[Federal Register Volume 89, Number 182 (Thursday, September 19, 2024)]
[Notices]
[Pages 76896-76897]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-21428]


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

SECURITIES AND EXCHANGE COMMISSION

[SEC File No. 270-216, OMB Control No. 3235-0243]


Proposed Collection; Comment Request; Extension: Rule 206(3)-2

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

    Notice is hereby given that, pursuant to the Paperwork Reduction 
Act of 1995 (44 U.S.C. 3501 et seq.), the Securities and Exchange 
Commission (the ``Commission'') is soliciting comments on the 
collection of information summarized below. The Commission plans to 
submit this existing collection of information to the Office of 
Management and Budget for extension and approval.
    Rule 206(3)-2, (17 CFR 275.206(3)-2) which is entitled ``Agency 
Cross Transactions for Advisory Clients,'' permits investment advisers 
to comply with section 206(3) of the Investment Advisers Act of 1940 
(the ``Act'') (15 U.S.C. 80b-6(3)) by obtaining a client's blanket 
consent to enter into agency cross transactions (i.e., a transaction in 
which an adviser acts as a broker to both the advisory client and the 
opposite party to the transaction), provided that certain disclosures 
are made to the client. Rule 206(3)-2 applies to all registered 
investment advisers. In relying on the rule, investment advisers must 
provide certain disclosures to their clients. Advisory clients can use 
the disclosures to monitor agency cross transactions that affect their 
advisory account. The Commission also uses the information required by 
Rule 206(3)-2 in connection with its investment adviser inspection 
program to ensure that advisers are in compliance with the rule. 
Without the information collected under the rule, advisory clients 
would not have information necessary for monitoring their adviser's 
handling of their accounts and the Commission would be less efficient 
and effective in its inspection program.
    The information requirements of the rule consist of the following: 
(1) prior to

[[Page 76897]]

obtaining the client's consent appropriate disclosure must be made to 
the client as to the practice of, and the conflicts of interest 
involved in, agency cross transactions; (2) at or before the completion 
of any such transaction the client must be furnished with a written 
confirmation containing specified information and offering to furnish 
upon request certain additional information; and (3) at least annually, 
the client must be furnished with a written statement or summary as to 
the total number of transactions during the period covered by the 
consent and the total amount of commissions received by the adviser or 
its affiliated broker-dealer attributable to such transactions.
    The Commission estimates that approximately 362 respondents use the 
rule annually, necessitating about 65 responses per respondent each 
year, for a total of 23,530 responses. Each response requires an 
estimated 0.5 hours, for a total of 11,765 hours. The estimated average 
burden hours are made solely for the purposes of the Paperwork 
Reduction Act and are not derived from a comprehensive or 
representative survey or study of the cost of Commission rules and 
forms.
    This collection of information is found at (17 CFR 275.206(3)-2) 
and is necessary in order for the investment adviser to obtain the 
benefits of Rule 206(3)-2. The collection of information requirements 
under the rule is mandatory. Information subject to the disclosure 
requirements of Rule 206(3)-2 does not require submission to the 
Commission; and, accordingly, the disclosure pursuant to the rule is 
not kept confidential. Commission-registered investment advisers are 
required to maintain and preserve certain information required under 
Rule 206(3)-2 for five (5) years. The long-term retention of these 
records is necessary for the Commission's inspection program to 
ascertain compliance with the Advisers Act.
    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 proposed 
collection of information is necessary for the proper performance of 
the functions of the Commission, including whether the information 
shall have 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 by November 18, 2024.
    An agency may not conduct or sponsor, and a person is not required 
to respond to, a collection of information under the PRA unless it 
displays a currently valid OMB control number.
    Please direct your written comments to: Austin Gerig, Director/
Chief Data Officer, Securities and Exchange Commission, c/o Oluwaseun 
Ajayi, 100 F Street NE, Washington, DC 20549 or send an email to: 
[email protected].

    Dated: September 16, 2024.
Vanessa A. Countryman,
Secretary.
[FR Doc. 2024-21428 Filed 9-18-24; 8:45 am]
BILLING CODE 8011-01-P