cost burden
----------------------------------------------------------------------------------------------------------------
                                            Burden per Initial Filing
----------------------------------------------------------------------------------------------------------------
Current burden for preparing and filing       310 hours   x  \2\ $415 (attorney)......     $128,650      $27,500
 initial filing.                              248 hours   x  \2\ $216 (senior               $53,568
                                               62 hours   x   accountant).                  $13,516
                                                             \2\ $218 (paralegal).....
Burden reduction from incorporation by   \3\ (10 hours)   x  \2\ $218 (paralegal).....     $(2,180)         $(0)
 reference amendments.
Total burden per initial filing........       610 hours   .  .........................     $193,554      $27,500
Number of annual initial filings.......       x \2\ 156   .  .........................    x \2\ 156    x \2\ 156
                                        ------------------------------------------------------------------------
    Total annual burden................    96,160 hours   .  .........................  $29,181,672   $4,290,000
----------------------------------------------------------------------------------------------------------------
                                              Burden per Amendment
----------------------------------------------------------------------------------------------------------------
Current burden for preparing and filing       150 hours   x  \2\ $415 (attorney)......      $62,250      $16,000
 amendments.                                  120 hours   x  \2\ $216 (senior               $25,920
                                               30 hours   x   accountant).                   $6,540
                                                             \2\ $218 (paralegal).....
Burden reduction from incorporation by   \3\ (10 hours)   x  \2\ $218 (paralegal).....     $(2,180)         $(0)
 reference amendments.
Total burden per amendment.............       290 hours   .  .........................      $92,530      $16,000
Number of annual amendments............        \2\ x 97   .  .........................     \2\ x 97     \2\ x 97
                                        ------------------------------------------------------------------------
    Total annual burden................    29,100 hours   .  .........................   $8,674,710   $1,552,000
----------------------------------------------------------------------------------------------------------------

[[Page 33345]]

 
                                                  Total Burden
----------------------------------------------------------------------------------------------------------------
Total initial filing burden............    96,160 hours   .  .........................  $29,181,672   $4,290,000
Total amendment burden.................    29,100 hours   .  .........................    8,674,710   $1,552,000
                                        ------------------------------------------------------------------------
    Total annual burden................   125,260 hours   .  .........................  $37,856,382   $5,842,000
----------------------------------------------------------------------------------------------------------------
Notes:
\1.\ See supra Table 6, at footnote 2.
\2.\ Estimate revised to reflect updated industry data.
\3.\ Estimate revised to reflect modifications from the proposal.

    Table 22 above summarizes the current PRA estimates associated with 
the requirements of Form N-14. Table 23 summarizes the final PRA 
amendments associated with Form N-14 as amended. We are revising our 
estimates as a result of updated industry data and modifications from 
the proposal. Specifically, we are deducting 10 hours of internal 
burden per filing to reflect the burden reduction associated with the 
incorporation by reference amendments affecting filings on Form N-14. 
In addition, we are revising the estimated wage rates to reflect 
updated industry data. As summarized in Table 23 above, we estimate 
that the total hour burdens and time costs associated with Form N-14 
will be an aggregate burden of 125,260 hours at an aggregate annual 
cost of internal burden of $37,856,382. We estimate an aggregate annual 
external time cost of $5,842,000.

V. Final Regulatory Flexibility Analysis

    The Commission has prepared the following Final Regulatory 
Flexibility Analysis (``FRFA'') in accordance with section 4(a) of the 
Regulatory Flexibility Act (``RFA''),\490\ regarding the final rule 
modifications to the registration, communications, and offering 
processes for affected funds under the Securities Act and the rules and 
forms under the Exchange Act and Investment Company Act, that will 
allow affected funds to use the securities offering rules that are 
already available to operating companies. An Initial Regulatory 
Flexibility Analysis (``IRFA'') was prepared in accordance with the RFA 
and is included in the Proposing Release.\491\
---------------------------------------------------------------------------

    \490\ See 5 U.S.C. 603.
    \491\ See Proposing Release, supra footnote 10, at section VI.
---------------------------------------------------------------------------

A. Need and Objectives of the Final Rule

    The BDC Act directs us to allow a BDC to use the securities 
offering rules that are available to other issuers required to file 
reports under section 13(a) or section 15(d) of the Exchange Act and 
specifically enumerates the required revisions. Similarly, the 
Registered CEF Act directs us to allow any listed registered CEF or 
interval fund to use the securities offering rules that are available 
to other issuers that are required to file reports under section 13(a) 
or section 15(d) of the Exchange Act, subject to appropriate 
conditions.\492\ Pursuant to both Acts, the final rule will modify the 
registration, communications, and offering processes for affected funds 
to allow them to use the securities offering rules that are available 
to other issuers required to file reports under section 13(a) or 
section 15(d) of the Exchange Act. We are also adopting amendments to 
our rules and forms, to tailor the disclosure and regulatory framework 
for affected funds, in light of the amendments to the offering rules 
applicable to them. The reasons for, and objectives of, the final rule 
are further discussed in more detail in Section II above. The costs and 
burdens of these requirements on smaller affected funds are discussed 
below as well as above in our Economic Analysis and Paperwork Reduction 
Act Analysis, which discusses the costs and burdens of the final rule 
on all affected funds.
---------------------------------------------------------------------------

    \492\ As discussed above, we apply the final rule to all 
registered CEFs (and BDCs), with certain conditions and exceptions.
---------------------------------------------------------------------------

 B. Significant Issues Raised by Public Comments

    In the Proposing Release, we requested comment on every aspect of 
the IRFA, including the number of small entities that would be affected 
by the proposed rule and form amendments, the existence or nature of 
the potential impact of the proposals on small entities discussed in 
the analysis, and how to quantify the impact of the proposed 
amendments. We also requested comment on the proposed compliance 
burdens and the effect these burdens would have on smaller entities. 
Although we did not receive comments specifically addressing the IRFA, 
several commenters stated in their comment letters the impact they 
believed certain aspects of the proposed amendments would have on small 
affected funds.\493\ Specifically, one commenter stated that the 
proposed rules would disadvantage smaller affected funds relative to 
larger affected funds that have obtained WKSI status, because smaller 
funds that would benefit from the ability to use automatic effective 
registration statements to quickly come to market during periods when 
their shares trade at a premium, may miss the opportunity to raise 
capital that the proposed rules were designed to facilitate. The 
commenter stated that this disparity was unnecessary because 
shareholders of smaller funds would not likely be disadvantaged by a 
lower level of market commentary about those funds as compared to 
larger funds given the investor protections afforded to those 
shareholders by the Investment Company Act.\494\ Similarly, another 
commenter stated that the Commission should reconsider the public float 
requirement in order to encourage new CEF issuances and give smaller 
CEFs the opportunity to grow through the issuance of additional shares, 
because the offering size of most of the recent offerings by public 
CEFs have been relatively small, making them ineligible for treatment 
as a ``seasoned fund'' or WKSI.\495\ The second commenter stated that 
forward incorporation by reference, which is allowed when an affected 
fund has met the requirements to use a short-form registration 
statement, should be made available to smaller affected funds.\496\ 
However, as discussed below, commenters defined smaller funds as those 
funds that did not meet the WKSI

[[Page 33346]]

public float threshold of $700 million or more for purposes of using an 
automatic registration statement, or did not meet the seasoned public 
float threshold of $75 million or more for purposes of forward 
incorporation by reference.
---------------------------------------------------------------------------

    \493\ See e.g., ABA Comment Letter; Invesco Comment Letter; 
White Comment Letter; XBRL US Comment Letter.
    \494\ See e.g., ABA Comment Letter.
    \495\ See e.g., Invesco Comment Letter.
    \496\ See e.g., White Comment Letter.
---------------------------------------------------------------------------

    Another commenter voiced support for the XBRL format proposed for 
certain filings by affected funds and recommended expanded use of the 
format for other disclosures.\497\ The commenter noted that a study it 
conducted along with the AICPA in 2014 and again in 2017 evaluating the 
annual cost of XBRL preparation for small reporting companies had 
decreased from $10,000 in 2014 to $5,500 in 2017.\498\ In citing to the 
Council of Institutional Investors (CII) July 19, 2018 comment letter 
in response to the SEC Draft Strategic Plan 2018-2022, the commenter 
stated that inline XBRL is an improvement to EDGAR functionality and 
makes disclosure documents more valuable and cost-effective for a broad 
range of users including market analysts and data vendors that conduct 
research on smaller companies.\499\ In response to the Commission's 
request for comment regarding whether the current burdens of preparing 
financial statements and notes in XBRL format have changed over time 
for small reporting companies, the commenter reiterated that the cost 
of XBRL preparation has declined 45% for small reporting 
companies.\500\
---------------------------------------------------------------------------

    \497\ See e.g., XBRL US Comment Letter.
    \498\ Id. at 13.
    \499\ Id. at 10.
    \500\ Id. at 13.
---------------------------------------------------------------------------

    After considering the comments we received on the proposed rule and 
form amendments, we are adopting the amendments, substantially as 
proposed, with two modifications intended to reduce the operational 
challenges commenters identified. Specifically, we are expanding the 
scope of rule 486 to any registered CEF or BDC conducting continuous 
offerings under rule 415(a)(1)(ix), and we are not adopting our 
proposed amendments to Form 8-K.\501\ However, we do not believe there 
would be any meaningful reporting, recordkeeping, or other compliance 
costs associated with these modifications that would impact small 
entities.
---------------------------------------------------------------------------

    \501\ See supra sections II.D and II.I.3.
---------------------------------------------------------------------------

C. Small Entities Subject to the Rule

    An investment company is a small entity if, together with other 
investment companies in the same group of related investment companies, 
it has net assets of $50 million or less as of the end of its most 
recent fiscal year.\502\ Commission staff estimates that, as of June 
2019, 16 BDCs and 33 registered CEFs are small entities.\503\
---------------------------------------------------------------------------

    \502\ 17 CFR 270.0-10(a) (Investment Company Act rule 0-10(a)).
    \503\ These estimates, reflecting the net assets of registered 
CEFs and of BDCs, are based on staff review of Forms N-CEN and N-Q 
filed with the Commission as of June 2019 and are based on the 
definition of small entity under Investment Company Act rule 0-10. 
Such funds will not necessarily be able to meet the transaction 
requirement to qualify to file a short-form registration statement 
on Form N-2 (i.e., generally those affected funds with a public 
float of $75 million) or to be a WKSI (i.e., generally those 
affected funds with a public float of $700 million). See supra 
section II.B.3 and II.C.
    Based on data as of June 2019 from Morningstar Direct, Forms 10-
K and 10-Q that are filed with the Commission by BDCs, and closed-
end fund data reported on Forms N-CSR, N-Q, and N-PORT filed with 
the Commission, we estimate, of the 16 BDCs that are small entities, 
3 were traded on an exchange with market capitalization below the 
$75 million public float threshold for qualifying to file a short-
form registration statement on Form N-2, and 5 small BDCs traded on 
the over-the-counter (OTC) market with market capitalization below 
this same $75 million threshold. Likewise, of the 33 registered CEFs 
that qualified as small entities, 4 traded on an exchange with 
market capitalizations below this same $75 million threshold; while 
3 were traded on the OTC market with market capitalizations below 
$75 million.
---------------------------------------------------------------------------

    A broker-dealer is a small entity if it has total capital (net 
worth plus subordinated liabilities) of less than $500,000 on the date 
in the prior fiscal year as of which its audited financial statements 
were prepared pursuant to 17 CFR 240.17a-5(d) (Exchange Act rule 17a-
5),\504\ and it is not affiliated with any person (other than a natural 
person) that is not a small business or small organization.\505\ 
Commission staff estimates that, as of June 30, 2019, there are 
approximately 942 broker-dealers that may be considered small 
entities.\506\ To the extent a small broker-dealer participates in a 
securities offering or prepares research reports, it may be affected by 
the final rule. Generally, we believe larger broker-dealers engage in 
these activities, and we did not receive comments on whether or how the 
proposed amendments to rule 138 affect small broker-dealers.\507\
---------------------------------------------------------------------------

    \504\ See 17 CFR 240.0-10(c)(1) (Exchange Act rule 0-10(c)(1)). 
Alternatively, if a broker-dealer is ``not required to file such 
statements, a broker or dealer that had total capital (net worth 
plus subordinated liabilities) of less than $500,000 on the last 
business day of the preceding fiscal year (or in the time that it 
has been in business, if shorter).'' See id.
    \505\ See Exchange Act rule 0-10(c)(2).
    \506\ This estimate is derived from an analysis of data for the 
period ending June 30, 2019 obtained from Financial and Operational 
Combined Uniform Single (FOCUS) Reports that broker-dealers 
generally are required to file with the Commission and/or SROs 
pursuant to Exchange Act rule 17a-5.
    \507\ See supra section II.F.2.
---------------------------------------------------------------------------

    The final rule will also affect ETPs, permitting them to register 
offerings of an indeterminate number of exchange-traded vehicle 
securities and pay registration fees for such offerings on an annual 
net basis. For purposes of the RFA, 17 CFR 230.157 (Securities Act rule 
157) defines an issuer, other than an investment company, to be a 
``small business'' or ``small organization'' if it had total assets of 
$5 million or less on the last day of its most recent fiscal year and 
is engaged or proposing to engage in an offering of securities not 
exceeding $5 million.\508\ Exchange Act rule 0-10(a) defines an issuer, 
other than an investment company, to be a ``small business'' or ``small 
organization'' if it had total assets of $5 million or less on the last 
day of its most recent fiscal year. Commission staff estimates that, as 
of February 2020, there are approximately 7 ETPs that are issuers, 
other than an investment company, that may be considered small 
entities.\509\
---------------------------------------------------------------------------

    \508\ See 17 CFR 230.157.
    \509\ Based on data as of February 2020 from Morningstar Direct 
and Form S-1 and Form S-3 registration statements filed with the 
Commission within the past three years. As discussed above, we do 
not anticipate that any issuers at this time will use Form F-1 to 
register offerings of an indeterminate number of exchange-traded 
vehicle securities and pay registration fees for these offerings on 
an annual net basis. See supra section IV.B.7. Consequently, our 
figures do not reflect F-1 filers as a ``small business'' or ``small 
organization.''
---------------------------------------------------------------------------

D. Projected Reporting, Recordkeeping, and Other Compliance 
Requirements

    The final rule will create, amend, or eliminate current 
requirements for affected funds and broker-dealers, including those 
that are small entities discussed in section V.C above.\510\
---------------------------------------------------------------------------

    \510\ See also supra section IV (discussing the skills necessary 
to perform the recordkeeping, reporting, and compliance requirements 
of the final rule, including those to be performed internally by a 
fund, and those to be performed externally by professionals). The 
PRA provides for the hours, costs, and skill level associated with 
preparing disclosures, filing forms, and retaining records in 
compliance with our adopted rules. These skills would apply for 
compliance with the adopted rules by all funds, large and small, and 
Commission staff further estimates that small funds will incur 
approximately the same initial and ongoing costs as large funds.
---------------------------------------------------------------------------

1. Registration Process and Final Prospectus Delivery
    The amendments to the registration process for affected funds will 
create a short-form registration statement on Form N-2 that will 
function like a registration statement filed on Form S-3.\511\ An 
affected fund eligible to file the short-form registration statement 
can use it to register shelf offerings, including shelf registration 
statements (filed by a WKSI) that become effective

[[Page 33347]]

automatically.\512\ Such a fund also can satisfy Form N-2's disclosure 
requirement by incorporating by reference information from the fund's 
Exchange Act reports. \513\
---------------------------------------------------------------------------

    \511\ See supra section II.B.3.
    \512\ Id.
    \513\ Id.
---------------------------------------------------------------------------

    In addition, the final rule will allow certain affected funds 
eligible to register a primary offering under the adopted short-form 
registration instruction to rely on rule 430B to omit information from 
their base prospectuses, and to permit affected funds to use the 
process operating companies follow to file prospectus supplements.\514\ 
Affected funds that choose to forward incorporate information by 
reference into their registration statements will also be able to 
include additional information in their periodic reports that is not 
required to be included in these reports in order to update their 
registration statements.\515\
---------------------------------------------------------------------------

    \514\ See supra section II.B.3.d.
    \515\ See supra section II.B.3.e.
---------------------------------------------------------------------------

    The amendments to the WKSI definition in rule 405 will also permit 
affected funds to qualify for enhanced offering and communication 
benefits under our rules.\516\ In order for an issuer to qualify as a 
WKSI, the issuer must meet the registrant requirements of Form S-3, 
i.e., it must be ``seasoned,'' and generally must have at least $700 
million in public float.\517\ Qualifying as a WKSI will allow such 
funds to file a registration statement or amendment that becomes 
effective automatically in a broader variety of contexts than non-
WKSIs, and to communicate at any time, including through a free writing 
prospectus, without violating the ``gun-jumping'' provisions of the 
Securities Act.\518\
---------------------------------------------------------------------------

    \516\ See supra section II.C.
    \517\ Id.
    \518\ Id.
---------------------------------------------------------------------------

    Smaller affected funds will not be able to avail themselves of the 
aspects of the adopted rule amendments streamlining the registration 
process for affected funds or that make available the WKSI designation 
to affected funds. The adopted short-form registration instruction is 
designed to provide affected funds parity with operating companies by 
permitting them to use the instruction to register the same 
transactions that an operating company can register on Form S-3.\519\ 
In order to qualify to use the short-form registration statement under 
Form N-2, General Instruction A.2 of Form N-2 generally requires an 
affected fund to meet the public float requirement of $75 million under 
the transaction requirements for Form S-3.\520\ Likewise, the WKSI 
provision of rule 405 contains a public float requirement of $700 
million, as discussed above. Smaller funds will not generally meet the 
public float thresholds to file a short-form registration statement or 
qualify as a WKSI and therefore will not generally be subject to either 
of these amendments.\521\ However, smaller affected funds may be 
affected by these amendments in other ways. For example, smaller 
affected funds may be more likely to merge to obtain WKSI status, and 
could experience competitive disadvantages compared to larger funds 
that qualify as WKSIs or that file short-form registration statements 
on Form N-2.\522\
---------------------------------------------------------------------------

    \519\ See supra section II.B.3.a; see also supra footnote 51 and 
accompanying and preceding text.
    \520\ See supra sections II.B.3.a and III.B.1.
    \521\ See supra sections II.B.3 and III.B.1.
    \522\ See supra section III.B.1.
---------------------------------------------------------------------------

    The final rule will also apply the delivery method for operating 
company final prospectuses to offerings of affected funds. As a result, 
an affected fund, broker, or dealer will be allowed to satisfy the 
final prospectus delivery obligations if a final prospectus is or will 
be on file with the Commission within the time required by the rules 
and other conditions are satisfied.\523\ These requirements will apply 
to all affected funds, as well as all brokers or dealers.\524\
---------------------------------------------------------------------------

    \523\ See supra sections IV.B.5 and II.E.
    \524\ Affected funds using the new approach to prospectus 
delivery will be required to provide a notice to purchasers stating 
that a sale of securities was made pursuant to a registration 
statement or in a transaction in which a final prospectus would have 
been required to have been delivered in the absence of Securities 
Act rule 172. See supra footnote 153 and accompanying text.
---------------------------------------------------------------------------

2. Communications Rules
    For offerings of smaller affected funds, we are not adopting any 
new restrictions on communications. As discussed above, the amendments 
to Securities Act rules 134, 138, 156, 163, 163A, 164, 168, 169, and 
433 will make available the use of certain types of communications that 
were previously not available to affected funds.\525\ Except as 
otherwise discussed below, we believe that there are no significant 
reporting, recordkeeping, or other compliance requirements associated 
with these amendments. As such, except as otherwise discussed below, we 
believe that there are no attendant costs and administrative burdens 
for small affected funds associated with these amendments.
---------------------------------------------------------------------------

    \525\ See supra sections II.F, III.B.2, III.C.1, and IV.B.4. The 
amendments to Securities Act rules 163 and 433, regarding the use of 
a free writing prospectus, create new recordkeeping, filing, and 
compliance requirements that are addressed further below.
---------------------------------------------------------------------------

    In addition, the communications rules themselves do not create any 
new restrictions for smaller affected funds. Instead, smaller affected 
funds now may be able to take advantage of new communications options 
not previously afforded to them.\526\ We also note that rule 163, and 
the new amendments, apply only to WKSIs. Consequently, these amendments 
to rule 163 will not produce any benefit, or create any burden, for 
small affected funds because they would not qualify as WKSIs, as 
discussed above.\527\
---------------------------------------------------------------------------

    \526\ See supra sections II.F, III.B.2, III.C.1, and IV.B.4. 
These include, for example, amendments to rule 163A of the 
Securities Act, which provides a bright-line rule permitting 
communications more than 30 days before filing a registration 
statement, and amendments to rule 169 of the Securities Act, which 
provides affected funds the ability to engage in regular factual 
business communications.
    \527\ See supra section V.D.1.
---------------------------------------------------------------------------

    To the extent that an affected fund uses a free writing prospectus 
under the adopted rules, any affected fund--large or small--will incur 
the burden of the requirement to file a free writing prospectus, or 
retain a record of the free writing prospectus for three years if it 
was not filed with the Commission.\528\ However, we believe that the 
burden here will be negligible. Affected funds currently use rule 482 
of the Securities Act to engage in communications similar to those that 
will be permitted under the amendments to rule 433, and these funds are 
required to file their rule 482 communication with either the 
Commission or, alternatively, with the Financial Industry Regulatory 
Authority (``FINRA'').\529\ The burden associated with the filing 
requirements that the amendments to rule 433 will entail will therefore 
not be meaningfully different than the burden associated with the 
filing requirement for rule 482 communications. Rule 433 also creates a 
recordkeeping requirement. We do not believe that this requirement will 
create any significant burden given that records of rule 482 
communications must also be retained for a period that

[[Page 33348]]

will generally exceed that required under rule 433.\530\ In addition, 
the recordkeeping requirement will apply only to affected funds (both 
large and small) that elect to use rule 433, as adopted.
---------------------------------------------------------------------------

    \528\ See amended rule 433(d) and (g). Paragraph (d) of the rule 
provides for the various conditions and exclusions applicable to the 
general requirement of 433(d)(1) that an issuer or offering 
participant file its free writing prospectus. Paragraph (g) requires 
that if a free writing prospectus is not filed pursuant to paragraph 
(d) or (f) of rule 433, issuers and offering participants must 
retain all free writing prospectuses that have been used, for three 
years following the initial bona fide offering of the securities in 
question.
    \529\ See note to paragraph (h) of Securities Act rule 482. Rule 
482 requires that advertisements used in reliance on rule 482 are 
required to be filed in accordance with the requirements of rule 
497, unless they are filed with FINRA. See supra footnote 528 and 
sections III.C and IV.B.4.; see also Securities Act rule 497(a) and 
(i).
    \530\ See 17 CFR 270.31a-2(a)(3) (Investment Company Act rule 
31a-2(a)(3)) (requiring every registered investment company to 
preserve for no less than six years from the end of the fiscal year 
last used, any advertisement, pamphlet, circular form letter, or 
other sales literature addressed to or intended for distribution to 
prospective investors). Securities Act rule 433(g) requires an 
issuer and offering participants to retain all free writing 
prospectuses that have been used, and that have not been filed 
pursuant to paragraphs (d) or (f) of the rule, for three years 
following the initial bona fide offering of the securities in 
question. However, for a broker or dealer utilizing a free writing 
prospectus, rule 433 defers to the recordkeeping requirements under 
17 CFR 240.17a-4 (Exchange Act rule 17a-4) (requiring sales 
literature to be retained for not less than three years).
---------------------------------------------------------------------------

    The final rule also will affect broker-dealers participating in a 
registered offering. Specifically, the amended rules will affect: (1) 
Broker-dealers' publication and distribution of research reports on 
affected funds; and (2) broker-dealers' use of free writing 
prospectuses on affected funds.
    The amendments to rule 138 will affect both large and small broker-
dealers. These amendments will now permit broker-dealers to publish or 
distribute research reports with respect to a broader class of issuers 
and securities without this publication or distribution being an offer 
that otherwise could be a non-conforming prospectus in violation of 
section 5 of the Securities Act.\531\ Broker-dealers that once used 
rule 482 ads styled as research reports, and instead rely on rule 138, 
as adopted, to publish or distribute similar communications, will no 
longer be subject to any filing requirement for these communications. 
Consequently, we expect that the amendments to rule 138 will result in 
fewer rule 482 communications being filed with FINRA.\532\ This in turn 
will reduce filing-related administrative costs for broker-dealers 
publishing or distributing research reports on affected funds under the 
amendments to rule 138. However, large and smaller broker-dealers will 
not be affected differently by the amendments to rule 138.
---------------------------------------------------------------------------

    \531\ See amended Securities Act rule 138.
    \532\ See supra footnote 529 and FINRA rule 2210(c)(7)(F) 
(requiring a broker-dealer to file with FINRA an investment company 
prospectus published pursuant to Securities Act rule 482).
---------------------------------------------------------------------------

    In addition, the free writing prospectus rule amendments will 
permit broker-dealers to engage in these communications on behalf of 
the affected fund issuer.\533\ This will require broker-dealers, both 
large and small, to file the free writing prospectuses that they use 
with the Commission, or maintain records of any free writing 
prospectuses used if it was not filed with the Commission.\534\ 
However, certain of these broker-dealers are already required to file 
communications made under rule 482.\535\ Broker-dealers that once used 
rule 482 ads and instead now choose to rely on adopted amended rule 433 
to publish or distribute similar communications, will no longer be 
required to file these communications with FINRA. Consequently, the 
amendments to rule 433 could result in fewer rule 482 communications 
being filed with FINRA and a potential increase in filings of free 
writing prospectuses by affected funds with the Commission.\536\ 
However, those broker-dealers that have not previously used rule 482 to 
publish or distribute the types of communications that the amendments 
to rule 433 permit, will newly be subject to both the filing and 
recordkeeping requirements of rule 433.
---------------------------------------------------------------------------

    \533\ See amended rule 433(b). Paragraph (b)(1) states that for 
WKSIs and seasoned issuers, both an issuer or offering participant 
may use a free writing prospectus, while paragraph (b)(2) states 
that for non-reporting and unseasoned issuers, any person 
participating in the offer or sale of the issuer's securities may 
use a free writing prospectus. Although the term ``offering 
participant'' is not defined, paragraph (h)(3) of rule 433 gives 
some context to this term.
    \534\ See supra footnote 528.
    \535\ See supra footnote 529.
    \536\ See supra section III.C.1 and IV.B.4 (noting that we are 
unable to predict whether affected funds will engage in more 
communications with investors as a result of the final rule). To the 
extent affected funds or broker-dealers will use a free writing 
prospectus for communications that currently occur under rule 482, 
we would expect an increase in such filings of free writing 
prospectuses as well as an increase in the number of rule 138 
research reports, and a decrease in the number of rule 482 ads filed 
with FINRA. See supra footnote 532 and accompanying text.
---------------------------------------------------------------------------

3. New Registration Fee Payment Method for Interval Funds
    Interval funds, like other affected funds, are not currently 
permitted to pay registration fees on this same annual ``net'' basis as 
mutual funds and ETFs, and pay the registration fee at the time of 
filing the registration statement.\537\ As discussed above, we believe 
that interval funds will benefit from the ability to pay their 
registration fees in the same manner as mutual funds and ETFs, and that 
this approach is appropriate in light of interval funds' 
operations.\538\ In addition, in response to comments to the Proposing 
Release, we also are adopting amendments to enable ETPs to register an 
indeterminate number of securities and to pay registration fees in 
arrears on an annual net basis.\539\ As we discussed above, ETPs 
operate in a manner substantially similar to that of ETFs, and as 
commenters noted, share similar attributes with interval funds, which 
we highlighted in extending to interval funds the ability to pay 
registration fees on an annual net basis, including routine repurchases 
of shares at NAV and avoiding the possibility of inadvertently selling 
more shares than it had registered.\540\ As a result, the final rule 
will require interval funds and allow ETPs to pay securities 
registration fees using the same method that mutual funds and ETFs 
use.\541\ We believe this will benefit small interval funds and ETPs as 
well as larger interval funds and ETPs equally, and will make the 
registration fee payment process for all interval funds and ETPs more 
efficient as discussed above.\542\
---------------------------------------------------------------------------

    \537\ See supra section II.H and III.E.1.
    \538\ See supra section II.H.
    \539\ Id.
    \540\ Id.
    \541\ Id.
    \542\ Id.; see also section III.E.1.
---------------------------------------------------------------------------

4. Disclosure and Reporting Requirements
    We also are adopting amendments, substantially as proposed, to our 
rules and forms that are intended to tailor the disclosure and 
regulatory framework for affected funds in light of our amendments to 
the offering rules applicable to them.\543\ These amendments include: 
Structured data requirements; new periodic requirements; amendments to 
provide affected funds additional flexibility to incorporate 
information by reference; and enhancements to the disclosures that 
registered CEFs make to investors when the funds are not updating their 
registration statements.\544\
---------------------------------------------------------------------------

    \543\ See supra section II.I. Some of the amendments reflect our 
consideration of the availability of information to investors, as 
required by the Registered CEF Act. See section 509(a) of the 
Registered CEF Act.
    \544\ See supra sections II.I.1-II.I.5.
---------------------------------------------------------------------------

Structured Data Requirements
    The amendments will require BDCs, like operating companies, to 
submit financial statement information using Inline XBRL format; to 
require that affected funds include structured cover page information 
in their registration statements on Form N-2 using Inline XBRL format; 
to require that certain information required in an affected fund's 
prospectus be tagged using Inline XBRL format; \545\ and to require 
that

[[Page 33349]]

filings on Form 24F-2 be submitted in XML format.\546\ Large and small 
affected funds will both incur on a proportional basis, the costs 
associated with these adopted structured data requirements. 
Furthermore, as noted above, based on our experience implementing the 
XBRL format, we recognize that some registrants affected by the adopted 
requirement, particularly filers with no Inline XBRL experience, likely 
will incur initial costs to acquire the necessary expertise and/or 
software as well as ongoing costs of tagging required information in 
Inline XBRL, and the incremental effect of any fixed costs, including 
ongoing fixed costs, of complying with the Inline XBRL requirement may 
be greater for smaller filers.\547\ However, we believe that smaller 
affected funds in particular may benefit more from enhanced exposure to 
investors that could result from these adopted requirements.\548\ If 
reporting the disclosures in a structured format increases the 
availability of, or reduces the cost of collecting and analyzing, key 
information about affected funds, smaller affected funds may benefit 
from improved coverage by third-party information providers and data 
aggregators.
---------------------------------------------------------------------------

    \545\ See supra footnote 241 and accompanying text noting that a 
seasoned fund filing a short-form registration statement on Form N-2 
also will be required to tag information appearing in Exchange Act 
reports, such as those on Forms N-CSR, 10-K, or 8-K, if that 
information is required to be tagged in the fund's prospectus.
    \546\ See supra sections II.I.1 and III.E.1.
    \547\ See supra section III.E.2. But see supra footnote 428 
(noting that since 2014, costs incurred utilizing XBRL have 
significantly reduced for smaller companies).
    \548\ Id.
---------------------------------------------------------------------------

Periodic Reporting Requirements
    The final rule also will require registered CEFs to provide the 
MDFP in their annual reports to shareholders, BDCs to provide financial 
highlights in their registration statements and annual reports, and 
affected funds filing a short-form registration statement on Form N-2 
to disclose material unresolved staff comments.\549\ These requirements 
are intended to modernize and harmonize our periodic reporting 
disclosure requirements for affected funds with those applicable to 
operating companies and mutual funds and ETFs.
---------------------------------------------------------------------------

    \549\ See supra sections II.I.2.b, II.I.2.c, and II.I.2.d.
---------------------------------------------------------------------------

    The final rule requirement for registered CEFs to include an MDFP 
section in the annual report and for BDCs to provide financial 
highlights in their registration statement and annual reports will 
apply to all applicable affected funds, large and small. We do not 
believe it would be appropriate to treat large and small entities 
differently for purposes of the MDFP requirement because such 
disclosures helps investors assess fund performance over the prior year 
and complements other information in the report, which may make the 
annual report disclosure more understandable as a whole.\550\ Such 
investor protection benefits are equally significant to investors in 
smaller affected funds as well as larger affected funds.\551\
---------------------------------------------------------------------------

    \550\ See supra section III.E.3.
    \551\ See supra section II.I.2.b and II.I.2.c; see also supra 
section IV.B.3 (discussing the burden hours associated with 
complying with the adopted disclosure requirements for both small 
and large affected funds).
---------------------------------------------------------------------------

    For similar reasons, we believe that the informational benefit of 
BDCs' inclusion of the financial highlights in their registration 
statements should apply equally to investors in large and small BDCs. 
We also believe the costs associated with this adopted requirement 
should be minimal for both large and small BDCs, since we understand 
that it is general market practice for BDCs to include this information 
in their registration statements.\552\
---------------------------------------------------------------------------

    \552\ Id.; see also supra sections IV.B.1 and IV.B.3.
---------------------------------------------------------------------------

    Finally, the final rule will require affected funds that file a 
short-form registration statement on Form N-2 to disclose material 
unresolved staff comments. Such a requirement will apply only to those 
entities that qualify for the short-form registration statement, which 
generally would not include smaller affected funds.\553\
---------------------------------------------------------------------------

    \553\ See supra footnote 503.
---------------------------------------------------------------------------

Online Availability of Information Incorporated by Reference
    The final rule will modernize Form N-2's requirements for backward 
incorporation by reference by all affected funds. Affected funds will 
no longer be required to deliver to new investors information that they 
have incorporated by reference.\554\ Instead, we are adopting new 
requirements that these funds make the incorporated materials and 
corresponding prospectus and SAI readily available and accessible on a 
website maintained by or for the fund and identified in the fund's 
prospectus or SAI.\555\ We do not believe this requirement will 
generate significant compliance costs for affected funds because many 
funds currently post their annual and semi-annual reports and other 
fund information on their websites.\556\ Nor do we think it would be 
appropriate to treat large and small entities differently for these 
purposes. The adopted requirement will make the incorporated 
information, prospectus, and SAI more accessible to retail investors, 
who we believe may be more inclined to look at a fund's website for 
information than to search the EDGAR system.\557\ The final rule also 
will increase the likelihood that fund investors view the information 
in their preferred format, and thereby increase their use of the 
information to make investment decisions.\558\ We believe that these 
investor protection benefits should be available equally for investors 
in smaller and larger affected funds.
---------------------------------------------------------------------------

    \554\ See supra sections II.I.4 and IV.E.5.
    \555\ Id.
    \556\ See supra section III.E.4.
    \557\ Id.
    \558\ Id.
---------------------------------------------------------------------------

Enhancements to Certain Registered CEFs' Annual Report Disclosure
    Finally, the amendments to rule 8b-16(b) under the Investment 
Company Act will require a fund relying on that rule to describe in its 
annual report the fund's current investment objectives, policies, and 
principal risks.\559\ The amendments also will require a fund to 
describe in its annual report certain key changes that occurred during 
the relevant year in enough detail to allow investors to understand 
each change and how it may affect the fund, and to preface such 
disclosures with a legend.\560\ The amendments to rule 8b-16(b) will 
only affect that portion of registered CEFs that rely on the rule.\561\ 
We do not think it would be appropriate to treat large and small 
entities differently for purposes of the amendments to rule 8b-16(b), 
as this new requirement will allow investors in funds relying on the 
rule to more easily identify and understand key information about their 
investments.\562\ We believe that this investor protection benefit 
should be available equally for investors in smaller and larger 
affected funds. In addition, the adopted new requirement will likely 
add only a small incremental compliance burden because funds relying on 
rule 8b-16(b) are already required to disclose the enumerated 
changes.\563\ The amendments described in section II.I above will apply 
to affected funds that are small entities as well as other affected 
funds unless noted otherwise.\564\
---------------------------------------------------------------------------

    \559\ See supra sections II.I.5 and III.E.3.
    \560\ Id.
    \561\ See supra section III.E.3. Based on staff review of data 
derived from Morningstar Direct and Commission filings for the 
period ending June 30, 2019, approximately 521 registered CEFs 
currently rely on rule 8b-16(b). Of these, we estimate that 22 will 
be small issuers based on net assets of $50 million or less.
    \562\ See supra section III.E.3.
    \563\ Id.
    \564\ See also supra sections III.E.3 and IV.B.3 (discussing the 
economic impact, and the estimated compliance costs and burdens, of 
the final rule described in section II.I).

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

[[Page 33350]]

5. Automatic or Immediate Effectiveness for Filings by Affected Funds 
Conducting Certain Continuous Offerings
    As we discussed above, the amendments we are adopting to rule 486 
will permit any registered CEF or BDC that conducts continuous 
offerings under rule 415(a)(1)(ix), including unlisted continuously-
offered affected funds such as tender offer funds, to rely on rule 
486.\565\ Our amendment to rule 486 will allow such funds to file post-
effective amendments and registration statements that become effective 
immediately upon filing or automatically effective 60 days after 
filing, depending on the substance of the disclosure changes.\566\ In 
doing so, we believe that such funds will be able to more efficiently 
update their financial statements under section 10(a)(3) of the 
Securities Act to maintain effective registration statements while they 
engage in continuous offerings.\567\
---------------------------------------------------------------------------

    \565\ See supra section II.D.
    \566\ Id.
    \567\ Id.; see also supra section III.E.5.
---------------------------------------------------------------------------

    These amendments will benefit both large and small continuously-
offered unlisted affected funds, and we believe that they provide 
benefits similar to the benefits the adopted rule offers affected funds 
that will file short-form registration statements or qualify as 
WKSIs.\568\ Because the amended rule applies only to those affected 
funds that conduct continuous offerings under rule 415(a)(1)(ix), we 
expect this subset of affected funds to be limited.\569\ In addition, 
although reliance on rule 486 is voluntary for continuously-offered 
affected funds who are newly permitted to rely on the rule, we expect 
many will rely on it due to the cost efficiencies sustained from a 
regime providing immediate or automatic effectiveness for post-
effective amendments and certain registration statements. 
Notwithstanding this increased use, and because it will provide greater 
efficiencies, we do not believe the final rule will create any new 
meaningful reporting, recordkeeping, or other compliance costs in 
relation to how affected funds currently file post-effective amendments 
or registration statements. In addition, immediate or automatic 
effectiveness would permit smaller funds the ability to engage in 
offerings that meet investor demand, on a timely basis, for such 
offerings.
---------------------------------------------------------------------------

    \568\ See supra section III.E.5.
    \569\ Based on staff review of fund filings, as of August 2019, 
we estimate that approximately 65 continuously-offered unlisted 
affected funds (that are not interval funds) conduct continuous 
offerings under rule 415(a)(1)(ix), of which 14 are BDCs, and 51 are 
registered CEFs.
---------------------------------------------------------------------------

E. Agency Action To Minimize Effect on Small Entities

    The RFA directs the Commission to consider significant alternatives 
that would accomplish our stated objective, while minimizing any 
significant economic impact on small entities. Although the BDC Act and 
Registered CEF Act required certain amendments to our rules and forms, 
we could have, for example, made additional modifications to the 
relevant provisions with respect to affected funds that are small 
entities. Alternatively, we also could have limited the scope to BDCs 
(as the BDC Act specified) and to interval funds and listed registered 
CEFs (as the Registered CEF Act specified), which would have excluded 
from the scope of the adopted rules certain small entities that are 
registered CEFs but that are not interval funds or listed registered 
CEFs.\570\ Where our final rules reflect an exercise of discretion, we 
considered the following alternatives for small entities in relation to 
our amendments:
---------------------------------------------------------------------------

    \570\ See supra section II.A.
---------------------------------------------------------------------------

     Exempting affected funds that are small entities from the 
adopted disclosure, reporting, or recordkeeping requirements, to 
account for resources available to small entities;
     Establishing different compliance or reporting 
requirements or frequency to account for resources available to small 
entities;
     Clarifying, consolidating, or simplifying the compliance 
requirements under the amendments for small entities; and
     Using performance rather than design standards.
1. Alternatives to the Adopted Approach to Implementing Statutory 
Mandates
    In accordance with the BDC Act and Registered CEF Act, to the final 
rule modifies the restrictions regarding offerings and communications 
permitted around the time of a Securities Act registered offering. The 
flexibility provided by our amendments will be greatest for larger and 
seasoned affected funds, but will also provide greater flexibility to 
all affected funds and broker-dealers, including small entities.
    We considered modifying the public float standards in the WKSI 
definition or the short-form registration instruction by reducing the 
required level of public float or providing alternative eligibility 
criteria, such as an aggregate NAV of a certain size for funds whose 
shares are not traded on an exchange or through the use of 
``performance'' rather than ``design'' standards.\571\ These 
alternatives would have allowed more affected funds, potentially 
including small entities, to qualify as WKSIs or file short-form 
registration statements. However, we believe that modifying the 
eligibility criteria in the WKSI definition or the short-form 
registration instruction could weaken the investor protection benefits 
provided by those criteria.
---------------------------------------------------------------------------

    \571\ See supra section II.C.
---------------------------------------------------------------------------

    We also considered extending the adopted rule amendments only to 
BDCs, listed registered CEFs, and interval funds.\572\ However, 
excluding unlisted registered CEFs from the adopted rule amendments 
will create unnecessary competitive disparities between unlisted 
registered CEFs (which will potentially include smaller funds) and 
unlisted BDCs and will not provide investors in unlisted registered 
CEFs with the benefits of the new investor protections we are 
adopting.\573\
---------------------------------------------------------------------------

    \572\ See supra section III.D.
    \573\ Id.
---------------------------------------------------------------------------

2. Alternative Approaches to Discretionary Choices
New Registration Fee Payment Method for Interval Funds
    We considered, but are not adopting, provisions allowing a wider 
range of affected funds, such as registered CEFs that are tender offer 
funds, to rely on rule 24f-2.\574\ To the extent that this alternative 
would have brought in additional small affected funds, it could have 
extended the benefits of this fee payment method to additional small 
entities. However, we did not adopt this alternative approach because 
interval funds and ETPs have structural similarities to mutual funds 
and ETFs that other affected funds do not.\575\
---------------------------------------------------------------------------

    \574\ See supra section III.E.1.
    \575\ See id.
---------------------------------------------------------------------------

Structured Data Requirements
    As an alternative, we could have adopted amendments requiring the 
Inline XBRL requirements only for a subset of affected funds--for 
example, affected funds that file short-form registration statements on 
Form N-2 or WKSIs.\576\ This would have lessened the burden associated 
with the structured data requirements on smaller affected funds. 
However, a structured data program that captures only a subset of 
affected funds would reduce potential data quality benefits compared to 
mandatory Inline XBRL requirements

[[Page 33351]]

for all affected funds.\577\ This in turn would reduce data users' 
ability to meaningfully analyze, aggregate, and compare data.
---------------------------------------------------------------------------

    \576\ See supra section IV.B.2.
    \577\ See id.
---------------------------------------------------------------------------

    However, we are adopting an extended compliance period for the new 
XBRL reporting requirements we adopted for affected funds that are not 
eligible to file a short-form registration statement. This extended 
compliance period--which will apply to affected funds that do not meet 
the transaction requirement to qualify to file a short-form 
registration statement on Form N-2 (i.e., generally those affected 
funds with a public float of $75 million), and which encompasses the 
small entities subject to the adopted rule amendments discussed above--
should enable small entities to defer the burden of additional cost 
associated with the adopted XBRL requirements and learn from affected 
funds that comply earlier.
Periodic Reporting Requirements and Online Availability of Information 
Incorporated by Reference
    We also considered a partial or complete exemption from the adopted 
periodic reporting requirements, and for the adopted requirements to 
make information incorporated by reference available on a website, for 
small entities.\578\ With respect to the periodic reporting 
requirements, small entities that are not affected funds currently 
follow the same requirements that large entities do when filing 
periodic reports, and we believe that establishing different reporting 
requirements or frequency for small entities that are affected funds 
would not be consistent with the Commission's goal of investor 
protection and industry oversight. For example, we could have adopted 
amendments to require smaller affected funds to include in their annual 
reports less information from their registration statements. While 
requiring less information would reduce costs to smaller affected funds 
by reducing the amount of required annual report disclosure, it could 
also make it more difficult for investors in these funds to find 
important fund information. Similarly, we believe that the investor 
protection benefits associated with the other adopted periodic 
reporting requirements that apply to large and small affected funds--
for example, the MDFP requirement for registered CEFs and the inclusion 
of BDCs' financial highlights in their registration statement--should 
apply equally to investors in large and small affected funds.\579\ We 
also believe that the investor protection benefits stemming from the 
adopted requirement to make materials incorporated by reference 
available on a website should be available equally for investors in 
smaller and larger affected funds, and therefore this adopted rule 
applies equally to large and small affected funds.\580\
---------------------------------------------------------------------------

    \578\ See supra section III.E.3.
    \579\ See supra section V.D.4.
    \580\ See id.
---------------------------------------------------------------------------

VI. Other Matters

    Pursuant to the Congressional Review Act,\581\ the Office of 
Information and Regulatory Affairs has designated this rule a ``major 
rule,'' as defined by 5 U.S.C. 804(2). If any of the provisions of 
these rules, or the application thereof to any person or circumstance, 
is held to be invalid, such invalidity shall not affect other 
provisions or application of such provisions to other persons or 
circumstances that can be given effect without the invalid provision or 
application.
---------------------------------------------------------------------------

    \581\ 5 U.S.C. 801 et seq.
---------------------------------------------------------------------------

VII. Statutory Authority

    The amendments contained in this release are being adopted under 
the authority set forth in the Securities Act, particularly sections 6, 
7, 8, 10, 19, and 28 thereof [15 U.S.C. 77a et seq.]; the Exchange Act, 
particularly sections 3, 4, 10, 12, 13, 14, 15, 17, 23, 35A, and 36 
thereof [15 U.S.C. 78a et seq.]; the Investment Company Act, 
particularly sections 6, 8, 20, 23, 24, 30, 31, and 38 thereof [15 
U.S.C. 80a et seq.]; the BDC Act, particularly section 803(b) thereof 
[Pub. L. 115-141, div. S, title VIII, 132 Stat. 348 (2018)]; and the 
Registered CEF Act, particularly section 509(a) thereof [Pub. L. 115-
174, title V, 132 Stat. 1296 (2018)].

List of Subjects

17 CFR Part 229

    Reporting and recordkeeping requirements, Securities.

17 CFR Part 230

    Advertising, Confidential business information, Investment 
Companies, Reporting and recordkeeping requirements, Securities.

17 CFR Part 232

    Administrative practice and procedure, Confidential business 
information, Reporting and recordkeeping requirements, Securities.

17 CFR Part 239

    Reporting and recordkeeping requirements, Securities.

17 CFR Part 240

    Brokers, Confidential business information, Fraud, Reporting and 
recordkeeping requirements, Securities.

17 CFR Part 243

    Reporting and recordkeeping requirements, Securities.

17 CFR Part 249

    Brokers, Reporting and recordkeeping requirements, Securities

17 CFR Part 270

    Confidential business information, Fraud, Investment companies, 
Reporting and recordkeeping requirements, Securities.

17 CFR Part 274

    Investment companies, Reporting and recordkeeping requirements, 
Securities.

Text of Rule and Form Amendments

    For reasons set forth in the preamble, we are amending title 17, 
chapter II of the Code of Federal Regulations as follows:

PART 229--STANDARD INSTRUCTIONS FOR FILING FORMS UNDER SECURITIES 
ACT OF 1933, SECURITIES EXCHANGE ACT OF 1934 AND ENERGY POLICY AND 
CONSERVATION ACT OF 1975--REGULATION S-K

0
1. The authority citation for part 229 continues to read as follows:

    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, 78i, 78j, 78j-3, 78l, 78m, 78n, 78n-1, 78o, 78u-
5, 78w, 78ll, 78 mm, 80a-8, 80a-9, 80a-20, 80a-29, 80a-30, 80a-
31(c), 80a-37, 80a-38(a), 80a-39, 80b-11 and 7201 et seq.; 18 U.S.C. 
1350; sec. 953(b), Pub. L. 111-203, 124 Stat. 1904 (2010); and sec. 
102(c), Pub. L. 112-106, 126 Stat. 310 (2012).


0
2. Amend Sec.  229.601 by revising paragraphs (b)(101)(i) introductory 
text, (b)(101)(i)(C), (b)(101)(ii)(A), and (b)(101)(iii) to read as 
follows:


Sec.  229.601  (Item 601) Exhibits.

* * * * *
    (b) * * *
    (101) * * *
    (i) Required to be submitted. Required to be submitted to the 
Commission in the manner provided by Sec.  232.405 of this chapter if 
the registrant is not registered under the Investment Company Act of 
1940 (15 U.S.C. 80a-1 et seq.), except that an Interactive Data File:
* * * * *
    (C) Is required for a Form 8-K (Sec.  249.308 of this chapter):

[[Page 33352]]

    (1) Only when the Form 8-K contains audited annual financial 
statements that are a revised version of financial statements that 
previously were filed with the Commission and that have been revised 
pursuant to applicable accounting standards to reflect the effects of 
certain subsequent events, including a discontinued operation, a change 
in reportable segments or a change in accounting principle. In such 
case, the Interactive Data File will be required only as to such 
revised financial statements regardless of whether the Form 8-K 
contains other financial statements; and
    (2) Except that a business development company as defined in 
Section 2(a)(48) of the Investment Company Act of 1940 (15 U.S.C. 80a-
2(a)(48)) also is required to submit an Interactive Data File to the 
extent required by Sec.  232.405(b)(3)(iii) of this chapter.
    (ii) * * *
    (A) Registrant is not registered under the Investment Company Act 
of 1940 (15 U.S.C. 80a-1 et seq.); and
* * * * *
    (iii) Not permitted to be submitted. Not permitted to be submitted 
to the Commission if the registrant is registered under the Investment 
Company Act of 1940 (15 U.S.C. 80a-1 et seq.).
* * * * *

PART 230--GENERAL RULES and REGULATIONS, SECURITIES ACT OF 1933

0
3. The authority citation for part 230 continues to read, in part, as 
follows:

    Authority: 15 U.S.C. 77b, 77b note, 77c, 77d, 77f, 77g, 77h, 
77j, 77r, 77s, 77z-3, 77sss, 78c, 78d, 78j, 78l, 78m, 78n, 78o, 78o-
7 note, 78t, 78w, 78ll(d), 78mm, 80a-8, 80a-24, 80a-28, 80a-29, 80a-
30, and 80a-37, and Pub. L. 112-106, sec. 201(a), sec. 401, 126 
Stat. 313 (2012), unless otherwise noted.
* * * * *
    Sections 230.400 to 230.499 issued under secs. 6, 8, 10, 19, 48 
Stat. 78, 79, 81, and 85, as amended (15 U.S.C. 77f, 77h, 77j, 77s).
    Sec. 230.457 also issued under secs. 6 and 7, 15 U.S.C. 77f and 
77g.
* * * * *

0
4. Amend Sec.  230.134 by revising paragraph (g) to read as follows:


Sec.  230.134  Communications not deemed a prospectus.

* * * * *
    (g) This section does not apply to a communication relating to an 
investment company registered under the Investment Company Act of 1940 
(15 U.S.C. 80a-1 et seq.), other than a registered closed-end 
investment company.

0
5. Amend Sec.  230.138 by:
0
a. Removing Instruction to paragraph (a)(1);
0
b. Adding paragraph (a)(1)(iii); and
0
c. Revising paragraph (a)(2)(i).
    The addition and revision read as follows:


Sec.  230.138  Publications or distributions of research reports by 
brokers or dealers about securities other than those they are 
distributing.

    (a) * * *
    (1) * * *
    (iii) Note: If the issuer has filed a shelf registration statement 
under Sec.  230.415(a)(1)(x) (Rule 415(a)(1)(x)) or pursuant to General 
Instruction I.D. of Form S-3, General Instruction I.C. of Form F-3 
(Sec.  239.13 or Sec.  239.33 of this chapter), or pursuant to General 
Instructions A.2 and B of Form N-2 (Sec. Sec.  239.14 and 274.11a-1 of 
this chapter) with respect to multiple classes of securities, the 
conditions of paragraph (a)(1) of this section must be satisfied for 
the offering in which the broker or dealer is participating or will 
participate.
    (2) * * *
    (i)(A) Is required to file reports, and has filed all periodic 
reports required during the preceding 12 months (or such shorter time 
that the issuer was required to file such reports) on Forms 10-K (Sec.  
249.310 of this chapter), 10-Q (Sec.  249.308a of this chapter), and 
20-F (Sec.  249.220f of this chapter) pursuant to Section 13 or Section 
15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); 
or
    (B)(1) Is a registered closed-end investment company; and
    (2) Is required to file reports, and has filed all periodic reports 
required during the preceding 12 months (or such shorter time that the 
issuer was required to file such reports) on Forms N-CSR (Sec. Sec.  
249.331 and 274.128 of this chapter), N-PORT (Sec.  274.150 of this 
chapter), and N-CEN (Sec. Sec.  249.330 and 274.101 of this chapter) 
pursuant to Section 30 of the Investment Company Act; or
* * * * *

0
6. Amend Sec.  230.156 by adding paragraph (d) to read as follows:


Sec.  230.156  Investment company sales literature.

* * * * *
    (d) Nothing in this section may be construed to prevent a business 
development company or a registered closed-end investment company from 
qualifying for an exemption under Sec.  230.168 or Sec.  230.169.

0
7. Amend Sec.  230.163 by:
0
a. In paragraph (b)(3)(i):
0
i. Removing ``Rule 165 (Sec.  230.165) or Rule 166 (Sec.  230.166)'' 
and adding ``Sec.  230.165 (Rule 165) or Sec.  230.166 (Rule 166)'' in 
its place; and
0
ii. Adding ``or'' after the semicolon at the end of the paragraph;
0
b. Revising paragraph (b)(3)(ii); and
0
c. Removing paragraph (b)(3)(iii).
    The revision reads as follows:


Sec.  230.163  Exemption from section 5(c) of the Act for certain 
communications by or on behalf of well-known seasoned issuers.

* * * * *
    (b) * * *
    (3) * * *
    (ii) Communications by an issuer that is an investment company 
registered under the Investment Company Act of 1940 (15 U.S.C. 80a-1 et 
seq.), other than a registered closed-end investment company.
* * * * *

0
8. Amend Sec.  230.163A by revising paragraph (b)(4) to read as 
follows:


Sec.  230.163A  Exemption from section 5(c) of the Act for certain 
communications made by or on behalf of issuers more than 30 days before 
a registration statement is filed.

* * * * *
    (b) * * *
    (4) Communications made by an issuer that is an investment company 
registered under the Investment Company Act of 1940 (15 U.S.C. 80a-1 et 
seq.), other than a registered closed-end investment company.
* * * * *

0
9. Amend Sec.  230.164 by revising paragraph (f) to read as follows:


Sec.  230.164  Post-filing free writing prospectuses in connection with 
certain registered offerings.

* * * * *
    (f) Excluded issuers. This section and Rule 433 are not available 
if the issuer is an investment company registered under the Investment 
Company Act of 1940 (15 U.S.C. 80a-1 et seq.), other than a registered 
closed-end investment company.
* * * * *

0
10. Amend Sec.  230.168 by revising paragraphs (b)(1) introductory 
text, (b)(2) introductory text, and (d)(3) to read as follows:


Sec.  230.168  Exemption from sections 2(a)(10) and 5(c) of the Act for 
certain communications of regularly released factual business 
information and forward-looking information.

* * * * *
    (b) * * *
    (1) Factual business information means some or all of the following

[[Page 33353]]

information that is released or disseminated under the conditions in 
paragraph (d) of this section, including, without limitation, such 
factual business information contained in reports or other materials 
filed with, furnished to, or submitted to the Commission pursuant to 
the Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) or the 
Investment Company Act of 1940 (15 U.S.C. 80a-1 et seq.):
* * * * *
    (2) Forward-looking information means some or all of the following 
information that is released or disseminated under the conditions in 
paragraph (d) of this section, including, without limitation, such 
forward-looking information contained in reports or other materials 
filed with, furnished to, or submitted to the Commission pursuant to 
the Securities Exchange Act of 1934 or pursuant to the Investment 
Company Act of 1940:
* * * * *
    (d) * * *
    (3) The issuer is not an investment company registered under the 
Investment Company Act of 1940 (15 U.S.C. 80a-1 et seq.), other than a 
registered closed-end investment company.

0
11. Amend Sec.  230.169 by revising paragraph (d)(4) to read as 
follows:


Sec.  230.169  Exemption from sections 2(a)(10) and 5(c) of the Act for 
certain communications of regularly released factual business 
information.

* * * * *
    (d) * * *
    (4) The issuer is not an investment company registered under the 
Investment Company Act of 1940 (15 U.S.C. 80a-1 et seq.), other than a 
registered closed-end investment company.

0
12. Amend Sec.  230.172 by:
0
a. Revising paragraph (d)(1);
0
b. Removing paragraph (d)(2);
0
c. Redesignating paragraphs (d)(3) and (4) as paragraphs (d)(2) and 
(3); and
0
d. In newly redesignated paragraph (d)(2), removing ``Rule 165(f)(1) 
(Sec.  230.165(f)(1)'' and adding ``Sec.  230.165(f)(1) (Rule 
165(f)(1))'' in its place.
    The revision reads as follows:


Sec.  230.172  Delivery of prospectuses.

* * * * *
    (d) * * *
    (1) Offering of any investment company registered under the 
Investment Company Act of 1940 (15 U.S.C. 80a-1 et seq.), other than a 
registered closed-end investment company;
* * * * *

0
13. Amend Sec.  230.173 by:
0
a. Revising paragraph (f)(2);
0
b. Removing paragraph (f)(3);
0
c. Redesignating paragraphs (f)(4) and (5) as paragraphs (f)(3) and 
(4); and
0
d. In newly redesignated paragraph (f)(3), removing ``Rule 165(f)(1) 
(Sec.  230.165(f)(1))'' and adding ``Sec.  230.165(f)(1) (Rule 
165(f)(1))'' in its place.
    The revision reads as follows:


Sec.  230.173  Notice of registration.

* * * * *
    (f) * * *
    (2) Offering of an investment company registered under the 
Investment Company Act of 1940 (15 U.S.C. 80a-1 et seq.), other than a 
registered closed-end investment company;
* * * * *

0
14. Amend Sec.  230.405 by:
0
a. Revising the definition of ``Automatic shelf registration 
statement'';
0
b. Adding the definition for ``Exchange-traded vehicle security'' in 
alphabetical order;
0
c. In the definition of ``Ineligible issuer'':
0
i. Revising paragraph (1)(i);
0
ii. In paragraph (1)(vii), removing the word ``or'' at the end of the 
paragraph;
0
iii. In paragraph (1)(viii), removing the period and adding in its 
place ``; or''; and
0
iv. Adding paragraph (1)(ix);
0
d. Adding the definition for ``Registered closed-end investment 
company'' in alphabetical order; and
0
e. In the definition ``Well-known seasoned issuer'', revising 
paragraphs (1)(i) introductory text, (1)(i)(B)(2), (1)(v), and 
(2)(iii).
    The additions and revisions read as follows:


Sec.  230.405  Definitions of terms.

* * * * *
    Automatic shelf registration statement. The term automatic shelf 
registration statement means a registration statement filed on Form S-
3, Form F-3, or Form N-2 (Sec.  239.13, Sec.  239.33, or Sec. Sec.  
239.14 and 274.11a-1 of this chapter) by a well-known seasoned issuer 
pursuant to General Instruction I.D. of Form S-3, General Instruction 
I.C. of Form F-3, or General Instruction B of Form N-2.
* * * * *
    Exchange-traded vehicle security. The term exchange-traded vehicle 
security means a security:
    (1) Of an issuer:
    (i) That is not a registered investment company under the 
Investment Company Act of 1940; and
    (ii) The assets of which consist primarily of commodities, 
currencies, or derivative instruments that reference commodities or 
currencies, or interests in the foregoing;
    (2) Offered or sold in a registered offering on a continuous basis 
pursuant to Sec.  230.415 (Rule 415) by or on behalf of the issuer;
    (3) Of a class of securities that is listed for trading on a 
national securities exchange at or immediately after the time of 
effectiveness of the registration statement; and
    (4) Which is able to be purchased or redeemed, subject to 
conditions or limitations as described in the registration statement 
for the offering of such security, by the issuer for a ratable share of 
the issuer's assets (or the cash equivalent thereof) at their net asset 
value each business day.
* * * * *
    Ineligible issuer. (1) * * *
    (i) Any issuer that is required to file reports pursuant to section 
13 or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 
78o(d)) or section 30 of the Investment Company Act of 1940 (15 U.S.C. 
80a-29) that has not filed all reports and other materials required to 
be filed during the preceding 12 months (or for such shorter period 
that the issuer was required to file such reports pursuant to sections 
13 or 15(d) of the Securities Exchange Act of 1934 or section 30 of the 
Investment Company Act of 1940), other than reports on Form 8-K (Sec.  
249.308 of this chapter) required solely pursuant to an item specified 
in General Instruction I.A.3(b) of Form S-3 (Sec.  239.13 of this 
chapter) or General Instruction A.2.a of Form N-2 (Sec. Sec.  239.14 
and 274.11a-1 of this chapter) (or in the case of an asset-backed 
issuer, to the extent the depositor or any issuing entity previously 
established, directly or indirectly, by the depositor (as such terms 
are defined in Sec.  229.1101 of this chapter (Item 1101 of Regulation 
AB) are or were at any time during the preceding 12 calendar months 
required to file reports pursuant to section 13 or 15(d) of the 
Securities Exchange Act of 1934 with respect to a class of asset-backed 
securities involving the same asset class, such depositor and each such 
issuing entity must have filed all reports and other material required 
to be filed for such period (or such shorter period that each such 
entity was required to file such reports), other than reports on Form 
8-K required solely pursuant to an item specified in General 
Instruction I.A.2 of Form SF-3);
* * * * *
    (ix) In the case of an issuer that is a registered closed-end 
investment

[[Page 33354]]

company or a business development company, within the past three years 
any person or entity that at the time was an investment adviser to the 
issuer, including any sub-adviser, was made the subject of any judicial 
or administrative decree or order arising out of a governmental action 
that determines that the investment adviser aided, abetted or caused 
the issuer to have violated the anti-fraud provisions of the Federal 
securities laws.
* * * * *
    Registered closed-end investment company. The term registered 
closed-end investment company means a closed-end company, as defined in 
section 5(a)(2) of the Investment Company Act of 1940 (15 U.S.C. 80a-
5(a)(2)), that is registered under the Investment Company Act.
* * * * *
    Well-known seasoned issuer. * * *
    (1)(i) Meets all the registrant requirements of General Instruction 
I.A. of Form S-3 or Form F-3 (Sec.  239.13 or Sec.  239.33 of this 
chapter), or General Instructions A.2.a and A.2.b of Form N-2 
(Sec. Sec.  239.14 and 274.11a-1 of this chapter) and either:
* * * * *
    (B) * * *
    (2) Will register only non-convertible securities, other than 
common equity, and full and unconditional guarantees permitted pursuant 
to paragraph (1)(ii) of this definition unless, at the determination 
date, the issuer also is eligible to register a primary offering of its 
securities relying on General Instruction I.B.1. of Form S-3 or Form F-
3 or is eligible to register a primary offering described in General 
Instruction I.B.1. of Form S-3 relying on General Instruction A.2 of 
Form N-2.
* * * * *
    (v) Is not an investment company registered under the Investment 
Company Act of 1940 (15 U.S.C. 80a-1 et seq.), other than a registered 
closed-end investment company.
    (2) * * *
    (iii) In the event that the issuer has not filed a shelf 
registration statement or amended a shelf registration statement for 
purposes of complying with section 10(a)(3) of the Act for sixteen 
months, the time of filing of the issuer's most recent annual report on 
Form 10-K (Sec.  249.310 of this chapter), Form 20-F (Sec.  249.220f of 
this chapter), or Form N-CSR (Sec. Sec.  249.331 and 274.128 of this 
chapter) (or if such report has not been filed by its due date, such 
due date).
* * * * *

0
15. Amend Sec.  230.415 by revising paragraphs (a)(1)(x) and (xi), 
adding paragraph (a)(1)(xiii), and revising paragraph (a)(2) to read as 
follows:


Sec.  230.415  Delayed or continuous offering and sale of securities.

    (a) * * *
    (1) * * *
    (x) Securities registered (or qualified to be registered) on Form 
S-3 or Form F-3 (Sec.  239.13 or Sec.  239.33 of this chapter), or on 
Form N-2 (Sec. Sec.  239.14 and 274.11a-1 of this chapter) pursuant to 
General Instruction A.2 of that form, which are to be offered and sold 
on an immediate, continuous or delayed basis by or on behalf of the 
registrant, a majority-owned subsidiary of the registrant or a person 
of which the registrant is a majority-owned subsidiary; or
    (xi) Shares of common stock which are to be offered and sold on a 
delayed or continuous basis by or on behalf of a registered closed-end 
investment company or business development company that makes periodic 
repurchase offers pursuant to Sec.  270.23c-3 of this chapter.
* * * * *
    (xiii) Exchange-traded vehicle securities which are to be offered 
and sold on a continuous basis by or on behalf of the registrant in 
accordance with Sec.  230.456(d) (Rule 456(d)).
    (2) Securities in paragraphs (a)(1)(viii) and (ix) of this section 
that are not registered on Form S-3 or Form F-3 (Sec.  239.13 or Sec.  
239.33 of this chapter), or on Form N-2 (Sec. Sec.  239.14 and 274.11a-
1 of this chapter) pursuant to General Instruction A.2 of that form, 
may only be registered in an amount which, at the time the registration 
statement becomes effective, is reasonably expected to be offered and 
sold within two years from the initial effective date of the 
registration.
* * * * *

0
16. Amend Sec.  230.418 by revising paragraph (a)(3) introductory text 
to read as follows:


Sec.  230.418  Supplemental information.

    (a) * * *
    (3) Except in the case of a registrant eligible to use Form S-3 
(Sec.  239.13 of this chapter), or Form N-2 (Sec. Sec.  239.14 and 
274.11a-1 of this chapter) under General Instruction A.2 of that form, 
any engineering, management or similar reports or memoranda relating to 
broad aspects of the business, operations or products of the 
registrant, which have been prepared within the past twelve months for 
or by the registrant and any affiliate of the registrant or any 
principal underwriter, as defined in Sec.  230.405 (Rule 405), of the 
securities being registered except for:
* * * * *

0
17. Amend Sec.  230.424 by revising paragraph (f) and adding paragraph 
(i) to read as follows:


Sec.  230.424  Filing of prospectuses, number of copies.

* * * * *
    (f) This section shall not apply with respect to prospectuses of an 
investment company registered under the Investment Company Act of 1940, 
other than a registered closed-end investment company. References to 
``form of prospectus'' in paragraphs (a), (b), and (c) of this section 
shall be deemed also to refer to the form of Statement of Additional 
Information.
* * * * *
    (i)(1) A form of prospectus filed pursuant to this section that 
operates to reflect the payment of filing fees for an offering of an 
indeterminate amount of exchange-traded vehicle securities pursuant to 
Sec. Sec.  230.456(d) and 230.457(u) (Rule 456(d) and Rule 457(u)) 
shall be filed with the Commission within the time period set forth in 
Rule 456(d). The form of prospectus must be accompanied by the 
appropriate registration fee.
    (2) The form of prospectus must include the following information:
    (i) The name and address of issuer;
    (ii) The name of the securities for which the prospectus is filed;
    (iii) The Securities Act file number(s) of the registration 
statement(s) associated with the offering;
    (iv) The last day of the fiscal year for the issuer for which the 
prospectus is filed;
    (v) The calculation of registration fee information calculated 
pursuant to Rule 457(u); and
    (vi) The total interest due pursuant to Rule 456(d)(5) and the 
total amount of registration fee due including any such interest, if 
the prospectus is being filed more than 90 days after the end of the 
issuer's fiscal year.

0
18. Amend Sec.  230.430A by revising paragraph (a)(2) to read as 
follows:


Sec.  230.430A  Prospectus in a registration statement at the time of 
effectiveness.

    (a) * * *
    (2) The registrant furnishes the undertakings required by Sec.  
229.512(i) of this chapter (Item 512(i) of Regulation S-K), or the 
undertakings required by Item 34.4 of Form N-2 (Sec. Sec.  239.14 and 
274.11a-1 of this chapter); and
* * * * *

0
19. Amend Sec.  230.430B by revising paragraphs (b) introductory text, 
(f)(4)

[[Page 33355]]

introductory text, (f)(4)(ii), and (i) to read as follows:


Sec.  230.430B  Prospectus in a registration statement after effective 
date.

* * * * *
    (b) A form of prospectus filed as part of a registration statement 
for offerings pursuant to Rule 415(a)(1)(i) by an issuer eligible to 
use Form S-3 or Form F-3 (Sec.  239.13 or Sec.  239.33 of this chapter) 
for primary offerings pursuant to General Instruction I.B.1 of such 
forms, or an issuer eligible to register such a primary offering under 
General Instruction A.2 of Form N-2 (Sec. Sec.  239.14 and 274.11a-1 of 
this chapter), may omit the information specified in paragraph (a) of 
this section, and may also omit the identities of selling security 
holders and amounts of securities to be registered on their behalf if:
* * * * *
    (f) * * *
    (4) Except for an effective date resulting from the filing of a 
form of prospectus filed for purposes of including information required 
by section 10(a)(3) of the Act or pursuant to Sec.  229.512(a)(1)(ii) 
of this chapter (Item 512(a)(1)(ii) of Regulation S-K) or Item 
34.3.a(2) of Form N-2 (Sec. Sec.  239.14 and 274.11a-1 of this 
chapter), the date a form of prospectus is deemed part of and included 
in the registration statement pursuant to this paragraph (f)(4) shall 
not be an effective date established pursuant to paragraph (f)(2) of 
this section as to:
* * * * *
    (ii) Any person signing any report or document incorporated by 
reference into the registration statement, except for such a report or 
document incorporated by reference for purposes of including 
information required by section 10(a)(3) of the Act or pursuant to Item 
512(a)(1)(ii) of Regulation S-K or Item 34.3.a(2) of Form N-2 
(Sec. Sec.  239.14 and 274.11a-1 of this chapter) (such person except 
for such reports being deemed not to be a person who signed the 
registration statement within the meaning of section 11(a) of the Act).
* * * * *
    (i) Issuers relying on this section shall furnish the undertakings 
required by Item 512(a) of Regulation S-K or Item 34.3 of Form N-2 
(Sec. Sec.  239.14 and 274.11a-1 of this chapter) as applicable.

0
20. Amend Sec.  230.433 by revising paragraphs (b)(1)(i) and (iv) and 
(c)(1)(ii) to read as follows:


Sec.  230.433  Conditions to permissible post-filing free writing 
prospectuses.

* * * * *
    (b) * * *
    (1) * * *
    (i) Offerings of securities registered on Form S-3 (Sec.  239.33 of 
this chapter) pursuant to General Instruction I.B.1, I.B.2, I.C., or 
I.D. thereof or on Form SF-3 (Sec.  239.45 of this chapter) or on Form 
N-2 (Sec. Sec.  239.14 and 274.11a-1 of this chapter) pursuant to 
General Instruction A.2 with respect to the same transactions;
* * * * *
    (iv) Any other offering not excluded from reliance on this section 
and Rule 164 of securities of an issuer eligible to use Form S-3 or 
Form F-3 for primary offerings pursuant to General Instruction I.B.1 of 
such Forms or an issuer eligible to use General Instruction A.2 of Form 
N-2 to register a primary offering described in General Instruction 
I.B.1 of Form S-3.
* * * * *
    (c) * * *
    (1) * * *
    (ii) Information contained in the issuer's periodic and current 
reports filed or furnished to the Commission pursuant to section 13 or 
15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)) 
that are incorporated by reference into the registration statement and 
not superseded or modified, or pursuant to section 30 of the Investment 
Company Act of 1940 (15 U.S.C. 80a-29).
* * * * *

0
21. Effective August 1, 2021, amend Sec.  230.456 by adding paragraph 
(d) to read as follows:


Sec.  230.456  Date of filing; timing of fee payment.

* * * * *
    (d)(1) Notwithstanding paragraph (a) of this section, where a 
registration statement relates to an offering of exchange-traded 
vehicle securities, an issuer may elect to register an offering of an 
indeterminate amount of such securities if it meets the following 
conditions:
    (i) The issuer must state in the ``Calculation of Registration 
Fee'' table that it is offering an indeterminate amount of such 
securities; and
    (ii) The issuer must, not later than 90 days after the end of any 
fiscal year during which it has publicly offered such securities, pay a 
registration fee to the Commission calculated in accordance with Sec.  
230.457(u) (Rule 457(u)) and file a prospectus in accordance with Sec.  
230.424(i) (Rule 424(i)).
    Instruction 1 to paragraph (d)(1)(ii): To determine the date on 
which the registration fee must be paid, the first day of the 90-day 
period is the first calendar day of the fiscal year following the 
fiscal year for which the registration fee is to be paid. If the last 
day of the 90-day period falls on a Saturday, Sunday, or Federal 
holiday, the registration fee is due on the first business day 
thereafter.
    (2) If a registrant elects to register an offering of an 
indeterminate amount of exchange-traded vehicle securities pursuant to 
paragraph (d)(1) of this section, the securities sold will be 
considered registered, for purposes of section 6(a) of the Act, if the 
registration fee has been paid and a prospectus is filed pursuant to 
paragraph (d)(1) not later than the end of the 90-day period.
    (3) A registration statement filed relying on the registration fee 
payment provisions of paragraph (d)(1) of this section will be 
considered filed as to the securities identified in the registration 
statement for purposes of this section and section 5 of the Act when it 
is received by the Commission, if it complies with all other 
requirements under the Act, including this part.
    (4) For purposes of this section, if an issuer ceases operations, 
the date the issuer ceases operations will be deemed to be the end of 
its fiscal year. In the case of a liquidation, merger, or sale of all 
or substantially all of the assets (``merger'') of the issuer, the 
issuer will be deemed to have ceased operations for the purposes of 
this section on the date the merger is consummated; provided, however, 
that in the case of a merger of an issuer or a series of an issuer 
(``Predecessor Issuer'') with another issuer or a series of an issuer 
(``Successor Issuer''), the Predecessor Issuer will not be deemed to 
have ceased operations and the Successor Issuer will assume the 
obligations, fees, and redemption credits of the Predecessor Issuer 
incurred pursuant to this section if the Successor Issuer:
    (i) Had no assets or liabilities, other than nominal assets or 
liabilities, and no operating history immediately prior to the merger;
    (ii) Acquired substantially all of the assets and assumed 
substantially all of the liabilities and obligations of the Predecessor 
Issuer; and
    (iii) The merger is not designed to result in the Predecessor 
Issuer merging with, or substantially all of its assets being acquired 
by, an issuer (or a series of an issuer) that would not meet the 
conditions of paragraph (d)(4)(i) of this section.
    (5) An issuer paying the fee required by paragraph (d)(1) of this 
section or any portion thereof more than 90 days after the end of the 
fiscal year of the issuer shall pay to the Commission interest on

[[Page 33356]]

unpaid amounts, calculated based on the interest rate in effect at the 
time of the interest payment by reference to the ``current value of 
funds rate'' on the Treasury Department's Financial Management Service 
internet site at http://www.fms.treas.gov, or by calling (202) 874-
6995, and using the following formula: I = (X) (Y) (Z/365), where: I = 
Amount of interest due; X = Amount of registration fee due; Y = 
Applicable interest rate, expressed as a fraction; Z = Number of days 
by which the registration fee payment is late. The payment of interest 
pursuant to this paragraph (d)(5) shall not preclude the Commission 
from bringing an action to enforce the requirements of this paragraph 
(d).
    (6) An immaterial or unintentional failure to comply with a 
requirement of this paragraph (d) will not result in a violation of 
section 6(a) of the Act (15 U.S.C. 77f(a)), so long as:
    (i) A good faith and reasonable effort was made to comply with the 
requirement; and
    (ii) In the case of a late payment of a registration fee, the 
issuer pays the registration fee and any interest due thereon as soon 
as practicable after discovery of the failure to pay the registration 
fee.

0
22. Effective August 1, 2021, amend Sec.  230.457 by adding paragraph 
(u) to read as follows:


Sec.  230.457  Computation of fee.

* * * * *
    (u) Where an issuer elects to register an offering of an 
indeterminate amount of exchange-traded vehicle securities in 
accordance with Sec.  230.456(d) (Rule 456(d)), the registration fee is 
to be calculated in the following manner:
    (1) Determine the aggregate sale price of securities sold during 
the fiscal year.
    (2) Determine the sum of:
    (i) The aggregate redemption or repurchase price of securities 
redeemed or repurchased during the fiscal year; and
    (ii) The aggregate redemption or repurchase price of securities 
redeemed or repurchased during any prior fiscal year ending no earlier 
than August 1, 2021, that were not used previously to reduce 
registration fees payable to the Commission.
    (3) Subtract the amount in paragraph (u)(2) of this section from 
the amount in paragraph (u)(1) of this section. If the resulting amount 
is positive, the amount is the net sales amount. If the resulting 
amount is negative, it is the amount of redemption credits available 
for use in future years to offset sales.
    (4) The registration fee is calculated by multiplying the net sales 
amount by the fee payment rate in effect on the date of the fee 
payment. If the issuer determines that it had net redemptions or 
repurchases for the fiscal year, no registration fee is due.

0
23. Amend Sec.  230.462 by revising paragraph (f) to read as follows:


Sec.  230.462  Immediate effectiveness of certain registration 
statements and post-effective amendments.

* * * * *
    (f) A post-effective amendment filed pursuant to paragraph (e) of 
this section for purposes of adding a new issuer and its securities as 
permitted by Sec.  230.413(b) (Rule 413(b)) that satisfies the 
requirements of Form S-3, Form F-3, or General Instruction A.2 of Form 
N-2 (Sec.  239.13, Sec.  239.33, or Sec. Sec.  239.14 and 274.11a-1 of 
this chapter), as applicable, including the signatures required by 
Sec.  230.402(e) (Rule 402(e)), and contains a prospectus satisfying 
the requirements of Sec.  230.430B (Rule 430B), shall become effective 
upon filing with the Commission.

0
24. Amend Sec.  230.486 by:
0
a. Revising paragraphs (a), (b) introductory text, and (b)(1)(iv);
0
b. Removing ``and'' at the end of paragraph (b)(1)(v);
0
c. Redesignating paragraph (b)(1)(vi) as paragraph (b)(1)(vii);
0
d. Adding new paragraph (b)(1)(vi);
0
e. Revising the introductory text to paragraph (b)(2); and
0
f. Adding paragraph (g).
    The revisions and additions read as follows:


Sec.  230.486  Effective date of post-effective amendments and 
registration statements filed by certain closed-end management 
investment companies.

    (a) Automatic effectiveness. Except as otherwise provided in this 
section, a post-effective amendment to a registration statement, or a 
registration statement described in paragraph (g) of this section, 
filed by a registered closed-end management investment company or 
business development company which makes periodic repurchase offers 
under Sec.  270.23c-3 of this chapter or which offers securities under 
Sec.  230.415(a)(1)(ix), shall become effective on the sixtieth day 
after the filing thereof, or a later date designated by the registrant 
on the facing sheet of the amendment or registration statement, which 
date shall not be later than eighty days after the date on which the 
amendment or registration statement is filed, Provided, that the 
Commission, having due regard to the public interest and the protection 
of investors, may declare an amendment or registration statement filed 
under this paragraph (a) effective on an earlier date.
    (b) Immediate effectiveness. Except as otherwise provided in this 
section, a post-effective amendment to a registration statement, or a 
registration statement, filed by a registered closed-end management 
investment company or business development company which makes periodic 
repurchase offers under Sec.  270.23c-3 of this chapter or which offers 
securities under Sec.  230.415(a)(1)(ix), shall become effective on the 
date on which it is filed with the Commission, or a later date 
designated by the registrant on the facing sheet of the amendment or 
registration statement, which date shall be not later than thirty days 
after the date on which the amendment or registration statement is 
filed, except that a post-effective amendment including a designation 
of a new effective date under paragraph (b)(1)(iii) of this section 
shall become effective on the new effective date designated therein, 
Provided, that the following conditions are met:
    (1) * * *
    (iv) Disclosing or updating the information required by Item 9.1.c 
of Form N-2 [17 CFR 239.14 and 274.11a-1];
* * * * *
    (vi) Complying with Sec.  230.415(a)(5) and (6); and
* * * * *
    (2) The registrant represents that the amendment is filed solely 
for one or more of the purposes specified in paragraph (b)(1) of this 
section and that no material event requiring disclosure in the 
prospectus, other than one listed in paragraph (b)(1) or one for which 
the Commission has approved a filing under paragraph (b)(1)(vii) of 
this section, has occurred since the latest of the following three 
dates:
* * * * *
    (g) Registration statements. A registration statement can become 
effective under paragraph (a) of this section if it is filed for the 
purpose of:
    (1) Registering additional shares of common stock for which a 
registration statement filed on Form N-2 (Sec. Sec.  239.14 and 
274.11a-1 of this chapter) is effective; or
    (2) Complying with Sec.  230.415(a)(5) and (6).

0
25. Amend Sec.  230.497 by:
0
a. Remove from paragraphs (c) and (e) the text ``Form N-2 (Sec. Sec.  
239.14 and 274.11a-1 of this chapter),'';
0
b. Removing the heading from paragraph (k);
0
c. Adding paragraph (l); and
0
d. Removing the parenthetical authority citation at the end of the 
section.

[[Page 33357]]

    The addition reads as follows:


Sec.  230.497  Filing of investment company prospectuses--number of 
copies.

* * * * *
    (l) Except for an investment company advertisement deemed to be a 
section 10(b) prospectus pursuant to Sec.  230.482, this section shall 
not apply with respect to prospectuses of a registered closed-end 
investment company, or a business development company.

PART 232--REGULATION S-T--GENERAL RULES AND REGULATIONS FOR 
ELECTRONIC FILINGS

0
26. The general authority citation for part 232 continues to read as 
follows:

    Authority: 15 U.S.C. 77c, 77f, 77g, 77h, 77j, 77s(a), 77z-3, 
77sss(a), 78c(b), 78l, 78m, 78n, 78o(d), 78w(a), 78ll, 80a-6(c), 
80a-8, 80a-29, 80a-30, 80a-37, 7201 et seq.; and 18 U.S.C. 1350, 
unless otherwise noted.
* * * * *

0
27. Amend Sec.  232.11 by revising the section heading and the 
definition of ``Related Official Filing'' to read as follows:


Sec.  232.11  Definition of terms used in this part.

* * * * *
    Related Official Filing. The term Related Official Filing means the 
ASCII or HTML format part of the official filing with which all or part 
of an Interactive Data File appears as an exhibit or, in the case of a 
filing on Form N-1A (Sec. Sec.  239.15A and 274.11A of this chapter), 
Form N-2 (Sec. Sec.  239.14 and 274.11a-1 of this chapter), Form N-3 
(Sec. Sec.  239.17a and 274.11b of this chapter), Form N-4 (Sec. Sec.  
239.17b and 274.11c of this chapter), Form N-6 (Sec. Sec.  239.17c and 
274.11d of this chapter), and Form N-CSR (Sec.  274.128 of this 
chapter), and, to the extent required by Sec.  232.405 [Rule 405 of 
Regulation S-T] for a business development company as defined in 
Section 2(a)(48) of the Investment Company Act of 1940 (15 U.S.C. 80a-
2(a)(48)), Form 10-K (Sec.  249.310 of this chapter), Form 10-Q (Sec.  
249.308a of this chapter), and Form 8-K (Sec.  249.308 of this 
chapter), the ASCII or HTML format part of an official filing that 
contains the information to which an Interactive Data File corresponds.
* * * * *

0
28. Amend Sec.  232.405 by:
0
a. Revising the introductory text and paragraphs (a)(2), (a)(3)(i) 
introductory text, (a)(3)(ii), and (a)(4);
0
b. Adding a heading for paragraph (b);
0
c. Removing the heading and revising the introductory text of paragraph 
(b)(1);
0
d. Adding paragraph (b)(3); and
0
e. Redesignating the note to Sec.  232.405 as note 2 to Sec.  232.405 
and revising the last sentence of newly redesignated note 2 to Sec.  
232.405.
    The revisions and addition read as follows:


Sec.  232.405  Interactive Data File submissions.

    This section applies to electronic filers that submit Interactive 
Data Files. Section 229.601(b)(101) of this chapter (Item 601(b)(101) 
of Regulation S-K), paragraph (101) of Part II--Information Not 
Required to be Delivered to Offerees or Purchasers of Form F-10 (Sec.  
239.40 of this chapter), paragraph 101 of the Instructions as to 
Exhibits of Form 20-F (Sec.  249.220f of this chapter), paragraph 
B.(15) of the General Instructions to Form 40-F (Sec.  249.240f of this 
chapter), paragraph C.(6) of the General Instructions to Form 6-K 
(Sec.  249.306 of this chapter), General Instruction C.3.(g) of Form N-
1A (Sec. Sec.  239.15A and 274.11A of this chapter), General 
Instruction I of Form N-2 (Sec. Sec.  239.14 and 274.11a-1 of this 
chapter), General Instruction C.3.(h) of Form N-3 (Sec. Sec.  239.17a 
and 274.11b of this chapter), General Instruction C.3.(h) of Form N-4 
(Sec. Sec.  239.17b and 274.11c of this chapter), General Instruction 
C.3.(h) of Form N-6 (Sec. Sec.  239.17c and 274.11d of this chapter), 
and General Instruction C.4 of Form N-CSR (Sec.  274.128 of this 
chapter) specify when electronic filers are required or permitted to 
submit an Interactive Data File (Sec.  232.11), as further described in 
note 2 to this section. This section imposes content, format, and 
submission requirements for an Interactive Data File, but does not 
change the substantive content requirements for the financial and other 
disclosures in the Related Official Filing (Sec.  232.11).
    (a) * * *
    (2) Be submitted only by an electronic filer either required or 
permitted to submit an Interactive Data File as specified by Sec.  
229.601(b)(101) of this chapter (Item 601(b)(101) of Regulation S-K), 
paragraph (101) of Part II--Information Not Required to be Delivered to 
Offerees or Purchasers of Form F-10 (Sec.  239.40 of this chapter), 
paragraph 101 of the Instructions as to Exhibits of Form 20-F (Sec.  
249.220f of this chapter), paragraph B.(15) of the General Instructions 
to Form 40-F (Sec.  249.240f of this chapter), paragraph C.(6) of the 
General Instructions to Form 6-K (Sec.  249.306 of this chapter), 
General Instruction C.3.(g) of Form N-1A (Sec. Sec.  239.15A and 
274.11A of this chapter), General Instruction I of Form N-2 (Sec. Sec.  
239.14 and 274.11a-1 of this chapter), General Instruction C.3.(h) of 
Form N-3 (Sec. Sec.  239.17a and 274.11b of this chapter), General 
Instruction C.3.(h) of Form N-4 (Sec. Sec.  239.17b and 274.11c of this 
chapter), General Instruction C.3.(h) of Form N-6 (Sec. Sec.  239.17c 
and 274.11d of this chapter), or General Instruction C.4 of Form N-CSR 
(Sec.  274.128 of this chapter), as applicable;
    (3) * * *
    (i) If the electronic filer is neither a management investment 
company registered under the Investment Company Act of 1940 (15 U.S.C. 
80a et seq.), nor a separate account as defined in Section 2(a)(14) of 
the Securities Act (15 U.S.C. 77b(a)(14)) registered under the 
Investment Company Act of 1940, nor a business development company as 
defined in Section 2(a)(48) of the Investment Company Act of 1940 (15 
U.S.C. 80a-2(a)(48)), and is not within one of the categories specified 
in paragraph (f)(1)(i) of this section, as partly embedded into a 
filing with the remainder simultaneously submitted as an exhibit to:
* * * * *
    (ii) If the electronic filer is either a management investment 
company registered under the Investment Company Act of 1940 (15 U.S.C. 
80a et seq.), or a separate account (as defined in Section 2(a)(14) of 
the Securities Act (15 U.S.C. 77b(a)(14)) registered under the 
Investment Company Act of 1940, or a business development company as 
defined in Section 2(a)(48) of the Investment Company Act of 1940 (15 
U.S.C. 80a-2(a)(48)), and is not within one of the categories specified 
in paragraph (f)(1)(ii) of this section, as partly embedded into a 
filing with the remainder simultaneously submitted as an exhibit to a 
filing that contains the disclosure this section requires to be tagged; 
and
    (4) Be submitted in accordance with the EDGAR Filer Manual and, as 
applicable, either Item 601(b)(101) of Regulation S-K (Sec.  
229.601(b)(101) of this chapter), paragraph (101) of Part II--
Information Not Required to be Delivered to Offerees or Purchasers of 
Form F-10 (Sec.  239.40 of this chapter), paragraph 101 of the 
Instructions as to Exhibits of Form 20-F (Sec.  249.220f of this 
chapter), paragraph B.(15) of the General Instructions to Form 40-F 
(Sec.  249.240f of this chapter), paragraph C.(6) of the General 
Instructions to Form 6-K (Sec.  249.306 of this chapter), General 
Instruction C.3.(g) of Form N-1A (Sec. Sec.  239.15A and 274.11A of 
this chapter), General Instruction I of Form N-2 (Sec. Sec.  239.14 and 
274.11a-1 of this chapter), General Instruction C.3.(h) of Form N-3 
(Sec. Sec.  239.17a and 274.11b of this chapter), General Instruction 
C.3.(h) of Form N-4 (Sec. Sec.  239.17b and 274.11c of

[[Page 33358]]

this chapter), General Instruction C.3.(h) of Form N-6 (Sec. Sec.  
239.17c and 274.11d of this chapter); or General Instruction C.4 of 
Form N-CSR (Sec.  274.128 of this chapter).
    (b) Content--categories of information presented. (1) If the 
electronic filer is neither a management investment company registered 
under the Investment Company Act of 1940 (15 U.S.C. 80a et seq.), nor a 
separate account (as defined in Section 2(a)(14) of the Securities Act 
(15 U.S.C. 77b(a)(14)) registered under the Investment Company Act of 
1940, nor a business development company as defined in Section 2(a)(48) 
of the Investment Company Act of 1940 (15 U.S.C. 80a-2(a)(48)) an 
Interactive Data File must consist of only a complete set of 
information for all periods required to be presented in the 
corresponding data in the Related Official Filing, no more and no less, 
from all of the following categories:
* * * * *
    (3) If the electronic filer is either a closed-end management 
investment company registered under the Investment Company Act of 1940 
(15 U.S.C. 80a et seq.) or a business development company as defined in 
Section 2(a)(48) of the Investment Company Act of 1940 (15 U.S.C. 80a-
2(a)(48)), an Interactive Data File must consist only of a complete set 
of information for all corresponding data in the Related Official 
Filing, no more and no less, as follows:
    (i) For a business development company, for all periods required to 
be presented:
    (A) The complete set of the electronic filer's financial statements 
(which includes the face of the financial statements and all 
footnotes); and
    (B) All schedules set forth in Sec. Sec.  210.12-01 through 210.12-
29 of this chapter (Article 12 of Regulation S-X) related to the 
electronic filer's financial statements;
    (ii) All of the information required on the cover page of Form N-2 
(Sec. Sec.  239.14 and 274.11a-1 of this chapter) except the 
Calculation of Registration Fee table; and
    (iii) As applicable, all of the information provided in response to 
Items 3.1, 4.3, 8.2.b, 8.2.d, 8.3.a, 8.3.b, 8.5.b, 8.5.c, 8.5.e, 
10.1.a-d, 10.2.a-c, 10.2.e, 10.3, and 10.5 of Form N-2 in any 
registration statement or post-effective amendment thereto filed on 
Form N-2; or any form of prospectus filed pursuant to Sec.  230.424 of 
this chapter (Rule 424 under the Securities Act); or, if a Registrant 
is filing a registration statement pursuant to General Instruction A.2 
of Form N-2, any filing on Form N-CSR, Form 10-K, Form 10-Q, or Form 8-
K to the extent such information appears therein.
* * * * *
    Note 2 to Sec.  232.405: * * * For an issuer that is a management 
investment company or separate account registered under the Investment 
Company Act of 1940 (15 U.S.C. 80a et seq.) or a business development 
company as defined in Section 2(a)(48) of the Investment Company Act of 
1940 (15 U.S.C. 80a-2(a)(48)), General Instruction C.3.(g) of Form N-1A 
(Sec. Sec.  239.15A and 274.11A of this chapter), General Instruction I 
of Form N-2 (Sec. Sec.  239.14 and 274.11a-1 of this chapter), General 
Instruction C.3.(h) of Form N-3 (Sec. Sec.  239.17a and 274.11b of this 
chapter), General Instruction C.3.(h) of Form N-4 (Sec. Sec.  239.17b 
and 274.11c of this chapter), General Instruction C.3.(h) of Form N-6 
(Sec. Sec.  239.17c and 274.11d of this chapter), and General 
Instruction C.4 of Form N-CSR (Sec.  274.128 of this chapter), as 
applicable, specifies the circumstances under which an Interactive Data 
File must be submitted.

PART 239--FORMS PRESCRIBED UNDER THE SECURITIES ACT OF 1933

0
29. The authority citation for part 239 continues to read, in part, as 
follows:

    Authority: 15 U.S.C. 77c, 77f, 77g, 77h, 77j, 77s, 77z-2, 77z-3, 
77sss, 78c, 78l,78m,78n, 78o(d), 78o-7 note, 78u-5, 78w(a), 
78ll,78mm, 80a-2(a), 80a-3, 80a-8, 80a-9, 80a-10, 80a-13, 80a-24, 
80a-26, 80a-29, 80a-30, and 80a-37; and sec. 107, Pub. L. 112-106, 
126 Stat. 312, unless otherwise noted.
    Sections 239.31, 239.32 and 239.33 are also issued under 15 U.S.C. 
78l, 78m, 78o, 78w, 80a-8, 80a-29, 80a-30, 80a-37 and 12 U.S.C. 241.
* * * * *

0
30. Effective August 1, 2021, amend Form S-1 (referenced in Sec.  
239.11) by revising the note that immediately follows the ``Calculation 
of Registration Fee'' table to read as follows:

    Note: The text of Form S-1 does not, and this amendment will 
not, appear in the Code of Federal Regulations.

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM S-1

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

* * * * *

CALCULATION OF REGISTRATION FEE

* * * * *
    Note: Specific details relating to the fee calculation shall be 
furnished in notes to the table, including references to provisions of 
Rule 457 (Sec.  230.457 of this chapter) relied upon, if the basis of 
the calculation is not otherwise evident from the information presented 
in the table. If the filing fee is calculated pursuant to Rule 457(o) 
under the Securities Act, only the title of the class of securities to 
be registered, the proposed maximum aggregate offering price for that 
class of securities and the amount of registration fee need to appear 
in the Calculation of Registration Fee table. If an offering of an 
indeterminate amount of exchange-traded vehicle securities is being 
registered, state that the registration statement covers an 
indeterminate amount of securities to be offered or sold and that the 
filing fee will be calculated and paid in accordance with Rule 456(d) 
and Rule 457(u) (Sec.  230.456(d) and Sec.  230.457(u) of this 
chapter), respectively. Any difference between the dollar amount of 
securities registered for such offerings and the dollar amount of 
securities sold may be carried forward on a future registration 
statement pursuant to Rule 429 under the Securities Act.
* * * * *

0
31. Effective August 1, 2021, amend Form S-3 (referenced in Sec.  
239.13) by adding Instruction 5 to the notes that immediately follow 
the ``Calculation of Registration Fee'' table to read as follows:

    Note: The text of Form S-3 does not, and this amendment will 
not, appear in the Code of Federal Regulations.

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM S-3

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

* * * * *

CALCULATION OF REGISTRATION FEE

* * * * *
    5. If an offering of an indeterminate amount of exchange-traded 
vehicle securities is being registered, the Fee Table must state that 
the registration statement covers an indeterminate amount of securities 
to be offered or sold and the filing fee will be calculated and paid in 
accordance with Rule

[[Page 33359]]

456(d) and Rule 457(u) (Sec.  230.456(d) and Sec.  230.457(u) of this 
chapter), respectively.
* * * * *

0
32. Amend Form N-14 (referenced in Sec.  239.23) by revising the first 
and second undesignated paragraphs of General Instruction G to read as 
follows:

    Note: The text of Form N-14 does not, and these amendments will 
not, appear in the Code of Federal Regulations.

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM N-14

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

* * * * *

GENERAL INSTRUCTIONS

* * * * *

G. Incorporation by Reference and Delivery of Prospectuses or Reports 
Filed With the Commission

    If any party to a transaction registered on Form N-14 is registered 
under the 1940 Act or is a business development company as defined by 
Section 2(a)(48) of the 1940 Act and has a current prospectus which 
meets the requirements of Section 10(a)(3) of the 1933 Act or is 
current in its reports filed pursuant to Section 13(a) or 15(d) of the 
1934 Act and Section 30 of the 1940 Act, the registrant may, if it so 
elects, incorporate by reference the prospectus, the corresponding 
Statement of Additional Information, or reports, or any information in 
the prospectus, the corresponding Statement of Additional Information, 
or reports, which satisfies the disclosure required by Items 5, 6, and 
11 through 14 of this Form. If the registrant elects to incorporate 
information by reference into the prospectus, a copy of each document 
from which information is incorporated by reference must accompany the 
prospectus, except that a prospectus from which information has been 
incorporated by reference need not be sent to an investor if the 
obligation to deliver a prospectus under Section 5(b)(2) of the 
Securities Act [15 U.S.C. 77e] has already been satisfied with respect 
to that investor pursuant to Rule 498A(j) for the offering described in 
the prospectus being incorporated by reference. Notwithstanding the 
foregoing the registrant may, at its discretion, incorporate any or all 
of the Statement of Additional Information into the prospectus 
delivered to investors, without delivering the Statement with the 
prospectus, so long as the Statement of Additional Information is 
available to investors as provided in General Instruction F. The 
registrant also may incorporate by reference into the prospectus 
information about the company being acquired without delivering the 
information with the prospectus under certain conditions pursuant to 
Item 6 of Form N-14, and in accordance with the requirements of 
Instruction F.
    If the registrant elects to incorporate information by reference 
into the Statement of Additional Information, a copy of each document 
from which information is incorporated by reference must accompany the 
Statement of Additional Information sent to shareholders.
* * * * *

0
33. Effective August 1, 2021, amend Form F-1 (referenced in Sec.  
239.31) by revising the note that immediately follows the ``Calculation 
of Registration Fee'' table to read as follows:

    Note: The text of Form F-1 does not, and this amendment will 
not, appear in the Code of Federal Regulations.

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM F-1

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

* * * * *

CALCULATION OF REGISTRATION FEE

* * * * *
    Note: Specific details relating to the fee calculation shall be 
furnished in notes to the table, including references to provisions of 
Rule 457 (Sec.  230.457 of this chapter) relied upon, if the basis of 
the calculation is not otherwise evident from the information presented 
in the table. If the filing fee is calculated pursuant to Rule 457(o) 
under the Securities Act, only the title of the class of securities to 
be registered, the proposed maximum aggregate offering price for that 
class of securities and the amount of registration fee need to appear 
in the Calculation of Registration Fee table. If an offering of an 
indeterminate amount of exchange-traded vehicle securities is being 
registered, state that the registration statement covers an 
indeterminate amount of securities to be offered or sold and that the 
filing fee will be calculated and paid in accordance with Rule 456(d) 
and Rule 457(u) (Sec.  230.456(d) and Sec.  230.457(u) of this 
chapter), respectively. Any difference between the dollar amount of 
securities registered for such offerings and the dollar amount of 
securities sold may be carried forward on a future registration 
statement pursuant to Rule 429 under the Securities Act.
* * * * *

0
34. Effective August 1, 2021, amend Form F-3 (referenced in Sec.  
239.33) by adding Instruction 5 to the notes that immediately follow 
the ``Calculation of Registration Fee'' table to read as follows:

    Note: The text of Form F-3 does not, and this amendment will 
not, appear in the Code of Federal Regulations.

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM F-3

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

* * * * *

GENERAL INSTRUCTIONS

* * * * *
    5. If an offering of an indeterminate amount of exchange-traded 
vehicle securities is being registered, the Fee Table must state that 
the registration statement covers an indeterminate amount of securities 
to be offered or sold and that the filing fee will be calculated and 
paid in accordance with Rule 456(d) and Rule 457(u) (Sec.  230.456(d) 
and Sec.  230.457(u) of this chapter), respectively.
* * * * *

PART 240--GENERAL RULES AND REGULATIONS, SECURITIES EXCHANGE ACT OF 
1934

0
35. The general authority citation for part 240 continues to read as 
follows:

    Authority: 15 U.S.C. 77c, 77d, 77g, 77j, 77s, 77z-2, 77z-3, 
77eee, 77ggg, 77nnn, 77sss, 77ttt, 78c, 78c-3, 78c-5, 78d, 78e, 78f, 
78g, 78i, 78j, 78j-1, 78k, 78k-1, 78l, 78m, 78n, 78n-1, 78o, 78o-4, 
78o-10, 78p, 78q, 78q-1, 78s, 78u-5, 78w, 78x, 78dd, 78ll, 78mm, 
80a-20, 80a-23, 80a-29, 80a-37, 80b-3, 80b-4, 80b-11, and 7201 et 
seq., and 8302; 7 U.S.C. 2(c)(2)(E); 12 U.S.C. 5221(e)(3); 18 U.S.C. 
1350; Pub. L. 111-203, 939A, 124 Stat. 1376 (2010); and Pub. L. 112-
106, sec. 503 and 602, 126 Stat. 326 (2012), unless otherwise noted.
* * * * *

0
36. Amend Sec.  240.14a-101 by:
0
a. Revising paragraph E of the ``Notes'' section; and

[[Page 33360]]

0
b. Revising paragraph (b)(1) of ``Item 13. Financial and other 
information. (See Notes D and E at the beginning of this Schedule.)''.
    The revisions read as follows:


Sec.  240.14a-101  Schedule 14A. Information required in proxy 
statement.

Schedule 14A Information

Proxy Statement Pursuant to Section 14(a) of the Securities Exchange 
Act of 1934

* * * * *
Notes
    Notes: * * *
    E. In Item 13 of this Schedule, the reference to ``meets the 
requirement of Form S-3'' or ``meets the requirements of General 
Instruction A.2 of Form N-2'' shall refer to a registrant who meets the 
following requirements:
    (a) A registrant meets the requirements of Form S-3 if:
    (1) The registrant meets the requirements of General Instruction 
I.A. of Form S-3 (Sec.  239.13 of this chapter); and
    (2) One of the following is met:
    (i) The registrant meets the aggregate market value requirement of 
General Instruction I.B.1 of Form S-3; or
    (ii) Action is to be taken as described in Items 11, 12, and 14 of 
this schedule which concerns non-convertible debt or preferred 
securities issued by a registrant meeting the requirements of General 
Instruction I.B.2. of Form S-3 (referenced in 17 CFR 239.13); or
    (iii) The registrant is a majority-owned subsidiary and one of the 
conditions of General Instruction I.C. of Form S-3 is met.
    (b) A registrant meets the requirements of General Instruction A.2 
of Form N-2 (Sec. Sec.  239.14 and 274.11a-1 of this chapter) if the 
registrant meets the conditions included in such General Instruction, 
provided that General Instruction A.2.c of Form N-2 is subject to the 
same limitations described in paragraph (a)(2) of this Note E.
* * * * *
    Item 13. Financial and other information. (See Notes D and E at the 
beginning of this Schedule.)
* * * * *
    (b) * * *
    (1) S-3 registrants and certain N-2 registrants. If the registrant 
meets the requirements of Form S-3 or General Instruction A.2 of Form 
N-2 (see Note E to this Schedule), it may incorporate by reference to 
previously-filed documents any of the information required by paragraph 
(a) of this Item, provided that the requirements of paragraph (c) are 
met. Where the registrant meets the requirements of Form S-3 or General 
Instruction A.2 of Form N-2 and has elected to furnish the required 
information by incorporation by reference, the registrant may elect to 
update the information so incorporated by reference to information in 
subsequently-filed documents.
* * * * *

PART 243--REGULATION FD

0
37. The authority citation for part 243 continues to read as follows:

    Authority: 15 U.S.C. 78c, 78i, 78j, 78m, 78o, 78w, 78mm, and 
80a-29, unless otherwise noted.

0
38. Amend Sec.  243.103 by revising paragraph (a) to read as follows:


Sec.  243.103  No effect on Exchange Act reporting status.

* * * * *
    (a) For purposes of Forms S-3 (17 CFR 239.13), S-8 (17 CFR 239.16b) 
and SF-3 (17 CFR 239.45) under the Securities Act of 1933 (15 U.S.C. 
77a et seq.), or Form N-2 (17 CFR 239.14 and 274.11a-1) under the 
Securities Act of 1933 (15 U.S.C. 77a et seq.) and the Investment 
Company Act of 1940 (15 U.S.C. 80a-1 et seq.), an issuer is deemed to 
have filed all the material required to be filed pursuant to Section 13 
or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 
78o(d)) or where applicable, has made those filings in a timely manner; 
or
* * * * *

PART 270--RULES AND REGULATIONS, INVESTMENT COMPANY ACT OF 1940

0
39. The authority citation for part 270 continues to read, in part, as 
follows:

    Authority: 15 U.S.C. 80a-1 et seq., 80a-34(d), 80a-37, 80a-39, 
and Pub. L. 111-203, sec. 939A, 124 Stat. 1376 (2010), unless 
otherwise noted.
* * * * *
    Section 270.23c-3 also issued under 15 U.S.C. 80a-23(c).
    Section 270.24f-2 also issued under 15 U.S.C. 80a-24(f)(4).
* * * * *

0
40. Amend Sec.  270.8b-16 by revising paragraphs (b)(2) and (4) and 
adding paragraph (e) to read as follows:


Sec.  270.8b-16  Amendments to registration statement.

* * * * *
    (b) * * *
    (2) The company's investment objectives and policies (described in 
Item 8.2 of Form N-2), and any material changes to same that have not 
been approved by shareholders;
* * * * *
    (4) The principal risk factors associated with investment in the 
company (described in Item 8.3 of Form N-2), and any material changes 
to same; and
* * * * *
    (e) The changes required to be disclosed by paragraphs (b)(2) 
through (5) of this section must be described in enough detail to allow 
investors to understand each change and how it may affect the fund. 
Such disclosures must be prefaced with the following legend: ``The 
following information [in this annual report] is a summary of certain 
changes since [date]. This information may not reflect all of the 
changes that have occurred since you purchased [this fund].''

0
41. Effective August 1, 2021, amend Sec.  270.23c-3 by adding paragraph 
(e) to read as follows:


Sec.  270.23c-3  Repurchase offers by closed-end companies.

* * * * *
    (e) Registration of an indefinite amount of securities. A company 
that makes repurchase offers pursuant to paragraph (b) of this section 
shall be deemed to have registered an indefinite amount of securities 
pursuant to Section 24(f) of the Act (15 U.S.C. 80a-24(f)) upon the 
effective date of its registration statement.

0
42. Effective August 1, 2021, amend Sec.  270.24f-2 by revising the 
first sentence of paragraph (a) to read as follows:


Sec.  270.24f-2  Registration under the Securities Act of 1933 of 
certain investment company securities.

    (a) General. Any face-amount certificate company, open-end 
management company, closed-end management company that makes periodic 
repurchase offers pursuant to Sec.  270.23c-3(b), or unit investment 
trust (``issuer'') that is deemed to have registered an indefinite 
amount of securities pursuant to Section 24(f) of the Act (15 U.S.C. 
80a-24(f)) must not later than 90 days after the end of any fiscal year 
during which it has publicly offered such securities, file Form 24F-2 
(17 CFR 274.24) with the Commission. * * *
* * * * *

PART 274--FORMS PRESCRIBED UNDER THE INVESTMENT COMPANY ACT of 1940

0
43. The authority citation for part 274 continues to read as follows:


[[Page 33361]]


    Authority: 15 U.S.C. 77f, 77g, 77h, 77j, 77s, 78c(b), 78l, 78m, 
78n, 78o(d), 80a-8, 80a-24, 80a-26, 80a-29, and Pub. L. 111-203, 
sec. 939A, 124 Stat. 1376 (2010), unless otherwise noted.
    Section 274.128 is also issued under 15 U.S.C. 78j-1, 7202, 7233, 
7241, 7264, and 7265; and 18 U.S.C. 1350.


0
44. Revise Form N-2 (referenced in Sec. Sec.  239.14 and 274.11a-1) to 
read as follows:

    Note: The text of Form N-2 does not, and this amendment will 
not, appear in the Code of Federal Regulations.

BILLING CODE 8011-01-P
[GRAPHIC] [TIFF OMITTED] TR01JN20.000


[[Page 33362]]


[GRAPHIC] [TIFF OMITTED] TR01JN20.001


[[Page 33363]]


[GRAPHIC] [TIFF OMITTED] TR01JN20.002

BILLING CODE 8011-01-C

                        Calculation of Registration Fee Under the Securities Act of 1933
----------------------------------------------------------------------------------------------------------------
                                                         Proposed  maximum  Proposed  maximum
Title of securities being registered     Amount being      offering price        aggregate         Amount of
                                          registered          per unit        offering price    registration fee
----------------------------------------------------------------------------------------------------------------
                                      .................  .................  .................  .................
----------------------------------------------------------------------------------------------------------------

    Instructions.
    Complete the Registration Fee table and provide the following 
(unless payment will be provided using Form 24F-2 [17 CFR 274.24]).
    If the registration statement or amendment is filed under only one 
of the Acts, omit reference to the other Act from the facing sheet. 
Include the ``Approximate Date of Commencement of Proposed Public 
Offering'' and the table showing the calculation of the registration 
fee only where shares are being registered under the Securities Act.
    If the filing fee is calculated pursuant to Rule 457(o) under the 
Securities Act [17 CFR 230.457], only the title of the class of 
securities to be registered, the proposed maximum aggregate offering 
price for that class of securities, and the amount of registration fee 
need to appear in the Calculation of Registration Fee table.
    If the filing fee is calculated pursuant to Rule 457(r) under the 
Securities Act, the Calculation of Registration Fee table must state 
that it registers an unspecified amount of securities of each 
identified class of securities and must provide that the Registrant is 
relying on Rule 456(b) [17 CFR 230.456] and Rule 457(r). If the 
Calculation of Registration Fee table is amended in a post-effective 
amendment to the registration statement or in a prospectus filed in 
accordance with Rule 456(b)(1)(ii), the table must specify the 
aggregate offering price for all classes of securities in the 
referenced offering or offerings and the applicable registration fee.
    Any difference between the dollar amount of securities registered 
for such offerings and the dollar amount of securities sold may be 
carried forward on a future registration statement pursuant to Rule 457 
under the Securities Act.
    Fill in the 811-___, 814-___ and 33-___ blanks only if these filing 
numbers (for the Investment Company Act registration and/or the 
Securities Act registration, respectively) have already been assigned 
by the Securities and Exchange Commission.
    Form N-2 is to be used by closed-end management investment 
companies, except small business investment companies licensed as such 
by the United States Small Business Administration, to register under 
the Investment Company Act and to offer their shares under the 
Securities Act. The Commission has designed Form N-2 to provide 
investors with information that will assist them in making a decision 
about investing in an investment company eligible to use the Form. The 
Commission also may use the information provided on Form N-2 in its 
regulatory, disclosure review, inspection, and policy making roles.

[[Page 33364]]

    A Registrant is required to disclose the information specified by 
Form N-2, and the Commission will make this information public. A 
Registrant is not required to respond to the collection of information 
contained in Form N-2 unless the Form displays a currently valid Office 
of Management and Budget (``OMB'') control number. Please direct 
comments concerning the accuracy of the information collection burden 
estimate and any suggestions for reducing the burden to Secretary, 
Securities and Exchange Commission, 100 F Street NE, Washington, DC 
20549. The OMB has reviewed this collection of information under the 
clearance requirements of 44 U.S.C. 3507.
    Persons who respond to the collection of information contained in 
this form are not required to respond unless the form displays a 
currently valid OMB control number.

Contents of Form N-2

General Instructions

    A. Use of Form N-2
    B. Automatic Shelf Offerings by Well-Known Seasoned Issuers
    C. Registration Fees
    D. Application of General Rules and Regulations
    E. Amendments
    F. Incorporation by Reference
    G. Documents Composing the Registration Statement or Amendment
    H. Preparation of the Registration Statement or Amendment
    I. Interactive Data Files
    J. Registration of Additional Securities
Part A: The Prospectus
Part B: Statement of Additional Information
General Instructions for Parts A and B
Part A--Information Required in a Prospectus
Item 1. Outside Front Cover
Item 2. Cover Pages; Other Offering Information
Item 3. Fee Table and Synopsis
Item 4. Financial Highlights
Item 5. Plan of Distribution
Item 6. Selling Shareholders
Item 7. Use of Proceeds
Item 8. General Description of the Registrant
Item 9. Management
Item 10. Capital Stock, Long-Term Debt, and Other Securities
Item 11. Defaults and Arrears on Senior Securities
Item 12. Legal Proceedings
Item 13. [Removed and reserved.]
Part B--Information Required in a Statement of Additional Information
Item 14. Cover Page
Item 15. Table of Contents
Item 16. General Information and History
Item 17. Investment Objective and Policies
Item 18. Management Instructions
Item 19. Control Persons and Principal Holders of Securities
Item 20. Investment Advisory and Other Services
Item 21. Portfolio Managers
Item 22. Brokerage Allocation and Other Practices
Item 23. Tax Status
Item 24. Financial Statements
Part C--Other Information
Item 25. Financial Statements and Exhibits
Item 26. Marketing Arrangements
Item 27. Other Expenses of Issuance and Distributions
Item 28. Persons Controlled by or Under Common Control
Item 29. Number of Holders of Securities
Item 30. Indemnification
Item 31. Business and Other Connections of Investment Adviser
Item 32. Location of Accounts and Records
Item 33. Management Services
Item 34. Undertakings

Signatures

General Instructions

A. Use of Form N-2

    1. General. Form N-2 is used by all closed-end management 
investment companies (``Registrant'' or ``Fund''), except small 
business investment companies licensed as such by the United States 
Small Business Administration, to file: (1) An initial registration 
statement under Section 8(b) of the Investment Company Act and any 
amendments to the registration statement, including amendments required 
by Rule 8b-16 under the Investment Company Act [17 CFR 270.8b-16]; (2) 
a registration statement under the Securities Act and any amendment to 
it; or (3) any combination of these filings.
    2. Optional Use of Form for Certain Registrants. A Registrant may 
elect to file a registration statement pursuant to this General 
Instruction A.2, including a registration statement used in connection 
with an offering pursuant to Rule 415(a)(1)(x) under the Securities Act 
[17 CFR 230.415], if it meets all of the following requirements:
    a. The Registrant meets the requirements of General Instruction 
I.A. of Form S-3 [17 CFR 239.13];
    b. if the Registrant is registered under the Investment Company 
Act, it has been registered for a period of at least twelve calendar 
months immediately preceding the filing of the registration statement 
on this Form, and has timely filed all reports required to be filed 
pursuant to Section 30 of the Investment Company Act during the twelve 
calendar months and any portion of a month immediately preceding the 
filing of the registration statement; and
    c. the registration statement to be filed pursuant to this General 
Instruction A.2 relates to a transaction specified in General 
Instruction I.B. or I.C of Form S-3, as applicable, and meets all of 
the conditions to the transaction specified in the applicable 
instruction.
    A registration statement filed pursuant to this instruction shall 
specifically incorporate by reference into the prospectus and statement 
of additional information (``SAI'') all of the materials specified in 
General Instruction F.3, pursuant to the requirements set forth in that 
instruction.
    A Registrant must indicate that the registration statement is being 
filed pursuant to this instruction by checking the appropriate box on 
the facing sheet.
    Note to General Instruction A.2. Attention is directed to the 
General Instructions of Form S-3, including General Instructions II.D, 
F, and G, which contain general information regarding the preparation 
and filing of automatic and non-automatic shelf registration 
statements.

B. Automatic Shelf Offerings by Well-Known Seasoned Issuers

    Any Registrant that is a Well-Known Seasoned Issuer as defined in 
Rule 405 of the Securities Act [17 CFR 230.405] at the most recent 
eligibility determination date specified in paragraph (2) of that 
definition may use a registration statement filed under General 
Instruction A.2 of this Form as an automatic shelf registration 
statement for registration under the Securities Act of securities 
offerings, other than pursuant to Rule 415(a)(1)(vii) or (viii) of the 
Securities Act, only for the transactions that are described in, and 
consistent with the requirements of, General Instruction I.D. of Form 
S-3.
    Note to General Instruction B. Attention is directed to the General 
Instructions of Form S-3, including General Instructions II.E, F, G, 
and IV.B, which contain general information regarding the preparation 
and filing of automatic shelf registration statements.

C. Registration Fees

    Section 6(b) of the Securities Act and Rule 457 thereunder set 
forth the fee requirements under the Securities Act. Registrants that 
are required to pay registration fees on an annual net basis

[[Page 33365]]

pursuant to Rule 24f-2 under the Investment Company Act must provide 
payment using Form 24F-2.

D. Application of General Rules and Regulations

    If the registration statement is being filed under both the 
Securities and Investment Company Acts or under only the Securities 
Act, the General Rules and Regulations under the Securities Act, 
particularly Regulation C, shall apply. If the registration statement 
is being filed under only the Investment Company Act, the General Rules 
and Regulations under the Investment Company Act, particularly those 
under Section 8(b), shall apply.

E. Amendments

    1. Paragraph (a) of Rule 8b-16 under the Investment Company Act 
requires closed-end management investment companies to annually amend 
the Investment Company Act registration statement. Paragraph (b) of 
Rule 8b-16 exempts a closed-end management investment company from this 
requirement if it provides certain information specified by that rule 
to shareholders in its annual report.
    2. If Form N-2 is used to file a registration statement under both 
the Securities and Investment Company Acts, any amendment of that 
registration statement shall be deemed to be filed under both Acts 
unless otherwise indicated on the facing sheet.
    3. Registrants offering securities on a delayed or continuous basis 
in reliance upon Rule 415 under the Securities Act must provide the 
undertakings with respect to post-effective amendments required by Item 
34 of Form N-2.
    4. A post-effective amendment to a registration statement on this 
Form, or a registration statement filed for the purpose of registering 
additional shares of common stock for which a registration statement 
filed on this Form is effective or for the purpose of complying with 
Rule 415(a)(5) and (a)(6), filed on behalf of a Registrant which makes 
periodic repurchase offers pursuant to Rule 23c-3 under the Investment 
Company Act [17 CFR 270.23c-3] or which makes a continuous offering of 
securities pursuant to Rule 415(a)(1)(ix) under the Securities Act may 
become effective automatically in accordance with Rule 486 under the 
Securities Act [17 CFR 230.486], as applicable. In accordance with Rule 
429 under the Securities Act [17 CFR 230.429], a Registrant filing a 
new registration statement for the purpose of registering additional 
shares of common stock may use a prospectus with respect to the 
additional shares also in connection with the shares covered by earlier 
registration statements if such prospectus includes all of the 
information which would currently be required in a prospectus relating 
to the securities covered by the earlier statements. The filing fee 
required by the Securities Act and Rule 457 under the Securities Act 
shall be paid with respect to the additional shares only.

F. Incorporation by Reference

    1. General Requirements. All incorporation by reference must comply 
with the requirements of this Form and the following rules on 
incorporation by reference: Rule 411 under the Securities Act [17 CFR 
230.411] (general rules on incorporation by reference in a prospectus); 
Rule 303 of Regulation S-T [17 CFR 232.303] (specific requirements for 
electronically filed documents); and Rule 0-4 [17 CFR 270.0-4], 
(additional rules on incorporation by reference for investment 
companies).
    2. Specific Requirements for Incorporation by Reference for 
Registrants Not Relying on General Instruction A.2.
    a. A Registrant may not incorporate by reference into a prospectus 
information that Part A of this Form requires to be included in a 
prospectus, except as specifically permitted by Part A of this Form or 
paragraph F.2.d below.
    b. A Registrant may incorporate by reference any or all of the SAI 
into the prospectus (but not to provide any information required by 
Part A to be included in the prospectus) without delivering the SAI 
with the prospectus.
    c. A Registrant may incorporate by reference into the SAI or its 
response to Part C, information that Parts B and C require to be 
included in the Registrant's registration statement.
    d. A Registrant may incorporate by reference into the prospectus or 
the SAI in response to Items 4.1 or 24 of this Form the information 
contained in Form N-CSR [17 CFR 249.331 and 274.128] or any report to 
shareholders meeting the requirements of Section 30(e) of the 
Investment Company Act and Rule 30e-1 [17 CFR 270.30e-1] thereunder 
(and a Registrant that has elected to be regulated as a business 
development company may so incorporate into Items 4.1, 4.2, 8.6.c, or 
24 of this Form the information contained in its annual report under 
the Exchange Act), provided:
    (1) The material incorporated by reference is prepared in 
accordance with, and covers the periods specified by, this Form; and
    (2) the Registrant states in the prospectus or the SAI, at the 
place where the information required by Items 4.1, 4.2, 8.6.c., or 24 
of this Form would normally appear, that the information is 
incorporated by reference from a report to shareholders or a report on 
Form N-CSR or an annual report on Form 10-K [17 CFR 249.310]. (The 
Registrant also may describe briefly, in either the prospectus, the 
SAI, or Part C of the registration statement (in response to Item 25.1) 
those portions of the report to shareholders or report on Form N-CSR or 
Form 10-K that are not incorporated by reference and are not a part of 
the registration statement.)
    3. Specific Requirements for Incorporation by Reference for Certain 
Registrants. If a Registrant is filing a registration statement 
pursuant to General Instruction A.2, the following requirements apply:
    a. Backward Incorporation by Reference. The documents listed in (1) 
and (2) below shall be specifically incorporated by reference into the 
prospectus and SAI by means of a statement to that effect in the 
prospectus and SAI listing all such documents:
    (1) The Registrant's latest annual report filed pursuant to Section 
13(a) or Section 15(d) of the Exchange Act that contains financial 
statements for the Registrant's latest fiscal year for which a Form N-
CSR or Form 10-K was required to be filed;
    (2) all other reports filed pursuant to Section 13(a) or Section 
15(d) of the Exchange Act since the end of the fiscal year covered by 
the annual report referred to in (1) above; and
    (3) if capital stock is to be registered and securities of the same 
class are registered under Section 12 of the Exchange Act, the 
description of such class of securities which is contained in a 
registration statement filed under the Exchange Act, including any 
amendment or reports filed for the purpose of updating such 
description.
    b. Forward Incorporation by Reference. The prospectus and SAI shall 
also state that all documents subsequently filed by the Registrant 
pursuant to Sections 13(a), 13(c), 14, or 15(d) of the Exchange Act, 
prior to the termination of the offering shall be deemed to be 
incorporated by reference into the prospectus and SAI.
    c. Use of Information to be Incorporated. Any information required 
in the prospectus and SAI in response to Items 3-12 and Items 16-24 of 
this Form may be included in the prospectus and SAI through documents 
filed pursuant to Sections 13(a), 14, or 15(d) of the Exchange Act that 
are incorporated or deemed incorporated by

[[Page 33366]]

reference into the prospectus and SAI that are part of the registration 
statement.
    Instruction. Attention is directed to Rule 439 under the Securities 
Act [17 CFR 230.439] regarding consent to use of material incorporated 
by reference.
    4. Disclosure.
    a. The Registrant must make its prospectus, SAI, and any periodic 
and current reports filed pursuant to Section 13 or Section 15(d) of 
the Exchange Act that are incorporated by reference readily available 
and accessible on a website maintained by or for the Registrant and 
containing information about the Registrant.
    b. The Registrant must state in its prospectus and SAI:
    (1) That it will provide to each person, including any beneficial 
owner, to whom a prospectus or SAI is delivered, a copy of any or all 
information that has been incorporated by reference into the prospectus 
or SAI but not delivered with the prospectus or SAI;
    (2) that it will provide this information upon written or oral 
request;
    (3) that it will provide this information at no charge;
    (4) the name, address, telephone number, and email address, if any, 
to which the request for this information must be made; and
    (5) the Registrant's website address where the prospectus, SAI, and 
any incorporated information may be accessed.
    Instruction. If the Registrant sends any of the information that is 
incorporated by reference into the prospectus or SAI to security 
holders, it also must send any exhibits that are specifically 
incorporated by reference into that information.
    c. The Registrant also must:
    (1) Identify the reports and other information that it files with 
the SEC; and
    (2) state that the SEC maintains an internet site that contains 
reports, proxy and information statements, and other information 
regarding issuers that file electronically with the SEC and state the 
address of that site (http://www.sec.gov).

G. Documents Composing the Registration Statement or Amendment

    1. A registration statement or an amendment to it filed under both 
the Securities and Investment Company Acts consists of the facing sheet 
of the Form, Part A, Part B, Part C, required signatures, all other 
documents filed as a part of the registration statement, and documents 
or information permitted to be incorporated by reference.
    2. A registration statement or amendment to it that is filed under 
only the Securities Act shall contain all the information and documents 
specified in paragraph 1 of this Instruction G.
    3. A registration statement or an amendment to it that is filed 
under only the Investment Company Act shall consist of the facing sheet 
of the Form, responses to all items of Parts A and B except Items 1, 2, 
3.2, 4, 5, 6, and 7 of Part A, responses to all items of Part C except 
Items 25.2.h, 25.2.l, 25.2.n, and 25.2.o, required signatures, and all 
other documents that are required or which the Registrant may file as 
part of the registration statement.

H. Preparation of the Registration Statement or Amendment

    The following instructions for completing Form N-2 are divided into 
three parts. Part A relates to the prospectus required by Section 10(a) 
of the Securities Act. Part B relates to the SAI that must be provided 
upon request to recipients of the prospectus. Part C relates to other 
information that is required to be in the registration statement.

I. Interactive Data Files

    1. An Interactive Data File as defined in Rule 11 of Regulation S-T 
[17 CFR 232.11] is required to be submitted to the Commission in the 
manner provided by Rule 405 of Regulation S-T [17 CFR 232.405] for any 
registration statement or post-effective amendment thereto filed on 
Form N-2 that contains the cover page information specified in Rule 405 
of Regulation S-T. The Interactive Data File must be submitted either 
with the filing, or as an amendment to the registration statement to 
which it relates that is submitted on or before the date the 
registration statement or post-effective amendment that contains the 
related information becomes effective.
    2. An Interactive Data File is required to be submitted to the 
Commission in the manner provided by Rule 405 of Regulation S-T for any 
registration statement or post-effective amendment thereto filed on 
Form N-2 or for any form of prospectus filed pursuant to Rule 424 under 
the Securities Act [17 CFR 230.424] that includes or amends information 
provided in response to Items 3.1, 4.3, 8.2.b, 8.2.d, 8.3.a, 8.3.b, 
8.5.b, 8.5.c, 8.5.e, 10.1.a-d, 10.2.a-c, 10.2.e, 10.3, or 10.5. The 
Interactive Data File must be submitted either with the filing, or as 
an amendment to the registration statement to which it relates, on or 
before the date the registration statement or post-effective amendment 
that contains the related information becomes effective. Interactive 
Data Files must be submitted with the filing made pursuant to Rule 424.
    3. If a Registrant is filing a registration statement pursuant to 
General Instruction A.2, an Interactive Data File is required to be 
submitted to the Commission in the manner provided by Rule 405 of 
Regulation S-T for any of the documents listed in General Instruction 
F.3.(a) or General Instruction F.3.(b) that include or amend 
information provided in response to Items 3.1, 4.3, 8.2.b, 8.2.d, 
8.3.a, 8.3.b, 8.5.b, 8.5.c, 8.5.e, 10.1.a-d, 10.2.a-c, 10.2.e, 10.3, or 
10.5. The Interactive Data File must be submitted with the filing of 
the document(s) listed in General Instruction F.3.(a) or General 
Instruction F.3.(b).
    4. The Interactive Data Files must be submitted in accordance with 
the specifications in the EDGAR Filer Manual, and must be submitted in 
such a manner that--for any information that does not relate to all of 
the classes of a Registrant--will permit each class of the Registrant 
to be separately identified.

J. Registration of Additional Securities

    With respect to the registration of additional securities for an 
offering pursuant to Rule 462(b) under the Securities Act [17 CFR 
230.462], the Registrant may file a registration statement consisting 
only of the following: the facing page; a statement that the contents 
of the earlier registration statement, identified by file number, are 
incorporated by reference; required opinions and consents; the 
signature page; and any price-related information omitted from the 
earlier registration statement in reliance on Rule 430A [17 CFR 
230.430A] that the Registrant chooses to include in the new 
registration statement. The information contained in such a Rule 462(b) 
registration statement shall be deemed to be part of the earlier 
registration statement as of the date of effectiveness of the Rule 
462(b) registration statement. Any opinion or consent required in such 
a registration statement may be incorporated by reference from the 
earlier registration statement with respect to the offering, if: (i) 
Such opinion or consent expressly provides for such incorporation; and 
(ii) such opinion relates to the securities registered pursuant to Rule 
462(b). See Rules 411(c), 439(b), and 483(c) under the Securities Act 
[17 CFR 230.483].
Part A: The Prospectus
    The purpose of the prospectus is to provide essential information 
about the Registrant in a way that will help investors make informed 
decisions

[[Page 33367]]

about whether to purchase the securities being offered. THE INFORMATION 
IN THE PROSPECTUS SHOULD BE CLEAR, CONCISE, AND UNDERSTANDABLE. AVOID 
THE USE OF TECHNICAL OR LEGAL TERMS, COMPLEX LANGUAGE, OR EXCESSIVE 
DETAIL.
    Responses to the items of Part A should be as simple and direct as 
possible and should include only information needed to understand the 
fundamental characteristics of the Registrant. Descriptions of 
practices that are required by law generally should not include 
detailed discussions of the law itself. No response is required for 
inapplicable items.
Part B: Statement of Additional Information
    The items in Part B call for additional information about the 
Registrant that may be of interest to some investors. Part B also 
allows the Registrant to augment discussions of matters described in 
the prospectus with additional information the Registrant believes may 
be of interest to some investors. If information is included in the 
prospectus, it need not be repeated in the SAI, and a Registrant need 
not prepare a SAI or refer to it in the prospectus (or provide the 
undertaking required by Item 34.7 as to the SAI) if all of the 
information required to be in the SAI is included in the prospectus. A 
Registrant placing information in Part B should not repeat information 
that is in the prospectus, except where necessary to make Part B 
understandable.
    Information in the SAI need not be included in the prospectus or be 
sent to investors with the prospectus provided that the cover page of 
the prospectus states that the SAI is available upon oral or written 
request and without charge, and includes a toll-free telephone number 
and email address, if any, for use by prospective investors to request 
the SAI. If the request is made prior to delivery of a confirmation 
with respect to a security offered by the prospectus, the SAI must be 
sent in a manner reasonably calculated for it to arrive prior to the 
confirmation. The SAI may be sent to the address to which the 
prospectus was delivered, unless the requester provides an alternate 
address for delivery of the SAI.
General Instructions for Parts A and B
    1. The information in the prospectus and the SAI should be 
organized to make it easy to understand the organization and operation 
of the Registrant. The information need not be in any particular order, 
with the exception that Items 1, 2, 3, and 4 must appear in order in 
the prospectus and may not be preceded or separated by any other 
information.
    2. The prospectus or the SAI may contain more information than 
called for by this Form, provided the information is not incomplete, 
inaccurate, or misleading and does not, because of its nature, 
quantity, or manner of presentation, obscure or impede understanding of 
required information.
    3. The requirements for dating the prospectus apply equally to 
dating the SAI for purposes of Rule 423 under the Securities Act [17 
CFR 230.423]. The SAI should be made available at the same time that 
the prospectus becomes available for purposes of Rules 430 and 460 
under the Securities Act [17 CFR 230.430 and 230.460].
    4. The prospectus should not be presented in fold-out or road-map 
type fashion.
    5. Instructions for charts, graphs, and sales literature:
    (a) A registration statement may include any chart, graph, or table 
that is not misleading; however, only the fee table and the table of 
contents (required by Rule 481(c) under the Securities Act [17 CFR 
230.481]) may precede the financial highlights specified in Item 4.
    (b) If ``sales literature'' is included in the prospectus, (1) it 
should not significantly lengthen the prospectus nor obscure essential 
disclosure, and (2) members of the Financial Industry Regulatory 
Authority (``FINRA'') are not relieved of the filing and other FINRA 
requirements for investment company sales literature. (See Securities 
Act Release No. 5359, Jan. 26, 1973 [38 FR 7220 (Mar. 19, 1973)].)

Part A--Information Required in a Prospectus

Item 1. Outside Front Cover

    1. The outside front cover must contain the following information:
    a. the Registrant's name;
    b. identification of the type of Registrant (e.g., bond fund, 
balanced fund, business development company, etc.) or a brief statement 
of the Registrant's investment objective(s);
    c. the title and amount of securities offered and a brief 
description of such securities (unless not necessary to indicate the 
material terms of the securities, as in the case of an issue of common 
stock with full voting rights and the dividend and liquidation rights 
usually associated with common stock);
    d. a statement that (A) the prospectus sets forth concisely the 
information about the Registrant that a prospective investor ought to 
know before investing; (B) the prospectus should be retained for future 
reference; and (C) additional information about the Registrant has been 
filed with the Commission and is available upon written or oral request 
and without charge (this statement should explain how to obtain the 
SAI, and whether any of it has been incorporated by reference into the 
prospectus). This statement should also explain how to obtain the 
Registrant's annual and semi-annual reports to shareholders. Provide a 
toll-free (or collect) telephone number for investors to call, and 
email address, if any, to request the Registrant's SAI; annual report; 
semi-annual report; or other information about the Registrant; and to 
make shareholder inquiries. Also state whether the Registrant makes 
available its SAI and annual and semi-annual reports, free of charge, 
on or through the Registrant's website at a specified internet address. 
If the Registrant does not make its SAI and shareholder reports 
available in this manner, disclose the reasons why it does not do so 
(including, where applicable, that the Registrant does not have an 
internet website). Also include the information that the Commission 
maintains a website (http://www.sec.gov) that contains the SAI, 
material incorporated by reference, and other information regarding 
Registrants;
    e. the date of the prospectus and the date of the Statement of 
Additional Information;
    f. if any of the securities being registered are to be offered for 
the account of shareholders, a statement to that effect;
    g. information in substantially the tabular form indicated as to 
all securities being registered that are to be offered for cash 
(estimate, if necessary):

------------------------------------------------------------------------
                                                         Proceeds to
       Price to public             Sales load        registrant or other
                                                           persons
------------------------------------------------------------------------
Per Share...................
Total.......................
------------------------------------------------------------------------


[[Page 33368]]

    Instructions.
    1. If it is impracticable to state the price to the public, briefly 
explain how the price will be determined (e.g., by reference to net 
asset value). If the securities will be offered at the market, indicate 
the market involved and the market price as of the latest practicable 
date.
    2. The term ``sales load'' is defined in Section 2(a)(35) of the 
Investment Company Act. Subject to Instruction 3, only include the 
portion of the sales load that consists of underwriting discounts and 
commissions, and include any commissions paid by selling shareholders 
(the term ``commissions'' is defined in paragraph 17 of Schedule A of 
the Securities Act [15 U.S.C. 77aa(17)]). Commissions paid by other 
persons and other consideration to underwriters shall be noted in the 
second column and briefly described in a footnote.
    3. Include in the table as sales load amounts borrowed to pay 
underwriting discounts and commissions or any other offering costs that 
are required to be repaid in less than one year. Exclude from the 
table, but include in a note thereto, the amount of funds borrowed to 
pay such costs that are required to be repaid in more than one year, 
and provide a cross-reference to the prospectus discussion of the 
borrowed amounts and the effect of repayment on fund assets available 
for investment.
    4. Where an underwriter has received an over-allotment option, 
present maximum-minimum information in the price table or in a note 
thereto, based on the purchase of all or none of the shares subject to 
the option. The terms of the option may be described briefly in 
response to Item 5 rather than on the prospectus cover page.
    5. If the securities are to be offered on a best efforts basis, set 
forth the termination date of the offering, any minimum required 
purchase, and any arrangements to place the funds received in an 
escrow, trust, or similar arrangement. If no arrangements have been 
made, so state. Set forth the following table in lieu of the ``Total'' 
information called for by the required table.

------------------------------------------------------------------------
                                                         Proceeds to
       Price to public             Sales load        registrant or other
                                                           persons
------------------------------------------------------------------------
Total Minimum...............
Total Maximum...............
------------------------------------------------------------------------

    6. Set forth in a note to the proceeds column the total of other 
expenses of issuance and distribution called for by Item 27, stated 
separately for the Registrant and for the selling shareholders, if any.
    h. the statements required by paragraphs (1) and (2) of Rule 481(b) 
under the Securities Act;
    i. if the Registrant's securities have no history of public 
trading, a prominent statement to that effect and a statement 
describing the tendency of closed-end fund shares to trade frequently 
at a discount from net asset value and the risk of loss this creates 
for investors purchasing shares in the initial public offering;
    Instruction. A Registrant may omit the discount statement if it 
believes that, as a result of its investment or other policies, its 
capital structure, or the markets in which its shares trade, its shares 
are unlikely to trade at a discount from net asset value.
    j. a cross-reference to the prospectus discussion of any factors 
that make the offering speculative or one of high risk, printed in bold 
face common type at least as large as ten point modern type and at 
least two points leaded; and
    Instruction. No cross-reference is required where the risks 
associated with securities in which the Registrant is authorized to 
invest are only the basic risks of investing in securities (e.g., the 
risk that the value of portfolio securities may fluctuate depending 
upon market conditions, or the risks that debt securities may be 
prepaid and the proceeds from the prepayments invested in debt 
instruments with lower interest rates). Include the cross-reference if 
the nature of the Registrant's investment objectives, investment 
policies, capital structure, or the trading markets for the 
Registrant's securities increase the likelihood that an investor could 
lose a significant portion of his or her investment.
    k. any other information required by Commission rules or by any 
other governmental authority having jurisdiction over the Registrant or 
the issuance of its securities.
    l. A statement to the following effect, if applicable:
    Beginning on [date], as permitted by regulations adopted by the 
Securities and Exchange Commission, paper copies of the Registrant's 
shareholder reports will no longer be sent by mail, unless you 
specifically request paper copies of the reports from the Registrant 
[or from your financial intermediary, such as a broker-dealer or bank]. 
Instead, the reports will be made available on a website, and you will 
be notified by mail each time a report is posted and provided with a 
website link to access the report.
    If you already elected to receive shareholder reports 
electronically, you will not be affected by this change and you need 
not take any action. You may elect to receive shareholder reports and 
other communications from the Registrant [or your financial 
intermediary] electronically by [insert instructions].
    You may elect to receive all future reports in paper free of 
charge. You can inform the Registrant [or your financial intermediary] 
that you wish to continue receiving paper copies of your shareholder 
reports by [insert instructions]. Your election to receive reports in 
paper will apply to all funds held with [the fund complex/your 
financial intermediary].
    2. The cover page may include other information if it does not, by 
its nature, quantity, or manner of presentation impede understanding of 
the required information.

Item 2. Cover Pages; Other Offering Information

    1. Disclose whether any national securities exchange or the Nasdaq 
Stock Market lists the securities offered, naming the particular 
market(s), and identify the trading symbol(s) for those securities on 
the inside front or outside back cover page of the prospectus, unless 
the information appears on the front cover page.
    2. Provide the information required by paragraph (d) of Rule 481 
under the Securities Act in an appropriate place in the prospectus.
    3. Provide the information required by paragraph (e) of Rule 481 
under the Securities Act on the outside back cover page of the 
prospectus.

Item 3. Fee Table and Synopsis

    1. If the prospectus offers common stock of the Registrant, include 
information about the costs and expenses that the investor will bear 
directly or indirectly, using the captions and tabular format 
illustrated below:

[[Page 33369]]

[GRAPHIC] [TIFF OMITTED] TR01JN20.003

    Instructions.

General Instructions

    1. Immediately after the table, provide a brief narrative 
explaining that the purpose of the table is to assist the investor in 
understanding the various costs and expenses that an investor in the 
fund will bear directly or indirectly. Include, where appropriate, 
cross-references to the relevant sections of the prospectus for more 
complete descriptions of the various costs and expenses.
    2. Any caption not applicable to the Registrant may be omitted from 
the table.
    3. Round all dollar figures to the nearest dollar and all 
percentages to the nearest hundredth of one percent.
Shareholder Transaction Expenses
    4. ``Dividend Reinvestment and Cash Purchase Plan Fees'' include 
all fees (except brokerage commissions) that are charged to 
participating shareholder accounts. The basis on which such fees are 
imposed should be described briefly in a note to the table.
    5. If the Registrant (or any other party under an agreement with 
the Registrant) charges any other transaction fee, add another caption 
describing it, and list the maximum amount of the fee or basis on which 
the fee is deducted. Underwriters' compensation that is paid with the 
proceeds of debt that is not to be repaid within one year need not be 
identified as sales load, but should be set forth as a shareholder 
transaction expense with a brief narrative following the table 
explaining the nature of such payments.
Annual Expenses
    6. State the basis on which payments will be made. ``Other 
Expenses'' should be estimated and stated (after any expense 
reimbursement or waiver) as a percentage of net asset value 
attributable to common shares. State in the narrative following the 
table that ``Other Expenses'' are based on estimated amounts for the 
current fiscal year.
    7.a. ``Management Fees'' include investment advisory fees 
(including any component thereof based on the performance of the 
Registrant), any other management fees payable to the investment 
adviser or its affiliates, and administrative fees payable to the 
investment adviser or its affiliates not included as ``Other 
Expenses,'' and any expenses incurred within the Registrant's own 
organization in connection with the research, selection, and 
supervision of investments. Where management fees are ``tiered'' or 
based on a ``sliding scale,'' they should be calculated based on the 
fund's asset size after giving effect to the anticipated net proceeds 
of the present offering. In the case of a performance fee arrangement, 
assume the base fee. With respect to a best-efforts offering with 
breakpoints, assume the maximum fee will be payable.
    b. In lieu of the information about management fees required by 
Item 3.1, a business development company with a fee structure that is 
not based solely on the aggregate amount of assets under management 
should provide disclosure concerning the fee arrangement to allow 
investors to assess its impact on the Registrant's expenses; a business 
development company may use any appropriate expense categories and may 
include items that may not, for accounting purposes, be treated as 
expenses. A business development company with special fee arrangements 
should provide a cross-reference, where applicable, to the discussion 
in Item 9.1.a of special management compensation plans.
    8. ``Interest Payments on Borrowed Funds'' include all interest 
paid in connection with outstanding loans

[[Page 33370]]

(including interest paid on funds borrowed to pay underwriting 
expenses), bonds, or other forms of debt. Show interest expenses as a 
percentage of net assets attributable to common shares and not the face 
amount of debt.
    9. ``Other Expenses'' include all expenses (except fees and 
expenses reported in other items in the table) that are deducted from 
the Registrant's assets and will be reflected as expenses in the 
Registrant's statement of operations (including increases resulting 
from complying with paragraph 2(g) of Rule 6-07 [17 CFR 210.6-07] of 
Regulation S-X).
    10. a. If the Registrant invests, or intends to invest based upon 
the anticipated net proceeds of the present offering, in shares of one 
or more ``Acquired Funds,'' add a subcaption to the ``Annual Expenses'' 
portion of the table directly above the subcaption titled ``Total 
Annual Expenses.'' Title the additional subcaption: ``Acquired Fund 
Fees and Expenses.'' Disclose in the subcaption fees and expenses 
incurred indirectly by the Registrant as a result of investment in 
shares of one or more Acquired Funds. For purposes of this Item, an 
``Acquired Fund'' means any company in which the Registrant invests or 
intends to invest (A) that is an investment company or (B) that would 
be an investment company under Section 3(a) of the Investment Company 
Act but for the exceptions to that definition provided for in Sections 
3(c)(1) and 3(c)(7) of the Investment Company Act. If a Registrant uses 
another term in response to other requirements of this Form to refer to 
Acquired Funds, it may include that term in parentheses following the 
subcaption title. In the event the fees and expenses incurred 
indirectly by the Registrant as a result of investment in shares of one 
or more Acquired Funds do not exceed 0.01 percent (one basis point) of 
average net assets of the Registrant, the Registrant may include these 
fees and expenses under the subcaption ``Other Expenses'' in lieu of 
this disclosure requirement.
    b. Determine the ``Acquired Fund Fees and Expenses'' according to 
the following formula:

     AFFE = [(F1/FY)*AI1* D1]+[(F2/FY)*AI2* D2]+[(F3/FY)*AI3* D3] +
                Transaction Fees + Incentive Allocations
------------------------------------------------------------------------
                                           Average Net Assets of the
                                                   Registrant
------------------------------------------------------------------------
Where:
    AFFE.............................  Acquired Fund fees and expenses;
    F1, F2, F3, . . .................  Total annual operating expense
                                        ratio for each Acquired Fund;
    FY...............................  Number of days in the relevant
                                        fiscal year;
    AI1, AI2, AI3, . . ..............  Average invested balance in each
                                        Acquired Fund;
    D1, D2, D3, . . .................  Number of days invested in each
                                        Acquired Fund;
    ``Transaction Fees''.............  The total amount of sales loads,
                                        redemption fees, or other
                                        transaction fees paid by the
                                        Registrant in connection with
                                        acquiring or disposing of shares
                                        in any Acquired Funds during the
                                        most recent fiscal year; and
    ``Incentive Allocations''........  Any allocation of capital from
                                        the Acquiring Fund to the
                                        adviser of the Acquired Fund (or
                                        its affiliate) based on a
                                        percentage of the Acquiring
                                        Fund's income, capital gains and/
                                        or appreciation in the Acquired
                                        Fund.
------------------------------------------------------------------------

    c. Calculate the average net assets of the Registrant for the most 
recent fiscal year, as provided in Item 4.1 (see Instruction 15 to Item 
4.1), and include the anticipated net proceeds of the present offering.
    d. The total annual operating expense ratio used for purposes of 
this calculation (F1) is the annualized ratio of operating expenses to 
average net assets for the Acquired Fund's most recent fiscal period as 
disclosed in the Acquired Fund's most recent shareholder report. If the 
ratio of expenses to average net assets is not included in the most 
recent shareholder report or the Acquired Fund is a newly formed fund 
that has not provided a shareholder report, then the ratio of expenses 
to average net assets of the Acquired Fund is the ratio of total annual 
operating expenses to average annual net assets of the Acquired Fund 
for its most recent fiscal period as disclosed in the most recent 
communication from the Acquired Fund to the Registrant. If the 
Registrant has a written fee agreement with the Acquired Fund that 
would affect the ratio of expenses to average net assets as disclosed 
in the Acquired Fund's most recent shareholder report, the Registrant 
should determine the ratio of expenses to average net assets for the 
Acquired Fund's most recent fiscal period using the written fee 
agreement. For purposes of this instruction: (i) Acquired Fund expenses 
include increases resulting from brokerage service and expense offset 
arrangements and reductions resulting from fee waivers or 
reimbursements by the Acquired Funds' investment advisers or sponsors; 
and (ii) Acquired Fund expenses do not include any expenses (i.e., 
performance fees) that are calculated solely upon the realization and/
or distribution of gains, or the sum of the realization and/or 
distribution of gains and unrealized appreciation of assets distributed 
in-kind. If an Acquired Fund has no operating history, include in the 
Acquired Funds' expenses any fees payable to the Acquired Fund's 
investment adviser or its affiliates stated in the Acquired Fund's 
registration statement, offering memorandum or other similar 
communication without giving effect to any performance.
    e. If a Registrant has made investments in the most recent fiscal 
year, to determine the average invested balance (AI1), the numerator is 
the sum of the amount initially invested in an Acquired Fund during the 
most recent fiscal year (if the investment was held at the end of the 
previous fiscal year, use the amount invested as of the end of the 
previous fiscal year) and the amounts invested in the Acquired Fund no 
less frequently than monthly during the period the investment is held 
by the Registrant (if the investment was held through the end of the 
fiscal year, use each month-end through and including the fiscal year-
end). Divide the numerator by the number of measurement points included 
in the calculation of the numerator (i.e., if an investment is made 
during the fiscal year and held for 3 succeeding months, the 
denominator would be 4).
    f. For investments based upon the anticipated net proceeds from the 
present offering, base the ``Acquired Fund Fees and Expenses'' on: (i) 
Assumptions about specific funds in which the Registrant expects to 
invest, (ii) estimates of the amount of assets the Registrant expects 
to invest in each of those Acquired Funds, and (iii) an assumption that 
the investment was held for all of the Registrant's most

[[Page 33371]]

recent fiscal year and was subject to the Acquired Funds' fees and 
expenses for that year. Disclose in a footnote to the table that 
Acquired Fund fees and expenses are based on estimated amounts for the 
current fiscal year.
    g. If an Acquired Fund charges an Incentive Allocation or any other 
fee based on income, capital gains and/or appreciation (i.e., 
performance fee), the Registrant must include a footnote to the 
``Acquired Fund Fees and Expenses'' subcaption that:
    (1) discloses the typical Incentive Allocation or such other fee 
(expressed as a percentage) to be paid to the investment advisers of 
the Acquired Funds (or an affiliate);
    (2) discloses that Acquired Funds' fees and expenses are based on 
historic fees and expenses; and
    (3) states that future Acquired Funds' fees and expenses may be 
substantially higher or lower because certain fees are based on the 
performance of the Acquired Funds, which may fluctuate over time.
    h. If the Registrant is a Feeder Fund, reflect the aggregate 
expenses of the Feeder Fund and the Master Fund in the ``Acquired Fund 
Fees and Expenses.'' The aggregate expenses of the Master-Feeder Fund 
must include the fees and expenses incurred indirectly by the Feeder 
Fund as a result of the Master Fund's investment in shares of one or 
more companies (A) that are investment companies or (B) that would be 
investment companies under Section 3(a) of the Investment Company Act 
but for the exceptions to that definition provided for in Sections 
3(c)(1) and 3(c)(7) of the Investment Company Act. For purposes of this 
instruction, a ``Master-Feeder Fund'' means a two-tiered arrangement in 
which one or more investment companies registered under the Investment 
Company Act (each a ``Feeder Fund'') holds shares of a single 
management investment company registered under the Investment Company 
Act (the ``Master Fund'') in accordance with Section 12(d)(1)(E) of the 
Investment Company Act.
    i. The Registrant may clarify in a footnote to the fee table that 
the total annual expenses item under Item 3.1 is different from the 
ratio of expenses to average net assets given in response to Item 4.1, 
which reflects the operating expenses of the Registrant and does not 
include Acquired Fund fees and expenses.
Example
    11. For purposes of the Example in the table:
    a. assume that the rates listed under ``Annual Expenses'' remain 
the same each year, except to reduce annual expenses to reflect the 
scheduled maturity of outstanding debt or the completion of 
organization expense amortization;
    b. assume reinvestment of all dividends and distributions at net 
asset value;
    c. reflect all recurring and nonrecurring fees including 
underwriting discounts and commissions; and
    d. prominently disclose that the Example should not be considered a 
representation of future expenses and that actual expenses may be 
greater or lesser than those shown.
    2. Include a synopsis of information contained in the prospectus 
when the prospectus is long or complex. Normally, a synopsis should not 
be provided where the prospectus is twelve or fewer printed pages.
    Instruction. The synopsis should provide a clear and concise 
description of the key features of the offering and the Registrant, 
with cross-references to relevant disclosures elsewhere in the 
prospectus or Statement of Additional Information.
    3. In the case of a business development company, include the 
information required by Item 101(e) of Regulation S-K [17 CFR 229.101] 
(concerning reports and other information filed with the Commission).

Item 4. Financial Highlights

    1. General. Furnish the following information for the Registrant, 
or for the Registrant and its subsidiaries, consolidated as prescribed 
in Rule 6-03 of Regulation S-X [17 CFR 210.6-03]:

Financial Highlights

Per Share Operating Performance

    a. Net Asset Value, Beginning of Period
    (1) Net Investment Income
    (2) Net Gains or Losses on Securities (both realized and 
unrealized)
    b. Total From Investment Operations
    c. Less Distributions
    (1) Dividends (from net investment income)
    (A) To Preferred Shareholders
    (B) To Common Shareholders
    (2) Distributions (from capital gains)
    (A) To Preferred Shareholders
    (B) To Common Shareholders
    (3) Returns of Capital
    (A) To Preferred Shareholders
    (B) To Common Shareholders
    d. Total Distributions
    e. Net Asset Value, End of Period
    f. Per Share Market Value, End of Period
    g. Total Investment Return

Ratios/Supplemental Data

    h. Net Assets, End of Period
    i. Ratio of Expenses to Average Net Assets
    j. Ratio of Net Income to Average Net Assets
    k. Portfolio Turnover Rate
    Instructions.

General Instructions

    1. [Removed and reserved.]
    2. Briefly explain the nature of the information contained in the 
table and its source. The auditor's report as to the financial 
highlights need not be included in the prospectus. Note that the 
auditor's report is contained elsewhere in the registration statement, 
specify its location, and state that it can be obtained by 
shareholders.
    3. Present the information in comparative columns for each of the 
last ten fiscal years of the Registrant (or for the life of the 
Registrant and its immediate predecessors, if less), but only for 
periods subsequent to the effective date of the Registrant's first 
Securities Act registration statement. In addition, present the 
information for the period between the end of the latest fiscal year 
and the date of the latest balance sheet or statement of assets and 
liabilities. Where the period for which the Registrant provides 
financial highlights is less than a full fiscal year, the ratios set 
forth in the table may be annualized but the fact of this annualization 
must be disclosed in a note to the table.
    4. List per share amounts at least to the nearest cent. If the 
offering price is computed in tenths of a cent or more, state the 
amounts on the table in tenths of a cent. Present all information using 
a consistent number of decimal places.
    5. Provide all information in the table, including distributions to 
preferred shareholders, on a common share equivalent basis.
    6. Make, and indicate in a note, appropriate adjustments to reflect 
any stock split or stock dividend during the period.
    7. If the investment adviser has been changed during the period 
covered by this Item, indicate the date(s) of the change(s) in a note.
    8. The financial highlights for at least the latest five fiscal 
years must be audited and must so state.

Per Share Operating Performance

    9. Derive the amount for caption a(1) by adding (deducting) the 
increase (decrease) per share in undistributed net investment income 
for the period to

[[Page 33372]]

(from) dividends from net investment income per share for the period. 
The increase (decrease) may be derived by comparing the per share 
figures obtained by dividing undistributed net investment income at the 
beginning and end of the period by the number of shares outstanding on 
those dates. Other methods may be acceptable but should be explained 
briefly in a note to the table.
    10. The amount shown at caption a(2) is the balancing figure 
derived from the other figures in the statement. The amount shown at 
this caption for a share outstanding throughout the year may not agree 
with the change in the aggregate gains and losses in the portfolio 
securities for the year because of the timing of sales and repurchases 
of the Registrant's shares in relation to fluctuating market values for 
the portfolio.
    11. For any distributions made from sources other than net 
investment income and capital gains, state the per share amounts 
thereof separately at caption c(3) and note the nature of the 
distributions.
    12. In caption e, use the net asset value for the end of each 
period for which information is being provided. If the Registrant has 
not been in operation for a full fiscal year, state its net asset value 
immediately after the closing of its first public offering in a note to 
the caption.

Total Investment Return

    13. When calculating ``total investment return'' for caption g:
    a. Assume a purchase of common stock at the current market price on 
the first day and a sale at the current market price on the last day of 
each period reported on the table;
    b. note that the total investment return does not reflect sales 
load; and
    c. assume reinvestment of dividends and distributions at prices 
obtained by the Registrant's dividend reinvestment plan or, if there is 
no plan, at the lower of the per share net asset value or the closing 
market price of the Registrant's shares on the dividend/distribution 
date.
    14. A Registrant also may include, as a separate caption, total 
return based on per share net asset value, provided the Registrant 
briefly explains in a note the differences between this calculation and 
the calculation required by caption g.

Ratios and Supplemental Data

    15. Compute ``average net assets'' for captions i and j based on 
the value of net assets determined no less frequently than the end of 
each month. Indicate in a note that the expense ratio and net 
investment income ratio do not reflect the effect of dividend payments 
to preferred shareholders.
    16. Compute the ``ratio of expenses to average net assets'' using 
the amount of expenses shown in the Registrant's statement of 
operations for the relevant fiscal year, including increases resulting 
from complying with paragraph 2(g) of Rule 6-07 of Regulation S-X, and 
including reductions resulting from complying with paragraphs 2(a) and 
(f) of Rule 6-07 regarding fee waivers and reimbursements. If a change 
in the methodology for determining the ratio of expenses to average net 
assets results from applying paragraph 2(g) of Rule 6-07, explain in a 
note that the ratio reflects fees paid with brokerage commissions and 
fees reduced in connection with specific agreements only for fiscal 
years ending after September 1, 1995.
    17. Compute portfolio turnover rate as follows:
    a. Divide (A) the lesser of purchases or sales of portfolio 
securities for the fiscal year by (B) the monthly average of the value 
of portfolio securities owned by the Registrant during the fiscal year. 
Calculate the monthly average by totaling the values of portfolio 
securities as of the beginning and end of the first month of the fiscal 
year and as of the end of each of the succeeding eleven months and 
dividing the sum by 13.
    b. Exclude from both the numerator and denominator all securities, 
including options, whose maturity or expiration date at the time of 
acquisition was one year or less. Include all long-term securities, 
including U.S. Government securities. Purchases include cash paid upon 
conversion of one portfolio security into another and the cost of 
rights or warrants. Sales include net proceeds of the sale of rights or 
warrants and net proceeds of portfolio securities that have been called 
or for which payment has been made through redemption or maturity.
    c. If during the fiscal year the Registrant acquired the assets of 
another investment company or of a personal holding company in exchange 
for its own shares, exclude from purchases the value of securities so 
acquired, and, from sales, all sales of the securities made following a 
purchase-of-assets transaction to realign the Registrant's portfolio. 
Appropriately adjust the denominator of the portfolio turnover 
computation, and disclose the exclusions and adjustments.
    d. Include in purchases and sales short sales that the Registrant 
intends to maintain for more than one year and put and call options 
with expiration dates more than one year from the date of acquisition. 
Include proceeds from a short sale in the value of portfolio securities 
sold during the period; include the cost of covering a short sale in 
the value of portfolio securities purchased during the period. Include 
premiums paid to purchase options in the value of portfolio securities 
purchased during the reporting period; include premiums received from 
the sale of options in the value of portfolio securities sold during 
the period.
    2. Business Development Companies. If the Registrant is regulated 
as a business development company under the Investment Company Act, 
furnish in a separate section the information required by Items 301, 
302, and 303 of Regulation S-K.
    3. Senior Securities. Furnish the following information as of the 
end of the last ten fiscal years for each class of senior securities 
(including bank loans) of the Registrant. If consolidated statements 
were prepared as of any of the dates specified, furnish the information 
on a consolidated basis:

----------------------------------------------------------------------------------------------------------------
                            Total amount
                       outstanding exclusive    Asset coverage per        Involuntary       Average market value
         Year               of treasury                unit               liquidating         per unit (exclude
                             securities                               preference per unit        bank loans)
----------------------------------------------------------------------------------------------------------------
              (1)                    (2)                    (3)                    (4)                    (5)
----------------------------------------------------------------------------------------------------------------

    Instructions.
    1. Instructions 2, 3, and 8 to Item 4.1 also apply to this sub-
item.
    2. Use the method described in Section 18(h) of the Investment 
Company Act to calculate the asset coverage to be set forth in column 
(3). However, in lieu of expressing asset coverage in terms of a ratio, 
as described in Section 18(h), express it for each class of senior 
securities in terms of dollar amounts per share (in the case of 
preferred stock) or per $1,000 of indebtedness (in the case of senior 
indebtedness).

[[Page 33373]]

    3. Column (4) need be included only with respect to senior stock.
    4. Set forth in a note to the table the method used to determine 
the averages called for by column (5) (e.g., weighted, monthly, daily, 
etc.).
    5. Briefly explain the terms used in the headings of the columns.

Item 5. Plan of Distribution

    Briefly describe how the securities being registered will be 
distributed. Include the following information:
    1. For each principal underwriter distributing the securities being 
offered set forth:
    a. Its name and principal business address;
    b. a brief discussion of the nature of any material relationship 
with the Registrant (other than that of principal underwriter), 
including any arrangement under which a principal underwriter or its 
affiliates will perform administrative or custodial services for the 
Registrant;
    Instruction. Any material relationship between the underwriter (or 
its affiliates) and the investment adviser (or its affiliates) of the 
Registrant relating to the business or operation of the Registrant 
constitutes a material relationship of the underwriter with the 
Registrant.
    c. the amount of securities underwritten; and
    d. the nature of the obligation to distribute the Registrant's 
securities.
    Instruction. All that is required to be disclosed as to the nature 
of the underwriter's obligation is whether the underwriter will be 
committed to take and pay for all the securities if any are taken, or 
whether it is merely an agency or ``best-efforts'' arrangement under 
which the underwriter is required to take and pay for only such 
securities as it may sell to the public. Conditions precedent to the 
underwriter's taking the securities, including ``market outs,'' need 
not be described, except in the case of an agency or ``best-efforts'' 
arrangement.
    2. The price to the public.
    Instructions.
    1. If it is impracticable to state the price to the public, 
concisely explain the manner in which the price will be determined, 
including a description of the valuation procedure used by the 
Registrant in determining the price. If the securities are to be 
offered at the market price, or if the offering price is to be 
determined by a formula related to market price, indicate the market 
involved and the market price as of the latest practicable date.
    2. For restrictions on distributions and repurchases of closed-end 
company securities, see Section 23 of the Investment Company Act, and 
Investment Company Act Rel. No. 3187 (Feb. 6, 1961) [26 FR 1275 (Feb. 
15, 1961)].
    3. Briefly explain the basis for any differences in the price at 
which securities are offered to the public, as individuals and/or as 
groups, and to officers, directors and employees of the Registrant, its 
adviser or underwriter.
    3. To the extent not set forth on the cover page of the prospectus, 
state the amount of the sales load, if any, as a percentage of the 
public offering price, and concisely describe the commissions to be 
allowed or paid to (i) underwriters, including all other items that 
would be deemed by FINRA to constitute underwriting compensation for 
purposes of FINRA's rules regarding securities offerings, underwriting 
and compensation, and (ii) dealers, including all cash, securities, 
contracts, and/or other considerations to be realized by any dealer in 
connection with the sale of securities.
    Instruction. If any dealers are to act in the capacity of sub-
underwriters and are allowed or paid any additional discounts or 
commission for acting in such capacity, a general statement to that 
effect will suffice without giving the additional amounts to be sold.
    4. If the underwriting agreement provides for indemnification by 
the Registrant of the underwriters or their controlling persons against 
any liability arising under the Securities Act or Investment Company 
Act, briefly describe such indemnification provisions.
    5. Provide the identity of any finder and, if applicable, concisely 
describe the nature of any material relationship between such finder 
and the Registrant, its officers, directors, principal shareholders, 
finders or promoters or the principal underwriter(s), or the managing 
underwriter(s), if any, and, in each case, the affiliates or associates 
thereof.
    6. Indicate the date by which investors must pay for the 
securities.
    7. If the securities are being offered in conjunction with any 
retirement plan, provide a statement regarding the manner in which 
further information about the plan can be obtained.
    8. If investors' funds will be forwarded to an escrow account, 
identify the escrow agent, and briefly describe the conditions for 
release of the funds, whether such funds will accrue interest while in 
escrow, and the manner in which the monies in such account will be 
distributed if such conditions are not satisfied, including how accrued 
interest, if any, will be distributed to investors.
    9. If the securities offered by the Registrant are not being listed 
on a national securities exchange, disclose whether any of the 
underwriters intends to act as a market maker with respect to such 
unlisted securities.
    10. Briefly outline the plan of distribution of any securities that 
are to be offered other than through underwriters.
    a. If the securities are to be offered through the selling efforts 
of brokers or dealers, concisely describe the plan of distribution and 
the terms of any agreement, arrangement, or understanding entered into 
with broker(s) or dealer(s) prior to the effective date of the 
registration statement, including volume limitations on sales, parties 
to the agreement, and the conditions under which the agreement may be 
terminated. If known, identify the broker(s) or dealer(s) that will 
participate in the offering, and state the amount to be offered through 
each.
    b. If any of the securities being registered are to be offered 
other than for cash, describe briefly the general purposes of the 
distribution, the basis upon which the securities are to be offered, 
the amount of compensation and other expenses of distribution, and the 
person(s) responsible for such expenses.
    c. If the distribution is to be made under a plan of acquisition, 
reorganization, readjustment, or succession, provide a statement 
regarding the general effect of the plan and when it becomes operative. 
As to any material amount of assets to be acquired under the plan, 
furnish the information required by Instruction 4 to Item 7.1 below.

Item 6. Selling Shareholders

    If any securities being registered are to be offered for the 
account of shareholders, furnish the information required by Item 507 
of Regulation S-K [17 CFR 229.507].

Item 7. Use of Proceeds

    1. State the principal purposes for which the net proceeds of the 
offering are intended to be used and the approximate amount intended to 
be used for each purpose.
    Instructions.
    1. If any substantial portion of the proceeds will not be allocated 
in accordance with the investment objectives and policies of the 
Registrant, a statement to that effect should be made together with a 
statement of the amount involved and an indication of how that amount 
will be invested.

[[Page 33374]]

    2. If a material part of the proceeds will be used to discharge 
indebtedness, state the interest rate and maturity of the indebtedness.
    3. If the Registrant intends to incur loans to pay underwriting 
commissions or any other organizational or offering expenses, disclose 
this fact and state the name of the lender, the amount of the first 
installment, the rate of interest, the date on which payments will 
begin, the dates and amounts of subsequent installments, and the final 
maturity date. Explain that the interest paid on such borrowing will 
not be available for investment purposes and will increase the expenses 
of the fund.
    4. If any material part of the proceeds will be used to acquire 
assets other than in the ordinary course of business, briefly describe 
the assets, the names of the persons from whom they are to be acquired, 
the cost of the assets to the Registrant, and how the costs were 
determined.
    2. Disclose how long it is expected to take to fully invest net 
proceeds in accordance with the Registrant's investment objectives and 
policies, the reasons for any anticipated lengthy delay in investing 
the net proceeds, and the consequences of any delay.

Item 8. General Description of the Registrant

    Concisely discuss the organization and operation, or proposed 
operation, of the Registrant. Include the information specified below.
    1. General. Briefly describe the Registrant, including:
    a. The date and form of organization and the name of the state or 
other jurisdiction under whose laws it is organized; and
    b. the classification and subclassification under Sections 4 and 5 
of the Investment Company Act.
    2. Investment Objectives and Policies. Concisely describe the 
investment objectives and policies of the Registrant that will 
constitute its principal portfolio emphasis, including the following:
    a. If these objectives may be changed without a vote of the holders 
of a majority of voting securities, a brief statement to that effect;
    b. how the Registrant proposes to achieve its objectives, 
including:
    (1) The types of securities in which the Registrant invests or will 
invest principally;
    (2) the identity of any particular industry or group of industries 
in which the Registrant proposes to concentrate.
    Instruction. Concentration, for purposes of this Item, is deemed 25 
percent or more of the value of the Registrant's total assets invested 
or proposed to be invested in a particular industry or group of 
industries. The policy on concentration should not be inconsistent with 
the Registrant's name.
    c. identify other policies of the Registrant that may not be 
changed without the vote of a majority of the outstanding voting 
securities, including those policies that the Registrant deems to be 
fundamental within the meaning of Section 8(b) of the Investment 
Company Act; and
    d. briefly describe the significant investment practices or 
techniques that the Registrant employs or intends to employ (such as 
risk arbitrage, reverse repurchase agreements, forward delivery 
contracts, when-issued securities, stand-by commitments, options and 
futures contracts, options on futures contracts, currency transactions, 
foreign securities, investing for control of management, and/or lending 
of portfolio securities) that are not described pursuant to 
subparagraph 2.c above or subparagraph 3 below.
    3. Risk Factors. Concisely describe the risks associated with an 
investment in the Registrant, including the following:
    a. General. Discuss the principal risk factors associated with 
investment in the Registrant specifically as well as those factors 
generally associated with investment in a company with investment 
objectives, investment policies, capital structure, or trading markets 
similar to the Registrant's.
    b. Effects of Leverage. If the prospectus offers common stock of 
the Registrant and the Registrant has outstanding or is offering a 
class of senior securities as defined in Section 18 of the Investment 
Company Act, then:
    (1) Set forth the annual rate of interest or dividend payments on 
the senior securities;
    Instruction. If payments will vary because the interest or dividend 
rate is variable, provide the initial rate or, if the security is 
currently outstanding, the current rate.
    (2) Set forth the annual return that the Registrant's portfolio 
must experience in order to cover annual interest or dividend payments 
on senior securities; and
    (3) provide a table illustrating the effect on return to a common 
stockholder of leverage (using senior securities) in the format 
illustrated below, using the captions provided, and assuming annual 
returns on the Registrant's portfolio (net of expenses) of minus ten, 
minus five, zero, five, and ten percent.
    (4) The table should be accompanied by a brief narrative explaining 
that the purpose of the table is to assist the investor in 
understanding the effects of leverage. Indicate that the figures 
appearing in the table are hypothetical and that actual returns may be 
greater or less than those appearing in the table.

----------------------------------------------------------------------------------------------------------------
 
----------------------------------------------------------------------------------------------------------------
Assumed Return on Portfolio (Net            -10%             -5%              0%              5%             10%
 of Expenses)...................
Corresponding Return to Common                 %               %               %               %               %
 Stockholder....................
----------------------------------------------------------------------------------------------------------------

    Instructions.
    1. Round all percentages to the nearest hundredth of one percent.
    2. A Registrant may assume additional rates of return on its 
portfolio; however, to the extent a Registrant shows an additional 
positive rate of return, it must also show an additional negative rate 
of return of the same magnitude. A Registrant may show the positive 
rate of return at which the corresponding rate of return to the common 
stockholder is zero without showing the corresponding negative rate of 
return.
    3. Compute the ``corresponding return to common stockholder'' as 
follows: Multiply the total amount of fund assets at the beginning of 
the period by the assumed rate of return; subtract from the resulting 
product all interest accrued or dividends declared on senior securities 
that would be made during the year following the offering; and divide 
the resulting difference by the total amount of fund assets 
attributable to common stock. If payments will vary because the 
interest or dividend rate is variable, use the initial rate or, if the 
security is currently outstanding, the current rate.
    4. Other Policies. Briefly discuss the types of investments that 
will be made by the Registrant, other than those that will constitute 
its principal portfolio emphasis (as discussed in Item 8.2 above), and 
any policies or practices relating to those investments.
    Instructions.
    1. This discussion should receive less emphasis in the prospectus 
than that required by Item 8.2 and, if appropriate in light of 
Instructions 2 and 3 below, may be omitted or limited to the

[[Page 33375]]

information necessary to identify the type of investment, policy, or 
practice.
    2. Do not discuss a policy that prohibits a particular practice or 
permits a practice that the Registrant has not used within the past 
twelve months (or since its initial public offering, if that period is 
shorter) and does not intend to use in the future.
    3. If a policy limits a particular practice so that no more than 
five percent of the Registrant's net assets are at risk, or if the 
Registrant has not followed that practice within the last year (or 
since its initial public offering, if such period is shorter) in such a 
manner that more than five percent of net assets were at risk and does 
not intend to follow such practice so as to put more than five percent 
of net assets at risk, limit the prospectus disclosure about such 
practice to that necessary to identify the practice. Disclose whether 
or not the Registrant will provide prior notice to security holders of 
its intention to commence or expand the use of such practice.
    The amount of the Registrant's net assets that are at risk for 
purposes of determining whether ``more than five percent of net assets 
are at risk'' is not limited to the initial amount of the Registrant's 
assets that are invested in a particular practice, e.g., the purchase 
price of an option. The amount of net assets at risk is determined by 
reference to the potential liability or loss that may be incurred by 
the Registrant in connection with a particular practice.
    5. Share Price Data. If the prospectus offers common stock or other 
type of common equity security (collectively ``common stock'') and if 
the Registrant's common stock is publicly held, provide the following 
information:
    a. Identify the principal United States market or markets in which 
the common stock is being traded. Where there is no established public 
trading market, furnish a statement to that effect.
    Instruction. The existence of limited or sporadic quotations should 
not itself be deemed to constitute an ``established public trading 
market.''
    b. If the principal United States market for the common stock is an 
exchange, state the high and low sales prices for the stock for each 
full quarterly period within the two most recent fiscal years and each 
full fiscal quarter since the beginning of the current fiscal year, as 
reported in the consolidated transaction reporting system or, if not so 
reported, as reported on the principal exchange market for the stock. 
If the principal United States market for the common stock is not an 
exchange, state the range of high and low bid information for the 
common stock for the periods described in the preceding sentence, as 
regularly quoted in the automated quotation system of a registered 
securities association or, if not so quoted, the range of reported high 
and low bid quotations, indicating the source of the quotations.
    Instructions.
    1. This information should be set forth in tabular form.
    2. Indicate, as applicable, that such over-the-counter market 
quotations reflect inter-dealer prices, without retail mark-up, mark-
down, or commission and may not necessarily represent actual 
transactions.
    3. Where there is an absence of an established public trading 
market, qualify reference to quotations by an appropriate explanation.
    4. With respect to each quotation, disclose the net asset value and 
the discount or premium to net asset value (expressed as a percentage) 
represented by the quotation.
    5. Where the shares of the Registrant trade at their high or low 
share price for more than one day during the period, the Registrant 
should provide the discount or premium information for the day on which 
the premium or discount was greatest.
    c. Include share price and corresponding net asset value and 
premium/discount information as of the latest practicable date.
    d. Disclose whether the Registrant's common stock has historically 
traded for an amount less than, equal to, or exceeding net asset value. 
Disclose any methods undertaken or to be undertaken by the Registrant 
that are intended to reduce any discount (such as the repurchase of 
fund shares, providing for the ability to convert to an open-end 
investment company, guaranteed distribution plans, etc.), and briefly 
discuss the effects that these measures have or may have on the 
Registrant.
    e. If the shares of the Registrant have no history of public 
trading, discuss the tendency of closed-end fund shares to trade 
frequently at a discount from net asset value and the risk of loss this 
creates for investors purchasing shares in the initial public offering. 
If the Registrant has omitted the statement required by Item 1.i, 
describe the basis for the Registrant's belief that its shares will not 
trade at a discount from net asset value.
    6. Business Development Companies. A Registrant that is a business 
development company should, in addition, provide the following 
information:
    a. Portfolio Companies. For each portfolio company in which the 
Registrant is investing, disclose: (1) The name and address; (2) nature 
of business; (3) title, class, percentage of class, and value of 
portfolio company securities held by the Registrant; (4) amount and 
general terms of all loans to portfolio companies; and (5) the 
relationship of the portfolio companies to the Registrant.
    Instructions.
    1. The description of the nature of the business of a portfolio 
company in which the Registrant is investing may vary according to the 
extent of the Registrant's investment in the particular portfolio 
company. The Registrant need only briefly identify the nature of the 
business of a portfolio company in which the Registrant's investment 
constitutes less than five percent of the Registrant's assets.
    2. In describing the nature of the business of a portfolio company, 
include matters such as the competitive conditions of the business of 
the company; its market share; dependence on a single or small number 
of customers; importance to it of any patents, trademarks, licenses, 
franchises, or concessions held; key operating personnel; and 
particular vulnerability to changes in government regulation, interest 
rates, or technology.
    3. In describing the relationship of portfolio companies to the 
Registrant, include a discussion of the extent to which the Registrant 
makes available significant managerial assistance to its portfolio 
companies. Disclose any other material business, professional, or 
family relationship between the officers and directors of the 
Registrant and any portfolio company, its officers, directors, and 
affiliates (as defined in Rule 12b-2 under the Exchange Act [17 CFR 
240.12b-2]).
    b. Certain Subsidiaries. If the Registrant has a wholly-owned small 
business investment company subsidiary, disclose: (1) Whether the 
subsidiary is regulated as a business development company or investment 
company under the Investment Company Act; (2) the percentage of the 
Registrant's assets invested in the subsidiary; and (3) material 
information about the small business investment company's operations, 
including the special risks of investing in a portfolio heavily 
invested in securities of small and developing or financially troubled 
businesses.
    c. Financial Statements. Unless the business development company 
has had less than one fiscal year of operations, provide the financial 
statements of the Registrant.
    Instructions.
    1. a. Furnish, in a separate section following the responses to the 
above

[[Page 33376]]

items in Part A of the registration statement, the financial statements 
and schedules required by Regulation S-X [17 CFR 210]. A business 
development company should comply with the provisions of Regulation S-X 
generally applicable to registered management investment companies. 
(See Section 210.3-18 and Sections 210.6-01 through 210.6-10 of 
Regulation S-X.)
    b. A business development company should provide an indication in 
its Schedule of Investments of those investments that are not 
qualifying investments under Section 55(a) of the Investment Company 
Act and, in a footnote, briefly explain the significance of non-
qualification.
    2. Notwithstanding the requirements of Instruction 1 above, the 
following statements and schedules required by Regulation S-X may be 
omitted from Part A and included in Part C of the Registration 
statement:
    a. The statement of any subsidiary that is not a majority-owned 
subsidiary; and
    b. columns C and D of Schedule IV [17 CFR 210.12-03] in support of 
the most recent balance sheet.
    3. A business development company with less than one fiscal year of 
operations should provide its financial statements in the Statement of 
Additional Information in response to Item 24.
    d. Prior Operations. If the Registrant has had an operating history 
prior to electing to be regulated as a business development company, 
disclose any anticipated changes in its operations as a result of 
coming into compliance with Section 55(a) of the Investment Company 
Act. This information may be omitted in a prospectus used a sufficient 
time after election to be regulated as a business development company 
so that it is no longer material.
    e. Special Risk Factors. To the extent not disclosed in response to 
this Item or Item 8.3, concisely describe the special risks of 
investing in a business development company, including the risks 
associated with investing in a portfolio of small and developing or 
financially troubled businesses. (See Section 64(b)(1) of the 
Investment Company Act.)

Item 9. Management

    1. General. Describe concisely how the business of the Registrant 
is managed, including:
    a. Board of Directors. A description of the responsibilities of the 
board of directors with respect to the management of the Registrant;
    Instructions.
    1. In responding to this Item, it is sufficient to include a 
general statement as to the responsibilities of the board of directors 
under the applicable laws of the Registrant's jurisdiction of 
organization.
    2. A Registrant that has elected to be regulated as a business 
development company should briefly describe the terms of any special 
compensation plans available to management.
    b. Investment Advisers. For each investment adviser of the 
Registrant:
    (1) Its name and principal business address, a description of its 
experience as an investment adviser, and, if the investment adviser is 
controlled by another person, the name of that person and the general 
nature of its business;
    Instruction. If the investment adviser is subject to more than one 
level of control, it is sufficient to provide the name of the ultimate 
control person.
    (2) A description of the services provided by the investment 
adviser;
    Instructions.
    1. If, in addition to providing investment advice, the investment 
adviser or persons employed by or associated with the investment 
adviser are subject to the authority of the board of directors, 
responsible for overall management of the Registrant's business 
affairs, it is sufficient to state that fact instead of listing all 
services provided.
    2. A Registrant that has elected to be regulated as a business 
development company should describe briefly the type of managerial 
assistance that is or will be provided to the businesses in which it is 
investing and the qualifications of the investment adviser to render 
such management assistance.
    (3) A description of its compensation; and
    Instructions.
    1. State generally what the adviser's fee is or will be as a 
percentage of average net assets, including any break-point. It is not 
necessary to include precise details as to how the fee is computed or 
paid.
    2. If the investment advisory fee is paid in some manner other than 
on the basis of average net assets, briefly describe the basis of 
payment.
    (4) A statement, adjacent to the disclosure required by paragraph 
1(b)(3) of this Item, that a discussion regarding the basis for the 
board of directors approving any investment advisory contract of the 
Registrant is available in the Registrant's annual or semi-annual 
report to shareholders, as applicable, and providing the period covered 
by the relevant annual or semi-annual report.
    c. Portfolio Management. The name, title, and length of service of 
the person or persons employed by or associated with the Registrant or 
an investment adviser of the Registrant who are primarily responsible 
for the day-to-day management of the Registrant's portfolio 
(``Portfolio Manager''). Also state each Portfolio Manager's business 
experience during the past 5 years. Include a statement, adjacent to 
the foregoing disclosure, that the SAI provides additional information 
about the Portfolio Manager's(s') compensation, other accounts managed 
by the Portfolio Manager(s), and the Portfolio Manager's(s') ownership 
of securities in the Registrant.
    Instruction. If a committee, team, or other group of persons 
associated with the Registrant or an investment adviser of the 
Registrant is jointly and primarily responsible for the day-to-day 
management of the Registrant's portfolio, information in response to 
this Item is required for each member of such committee, team, or other 
group. For each such member, provide a brief description of the 
person's role on the committee, team, or other group (e.g., lead 
member), including a description of any limitations on the person's 
role and the relationship between the person's role and the roles of 
other persons who have responsibility for the day- to-day management of 
the Registrant's portfolio. If more than five persons are jointly and 
primarily responsible for the day-to-day management of the Registrant's 
portfolio, the Registrant need only provide information for the five 
persons with the most significant responsibility for the day-to-day 
management of the Registrant's portfolio.
    d. Administrators. The identity of any other person who provides 
significant administrative or business affairs management services 
(e.g., an ``Administrator'' or ``Sub-Administrator''), a description of 
the services provided, and the compensation to be paid;
    e. Custodians. The name and principal business address of the 
custodian(s), transfer agent, and dividend paying agent;
    f. Expenses. The type of expenses for which the Registrant is 
responsible, and, if organization expenses of the Registrant are to be 
paid out of its assets, how the expenses will be amortized and the 
period over which the amortization will occur; and
    g. Affiliated Brokerage. If the Registrant pays (or will pay) 
brokerage commissions to any broker that is an (1) affiliated person of 
the Registrant, (2) affiliated person of such person, or (3) affiliated 
person of an affiliated person of the Registrant, its investment 
adviser,

[[Page 33377]]

or its principal underwriter, a statement to that effect.
    2. Non-Resident Managers. If any non-resident officer, director, 
underwriter, investment adviser, or expert named in the registration 
statement has a substantial portion of its assets located outside the 
United States, identify each person, and state how the enforcement by 
investors of civil liabilities under the federal securities laws may be 
affected. This disclosure should indicate whether:
    a. Investors will be able to effect service of process within the 
United States upon these persons;
    b. investors will be able to enforce, in United States courts, 
judgments against these persons obtained in such courts predicated upon 
the civil liability provisions of the federal securities laws;
    c. the appropriate foreign courts would enforce judgments of United 
States courts obtained in actions against these persons predicated upon 
the civil liability provisions of the federal securities laws; and
    d. the appropriate foreign courts would enforce, in original 
actions, liabilities against these persons predicated solely upon the 
federal securities laws.
    Instruction. If any portions of this disclosure are stated to be 
based upon an opinion of counsel, name the counsel in the prospectus, 
and include an appropriate manually signed consent to the use of 
counsel's name and opinion as an exhibit to the registration statement.
    3. Control Persons. Identify each person who, as of a specified 
date no more than 30 days prior to the date of filing the registration 
statement (or amendment to it), controls the Registrant.
    Instruction. For the purposes of this Item, ``control'' means (1) 
the beneficial ownership, either directly or through one or more 
controlled companies, of more than 25 percent of the voting securities 
of a company; (2) the acknowledgment or assertion by either the 
controlled or controlling party of the existence of control; or (3) an 
adjudication under Section 2(a)(9) of the Investment Company Act, which 
has become final, that control exists.

Item 10. Capital Stock, Long-Term Debt, and Other Securities

    1. Capital Stock. For each class of capital stock of the 
Registrant, state the title of the class and briefly describe all of 
the matters listed in paragraphs 1.a through 1.f that are relevant:
    a. concisely discuss the nature and most significant attributes, 
including, where applicable, (1) dividend rights, policies, or 
limitations; (2) voting rights; (3) liquidation rights; (4) liability 
to further calls or to assessments by the Registrant; (5) preemptive 
rights, conversion rights, redemption provisions, and sinking fund 
provisions; and (6) any material obligations or potential liability 
associated with ownership of the security (not including investment 
risks);
    Instructions.
    1. A complete legal description of the securities should not be 
given.
    2. If the Registrant has a policy of making distribution or 
dividend payments at predetermined times and minimum rates, disclosure 
should include a statement that, if the fund's investments do not 
generate sufficient income, the fund may be required to liquidate a 
portion of its portfolio to fund these distributions, and therefore 
these payments may represent a reduction of the shareholders' principal 
investment. The tax consequences of such payments also should be 
described briefly.
    b. with respect to preferred stock, (1) state whether there are any 
restrictions on the Registrant while there is an arrearage in the 
payment of dividends or sinking fund installments, and, if so, 
concisely describe the restrictions and (2) briefly describe provisions 
restricting the declaration of dividends, requiring the maintenance of 
any ratio or assets, requiring the creation or maintenance of reserves, 
or permitting or restricting the issuance of additional securities;
    c. if the rights of holders of the security may be modified other 
than by a vote of a majority or more of the shares outstanding, voting 
as a class, so state, and briefly explain;
    d. if rights evidenced by, or the amounts payable with respect to, 
any class of securities being described are, or may be, materially 
limited or qualified by the rights of any other authorized class of 
securities, include sufficient information regarding the other 
securities to enable investors to understand such rights and 
limitations;
    e. if the Registrant has a dividend reinvestment plan, briefly 
discuss the material aspects of the plan including, but not limited to, 
whether the plan is automatic or whether shareholders must 
affirmatively elect to participate; (2) the method by which 
shareholders can elect to reinvest stock dividends or, if the plan is 
automatic, to receive cash dividends; (3) from whom additional 
information about the plan may be obtained (including a telephone 
number or address); (4) the method of determining the number of shares 
that will be distributed in lieu of a cash dividend; (5) the income tax 
consequences of participation in the plan (i.e., that capital gains and 
income are realized, although cash is not received by the shareholder); 
(6) how to terminate participation in the plan and rights upon 
termination; (7) if applicable, that an investor holding shares that 
participate in the dividend reinvestment plan in a brokerage account 
may not be able to transfer the shares to another broker and continue 
to participate in the dividend reinvestment plan; (8) the type and 
amount (if known) of fees, commissions, and expenses payable by 
participants in connection with the plan; and (9) if a cash purchase 
plan option is available, any minimum or maximum investment required; 
and
    f. briefly describe any provision of the Registrant's charter or 
bylaws that would have an effect of delaying, deferring, or preventing 
a change of control of the Registrant and that would operate only with 
respect to an extraordinary corporate transaction involving the 
Registrant, such as a merger, reorganization, tender offer, sale or 
transfer of substantially all of its assets, or liquidation.
    Instruction. Provisions and arrangements required by law or imposed 
by governmental or judicial authority need not be discussed. Provisions 
or arrangements adopted by the Registrant to effect or further 
compliance with laws or governmental or judicial mandate must be 
described where compliance does not require the specific provisions or 
arrangements adopted.
    2. Long-Term Debt. If the Registrant is issuing or has outstanding 
a class of long-term debt, state the title of the debt securities and 
their principal amount, and concisely describe any of the matters 
listed in paragraphs 2.a through 2.e that are relevant:
    a. provisions concerning maturity, interest, conversion, 
redemption, amortization, sinking fund, and/or retirement;
    b. provisions restricting the declaration of dividends, requiring 
the maintenance of any ratio or assets, and/or requiring the creation 
or maintenance of reserves;
    c. provisions permitting or restricting the issuance of additional 
securities, the ability to incur additional debt, the release or 
substitution of assets securing the issue, and/or the modification of 
the terms of the securities;
    Instruction. A complete legal description of the securities should 
not be given.
    d. for each trustee, its name, the nature of any material 
relationship it has with the Registrant or any of its affiliates, the 
percentage of securities

[[Page 33378]]

necessary to require the trustee to take action, and any 
indemnification the trustee may require before proceeding against 
assets of the Registrant; and
    e. to the extent not otherwise disclosed in response to this Item, 
whether the rights evidenced by the long-term debt are, or may be, 
materially limited or qualified by the rights of any other authorized 
class of securities, and, if so, include sufficient information 
regarding such other securities to enable investors to understand such 
rights and limitations.
    3. General. Concisely describe the significant attributes of each 
other class of the Registrant's authorized securities. The description 
should be comparable to that called for by paragraphs 1 and 2 of this 
Item. If the securities are subscription warrants or rights, state the 
title and amount of securities called for and the period during which, 
and the prices at which, the warrants or rights are exercised.
    4. Taxes. Concisely describe the tax consequences to investors of 
an investment in the securities being offered. If the Registrant 
intends to qualify for treatment under Subchapter M of the Internal 
Revenue Code of 1986 [26 U.S.C. 851-856], it is sufficient, in the 
absence of special circumstances, to state that: (i) the Registrant 
will distribute all of its net investment income and gains to 
shareholders and that these distributions are taxable as ordinary 
income or capital gains; (ii) shareholders may be proportionately 
liable for taxes on income and gains of the Registrant but shareholders 
not subject to tax on their income will not be required to pay tax on 
amounts distributed on them: and (iii) the Registrant will inform 
shareholders of the amount and nature of the income or gains.
    Instructions.
    1. The description should not include detailed discussions of 
applicable law.
    2. The Registrant should specifically address whether shareholders 
will be subject to the alternative minimum tax.
    5. Outstanding Securities. Furnish the following information, in 
substantially the tabular form indicated, for each class of authorized 
securities of the Registrant. The information must be current within 90 
days of the filing of this registration statement or amendment to it.

----------------------------------------------------------------------------------------------------------------
                                                                                          Amount outstanding
       Title of class             Amount authorized        Amount held by registrant   exclusive of amount shown
                                                              or for its account               under (3)
----------------------------------------------------------------------------------------------------------------
                   (1)                          (2)                         (3)                         (4)
----------------------------------------------------------------------------------------------------------------

    6. Securities Ratings. If the prospectus relates to senior 
securities of the Registrant that have been assigned a rating by a 
nationally recognized securities rating organization and the rating is 
disclosed in the prospectus, briefly discuss the significance of the 
rating, the basis upon which ratings are issued, any conditions or 
guidelines imposed by the NRSRO for the Registrant to maintain the 
rating, and whether or not the Registrant intends, or has any 
contractual obligation, to comply with these conditions or guidelines. 
In addition, disclose the material terms of any agreement between the 
Registrant or any of its affiliates and the NRSRO under which the NRSRO 
provides such rating. If the prospectus relates to securities other 
than senior securities of the Registrant that have been assigned a 
rating by a NRSRO, the information required by this paragraph may be 
provided in the Statement of Additional Information unless the rating 
criteria will materially affect the investment policies of the 
Registrant (e.g., if the rating agency establishes criteria for 
selection of the Registrant's portfolio securities with which the 
Registrant intends to comply), in which case it should be included in 
the prospectus.
    Instructions.
    1. The term ``nationally recognized securities rating 
organization'' has the same meaning as used in Rule 15c3-1(c)(2)(vi)(F) 
under the Exchange Act [17 CFR 240.15c3-1].
    2. Rule 436(g)(1) of Regulation C under the Securities Act [17 CFR 
230.436] provides that a security rating assigned by an NRSRO to a 
class of debt securities, a class of convertible debt securities, or a 
class of preferred stock is not considered a part of the registration 
statement for purposes of Sections 7 and 11 of the Securities Act. 
Therefore, in the case of disclosure of a rating assigned to these 
types of securities issued by the Registrant, the Registrant need not 
include a written consent of the NRSRO as an exhibit to the 
registration statement as required by Item 25.2.n but must provide the 
disclosure called for by this Item.
    3. Reference should be made to the statement of the Commission's 
policy on security ratings set forth under the section ``General'' in 
Regulation S-K [17 CFR 229.10] for the Commission's views on other 
important matters to be considered in disclosing securities ratings.

Item 11. Defaults and Arrears on Senior Securities

    1. State the nature, date, and amount of default of payment of 
principal, interest, or amortization for each issue of long-term debt 
of the Registrant that is in default on the date of filing.
    2. If an issue of capital stock has any accumulated dividend in 
arrears at the date of filing, state the title of each issue and the 
amount per share in arrears.

Item 12. Legal Proceedings

    Describe briefly any material pending legal proceedings, other than 
ordinary routine litigation incidental to the business, to which the 
Registrant, any subsidiary of the Registrant, or the Registrant's 
investment adviser or principal underwriter is a party. Include the 
name of the court where the case is pending, the date instituted, the 
principal parties, a description of the factual basis alleged to 
underlie the proceeding, and the relief sought. Include similar 
information as to any proceeding instituted by a governmental authority 
or known to be contemplated by a governmental authority.
    Instruction. Legal Proceedings, for purposes of this Item, are 
material only to the extent that they are likely to have a material 
adverse effect upon: (1) the ability of the investment adviser or 
principal underwriter to perform its contract with the Registrant; or 
(2) the Registrant.

Item 13. [Removed and reserved.]

Part B--Information Required in a Statement of Additional Information

Item 14. Cover Page

    1. The outside cover page must contain the following information:
    a. the Registrant's name;
    b. a statement or statements (1) that the Statement of Additional 
Information is not a prospectus, (2) that the Statement of Additional 
Information should be read with the prospectus, and (3) how a copy of 
the prospectus may be obtained;
    c. the date of the Statement of Additional Information;
    d. the date of the related prospectus and any other identifying 
information

[[Page 33379]]

that the Registrant deems appropriate; and
    e. the statement required by paragraph (b)(2) of Rule 481 under the 
Securities Act.
    2. The cover page may include other information, provided that it 
does not, by its nature, quantity, or manner of presentation, impede 
understanding of required information.

Item 15. Table of Contents

    List the contents of the Statement of Additional Information, and, 
where useful, provide a cross-reference to related disclosure in the 
prospectus.

Item 16. General Information and History

    If the Registrant has engaged in a business other than that of an 
investment company during the past five years, state the nature of the 
other business and give the approximate date on which the Registrant 
commenced business as an investment company. If the Registrant's name 
was changed during that period, state its former name and the 
approximate date on which it was changed. If the change in the 
Registrant's business or name occurred in connection with any 
bankruptcy, receivership, or similar proceeding or any other material 
reorganization, readjustment, or succession, briefly describe the 
nature and results of the same.

Item 17. Investment Objective and Policies

    1. Describe clearly and concisely the investment policies of the 
Registrant. It is not necessary to repeat information contained in the 
prospectus, but, in augmenting the disclosure about those types of 
investments, policies, or practices that are briefly discussed or 
identified in the prospectus, the Registrant should refer to the 
prospectus when necessary to clarify the additional information called 
for by this Item.
    2. Concisely describe any fundamental policy of the Registrant not 
described in the prospectus with respect to each of the following 
activities:
    a. the issuance of senior securities;
    b. short sales, purchases on margin, and the writing of put and 
call options;
    c. the borrowing of money (describe briefly any fundamental policy 
that limits the Registrant's ability to borrow money, and state the 
purpose for which the proceeds will be used);
    d. the underwriting of securities of other issuers (include any 
fundamental policy concerning the acquisition of restricted securities, 
i.e., securities that must be registered under the Securities Act 
before they may be offered or sold to the public);
    e. the concentration of investments in a particular industry or 
groups of industries;
    f. the purchase or sale of real estate and real estate mortgage 
loans;
    g. the purchase or sale of commodities or commodity contracts, 
including futures contracts;
    h. the making of loans (for purposes of this Item, the term 
``loans'' does not include the purchase of a portion of an issue of 
publicly distributed bonds, debentures, or other securities, whether or 
not the purchase was made upon the original issuance of the securities; 
however, the term ``loan'' includes the loaning of cash or portfolio 
securities to any person); and
    i. any other policy that the Registrant deems fundamental.
    Instructions.
    1. For purposes of this Item, the term ``fundamental policy'' is 
defined as any policy that the Registrant has deemed to be fundamental 
or that may not be changed without the approval of a majority of the 
Registrant's outstanding voting securities.
    2. If the Registrant reserves freedom of action with respect to any 
of the foregoing activities (other than the activity described in 
paragraph e), it must disclose the maximum percentage of assets to be 
devoted to the particular activity.
    3. Describe fully any significant investment policies of the 
Registrant not described in the prospectus that are not deemed 
fundamental and that may be changed without the approval of the holders 
of a majority of the voting securities (e.g., investing for control of 
management, investing in foreign securities, or arbitrage activities).
    Instruction. The Registrant should disclose the extent to which it 
may engage in the above policies and the risks inherent in such 
policies.
    4. Briefly explain any significant change in the Registrant's 
portfolio turnover rates over the last two fiscal years. If the 
Registrant anticipates a significant change in the portfolio turnover 
rate from that reported under caption k of Item 4.1 for its most recent 
fiscal year, so state. In the case of a new registration, the 
Registrant should state its policy with respect to portfolio turnover.

Item 18. Management

    General Instructions.
    1. For purposes of this Item 18, the terms below have the following 
meanings:
    a. The term ``family of investment companies'' means any two or 
more registered investment companies that:
    (1) Share the same investment adviser or principal underwriter; and
    (2) Hold themselves out to investors as related companies for 
purposes of investment and investor services.
    b. The term ``fund complex'' means two or more registered 
investment companies that:
    (1) Hold themselves out to investors as related companies for 
purposes of investment and investor services; or
    (2) Have a common investment adviser or have an investment adviser 
that is an affiliated person of the investment adviser of any of the 
other registered investment companies.
    c. The term ``immediate family member'' means a person's spouse; 
child residing in the person's household (including step and adoptive 
children); and any dependent of the person, as defined in Section 152 
of the Internal Revenue Code [26 U.S.C. 152].
    d. The term ``officer'' means the president, vice-president, 
secretary, treasurer, controller, or any other officer who performs 
policy-making functions.
    2. When providing information about directors, furnish information 
for directors who are interested persons of the Registrant, as defined 
in Section 2(a)(19) of the Investment Company Act and the rules 
thereunder, separately from the information for directors who are not 
interested persons of the Registrant. For example, when furnishing 
information in a table, you should provide separate tables (or separate 
sections of a single table) for directors who are interested persons 
and for directors who are not interested persons. When furnishing 
information in narrative form, indicate by heading or otherwise the 
directors who are interested persons and the directors who are not 
interested persons.
    1. Provide the information required by the following table for each 
director and officer of the Registrant, and, if the Registrant has an 
advisory board, member of the board. Explain in a footnote to the table 
any family relationship between the persons listed.

[[Page 33380]]



----------------------------------------------------------------------------------------------------------------
                                                                                Number of
                                        Term of office       Principal        portfolios in          Other
  Name, address,    Position(s) held    and length of      occupation(s)       fund complex      directorships
     and age        with registrant      time served       during past 5       overseen by      held by director
                                                               years             director
----------------------------------------------------------------------------------------------------------------
            (1)                (2)                (3)                (4)                (5)                (6)
----------------------------------------------------------------------------------------------------------------

    Instructions.
    1. For purposes of this paragraph, the term ``family relationship'' 
means any relationship by blood, marriage, or adoption, not more remote 
than first cousin.
    2. For each director who is an interested person of the Registrant, 
as defined in Section 2(a)(19) of the Investment Company Act and the 
rules thereunder, describe, in a footnote or otherwise, the 
relationship, events, or transactions by reason of which the director 
is an interested person.
    3. State the principal business of any company listed under column 
(4) unless the principal business is implicit in its name.
    4. Indicate in column (6) directorships not included in column (5) 
that are held by a director in any company with a class of securities 
registered pursuant to Section 12 of the Exchange Act or subject to the 
requirements of Section 15(d) of the Exchange Act or any company 
registered as an investment company under the Investment Company Act, 
and name the companies in which the directorships are held. Where the 
other directorships include directorships overseeing two or more 
portfolios in the same fund complex, identify the fund complex and 
provide the number of portfolios overseen as a director in the fund 
complex rather than listing each portfolio separately.
    2. For each individual listed in column (1) of the table required 
by paragraph 1 of this Item 18, except for any director who is not an 
interested person of the Registrant, as defined in Section 2(a)(19) of 
the Investment Company Act and the rules thereunder, describe any 
positions, including as an officer, employee, director, or general 
partner, held with affiliated persons or principal underwriters of the 
Registrant.
    Instruction. When an individual holds the same position(s) with two 
or more registered investment companies that are part of the same fund 
complex, identify the fund complex and provide the number of registered 
investment companies for which the position(s) are held rather than 
listing each registered investment company separately.
    3. Describe briefly any arrangement or understanding between any 
director or officer and any other person(s) (naming the person(s)) 
pursuant to which he was selected as a director or officer.
    Instruction. Do not include arrangements or understandings with 
directors or officers acting solely in their capacities as such.
    4. For each non-resident director or officer of the Registrant 
listed in column (1) of the table required by paragraph 1, disclose 
whether he has authorized an agent in the United States to receive 
notice and, if so, disclose the name and address of the agent.
    5. a. Briefly describe the leadership structure of the Registrant's 
board, including whether the chairman of the board is an interested 
person of the Registrant, as defined in Section 2(a)(19) of the 
Investment Company Act. If the chairman of the board is an interested 
person of the Registrant, disclose whether the Registrant has a lead 
independent director and what specific role the lead independent 
director plays in the leadership of the Registrant. This disclosure 
should indicate why the Registrant has determined that its leadership 
structure is appropriate given the specific characteristics or 
circumstances of the Registrant. In addition, disclose the extent of 
the board's role in the risk oversight of the Registrant, such as how 
the board administers its oversight function, and the effect that this 
has on the board's leadership structure.
    b. Identify the standing committees of the Registrant's board of 
directors, and provide the following information about each committee:
    (1) A concise statement of the functions of the committee;
    (2) The members of the committee;
    (3) The number of committee meetings held during the last fiscal 
year; and
    (4) If the committee is a nominating or similar committee, state 
whether the committee will consider nominees recommended by security 
holders and, if so, describe the procedures to be followed by security 
holders in submitting recommendations.
    6. a. Unless disclosed in the table required by paragraph 1 of this 
Item 18, describe any positions, including as an officer, employee, 
director, or general partner, held by any director who is not an 
interested person of the Registrant, as defined in Section 2(a)(19) of 
the Investment Company Act and the rules thereunder, or immediate 
family member of the director, during the two most recently completed 
calendar years with:
    (1) The Registrant;
    (2) An investment company, or a person that would be an investment 
company but for the exclusions provided by Sections 3(c)(1) and 3(c)(7) 
of the Investment Company Act, having the same investment adviser or 
principal underwriter as the Registrant or having an investment adviser 
or principal underwriter that directly or indirectly controls, is 
controlled by, or is under common control with an investment adviser or 
principal underwriter of the Registrant;
    (3) An investment adviser, principal underwriter, or affiliated 
person of the Registrant; or
    (4) Any person directly or indirectly controlling, controlled by, 
or under common control with an investment adviser or principal 
underwriter of the Registrant.
    b. Unless disclosed in the table required by paragraph 1 of this 
Item 18 or in response to paragraph 6.a of this Item 18, indicate any 
directorships held during the past five years by each director in any 
company with a class of securities registered pursuant to Section 12 of 
the Exchange Act or subject to the requirements of Section 15(d) of the 
Exchange Act or any company registered as an investment company under 
the Investment Company Act, and name the companies in which the 
directorships were held.
    Instruction. When an individual holds the same position(s) with two 
or more portfolios that are part of the same fund complex, identify the 
fund complex and provide the number of portfolios for which the 
position(s) are held rather than listing each portfolio separately.
    7. For each director, state the dollar range of equity securities 
beneficially owned by the director as required by the following table:
    a. In the Registrant; and
    b. On an aggregate basis, in any registered investment companies 
overseen by the director within the same family of investment companies 
as the Registrant.

[[Page 33381]]



----------------------------------------------------------------------------------------------------------------
                                                                              Aggregate dollar range of equity
                                                                                securities in all registered
          Name of director             Dollar range of equity  securities     investment  companies overseen by
                                                in the registrant             director in family  of investment
                                                                                          companies
----------------------------------------------------------------------------------------------------------------
                          (1)                                   (2)                                   (3)
----------------------------------------------------------------------------------------------------------------

    Instructions.
    1. Information should be provided as of the end of the most 
recently completed calendar year. Specify the valuation date by 
footnote or otherwise.
    2. Determine ``beneficial ownership'' in accordance with Rule 16a-
1(a)(2) under the Exchange Act [17 CFR 240.16a-1].
    3. In disclosing the dollar range of equity securities beneficially 
owned by a director in columns (2) and (3), use the following ranges: 
none, $1-$10,000, $10,001-$50,000, $50,001-$100,000, or over $100,000.
    8. For each director who is not an interested person of the 
Registrant, as defined in Section 2(a)(19) of the Investment Company 
Act and the rules thereunder, and his immediate family members, furnish 
the information required by the following table as to each class of 
securities owned beneficially or of record in:
    a. An investment adviser or principal underwriter of the 
Registrant; or
    b. person (other than a registered investment company) directly or 
indirectly controlling, controlled by, or under common control with an 
investment adviser or principal underwriter of the Registrant:

----------------------------------------------------------------------------------------------------------------
                     Name of owners
 Name of director  and relationships       Company         Title of class        Value of       Percent of class
                       to director                                              securities
----------------------------------------------------------------------------------------------------------------
            (1)                (2)                (3)                (4)                (5)                (6)
----------------------------------------------------------------------------------------------------------------

    Instructions.
    1. Information should be provided as of the end of the most 
recently completed calendar year. Specify the valuation date by 
footnote or otherwise.
    2. An individual is a ``beneficial owner'' of a security if he is a 
``beneficial owner'' under either Rule 13d-3 [17 CFR 240.13d-3] or Rule 
16a-1(a)(2) under the Exchange Act.
    3. Identify the company in which the director or immediate family 
member of the director owns securities in column (3). When the company 
is a person directly or indirectly controlling, controlled by, or under 
common control with an investment adviser or principal underwriter, 
describe the company's relationship with the investment adviser or 
principal underwriter.
    4. Provide the information required by columns (5) and (6) on an 
aggregate basis for each director and his immediate family members.
    9. Unless disclosed in response to paragraph 8 of this Item 18, 
describe any direct or indirect interest, the value of which exceeds 
$120,000, of each director who is not an interested person of the 
Registrant, as defined in Section 2(a)(19) of the Investment Company 
Act and the rules thereunder, or immediate family member of the 
director, during the two most recently completed calendar years, in:
    a. An investment adviser or principal underwriter of the 
Registrant; or
    b. A person (other than a registered investment company) directly 
or indirectly controlling, controlled by, or under common control with 
an investment adviser or principal underwriter of the Registrant.
    Instructions.
    1. A director or immediate family member has an interest in a 
company if he is a party to a contract, arrangement, or understanding 
with respect to any securities of, or interest in, the company.
    2. The interest of the director and the interests of his immediate 
family members should be aggregated in determining whether the value 
exceeds $120,000.
    10. Describe briefly any material interest, direct or indirect, of 
any director who is not an interested person of the Registrant, as 
defined in Section 2(a)(19) of the Investment Company Act and the rules 
thereunder, or immediate family member of the director, in any 
transaction, or series of similar transactions, during the two most 
recently completed calendar years, in which the amount involved exceeds 
$120,000 and to which any of the following persons was a party:
    a. The Registrant;
    b. An officer of the Registrant;
    c. An investment company, or a person that would be an investment 
company but for the exclusions provided by Sections 3(c)(1) and 3(c)(7) 
of the Investment Company, having the same investment adviser or 
principal underwriter as the Registrant or having an investment adviser 
or principal underwriter that directly or indirectly controls, is 
controlled by, or is under common control with an investment adviser or 
principal underwriter of the Registrant;
    d. An officer of an investment company, or a person that would be 
an investment company but for the exclusions provided by Sections 
3(c)(1) and 3(c)(7) of the Investment Company Act, having the same 
investment adviser or principal underwriter as the Registrant or having 
an investment adviser or principal underwriter that directly or 
indirectly controls, is controlled by, or is under common control with 
an investment adviser or principal underwriter of the Registrant;
    e. An investment adviser or principal underwriter of the 
Registrant;
    f. An officer of an investment adviser or principal underwriter of 
the Registrant;
    g. A person directly or indirectly controlling, controlled by, or 
under common control with an investment adviser or principal 
underwriter of the Registrant; or
    h. An officer of a person directly or indirectly controlling, 
controlled by, or under common control with an investment adviser or 
principal underwriter of the Registrant.
    Instructions.
    1. Include the name of each director or immediate family member 
whose interest in any transaction or series of similar transactions is 
described and the nature of the circumstances by reason of which the 
interest is required to be described.
    2. State the nature of the interest, the approximate dollar amount 
involved in the transaction, and, where practicable, the approximate 
dollar amount of the interest.
    3. In computing the amount involved in the transaction or series of 
similar transactions, include all periodic payments in the case of any 
lease or

[[Page 33382]]

other agreement providing for periodic payments.
    4. Compute the amount of the interest of any director or immediate 
family member of the director without regard to the amount of profit or 
loss involved in the transaction(s).
    5. As to any transaction involving the purchase or sale of assets, 
state the cost of the assets to the purchaser and, if acquired by the 
seller within two years prior to the transaction, the cost to the 
seller. Describe the method used in determining the purchase or sale 
price and the name of the person making the determination.
    6. Disclose indirect, as well as direct, material interests in 
transactions. A person who has a position or relationship with, or 
interest in, a company that engages in a transaction with one of the 
persons listed in paragraphs 10.a through 10.h of this Item 18 may have 
an indirect interest in the transaction by reason of the position, 
relationship, or interest. The interest in the transaction, however, 
will not be deemed ``material'' within the meaning of paragraph 10 of 
this Item 18 where the interest of the director or immediate family 
member arises solely from the holding of an equity interest (including 
a limited partnership interest, but excluding a general partnership 
interest) or a creditor interest in a company that is a party to the 
transaction with one of the persons specified in paragraphs 10.a 
through 10.h of this Item 18, and the transaction is not material to 
the company.
    7. The materiality of any interest is to be determined on the basis 
of the significance of the information to investors in light of all the 
circumstances of the particular case. The importance of the interest to 
the person having the interest, the relationship of the parties to the 
transaction with each other, and the amount involved in the transaction 
are among the factors to be considered in determining the significance 
of the information to investors.
    8. No information need be given as to any transaction where the 
interest of the director or immediate family member arises solely from 
the ownership of securities of a person specified in paragraphs 10.a 
through 10.h of this Item 18 and the director or immediate family 
member receives no extra or special benefit not shared on a pro rata 
basis by all holders of the class of securities.
    9. Transactions include loans, lines of credit, and other 
indebtedness. For indebtedness, indicate the largest aggregate amount 
of indebtedness outstanding at any time during the period, the nature 
of the indebtedness and the transaction in which it was incurred, the 
amount outstanding as of the end of the most recently completed 
calendar year, and the rate of interest paid or charged.
    10. No information need be given as to any routine, retail 
transaction. For example, the Registrant need not disclose that a 
director has a credit card, bank or brokerage account, residential 
mortgage, or insurance policy with a person specified in paragraphs 
10.a through 10.h of this Item 18 unless the director is accorded 
special treatment.
    11. Describe briefly any direct or indirect relationship, in which 
the amount involved exceeds $120,000, of any director who is not an 
interested person of the Registrant, as defined in Section 2(a)(19) of 
the Investment Company Act and the rules thereunder, or immediate 
family member of the director, that existed at any time during the two 
most recently completed calendar years, with any of the persons 
specified in paragraphs 10.a through 10.h of this Item 18. 
Relationships include:
    a. Payments for property or services to or from any person 
specified in paragraphs 10.a through 10.h of this Item 18;
    b. Provision of legal services to any person specified in 
paragraphs 10.a through 10.h of this Item 18;
    c. Provision of investment banking services to any person specified 
in paragraphs 10.a through 10.h of this Item 18, other than as a 
participating underwriter in a syndicate; and
    d. Any consulting or other relationship that is substantially 
similar in nature and scope to the relationships listed in paragraphs 
11.a through 11.c of this Item 18.
    Instructions.
    1. Include the name of each director or immediate family member 
whose relationship is described and the nature of the circumstances by 
reason of which the relationship is required to be described.
    2. State the nature of the relationship and the amount of business 
conducted between the director or immediate family member and the 
person specified in paragraphs 10.a through 10.h of this Item 18 as a 
result of the relationship during the two most recently completed 
calendar years.
    3. In computing the amount involved in a relationship, include all 
periodic payments in the case of any agreement providing for periodic 
payments.
    4. Disclose indirect, as well as direct, relationships. A person 
who has a position or relationship with, or interest in, a company that 
has a relationship with one of the persons listed in paragraphs 10.a 
through 10.h of this Item 18 may have an indirect relationship by 
reason of the position, relationship, or interest.
    5. In determining whether the amount involved in a relationship 
exceeds $120,000, amounts involved in a relationship of the director 
should be aggregated with those of his immediate family members.
    6. In the case of an indirect interest, identify the company with 
which a person specified in paragraphs 10.a through 10.h of this Item 
18 has a relationship; the name of the director or immediate family 
member affiliated with the company and the nature of the affiliation; 
and the amount of business conducted between the company and the person 
specified in paragraphs 10.a through 10.h of this Item 18 during the 
two most recently completed calendar years.
    7. In calculating payments for property and services for purposes 
of paragraph 11.a of this Item 18, the following may be excluded:
    a. Payments where the transaction involves the rendering of 
services as a common contract carrier, or public utility, at rates or 
charges fixed in conformity with law or governmental authority; or
    b. Payments that arise solely from the ownership of securities of a 
person specified in paragraphs 10.a through 10.h of this Item 18 and no 
extra or special benefit not shared on a pro rata basis by all holders 
of the class of securities is received.
    8. No information need be given as to any routine, retail 
relationship. For example, the Registrant need not disclose that a 
director has a credit card, bank or brokerage account, residential 
mortgage, or insurance policy with a person specified in paragraphs 
10.a through 10.h of this Item 18 unless the director is accorded 
special treatment.
    12. If an officer of an investment adviser or principal underwriter 
of the Registrant, or an officer of a person directly or indirectly 
controlling, controlled by, or under common control with an investment 
adviser or principal underwriter of the Registrant, served during the 
two most recently completed calendar years, on the board of directors 
of a company where a director of the Registrant who is not an 
interested person of the Registrant, as defined in Section 2(a)(19) of 
the Investment Company Act and the rules thereunder, or immediate 
family member of the director, was during the two most recently 
completed calendar years, an officer, identify:
    a. The company;

[[Page 33383]]

    b. The individual who serves or has served as a director of the 
company and the period of service as director;
    c. The investment adviser or principal underwriter or person 
controlling, controlled by, or under common control with the investment 
adviser or principal underwriter where the individual named in 
paragraph 12.b of this Item 18 holds or held office and the office 
held; and
    d. The director of the Registrant or immediate family member who is 
or was an officer of the company; the office held; and the period of 
holding the office.
    13. In the case of a Registrant that is not a business development 
company, provide the following for all directors of the Registrant, all 
members of the advisory board of the Registrant, and for each of the 
three highest paid officers or any affiliated person of the Registrant 
with aggregate compensation from the Registrant for the most recently 
completed fiscal year in excess of $60,000 (``Compensated Persons'').
    a. Furnish the information required by the following table:

                                               Compensation Table
----------------------------------------------------------------------------------------------------------------
                                                                                             Total compensation
   Name of person,           Aggregate        Pension or retirement     Estimated annual     from fund and fund
       position          compensation from      benefits accrued as      benefits upon         complex paid to
                                fund          part of fund expenses        retirement             directors
----------------------------------------------------------------------------------------------------------------
                (1)                    (2)                    (3)                    (4)                   (5)
----------------------------------------------------------------------------------------------------------------

    Instructions.
    1. For column (1), indicate, if necessary, the capacity in which 
the remuneration is received. For Compensated Persons that are 
directors of the Registrant, compensation is amounts received for 
service as a director.
    2. If the Registrant has not completed its first full year since 
its organization, furnish the information for the current fiscal year, 
estimating future payments that would be made pursuant to an existing 
agreement or understanding. Disclose in a footnote to the Compensation 
Table the period for which the information is furnished.
    3. Include in column (2) amounts deferred at the election of the 
Compensated Person, whether pursuant to a plan established under 
Section 401(k) of the Internal Revenue Code [26 U.S.C. 401(k)] or 
otherwise for the fiscal year in which earned. Disclose in a footnote 
to the Compensation Table the total amount of deferred compensation 
(including interest) payable to or accrued for any Compensated Person.
    4. Include in columns (3) and (4) all pension or retirement 
benefits proposed to be paid under any existing plan in the event of 
retirement at normal retirement date, directly or indirectly, by the 
Registrant, any of its subsidiaries, or other companies in the Fund 
Complex. Omit column (4) where retirement benefits are not 
determinable.
    5. For any defined benefit or actuarial plan under which benefits 
are determined primarily by final compensation (or average final 
compensation) and years of service, provide the information required in 
column (4) in a separate table showing estimated annual benefits 
payable upon retirement (including amounts attributable to any defined 
benefit supplementary or excess pension award plans) in specified 
compensation and years of service classifications. Also provide the 
estimated credited years of service for each Compensated Person.
    6. Include in column (5) only aggregate compensation paid to a 
director for service on the board and all other boards of investment 
companies in a Fund Complex specifying the number of such other 
investment companies.
    b. Describe briefly the material provisions of any pension, 
retirement, or other plan or any arrangement other than fee 
arrangements disclosed in paragraph (a) pursuant to which Compensated 
Persons are or may be compensated for any services provided, including 
amounts paid, if any, to the Compensated Person under any such 
arrangements during the most recently completed fiscal year. 
Specifically include the criteria used to determine amounts payable 
under the plan, the length of service or vesting period required by the 
plan, the retirement age or other event which gives rise to payments 
under the plan, and whether the payment of benefits is secured or 
funded by the Registrant.
    14. In the case of a Registrant that is a business development 
company, provide the information required by Item 402 of Regulation S-K 
[17 CFR 229.402].
    15. Codes of Ethics. Provide a brief statement disclosing whether 
the Registrant and its investment adviser and principal underwriter 
have adopted codes of ethics under Rule 17j-1 under the Investment 
Company Act [17 CFR 270.17j-1] and whether these codes of ethics permit 
personnel subject to the codes to invest in securities, including 
securities that may be purchased or held by the Registrant. Also, 
explain in the statement that these codes of ethics are available on 
the EDGAR Database on the Commission's internet site at http://www.sec.gov, and that copies of these codes of ethics may be obtained, 
after paying a duplicating fee, by electronic request at the following 
email address: [email protected].
    Instruction. A Registrant that is not required to adopt a code of 
ethics under Rule 17j-1 under the Investment Company Act is not 
required to respond to this Item.
    16. Unless the Registrant invests exclusively in non-voting 
securities, describe the policies and procedures that the Registrant 
uses to determine how to vote proxies relating to portfolio securities, 
including the procedures that the Registrant uses when a vote presents 
a conflict between the interests of the Registrant's shareholders, on 
the one hand, and those of the Registrant's investment adviser; 
principal underwriter; or any affiliated person (as defined in Section 
2(a)(3) of the Investment Company Act and the rules thereunder) of the 
Registrant, its investment adviser, or its principal underwriter, on 
the other. Include any policies and procedures of the Registrant's 
investment adviser, or any other third party, that the Registrant uses, 
or that are used on the Registrant's behalf, to determine how to vote 
proxies relating to portfolio securities. Also, state that information 
regarding how the Registrant voted proxies relating to portfolio 
securities during the most recent 12-month period ended June 30 is 
available (i) without charge, upon request, by calling a specified 
toll-free (or collect) telephone number; sending an email to a 
specified email address, if any; or on or through the Registrant's 
website at a specified internet address; and (ii) on the Commission's 
website at http://www.sec.gov.
    Instructions.
    1. A Registrant may satisfy the requirement to provide a 
description of the policies and procedures that it uses to determine 
how to vote proxies

[[Page 33384]]

relating to portfolio securities by including a copy of the policies 
and procedures themselves.
    2. If a Registrant discloses that the Registrant's proxy voting 
record is available by calling a toll-free (or collect) telephone 
number or sending an email to a specified email address, if any, and 
the Registrant (or financial intermediary through which shares of the 
Registrant may be purchased or sold) receives a request for this 
information, the Registrant (or financial intermediary) must send the 
information disclosed in the Registrant's most recently filed report on 
Form N-PX [17 CFR 274.129], within 3 business days of receipt of the 
request, by first-class mail or other means designed to ensure equally 
prompt delivery.
    3. If a Registrant discloses that the Registrant's proxy voting 
record is available on or through its website, the Registrant must make 
available free of charge the information disclosed in the Registrant's 
most recently filed report on Form N-PX on or through its website as 
soon as reasonably practicable after filing the report with the 
Commission. The information disclosed in the Registrant's most recently 
filed report on Form N-PX must remain available on or through the 
Registrant's website for as long as the Registrant remains subject to 
the requirements of Rule 30b1-4 under the Investment Company Act [17 
CFR 270.30b1-4] and discloses that the Registrant's proxy voting record 
is available on or through its website.
    17. For each director, briefly discuss the specific experience, 
qualifications, attributes, or skills that led to the conclusion that 
the person should serve as a director for the Registrant at the time 
that the disclosure is made, in light of the Registrant's business and 
structure. If material, this disclosure should cover more than the past 
five years, including information about the person's particular areas 
of expertise or other relevant qualifications.

Item 19. Control Persons and Principal Holders of Securities

    Furnish the following information as of a specified date no more 
than 30 days prior to the date of filing of the registration statement 
or amendment to it.
    1. State the name and address of each person who controls the 
Registrant, and briefly explain the effect of such control on the 
voting rights of other shareholders. For each control person, state the 
percentage of the Registrant's voting securities owned or any other 
basis of control. If the control person is a company, disclose the 
state or other jurisdiction under the laws of which it is organized. 
List all parents of each control person.
    Instructions.
    1. The term ``control'' is defined in the instruction to Item 9.3 
of this Form.
    2. A Registrant that is controlled by its adviser or underwriter(s) 
before the effective date of the registration statement need not 
respond to this Item if, immediately after the public offering, there 
will be no control person.
    2. State the name, address, and percentage of ownership of each 
person who owns of record or is known by the Registrant to own of 
record or beneficially five percent or more of any class of the 
Registrant's outstanding equity securities.
    Instructions.
    1. Calculate the percentages on the basis of the amount of common 
stock outstanding.
    2. If securities are being registered in connection with or 
pursuant to a plan of acquisition, reorganization, readjustment, or 
succession, indicate, to the extent practicable, the status to exist 
upon consummation of the plan on the basis of present holdings and 
commitments.
    3. If, to the knowledge of the Registrant or any principal 
underwriter of its securities, five percent or more of any class of 
voting securities of the Registrant are or will be held subject to any 
voting trust or other similar agreement, disclose this fact.
    4. Indicate whether the securities are owned both of record and 
beneficially, or of record only, or beneficially only, and disclose the 
respective percentage owned in each manner.
    3. Disclose all equity securities of the Registrant owned by all 
officers, directors, and members of the advisory board of the 
Registrant as a group, without naming them. In any case where the 
amount owned by directors and officers as a group is less than one 
percent of the class, a statement to that effect is sufficient.

Item 20. Investment Advisory and Other Services

    1. Furnish the following information about each investment adviser:
    a. The names of all controlling persons, the basis of such control, 
and, if material, the business history of any organization that 
controls the adviser;
    b. the names of any affiliated person of the Registrant who is also 
an affiliated person of the investment adviser and a list of all 
capacities in which such person named is affiliated with the Registrant 
and/or with the investment adviser; and
    Instruction. If an affiliated person of the Registrant, either 
alone or together with others, is a controlling person of the 
investment adviser, the Registrant must disclose that fact but need not 
supply the specific amount of percentage of the outstanding voting 
securities of the investment adviser that are owned by the controlling 
person.
    c. The method of computing the advisory fee payable by the 
Registrant, including:
    (1) The total dollar amounts paid to the adviser by the Registrant 
under the investment advisory contract for the last three fiscal years;
    (2) if applicable, any credits that reduced the advisory fee for 
any of the last fiscal years; and
    (3) any expense limitation provision.
    Instructions.
    1. If the advisory fee payable by the Registrant varies depending 
on the Registrant's investment performance in relation to some 
standard, set forth the standard along with a fee schedule in tabular 
form. The Registrant may include examples showing the fees the adviser 
would earn at various levels of performance, but such examples must 
include calculations showing the maximum and minimum fee percentages 
that could be earned under the contract.
    2. State each type of credit or offset separately.
    3. Where the Registrant is subject to more than one expense 
limitation provision, describe only the most restrictive provision.
    2. Concisely describe all services performed for or on behalf of 
the Registrant that are supplied or paid for wholly or in substantial 
part by the investment adviser in connection with the investment 
advisory contract.
    3. Describe briefly all fees, expenses, and costs of the Registrant 
that are to be paid by persons other than the investment adviser or the 
Registrant, and identify such persons.
    4. Summarize any management-related service contract under which 
services are provided to the Registrant that is not otherwise disclosed 
in response to an Item of this Form and may be of interest to a 
purchaser of the Registrant's securities, indicating the parties to the 
contract and the total dollars paid, and by whom, for the past three 
years.
    Instructions.
    1. A ``management-related service contract'' includes any agreement 
whereby another person contracts with the Registrant to keep, prepare, 
and/or file accounts, books, records, or other documents that the 
Registrant may be required to keep under federal or state law, or to 
provide any similar services with respect to the daily administration

[[Page 33385]]

of the Registrant, but does not include the following: (1) Any contract 
with the Registrant to provide investment advice; (2) any agreement to 
act as custodian, transfer agent, or dividend-paying agent; and (3) 
bona fide contracts for outside legal or auditing services, or bona 
fide contracts for personal employment entered into in the ordinary 
course of business.
    2. No information is required about the service of mailing proxies 
or periodic reports to shareholders of the Registrant.
    3. In summarizing the substantive provisions of a management-
related service contract, include: (1) The name of the person providing 
the service; (2) any direct or indirect relationship of that person 
with the Registrant, its investment adviser, or its principal 
underwriter; (3) the nature of the services provided; and (4) the basis 
of the compensation paid for the last three fiscal years.
    5. If any person (other than a bona fide director, officer, member 
of an advisory board, employee of the Registrant, or a person named as 
an investment adviser in response to paragraph 1 of this Item), 
pursuant to any understanding, whether formal or informal, regularly 
furnishes advice to the Registrant or the investment adviser of the 
Registrant with respect to the desirability of the Registrant's 
investing in, purchasing, or selling securities or other property, or 
is empowered to determine which securities or other property should be 
purchased or sold by the Registrant, and receives direct or indirect 
remuneration from the Registrant, furnish the following information:
    a. The name of the person;
    b. a description of the nature of the arrangement and the advice or 
information given; and
    c. any remuneration (including, for example, participation, 
directly or indirectly, in commissions or other compensation paid in 
connection with transactions in the Registrant's portfolio securities) 
paid for the advice or information, and a statement as to how and by 
whom such remuneration was paid for the last three fiscal years.
    Instruction. No information is required with respect to any of the 
following:
    1. Persons whose advice was furnished solely through uniform 
publications distributed to subscribers;
    2. persons who furnished only statistical and other factual 
information, advice regarding economic factors and trends, or advice as 
to occasional transactions in specific securities, but without 
generally furnishing advice or making recommendations regarding the 
purchase or sale of securities by the Registrant;
    3. a company that is excluded from the definition of ``investment 
adviser'' of an investment company by reason of Section 2(a)(20)(iii) 
of the Investment Company Act;
    4. any person the character and amount of whose compensation for 
such service must be approved by a court; or
    5. such other persons as the Commission has by rules and 
regulations or order determined not to be an ``investment adviser'' of 
an investment company.
    6. Furnish the name and principal business address of each of the 
Registrant's custodians, the nature of the business of each such 
person, and a general description of the services performed by each.
    7. Furnish the name and principal business address of the 
Registrant's independent public accountant, and provide a general 
description of the services performed by such person.
    8. If an affiliated person of the Registrant, or an affiliated 
person of an affiliated person of the Registrant, acts as custodian, 
transfer agent, or dividend-paying agent for the Registrant, furnish a 
description of the services performed by that person and the basis for 
remuneration (e.g., the method by which that person's fee is 
calculated).

Item 21. Portfolio Managers

    1. Other Accounts Managed. If a Portfolio Manager required to be 
identified in response to Item 9.1.c is primarily responsible for the 
day-to-day management of the portfolio of any other account, provide 
the following information:
    a. The Portfolio Manager's name;
    b. The number of other accounts managed within each of the 
following categories and the total assets in the accounts managed 
within each category:
    (1) Registered investment companies;
    (2) Other pooled investment vehicles; and
    (3) Other accounts.
    c. For each of the categories in Item 21.1.b, the number of 
accounts and the total assets in the accounts with respect to which the 
advisory fee is based on the performance of the account; and
    d. A description of any material conflicts of interest that may 
arise in connection with the Portfolio Manager's management of the 
Registrant's investments, on the one hand, and the investments of the 
other accounts included in response to Item 21.1.b, on the other. This 
description would include, for example, material conflicts between the 
investment strategy of the Registrant and the investment strategy of 
other accounts managed by the Portfolio Manager and material conflicts 
in allocation of investment opportunities between the Registrant and 
other accounts managed by the Portfolio Manager.
    Instructions.
    1. Provide the information required by Item 21.1 as of the end of 
the Registrant's most recently completed fiscal year, except that, in 
the case of an initial registration statement or an update to the 
Registrant's registration statement that discloses a new Portfolio 
Manager, information with respect to any newly identified Portfolio 
Manager must be provided as of the most recent practicable date. 
Disclose the date as of which the information is provided.
    2. If a committee, team, or other group of persons that includes 
the Portfolio Manager is jointly and primarily responsible for the day-
to-day management of the portfolio of an account, include the account 
in responding to Item 21.1.
    2. Compensation. Describe the structure of, and the method used to 
determine, the compensation of each Portfolio Manager required to be 
identified in response to Item 9.1.c. For each type of compensation 
(e.g., salary, bonus, deferred compensation, retirement plans and 
arrangements), describe with specificity the criteria on which that 
type of compensation is based, for example, whether compensation is 
fixed, whether (and, if so, how) compensation is based on the 
Registrant's pre- or after-tax performance over a certain time period, 
and whether (and, if so, how) compensation is based on the value of 
assets held in the Registrant's portfolio. For example, if compensation 
is based solely or in part on performance, identify any benchmark used 
to measure performance and state the length of the period over which 
performance is measured.
    Instructions.
    1. Provide the information required by Item 21.2 as of the end of 
the Registrant's most recently completed fiscal year, except that, in 
the case of an initial registration statement or an update to the 
Registrant's registration statement that discloses a new Portfolio 
Manager, information with respect to any newly identified Portfolio 
Manager must be provided as of the most recent practicable date. 
Disclose the date as of which the information is provided.
    2. Compensation includes, without limitation, salary, bonus, 
deferred compensation, and pension and retirement plans and 
arrangements,

[[Page 33386]]

whether the compensation is cash or non-cash. Group life, health, 
hospitalization, medical reimbursement, and pension and retirement 
plans and arrangements may be omitted, provided that they do not 
discriminate in scope, terms, or operation in favor of the Portfolio 
Manager or a group of employees that includes the Portfolio Manager and 
are available generally to all salaried employees. The value of 
compensation is not required to be disclosed under this Item.
    3. Include a description of the structure of, and the method used 
to determine, any compensation received by the Portfolio Manager from 
the Registrant, the Registrant's investment adviser, or any other 
source with respect to management of the Registrant and any other 
accounts included in the response to Item 21.1.b. This description must 
clearly disclose any differences between the method used to determine 
the Portfolio Manager's compensation with respect to the Registrant and 
other accounts, e.g., if the Portfolio Manager receives part of an 
advisory fee that is based on performance with respect to some accounts 
but not the Registrant, this must be disclosed.
    3. Ownership of Securities. For each Portfolio Manager required to 
be identified in response to Item 9.1.c, state the dollar range of 
equity securities in the Registrant beneficially owned by the Portfolio 
Manager using the following ranges: none; $1-$10,000; $10,001-$50,000; 
$50,001-$100,000; $100,001-$500,000; $500,001-$1,000,000; or over 
$1,000,000.
    Instructions.
    1. Provide the information required by Item 21.3 as of the end of 
the Registrant's most recently completed fiscal year, except that, in 
the case of an initial registration statement or an update to the 
Registrant's registration statement that discloses a new Portfolio 
Manager, information with respect to any newly identified Portfolio 
Manager must be provided as of the most recent practicable date. 
Specify the valuation date.
    2. Determine ``beneficial ownership'' in accordance with Rule 16a-
1(a)(2) under the Exchange Act.

Item 22. Brokerage Allocation and Other Practices

    1. Concisely describe how transactions in portfolio securities are 
or will be effected. Provide a general statement about brokerage 
commissions and mark-ups on principal transactions and the aggregate 
amount of any brokerage commissions paid by the Registrant during the 
three most recent fiscal years. Concisely explain any material change 
in brokerage commissions paid by the Registrant during the most recent 
fiscal year as compared to the two prior fiscal years.
    2. a. State the total dollar amount, if any, of brokerage 
commissions paid by the Registrant during the three most recent fiscal 
years to any broker that: (1) Is an affiliated person of the 
Registrant; (2) is an affiliated person of an affiliated person of the 
Registrant; or (3) has an affiliated person that is an affiliated 
person of the Registrant, its investment adviser, or principal 
underwriter. In the case of an initial public offering, disclose 
whether or not the Registrant intends to use any brokers described in 
this subparagraph, a. Identify each broker, and state the relationships 
that cause the broker to be identified in this Item.
    b. State for each broker identified in response to paragraph 2.a of 
this Item:
    (1) The percentage of the Registrant's aggregate brokerage 
commissions paid to the broker during the most recent fiscal year; and
    (2) the percentage of the Registrant's aggregate dollar amount of 
transactions involving the payment of commissions effected through the 
broker during the most recent fiscal year.
    c. Where there is a material difference in the percentage of 
brokerage commissions paid to, and the percentage of transactions 
effected through, any broker identified in response to paragraph 2.a of 
this Item, state the reasons for the difference.
    3. Describe briefly how brokers will be selected to effect 
securities transactions for the Registrant and how evaluations will be 
made of the overall reasonableness of brokerage commissions paid, 
including the factors considered.
    Instructions.
    1. If the receipt of products or services other than brokerage or 
research services is a factor considered in the selection of brokers, 
specify the products and services.
    2. If the receipt of research services is a factor in selecting 
brokers, identify the nature of the research services.
    3. State whether persons acting on behalf of the Registrant are 
authorized to pay a broker a commission in excess of that which another 
broker might have charged for effecting the same transaction because of 
the value of brokerage or research services provided by the broker.
    4. If applicable, explain that research services furnished by 
brokers through whom the Registrant effects securities transactions may 
be used by the Registrant's investment adviser in servicing all of its 
accounts and that not all the services may be used by the investment 
adviser in connection with the Registrant; or, if other policies or 
practices are applicable to the Registrant with respect to the 
allocation of research services provided by brokers, concisely explain 
the policies and practices.
    5. Registrants should refer to Rule 17e-1 under the Investment 
Company Act [17 CFR 270.17e-1] with respect to securities transactions 
executed by exchange members.
    4. If during the last fiscal year the Registrant or its investment 
adviser, pursuant to an agreement or understanding with a broker or 
otherwise through an internal allocation procedure, directed the 
Registrant's brokerage transactions to a broker because of research 
services provided, state the amount of the transactions and related 
commissions.
    5. If the Registrant has acquired during its most recent fiscal 
year or during the period of time since organization, whichever is 
shorter, securities of its regular brokers or dealers, as defined in 
Rule 10b-1 under the Investment Company Act [17 CFR 270.10b-1], or 
their parents, identify those brokers or dealers, and state the value 
of the Registrant's aggregate holdings of the securities of each 
subject issuer as of the close of the Registrant's most recent fiscal 
year.
    Instruction. The Registrant need only disclose information with 
respect to the parent of a broker or dealer that derived more than 
fifteen percent of its gross revenues from the business of a broker, a 
dealer, an underwriter, or an investment adviser.

Item 23. Tax Status

    Provide information about the Registrant's tax status that is not 
required to be in the prospectus but that the Registrant believes is of 
interest to investors, including, but not limited to, an explanation of 
the legal basis for the Registrant's tax status. If the Registrant is 
qualified or intends to qualify under Subchapter M of the Internal 
Revenue Code and has not disclosed that fact in the prospectus, then 
disclosure of that fact will be sufficient. If not otherwise disclosed, 
concisely describe any special or unusual tax aspects of the 
Registrant, e.g., taxes resulting from foreign investment or from 
status as a personal holding company, or any tax loss carry-forward to 
which the Registrant may be entitled.

Item 24. Financial Statements

    Provide the financial statements of the Registrant.
    Instructions.

[[Page 33387]]

    1. a. Furnish, in a separate section following the responses to the 
above items in Part B of the registration statement, the financial 
statements and schedules required by Regulation S-X [17 CFR 210]. (See 
Section 210.3-18 and Sections 210.6-01 through 210.6-10 of Regulation 
S-X.)
    b. A business development company that has had at least one fiscal 
year of operations need provide financial statements under Item 8.6.c 
of Part A only. A business development company with less than one 
fiscal year of operations should refer to Item 8.6.c of Part A and 
Instructions 1 and 2 thereunder in responding to this Item 24.
    2. Notwithstanding the requirements of Instruction 1 above, the 
following statements and schedules required by Regulation S-X may be 
omitted from Part B and included in Part C of the registration 
statement:
    a. The statement of any subsidiary that is not a majority-owned 
subsidiary; and
    b. Columns C and D of Schedule III [17 CFR 210.12-14].
    3. In addition to the requirements of Rule 3-18 of Regulation S-X 
[17 CFR 210.3-18], any company registered under the Investment Company 
Act that has not previously had an effective registration statement 
under the Securities Act shall include in its initial registration 
statement under the Securities Act such additional financial statements 
and financial highlights (which need not be audited) as are necessary 
to make the financial statements and financial highlights included in 
the registration statement as of a date within 90 days prior to the 
date of filing.
    4. Every annual report to shareholders required by Section 30(e) of 
the Investment Company Act and Rule 30e-1 thereunder shall contain the 
following information:
    a. The audited financial statements required by Regulation S-X for 
the periods specified by Regulation S-X, modified to permit the 
omission of the statements and schedules that may be omitted from Part 
B of the registration statement by Instruction 2 above and as permitted 
by Instruction 7 below;
    b. the financial highlights required by Item 4.1 of this Form, for 
the five most recent fiscal years, with at least the most recent year 
audited;
    c. unless shown elsewhere in the report as part of the financial 
statements required by a above, the aggregate remuneration paid by the 
company during the period covered by the report (1) to all directors 
and to all members of any advisory board for regular compensation; (2) 
to each director and to each member of an advisory board for special 
compensation; (3) to all officers; and (4) to each person of whom any 
officer or director of the company is an affiliated person;
    d. the information concerning changes in and disagreements with 
accountants and on accounting and financial disclosure required by Item 
304 of Regulation S-K [17 CFR 229.304];
    e. the management information required by paragraph 1 of Item 18; 
and
    f. a statement that the SAI includes additional information about 
directors of the Registrant and is available, without charge, upon 
request, and a toll-free (or collect) telephone number and email 
address, if any, for shareholders to use to request the SAI.
    g. Management's Discussion of Fund Performance. Disclose the 
following information:
    (1) Discuss the factors that materially affected the Fund's 
performance during the most recently completed fiscal year, including 
the relevant market conditions and the investment strategies and 
techniques used by the Fund. The information presented may include 
tables, charts, and other graphical depictions.
    (2) (A) Provide a line graph comparing the initial and subsequent 
account values at the end of each of the most recently completed 10 
fiscal years of the Fund (or for the life of the Fund, if shorter), but 
only for periods subsequent to the effective date of the Fund's 
registration statement. Assume a $10,000 initial investment at the 
beginning of the first fiscal year in an appropriate broad-based 
securities market index for the same period.
    1. Line Graph Computation.
    (a) Assume that the initial investment was made at the offering 
price last calculated on the business day before the first day of the 
first fiscal year.
    (b) Base subsequent account values on the market price (or, if 
shares are not listed, the net asset value) of the Fund on the last 
business day of the first and each subsequent fiscal year.
    (c) Calculate the final account value by assuming the account was 
closed and sale was at the market price (or, if shares are not listed, 
the net asset value) on the last business day of the most recent fiscal 
year.
    (d) Base the line graph on the Fund's required minimum initial 
investment if that amount exceeds $10,000.
    2. Multiple Class Funds. The Fund can select which Class to 
include, consistent with the requirements of Instruction 3(a) to Item 
4(b)(2) of Form N-1A [17 CFR 274.11A].
    (B) In a table placed within or next to the graph, provide the 
Fund's average annual total returns for the 1-, 5-, and 10- year 
periods as of the end of the last day of the most recent fiscal year 
(or for the life of the Fund, if shorter), but only for periods 
subsequent to the effective date of the Fund's registration statement. 
Average annual total returns should be computed in accordance with Item 
26(b)(1) of Form N-1A, except with respect to reinvestments of 
dividends and distributions, which must be calculated consistent with 
Item 4 of this Form. Include a statement accompanying the graph and 
table to the effect that past performance does not predict future 
performance and that the graph and table do not reflect the deduction 
of taxes that a shareholder would pay on fund distributions or the sale 
of fund shares.
    (C) Sales Load. Reflect any sales load (or any other fees charged 
at the time of purchasing shares or opening an account) by beginning 
the line graph at the amount that actually would be invested (i.e., 
assume that the maximum sales load, and other charges deducted from 
payments, is deducted from the initial $10,000 investment). For a Fund 
whose shares are subject to a contingent deferred sales load, assume 
the deduction of the maximum deferred sales load (or other charges) 
that would apply for a complete sale that received the market price 
(or, if shares are not listed, the net asset value) on the last 
business day of the most recent fiscal year. For any other deferred 
sales load, repurchase fee, or withdrawal charge, assume that the 
deduction is in the amount(s) and at the time(s) that the sales load, 
repurchase fee, or withdrawal charge actually would have been deducted.
    (D) Dividends and Distributions. Assume reinvestment of all of the 
Fund's dividends and distributions on the reinvestment dates during the 
period, and reflect any sales load imposed upon reinvestment of 
dividends or distributions or both.
    (E) Account Fees. Reflect recurring fees that are charged to all 
accounts.
    1. For any account fees that vary with the size of the account, 
assume a $10,000 account size.
    2. Reflect, as appropriate, any recurring fees charged to 
shareholder accounts that are paid other than by sale of the Fund's 
shares.
    3. Reflect an annual account fee that applies to more than one Fund 
by allocating the fee in the following manner: Divide the total amount 
of account fees collected during the year by the Funds' total average 
market price, multiply the resulting percentage by the

[[Page 33388]]

average account value for each Fund and reduce the value of each 
hypothetical account at the end of each fiscal year during which the 
fee was charged.
    (F) Appropriate Index. For purposes of this Item, an ``appropriate 
broad-based securities market index'' is one that is administered by an 
organization that is not an affiliated person of the Fund, its 
investment adviser, or principal underwriter, unless the index is 
widely recognized and used. Adjust the index to reflect the 
reinvestment of dividends on securities in the index, but do not 
reflect the expenses of the Fund.
    (G) Additional Indexes. A Fund is encouraged to compare its 
performance not only to the required broad-based index, but also to 
other more narrowly based indexes that reflect the market sectors in 
which the Fund invests. A Fund also may compare its performance to an 
additional broad-based index, or to a non-securities index (e.g., the 
Consumer Price Index), so long as the comparison is not misleading.
    (H) Change in Index. If the Fund uses an index that is different 
from the one used for the immediately preceding fiscal year, explain 
the reason(s) for the change and compare the Fund's annual change in 
the value of an investment in the hypothetical account with the new and 
former indexes.
    (I) Other Periods. The line graph may cover earlier fiscal years 
and may compare the ending values of interim periods (e.g., monthly or 
quarterly ending values), so long as those periods are after the 
effective date of the Fund's registration statement.
    (J) Scale. The axis of the graph measuring dollar amounts may use 
either a linear or a logarithmic scale.
    (K) New Funds. A New Fund is not required to include the 
information specified by this Item in its prospectus (or annual 
report), unless Form N-2 (or the annual report) contains audited 
financial statements covering a period of at least 6 months.
    (L) Change in Investment Adviser. If the Fund has not had the same 
investment adviser for the previous 10 fiscal years, the Fund may begin 
the line graph on the date that the current adviser began to provide 
advisory services to the Fund so long as:
    1. Neither the current adviser nor any affiliate is or has been in 
``control'' of the previous adviser under Section 2(a)(9) of the 
Investment Company Act;
    2. The current adviser employs no officer(s) of the previous 
adviser or employees of the previous adviser who were responsible for 
providing investment advisory or portfolio management services to the 
Fund; and
    3. The graph is accompanied by a statement explaining that previous 
periods during which the Fund was advised by another investment adviser 
are not shown.
    (3) Discuss the effect of any policy or practice of maintaining a 
specified level of distributions to shareholders on the Fund's 
investment strategies and per share net asset value during the last 
fiscal year. Also discuss the extent to which the Fund's distribution 
policy resulted in distributions of capital.
    h. If the Registrant has filed a registration statement pursuant to 
General Instruction A.2:
    (1) Senior Securities. Include the information required by Item 
4.3.
    (2) Fee and Expense Table. Include the information required by Item 
3.1.
    (3) Share Price Data. Include the information required by Item 8.5.
    (4) Unresolved Staff Comments. If the Registrant has received 
written comments from the Commission staff regarding its periodic or 
current reports under the Exchange Act or Investment Company Act or its 
registration statement not less than 180 days before the end of its 
fiscal period to which the annual report relates, and such comments 
remain unresolved, disclose the substance of any such unresolved 
comments that the Registrant believes are material. Such disclosure may 
provide other information including the position of the Registrant with 
respect to any such comment.
    5. Every report to shareholders required by Section 30(e) of the 
Investment Company Act and Rule 30e-1 thereunder, except the annual 
report, shall contain the following information (which need not be 
audited):
    a. The financial statements required by Regulation S-X for the 
period commencing either with (1) the beginning of the company's fiscal 
year (or date of organization, if newly organized); or (2) a date not 
later than the date after the close of the period included in the last 
report conforming with the requirements of Rule 30e-1 and the most 
recent preceding fiscal year, modified to permit the omission of the 
statements and schedules that may be omitted from Part B of the 
registration statement by Instruction 2 above and as permitted by 
Instruction 7 below;
    b. the financial highlights required by Item 4.1 of this Form, for 
the period of the report as specified by subparagraph a of this 
instruction, and the most recent preceding fiscal year;
    c. unless shown elsewhere in the report as part of the financial 
statements required by subparagraph a of this instruction, the 
aggregate remuneration paid by the company during the period covered by 
the report (1) to all directors and to all members of any advisory 
board for regular compensation; (2) to each director and to each member 
of an advisory board for special compensation; (3) to all officers; and 
(4) to each person of whom an officer or director of the company is an 
affiliated person; and
    d. the information concerning changes in and disagreements with 
accountants and on accounting and financial disclosure required by Item 
304 of Regulation S-K.
    6. Every annual and semi-annual report to shareholders required by 
Section 30(e) of the Investment Company Act and Rule 30e-1 thereunder 
shall contain the following information:
    a. One or more tables, charts, or graphs depicting the portfolio 
holdings of the Registrant by reasonably identifiable categories (e.g., 
type of security, industry sector, geographic region, credit quality, 
or maturity) showing the percentage of net asset value or total 
investments attributable to each. The categories and the basis of 
presentation (e.g., net asset value or total investments) should be 
selected, and the presentation should be formatted, in a manner 
reasonably designed to depict clearly the types of investments made by 
the Fund, given its investment objectives. If the Fund depicts 
portfolio holdings according to credit quality, it should include a 
description of how the credit quality of the holdings were determined, 
and if credit ratings, as defined in Section 3(a)(60) of the Exchange 
Act, assigned by a credit rating agency, as defined in Section 3(a)(61) 
of the Exchange Act, are used, explain how they were identified and 
selected. This description should be included near, or as part of, the 
graphical representation.
    b. Statement Regarding Availability of Quarterly Portfolio 
Schedule. A statement that: (i) The Registrant files its complete 
schedule of portfolio holdings with the SEC for the first and third 
quarters of each fiscal year as an exhibit to its reports on Form N-
PORT [17 CFR 274.150]; (ii) the Registrant's Form N-PORT reports are 
available on the Commission's website at http://www.sec.gov; (iii) if 
the Registrant makes the information on Form N-PORT available to 
shareholders on its website or upon request, a description of how the 
information may be obtained from the Registrant.
    c. A statement that a description of the policies and procedures 
that the Registrant uses to determine how to vote proxies relating to 
portfolio securities is

[[Page 33389]]

available (1) without charge, upon request, by calling a specified 
toll-free (or collect) telephone number or sending an email to a 
specified email address, if any; (2) on the Registrant's website, if 
applicable; and (3) on the Commission's website at http://www.sec.gov; 
and
    d. A statement that information regarding how the Registrant voted 
proxies relating to portfolio securities during the most recent 12-
month period ended June 30 is available (1) without charge, upon 
request, by calling a specified toll-free (or collect) telephone 
number; sending an email to a specified email address, if any; or on or 
through the Registrant's website at a specified internet address; and 
(2) on the Commission's website at http://www.sec.gov.
    e. If the Registrant's board of directors approved any investment 
advisory contract during the Registrant's most recent fiscal half-year, 
discuss in reasonable detail the material factors and the conclusions 
with respect thereto that formed the basis for the board's approval. 
Include the following in the discussion:
    (1) Factors relating to both the board's selection of the 
investment adviser and approval of the advisory fee and any other 
amounts to be paid by the Registrant under the contract. This would 
include, but not be limited to, a discussion of the nature, extent, and 
quality of the services to be provided by the investment adviser; the 
investment performance of the Registrant and the investment adviser; 
the costs of the services to be provided and profits to be realized by 
the investment adviser and its affiliates from the relationship with 
the Registrant; the extent to which economies of scale would be 
realized as the Registrant grows; and whether fee levels reflect these 
economies of scale for the benefit of the Registrant's investors. Also 
indicate in the discussion whether the board relied upon comparisons of 
the services to be rendered and the amounts to be paid under the 
contract with those under other investment advisory contracts, such as 
contracts of the same and other investment advisers with other 
registered investment companies or other types of clients (e.g., 
pension funds and other institutional investors). If the board relied 
upon such comparisons, describe the comparisons that were relied on and 
how they assisted the board in concluding that the contract should be 
approved; and
    (2) If applicable, any benefits derived or to be derived by the 
investment adviser from the relationship with the Registrant such as 
soft dollar arrangements by which brokers provide research to the 
Registrant or its investment adviser in return for allocating the 
Registrant's brokerage.
    f. Board approvals covered by Instruction 6.e to this Item include 
both approvals of new investment advisory contracts and approvals of 
contract renewals. Investment advisory contracts covered by Instruction 
6.e include subadvisory contracts. Conclusory statements or a list of 
factors will not be considered sufficient disclosure under Instruction 
6.e. Relate the factors to the specific circumstances of the Registrant 
and the investment advisory contract and state how the board evaluated 
each factor. For example, it is not sufficient to state that the board 
considered the amount of the investment advisory fee without stating 
what the board concluded about the amount of the fee and how that 
affected its decision to approve the contract. If any factor enumerated 
in Instruction 6.e.(1) to this Item is not relevant to the board's 
evaluation of an investment advisory contract, note this and explain 
the reasons why the factor is not relevant.
    g. Include on the front cover page or at the beginning of the 
annual or semi-annual report a statement to the following effect, if 
applicable:
    Beginning on [date], as permitted by regulations adopted by the 
Securities and Exchange Commission, paper copies of the Registrant's 
shareholder reports like this one will no longer be sent by mail, 
unless you specifically request paper copies of the reports from the 
Registrant [or from your financial intermediary, such as a broker-
dealer or bank]. Instead, the reports will be made available on a 
website, and you will be notified by mail each time a report is posted 
and provided with a website link to access the report.
    If you already elected to receive shareholder reports 
electronically, you will not be affected by this change and you need 
not take any action. You may elect to receive shareholder reports and 
other communications from the Registrant [or your financial 
intermediary] electronically by [insert instructions].
    You may elect to receive all future reports in paper free of 
charge. You can inform the Registrant [or your financial intermediary] 
that you wish to continue receiving paper copies of your shareholder 
reports by [insert instructions]. Your election to receive reports in 
paper will apply to all funds held with [the fund complex/your 
financial intermediary].
    7. Schedule IX--Summary schedule of investments in securities of 
unaffiliated issuers [17 CFR 210.12-12C] may be included in the 
financial statements required under Instructions 4.a and 5.a of this 
Item in lieu of Schedule I--Investments in securities of unaffiliated 
issuers [17 CFR 210.12-12] if:
    a. The Registrant states in the report that the Registrant's 
complete schedule of investments in securities of unaffiliated issuers 
is available (i) without charge, upon request, by calling a specified 
toll-free (or collect) telephone number or sending an email to a 
specified email address, if any; (ii) on the Registrant's website, if 
applicable; and (iii) on the Commission's website at http://www.sec.gov; and
    b. whenever the Registrant (or financial intermediary through which 
shares of the Registrant may be purchased or sold) receives a request 
for the Registrant's schedule of investments in securities of 
unaffiliated issuers, the Registrant (or financial intermediary) sends 
a copy of Schedule I--Investments in securities of unaffiliated issuers 
within 3 business days of receipt by first-class mail or other means 
designed to ensure equally prompt delivery.
    8. a. When a Registrant (or financial intermediary through which 
shares of the Registrant may be purchased or sold) receives a request 
for a description of the policies and procedures that the Registrant 
uses to determine how to vote proxies, the Registrant (or financial 
intermediary) must send the information most recently disclosed in 
response to Item 18.16 of this Form or Item 7 of Form N-CSR within 3 
business days of receipt of the request, by first-class mail or other 
means designed to ensure equally prompt delivery.
    b. If a Registrant discloses that the Registrant's proxy voting 
record is available by calling a toll-free (or collect) telephone 
number or sending an email to a specified email address, if any, and 
the Registrant (or financial intermediary through which shares of the 
Registrant may be purchased or sold) receives a request for this 
information, the Registrant (or financial intermediary) must send the 
information disclosed in the Registrant's most recently filed report on 
Form N-PX, within 3 business days of receipt of the request, by first-
class mail or other means designed to ensure equally prompt delivery.
    c. If a Registrant discloses that the Registrant's proxy voting 
record is available on or through its website, the Registrant must make 
available free of charge the information disclosed in the Registrant's 
most recently filed report

[[Page 33390]]

on Form N-PX on or through its website as soon as reasonably 
practicable after filing the report with the Commission. The 
information disclosed in the Registrant's most recently filed report on 
Form N-PX must remain available on or through the Registrant's website 
for as long as the Registrant remains subject to the requirements of 
Rule 30b1-4 under the Investment Company Act and discloses that the 
Registrant's proxy voting record is available on or through its 
website.
    9. See General Instruction F regarding Incorporation by Reference.
    10. Every annual report filed under the Exchange Act by a business 
development company must contain the information required by 
Instructions 4.b and 4.h.

Part C--Other Information

Item 25. Financial Statements and Exhibits

    List all financial statements and exhibits filed as part of the 
registration statement.
    1. Financial statements.
    Instruction. Identify those financial statements that are included 
in Parts A and B of the registration statement.
    2. Exhibits.
    Subject to General Instruction F regarding incorporation by 
reference and Rule 483 under the Securities Act [17 CFR 230.483], file 
the exhibits listed below as part of the registration statement. Letter 
or number the exhibits in the sequence indicated, unless otherwise 
required by Rule 483. Reflect any exhibit incorporated by reference in 
the list below and identify the previously filed document containing 
the incorporated material.
    a. Copies of the charter as now in effect.
    b. Copies of the existing bylaws or instruments corresponding 
thereto.
    c. Copies of any voting trust agreement with respect to more than 
five percent of any class of equity securities of the Registrant.
    d. Copies of the constituent instruments defining the rights of the 
holders of the securities.
    e. A copy of the document setting forth the Registrant's dividend 
reinvestment plan, if any.
    f. Copies of the constituent instruments defining the rights of the 
holders of long-term debt of all subsidiaries for which consolidated or 
unconsolidated financial statements are required to be filed (The 
instrument relating to any class of long-term debt of the Registrant or 
any subsidiary need not be filed if the total amount of securities 
authorized thereunder amounts to less than two percent of the total 
assets of the Registrant and its subsidiaries on a consolidated basis, 
and if the Registrant files an agreement to furnish such copies to the 
Commission upon request.).
    g. Copies of all investment advisory contracts relating to the 
management of the assets of the Registrant.
    h. Copies of each underwriting or distribution contract between the 
Registrant and a principal underwriter, and specimens or copies of all 
agreements between principal underwriters and dealers.
    i. Copies of all bonus, profit sharing, pension, or other similar 
contracts or arrangements wholly or partly for the benefit of directors 
or officers of the Registrant in their capacity as such (a reasonably 
detailed description of any plan that is not set forth in a formal 
document should be furnished).
    j. Copies of all custodian agreements and depository contracts 
entered into in conformance with Section 17(f) of the Investment 
Company Act or rules thereunder with respect to securities and similar 
investments of the Registrant, including the schedule of remuneration.
    k. Copies of all other material contracts not made in the ordinary 
course of business that are to be performed in whole or in part at or 
after the date of filing the registration statement.
    l. An opinion of counsel and consent to its use as to the legality 
of the securities being registered, indicating whether they will be 
legally issued, fully paid, and nonassessable.
    m. If a non-resident director, officer, investment adviser, or 
expert named in the registration statement has executed a consent to 
service of process within the United States, a copy of that consent to 
service.
    n. Copies of any other opinions, appraisals, or rulings, and 
consents to their use, relied on in preparing the registration 
statement, and consents to the use of accountants' reports relating to 
audited financial statements required by Section 7 of the Securities 
Act.
    o. All financial statements omitted from Items 8.6 or 24.
    p. Copies of any agreements or understandings made in consideration 
for providing the initial capital between or among the Registrant, the 
underwriter, adviser, promoter, or initial stockholders and written 
assurance from the promoters or initial stockholders that their 
purchases were made for investment purposes without any present 
intention of reselling.
    q. Copies of the model plan used in the establishment of any 
retirement plan in conjunction with which the Registrant offers its 
securities, any instructions to it, and any other documents making up 
the model plan (such form(s) should disclose the costs and fees charged 
in connection with the plan).
    r. Copies of any codes of ethics adopted under Rule 17j-1 under the 
Investment Company Act and currently applicable to the Registrant 
(i.e., the codes of the Registrant and its investment advisers and 
principal underwriters). If there are no codes of ethics applicable to 
the Registrant, state the reason (e.g., the Registrant is a Money 
Market Fund).
    Instructions.
    1. Subject to the rules on incorporation by reference and 
Instruction 2 below, the foregoing exhibits shall be filed as a part of 
the registration statement. Exhibits required by paragraphs 2.h, 2.l, 
2.n, and 2.o above need to be filed only as part of a Securities Act 
registration statement. Exhibits shall be appropriately lettered or 
numbered for convenient reference. Exhibits incorporated by reference 
may bear the designation given in a previous filing. Where exhibits are 
incorporated by reference, the reference shall be made in the list of 
exhibits. The reference shall include the form, file number and date of 
the previous filing, and the exhibit number (i.e., exhibit 2.a, 2.b, 
etc.) under which the exhibit was previously filed.
    2. A Registrant need not file an exhibit as part of a post-
effective amendment, if the exhibit has been filed in the Registrant's 
initial registration statement or in a previous post-effective 
amendment, unless there has been a change in the exhibit, or unless the 
exhibit is a copy of a consent required by Section 7 of the Securities 
Act or is a financial statement omitted from Items 8.6 or 24. The 
reference to this exhibit shall include the number of the previous 
filing (e.g., pre-effective amendment No. 1) where such exhibit was 
filed.
    3. If an exhibit to a registration statement (other than an opinion 
or consent), filed in preliminary form, has been changed (1) only to 
insert information as to interest, dividend or conversion rates, 
redemption or conversion prices, purchase or offering prices, 
underwriters' or dealers' commissions, names, addresses or 
participation of underwriters or similar matters, which information 
appears elsewhere in an amendment to the registration statement or a 
prospectus filed pursuant to Rule 424(b) under the Securities Act or 
(2) to correct typographical errors, insert signatures or

[[Page 33391]]

make other similar immaterial changes, then, notwithstanding any 
contrary requirement of any rule or form, the Registrant need not 
refile the exhibit as so amended. Any incomplete exhibit may not, 
however, be incorporated by reference into any subsequent filing under 
any Act administered by the Commission. If an exhibit required to be 
executed (e.g., an underwriting agreement) is filed in final form, a 
copy of an executed copy shall be filed.
    4. Schedules (or similar attachments) to the exhibits required by 
this Item are not required to be filed provided that they do not 
contain information material to an investment or voting decision and 
that information is not otherwise disclosed in the exhibit or the 
disclosure document. Each exhibit filed must contain a list briefly 
identifying the contents of all omitted schedules. Registrants need not 
prepare a separate list of omitted information if such information is 
already included within the exhibit in a manner that conveys the 
subject matter of the omitted schedules and attachments. In addition, 
the registrant must provide a copy of any omitted schedule to the 
Commission or its staff upon request.
    5. The registrant may redact information from exhibits required to 
be filed by this Item if disclosure of such information would 
constitute a clearly unwarranted invasion of personal privacy (e.g., 
disclosure of bank account numbers, social security numbers, home 
addresses and similar information).
    6. The registrant may redact provisions or terms of exhibits 
required to be filed by paragraph k. of this Item if those provisions 
or terms are both (1) not material and (2) would likely cause 
competitive harm to the registrant if publicly disclosed. If it does 
so, the registrant should mark the exhibit index to indicate that 
portions of the exhibit or exhibits have been omitted and include a 
prominent statement on the first page of the redacted exhibit that 
certain identified information has been excluded from the exhibit 
because it is both (1) not material and (2) would likely cause 
competitive harm to the registrant if publicly disclosed. The 
registrant also must indicate by brackets where the information is 
omitted from the filed version of the exhibit.
    If requested by the Commission or its staff, the registrant must 
promptly provide an unredacted copy of the exhibit on a supplemental 
basis. The Commission staff also may request the registrant to provide 
its materiality and competitive harm analyses on a supplemental basis. 
Upon evaluation of the registrant's supplemental materials, the 
Commission or its staff may request the registrant to amend its filing 
to include in the exhibit any previously redacted information that is 
not adequately supported by the registrant's materiality and 
competitive harm analyses. The registrant may request confidential 
treatment of the supplemental material pursuant to Rule 83 [17 CFR 
200.83] while it is in the possession of the Commission or its staff. 
After completing its review of the supplemental information, the 
Commission or its staff will return or destroy it at the request of the 
registrant, if the registrant complies with the procedures outlined in 
Rule 418 [17 CFR 230.418].
    7. Each exhibit identified in the exhibit index (other than an 
exhibit filed in eXtensible Business Reporting Language) must include 
an active link to an exhibit that is filed with the registration 
statement or, if the exhibit is incorporated by reference, an active 
hyperlink to the exhibit separately filed on EDGAR. If the registration 
statement is amended, each amendment must include active hyperlinks to 
the exhibits required with the amendment.

Item 26. Marketing Arrangements

    Briefly describe any arrangements known to the Registrant or to any 
person named in response to Item 5, or to any person specified in Item 
19.2, made for any of the following purposes:
    1. to limit or restrict the sale of other securities of the same 
class as those to be offered for the period of distribution;
    2. to stabilize the market for any of the securities to be offered; 
or
    3. to hold each underwriter or dealer responsible for the 
distribution of his or her participation.
    Instruction. If the answer to this Item is contained in an exhibit, 
the Item may be answered by cross-reference to the relevant 
paragraph(s) of the exhibit.

Item 27. Other Expenses of Issuance and Distribution

    Furnish a reasonably itemized statement of all expenses in 
connection with the issuance and distribution of the securities being 
registered, other than underwriting discounts and commissions. If any 
of the securities being registered are to be offered for the account of 
securityholders, indicate the portion of expenses to be borne by 
securityholders.
    Instruction. Insofar as practicable, separately itemize 
registration fees, federal taxes, state taxes and fees, trustees' and 
transfer agents' fees, costs of printing and engraving, rating agency 
fees, and legal and accounting fees. The information may be given 
subject to future contingencies. Provide estimates if the amounts of 
any items are not known.

Item 28. Persons Controlled by or Under Common Control

    Furnish a list or diagram of all persons directly or indirectly 
controlled by, or under common control with, the Registrant, and as to 
each of these persons indicate (1) if a company, the state or other 
jurisdiction under whose laws it is organized, and (2) the percentage 
of voting securities owned or other basis of control by the person, if 
any, immediately controlling it.
    Instructions.
    1. The list or diagram shall include the Registrant and shall show 
clearly the relationship of each company named to the Registrant and to 
other companies named. If the company is controlled by the direct 
ownership of its securities by two or more persons, so indicate by 
appropriate cross-reference.
    2. Identify, by appropriate symbols: (1) Subsidiaries for which 
separate financial statements are filed; (2) subsidiaries included in 
the respective consolidated financial statements; (3) subsidiaries 
included in the respective group financial statements filed for 
unconsolidated subsidiaries; and (4) other subsidiaries, indicating 
briefly why statements of these subsidiaries are not filed.

Item 29. Number of Holders of Securities

    State in substantially the tabular form indicated, as of a 
specified date within 90 days prior to the date of filing, the number 
of record holders of each class of securities of the Registrant.

------------------------------------------------------------------------
                                                            Number of
                     Title of class                       record holders
------------------------------------------------------------------------
(1)....................................................             (2)
------------------------------------------------------------------------

Item 30. Indemnification

    State the general effect of any contract, arrangement, or statute 
under which any director, officer, underwriter, or affiliated person of 
the Registrant is insured or indemnified in any manner against any 
liability that may be incurred in such capacity, other than insurance 
provided by any member of the board of directors, officer, underwriter, 
or affiliated person for his or her own protection.
    Instruction. In responding to this Item, the Registrant should note 
the requirements of Rules 461(c) and 484 under the Securities Act [17 
CFR 230.461 and 230.484] and Section 17 of the Investment Company Act. 
(See Investment Company Act Rel. No. 11330 (Sept. 4, 1980) [45 FR 62423 
(Sept. 19,

[[Page 33392]]

1980)] and Investment Company Act Rel. No. 7221 (June 9, 1972) [37 FR 
12790 (June 29, 1972)].)

Item 31. Business and Other Connections of Investment Adviser

    Describe briefly any other business, profession, vocation, or 
employment of a substantial nature in which each investment adviser of 
the Registrant, and each director, executive officer, or partner of any 
such investment adviser, is or has been, at any time during the past 
two fiscal years, engaged for his or her own account or in the capacity 
of director, officer, employee, partner, or trustee.
    Instructions.
    1. State the name and principal business address of any company 
with which any person specified above is connected in the capacity of 
director, officer, employee, partner, or trustee and the nature of the 
connection.
    2. The names of investment advisory clients need not be provided.
    3. For purposes of this Item, the term ``executive officer'' means 
the investment adviser's president, any other officer who performs a 
policy-making function for the investment adviser in connection with 
its management of the closed-end fund, or any other person who performs 
a similar policy-making function for the investment adviser. Executive 
officers of subsidiaries of the investment adviser may be deemed 
executive officers of the investment adviser, if they perform such 
policy-making functions for the investment adviser.

Item 32. Location of Accounts and Records

    Furnish the name and address of each person maintaining physical 
possession of each account, book, or other document required to be 
maintained by Section 31(a) of the Investment Company Act and the rules 
thereunder.
    Instruction. The Registrant may omit this information to the extent 
it is provided in its most recent report on Form N-CEN [17 CFR 
249.330].

Item 33. Management Services

    Furnish a summary of the substantive provisions of any management-
related service contract not discussed in Part A or B of the 
registration statement (because the contract was not believed to be of 
interest to a purchaser of the Registrant's securities), indicating the 
parties to the contract, the total dollars paid, and by whom, for the 
last three fiscal years.
    Instructions.
    1. The instructions to Item 20.4 of this Form shall also apply to 
this Item.
    2. Information need not be provided for any service for which total 
payments of less than $5,000 were made during each of the last three 
fiscal years.

Item 34. Undertakings

    Furnish the following undertakings in substantially the following 
form in all registration statements filed under the Securities Act, as 
applicable:
    1. An undertaking to suspend the offering of shares until the 
prospectus is amended if (1) subsequent to the effective date of its 
registration statement, the net asset value declines more than ten 
percent from its net asset value as of the effective date of the 
registration statement or (2) the net asset value increases to an 
amount greater than its net proceeds as stated in the prospectus.
    Provided, however, that this paragraph does not apply if the 
registration statement is filed pursuant to General Instruction A.2 of 
this Form to register an offering in reliance on Rule 415 under the 
Securities Act.
    2. An undertaking to file a post-effective amendment with certified 
financial statements showing the initial capital received before 
accepting subscriptions from more than 25 persons, if the Registrant 
proposes to raise its initial capital under Section 14(a)(3) of the 
Investment Company Act.
    3. If the securities are being registered in reliance on Rule 415 
under the Securities Act, an undertaking:
    a. to file, during any period in which offers or sales are being 
made, a post-effective amendment to the registration statement:
    (1) To include any prospectus required by Section 10(a)(3) of the 
Securities Act;
    (2) to reflect in the prospectus any facts or events after the 
effective date of the registration statement (or the most recent post-
effective amendment thereof) which, individually or in the aggregate, 
represent a fundamental change in the information set forth in the 
registration statement. Notwithstanding the foregoing, any increase or 
decrease in volume of securities offered (if the total dollar value of 
securities offered would not exceed that which was registered) and any 
deviation from the low or high end of the estimated maximum offering 
range may be reflected in the form of prospectus filed with the 
Commission pursuant to Rule 424(b) if, in the aggregate, the changes in 
volume and price represent no more than 20% change in the maximum 
aggregate offering price set forth in the ``Calculation of Registration 
Fee'' table in the effective registration statement.
    (3) to include any material information with respect to the plan of 
distribution not previously disclosed in the registration statement or 
any material change to such information in the registration statement.
    Provided, however, that paragraphs a(1), a(2), and a(3) of this 
section do not apply if the registration statement is filed pursuant to 
General Instruction A.2 of this Form and the information required to be 
included in a post-effective amendment by those paragraphs is contained 
in reports filed with or furnished to the Commission by the Registrant 
pursuant to Section 13 or Section 15(d) of the Exchange Act that are 
incorporated by reference into the registration statement, or is 
contained in a form of prospectus filed pursuant to Rule 424(b) that is 
part of the registration statement.
    b. that, for the purpose of determining any liability under the 
Securities Act, each such post-effective amendment shall be deemed to 
be a new registration statement relating to the securities offered 
therein, and the offering of those securities at that time shall be 
deemed to be the initial bona fide offering thereof;
    c. to remove from registration by means of a post-effective 
amendment any of the securities being registered which remain unsold at 
the termination of the offering;
    d. that, for the purpose of determining liability under the 
Securities Act to any purchaser:
    (1) if the Registrant is relying on Rule 430B [17 CFR 230.430B]:
    (A) Each prospectus filed by the Registrant pursuant to Rule 
424(b)(3) shall be deemed to be part of the registration statement as 
of the date the filed prospectus was deemed part of and included in the 
registration statement; and
    (B) Each prospectus required to be filed pursuant to Rule 
424(b)(2), (b)(5), or (b)(7) as part of a registration statement in 
reliance on Rule 430B relating to an offering made pursuant to Rule 
415(a)(1)(i), (x), or (xi) for the purpose of providing the information 
required by Section 10(a) of the Securities Act shall be deemed to be 
part of and included in the registration statement as of the earlier of 
the date such form of prospectus is first used after effectiveness or 
the date of the first contract of sale of securities in the offering 
described in the prospectus. As provided in Rule 430B, for liability 
purposes of the issuer and any person that is at that date an 
underwriter, such date shall be deemed to be a new effective date of 
the registration statement relating to the securities in

[[Page 33393]]

the registration statement to which that prospectus relates, and the 
offering of such securities at that time shall be deemed to be the 
initial bona fide offering thereof. Provided, however, that no 
statement made in a registration statement or prospectus that is part 
of the registration statement or made in a document incorporated or 
deemed incorporated by reference into the registration statement or 
prospectus that is part of the registration statement will, as to a 
purchaser with a time of contract of sale prior to such effective date, 
supersede or modify any statement that was made in the registration 
statement or prospectus that was part of the registration statement or 
made in any such document immediately prior to such effective date; or
    (2) if the Registrant is subject to Rule 430C [17 CFR 230.430C]: 
each prospectus filed pursuant to Rule 424(b) under the Securities Act 
as part of a registration statement relating to an offering, other than 
registration statements relying on Rule 430B or other than prospectuses 
filed in reliance on Rule 430A, shall be deemed to be part of and 
included in the registration statement as of the date it is first used 
after effectiveness. Provided, however, that no statement made in a 
registration statement or prospectus that is part of the registration 
statement or made in a document incorporated or deemed incorporated by 
reference into the registration statement or prospectus that is part of 
the registration statement will, as to a purchaser with a time of 
contract of sale prior to such first use, supersede or modify any 
statement that was made in the registration statement or prospectus 
that was part of the registration statement or made in any such 
document immediately prior to such date of first use.
    e. that for the purpose of determining liability of the Registrant 
under the Securities Act to any purchaser in the initial distribution 
of securities:
    The undersigned Registrant undertakes that in a primary offering of 
securities of the undersigned Registrant pursuant to this registration 
statement, regardless of the underwriting method used to sell the 
securities to the purchaser, if the securities are offered or sold to 
such purchaser by means of any of the following communications, the 
undersigned Registrant will be a seller to the purchaser and will be 
considered to offer or sell such securities to the purchaser:
    (1) Any preliminary prospectus or prospectus of the undersigned 
Registrant relating to the offering required to be filed pursuant to 
Rule 424 under the Securities Act;
    (2) free writing prospectus relating to the offering prepared by or 
on behalf of the undersigned Registrant or used or referred to by the 
undersigned Registrants;
    (3) the portion of any other free writing prospectus or 
advertisement pursuant to Rule 482 under the Securities Act [17 CFR 
230.482] relating to the offering containing material information about 
the undersigned Registrant or its securities provided by or on behalf 
of the undersigned Registrant; and
    (4) any other communication that is an offer in the offering made 
by the undersigned Registrant to the purchaser.
    4. If the Registrant is filing a registration statement permitted 
by Rule 430A under the Securities Act, an undertaking that:
    a. for the purpose of determining any liability under the 
Securities Act, the information omitted from the form of prospectus 
filed as part of this registration statement in reliance upon Rule 430A 
and contained in a form of prospectus filed by the Registrant under 
Rule 424(b)(1) under the Securities Act shall be deemed to be part of 
this registration statement as of the time it was declared effective; 
and
    b. for the purpose of determining any liability under the 
Securities Act, each post-effective amendment that contains a form of 
prospectus shall be deemed to be a new registration statement relating 
to the securities offered therein, and the offering of the securities 
at that time shall be deemed to be the initial bona fide offering 
thereof.
    5. Filings Incorporating Subsequent Exchange Act Documents by 
Reference. Include the following if the registration statement 
incorporates by reference any Exchange Act document filed subsequent to 
the effective date of the registration statement:
    The undersigned Registrant hereby undertakes that, for purposes of 
determining any liability under the Securities Act of 1933, each filing 
of the Registrant's annual report pursuant to Section 13(a) or Section 
15(d) of the Securities Exchange Act of 1934 that is incorporated by 
reference into the registration statement shall be deemed to be a new 
registration statement relating to the securities offered therein, and 
the offering of such securities at that time shall be deemed to be the 
initial bona fide offering thereof.
    6. Request for acceleration of effective date or filing of 
registration statement becoming effective upon filing. Include the 
following if acceleration is requested of the effective date of the 
registration statement pursuant to Rule 461 under the Securities Act, 
or if a registration statement filed pursuant to General Instruction 
A.2 of this Form will become effective upon filing with the Commission 
pursuant to Rule 462(e) or (f) under the Securities Act, and:
    a. Any provision or arrangement exists whereby the Registrant may 
indemnify a director, officer or controlling person of the Registrant 
against liabilities arising under the Securities Act, or
    b. The underwriting agreement contains a provision whereby the 
Registrant indemnifies the underwriter or controlling persons of the 
underwriter against such liabilities and a director, officer or 
controlling person of the Registrant is such an underwriter or 
controlling person thereof or a member of any firm which is such an 
underwriter, and
    c. The benefits of such indemnification are not waived by such 
persons:
    Insofar as indemnification for liabilities arising under the 
Securities Act of 1933 may be permitted to directors, officers and 
controlling persons of the Registrant pursuant to the foregoing 
provisions, or otherwise, the Registrant has been advised that in the 
opinion of the Securities and Exchange Commission such indemnification 
is against public policy as expressed in the Act and is, therefore, 
unenforceable. In the event that a claim for indemnification against 
such liabilities (other than the payment by the Registrant of expenses 
incurred or paid by a director, officer or controlling person of the 
Registrant in the successful defense of any action, suit or proceeding) 
is asserted by such director, officer or controlling person in 
connection with the securities being registered, the Registrant will, 
unless in the opinion of its counsel the matter has been settled by 
controlling precedent, submit to a court of appropriate jurisdiction 
the question whether such indemnification by it is against public 
policy as expressed in the Act and will be governed by the final 
adjudication of such issue.
    7. An undertaking to send by first class mail or other means 
designed to ensure equally prompt delivery, within two business days of 
receipt of a written or oral request, any prospectus or Statement of 
Additional Information.

Signatures

    Pursuant to the requirements of the Securities Act of 1933 and/or 
the Investment Company Act of 1940, the Registrant has duly caused this 
registration statement to be signed on its behalf by the undersigned, 
thereunto

[[Page 33394]]

duly authorized, in the City of_____, and State of _____, on the ____ 
day of _____, ____.

-----------------------------------------------------------------------
Registrant

By---------------------------------------------------------------------
-----------------------------------------------------------------------
Signature

-----------------------------------------------------------------------
Title

    Pursuant to the requirements of the Securities Act of 1933, this 
registration statement has been signed by the following person in 
the capacities and on the dates indicated.
-----------------------------------------------------------------------
Signature

-----------------------------------------------------------------------
Title

-----------------------------------------------------------------------
Date

0
45. Effective August 1, 2021, amend Form 24F-2 (referenced in Sec.  
274.24) by:
0
a. Amending Item 2 to add ``and EDGAR identifier'' after the word 
``name'';
0
b. Amending Item 5 to add ``(if calculating on a class-by-class or 
series-by-series basis, provide the EDGAR identifier for each such 
class or series):'';
0
c. Adding Item 10;
0
d. Revising paragraph A.1. of the ``INSTRUCTIONS'' section; and
0
e. Revising paragraph A.3. of the ``INSTRUCTIONS'' section.
    The addition and revisions read as follows:

    Note: The text of Form 24F-2 does not, and these amendments will 
not, appear in the Code of Federal Regulations.

United States

Securities and Exchange Commission

Washington, DC 20549

Form 24F-2

Annual Filing Under Rule 24f-2 of the Investment Company Act of 1940

* * * * *
    2. The name and EDGAR identifier of each series or class of 
securities for which this Form is filed (If the Form is being filed for 
all series and classes of securities of the issuer, check the box but 
do not list series of classes):
* * * * *
    5. Calculation of registration fee (if calculating on a class-by-
class or series-by-series basis, provide the EDGAR identifier for each 
such class or series):
* * * * *
    10. Explanatory Notes (if any): The issuer may provide any 
information it believes would be helpful in understanding the 
information reported in response to any item of this Form. To the 
extent responses relate to a particular item, provide the item 
number(s), as applicable.
* * * * *

Instructions

    A. * * *
    1. This Form should be used by an open-end management investment 
company, closed-end management company that makes periodic repurchase 
offers pursuant to Sec.  270.23c-3(b) of this chapter, face amount 
certificate company, or unit investment trust (``issuer'') for annual 
filings required by rule 24f-2 under the Investment Company Act of 1940 
[15 U.S.C. 80a] (``Investment Company Act''). If the issuer has 
registered more than one class or series of securities on the same 
registration statement under the Securities Act of 1933 [15 U.S.C. 77a-
aa] (``Securities Act''), the issuer may file a single Form 24F-2 for 
those classes or series that have the same fiscal year end. Such an 
issuer may calculate its fees based on aggregate net sales of the 
series having the same fiscal year end. An issuer choosing to calculate 
registration fees on a class-by-class or series-by-series basis should 
make a single filing consisting of a separate Form 24F-2 for each class 
or series in a single EDGAR document and provide the EDGAR identifier 
for each such class or series.
* * * * *
    3. Pursuant to rule 101(a)(1)(iv) of Regulation S-T [17 CFR 
232.101(a)(1)(iv)] this Form must be submitted in electronic format 
using the Commission's Electronic Data Gathering, Analysis, and 
Retrieval (``EDGAR'') system. Consult the EDGAR Filer Manual and 
Appendices for EDGAR filing instructions.
* * * * *

0
46. Amend Form N-CSR (referenced in Sec. Sec.  249.331 and 274.128) by 
adding new paragraph 4 to General Instruction C to read as follows:

    Note: The text of Form N-CSR does not, and these amendments will 
not, appear in the Code of Federal Regulations.

United States

Securities and Exchange Commission

Washington, DC 20549

Form N-CSR

Certified Shareholder Report of Registered Management Investment 
Companies

* * * * *

General Instructions

    C. * * *
    4. Interactive Data File. An Interactive Data File as defined in 
Rule 11 of Regulation S-T [17 CFR 232.11] is required to be submitted 
to the Commission in the manner provided by Rule 405 of Regulation S-T 
[17 CFR 232.405] by a closed-end management investment company 
registered under the Investment Company Act of 1940 (15 U.S.C. 80a et 
seq.) to the extent required by Rule 405 of Regulation S-T.

    By the Commission.

    Dated: April 8, 2020.
Vanessa A. Countryman,
Secretary.
[FR Doc. 2020-07790 Filed 5-29-20; 8:45 am]
BILLING CODE 8011-01-P