[Federal Register Volume 86, Number 220 (Thursday, November 18, 2021)]
[Notices]
[Pages 64569-64570]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-25172]


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SECURITIES AND EXCHANGE COMMISSION

[SEC File No. 270-603, OMB Control No. 3235-0658]


Proposed Collection; Comment Request

Upon Written Request, Copies Available From: Securities and Exchange 
Commission, Office of FOIA Services, 100 F Street NE, Washington, DC 
20549-2736

Extension:
    Rule 22e-3

    Notice is hereby given that, under the Paperwork Reduction Act of 
1995 (44 U.S.C. 3501-3520), the Securities and Exchange Commission (the 
``Commission'') has submitted to the Office of Management and Budget a 
request for extension of the previously approved collection of 
information discussed below.
    Section 22(e) of the Investment Company Act [15 U.S.C. 80a-22(e)] 
(``Act'') generally prohibits funds, including money market funds, from 
suspending the right of redemption, and from postponing the payment or 
satisfaction upon redemption of any redeemable security for more than 
seven days. The provision was designed to prevent funds and their 
investment advisers from interfering with the redemption rights of 
shareholders for improper purposes, such as the preservation of 
management fees. Although section 22(e) permits funds to postpone the 
date of payment or satisfaction upon redemption for up to seven days, 
it does not permit funds to suspend the right of redemption for any 
amount of time, absent certain specified circumstances or a Commission 
order.
    Rule 22e-3 under the Act [17 CFR 270.22e-3] exempts money market 
funds from section 22(e) to permit them to suspend redemptions in order 
to facilitate an orderly liquidation of the fund. Specifically, rule 
22e-3 permits a money market fund to suspend redemptions and postpone 
the payment of proceeds pending board-approved liquidation proceedings 
if: (i) The fund's board of directors, including a majority of 
disinterested directors, determines pursuant to Sec.  270.2a-
7(c)(8)(ii)(C) that the extent of the deviation between the fund's 
amortized cost price per share and its current net asset value per 
share calculated using available market quotations (or an appropriate 
substitute that reflects current market conditions) may result in 
material dilution or other unfair results to investors or existing 
shareholders; (ii) the fund's board of directors, including a majority 
of

[[Page 64570]]

disinterested directors, irrevocably approves the liquidation of the 
fund; and (iii) the fund, prior to suspending redemptions, notifies the 
Commission of its decision to liquidate and suspend redemptions. Rule 
22e-3 also provides an exemption from section 22(e) for registered 
investment companies that own shares of a money market fund pursuant to 
section 12(d)(1)(E) of the Act (``conduit funds''), if the underlying 
money market fund has suspended redemptions pursuant to the rule. A 
conduit fund that suspends redemptions in reliance on the exemption 
provided by rule 22e-3 is required to provide prompt notice of the 
suspension of redemptions to the Commission. Notices required by the 
rule must be provided by electronic mail, directed to the attention of 
the Director of the Division of Investment Management or the Director's 
designee.\1\ Compliance with the notification requirement is mandatory 
for money market funds and conduit funds that rely on rule 22e-3 to 
suspend redemptions and postpone payment of proceeds pending a 
liquidation, and are not kept confidential.
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    \1\ See rule 22e-3(a)(3).
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    Commission staff estimates that, on average, one fund would be 
required to make the required notice every year.\2\ Commission staff 
further estimates that a money market fund or conduit fund would spend 
approximately one hour of an in-house attorney's time to prepare and 
submit the notice required by the rule. Given these estimates, the 
total annual burden of the notification requirement of rule 22e-3 for 
all money market funds and conduit funds would be approximately one 
hour at a cost of $425.\3\ The Commission staff estimates that there is 
no cost burden associated with the information collection requirement 
of rule 22e-3 other than this cost. The estimate of average burden 
hours is made solely for the purposes of the Paperwork Reduction Act, 
and is not derived from a comprehensive or even a representative survey 
or study of the costs of Commission rules and forms.
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    \2\ The Commission has not received any notices invoking rule 
22e-3 to halt redemptions. However, for administrative purposes, we 
are reporting one respondent and one annual response.
    \3\ This figure for an Attorney is from SIFMA's Management & 
Professional Earnings in the Securities Industry 2013, modified by 
Commission staff to account for an 1800-hour work-year and 
inflation, and multiplied by 5.35 to account for bonuses, firm size, 
employee benefits and overhead.
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    Compliance with the collection of information requirements of the 
rule is necessary to obtain the benefit of relying on the rule. An 
agency may not conduct or sponsor, and a person is not required to 
respond to, a collection of information unless it displays a currently 
valid control number.
    Written comments are invited on: (a) Whether the collection of 
information is necessary for the proper performance of the functions of 
the Commission, including whether the information has practical 
utility; (b) the accuracy of the Commission's estimate of the burden of 
the collection of information; (c) ways to enhance the quality, 
utility, and clarity of the information collected; and (d) ways to 
minimize the burden of the collection of information on respondents, 
including through the use of automated collection techniques or other 
forms of information technology. Consideration will be given to 
comments and suggestions submitted in writing within 60 days after this 
publication.
    Please direct your written comments to David Bottom, Director/Chief 
Information Officer, Securities and Exchange Commission, C/O John R. 
Pezzullo, 100 F Street NE, Washington, DC 20549; or send an email to: 
[email protected].

    Dated: November 15, 2021.
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2021-25172 Filed 11-17-21; 8:45 am]
BILLING CODE 8011-01-P