PRA Supporting Statment FormID Revised 2012[1]

SUPPORTING STATEMENT
for the Paperwork Reduction Act Information Collection Submission
“Form ID”

A.

Justification

1.

Necessity of Information Collection

Regulation S-T1 provides the general requirements and procedures for electronic filing
with the Commission using the Commission’s Electronic Data Gathering, Analysis and Retrieval
(“EDGAR”) system. It further mandates that domestic registrants, foreign private issuers, and
foreign governments generally file their securities documents electronically with the
Commission. This includes registration statements under the Securities Act of 19332 and
registration statements, reports and other documents under the Securities Exchange Act of 1934
(“Exchange Act”).3
To facilitate the electronic filing requirements, the Commission developed certain
procedures and forms that were unique to the EDGAR filing system, including Form ID4 to be
used by EDGAR filers. Form ID is used to apply for access codes to file documents on EDGAR.
Form ID requires registrants, third party filers, or their agents, to whom the Commission has not
previously assigned a Central Index Key code, to request certain access codes to permit filing
electronically on EDGAR.
The Dodd-Frank Wall Street Reform and Consumer Protection Act5 (“Dodd-Frank Act”)
was enacted on July 21, 2010. Title IX, Subtitle C of the Dodd-Frank, “Improvements to the
Regulation of Credit Rating Agencies,” among other things, established new self-executing
requirements applicable to nationally recognized statistical rating organizations (“NRSROs”),
required certain studies, and required that the Commission adopt rules applicable to NRSROs,
providers of due diligence services, and issuers and underwriters of asset-backed securities in a
number of areas.
The Commission is proposing rules and rule amendments to, among other things,
implement certain provisions of the Dodd-Frank Act.6 As part of this proposal, the Commission
is proposing amendments to Rule 101 to Regulation S-T to require the electronic submission
using the EDGAR system of Form NRSRO pursuant to paragraphs (e), (f), and (g) of Exchange Act
Rule 17g-1 and the annual reports pursuant to Exchange Act Rule 17g-3, which are currently
1

17 CFR 232.10 et seq.

2

15 U.S.C. 77a et seq.

3

15 U.S.C. 78a et seq.

4

17 CFR 239.63, 249.446, 269.7 and 274.402.

5

Pub. L. No. 111-203, 124 Stat. 1376, H.R. 4173.
Exchange Act Release No. 64514 (May 18, 2011), 76 FR 33420 (June 8, 2011).

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submitted in paper form. The Commission is also proposing a new rule which would require an
issuer or underwriter of certain asset-backed securities (“ABS”) that are to be rated by an
NRSRO to furnish a Form ABS-15G on the EDGAR system containing the findings and
conclusions of any third-party “due diligence report” obtained by the issuer or underwriter.
The Commission expects that NRSROs would need to file a Form ID with the
Commission in order to gain access to the EDGAR system.
The Commission preliminarily believes that the issuers and underwriters of Exchange
Act-ABS that would need to furnish Form ABS-15G to the Commission through the EDGAR
system pursuant to proposed new Rule 15Ga-2 already have access to the EDGAR system
because, for example, they need such access for purposes of Rule 15Ga-1.
2.

Purpose and Use of the Information Collection

The information provided on Form ID allows the Commission to assign company
identification numbers (“CIKs”) and passwords to registrants and others, providing access to the
EDGAR system. These are essential to the security of the EDGAR system.
Under the proposal, NRSROs would need to file a Form ID with the Commission in
order to gain access to the EDGAR system to electronically submit Form NRSRO pursuant to
paragraphs (e), (f), and (g) of Rule 17g-1 and the annual reports submitted pursuant to Rule
17g3.
One of the primary goals of the EDGAR system since its inception is to facilitate the
rapid dissemination of financial and business information in connection with filings the
Commission receives. With respect to Form NRSRO, although paragraph (i) of Rule 17g-1
currently requires NRSROs to make the public portions of their current Form NRSROs
publicly available within 10 business days after submission to the Commission, the
Commission believes that having all such information available immediately upon submission
in one location would increase the efficiency of retrieving and comparing NRSRO public
submissions by investors and other users of credit ratings by enabling them to access the
information more quickly. Further, the Commission believes that submissions made to the
Commission are more valuable to investors and other users of credit ratings if they are
available in electronic form. The Commission preliminarily believes that, as a result of the
proposals, the EDGAR page of the Commission’s website7 in conjunction with the NRSRO
page of the Commission’s website,8 would be a comprehensive source from which to find
most public information submitted to the Commission, as well as other information, related to
NRSROs.
In addition, while the Rule 17g-3 annual reports would not be made public on
EDGAR, having them submitted on EDGAR would assist the Commission in its oversight of
NRSROs. For example, Commission examiners could easily retrieve the annual reports of a
specific NRSRO to prepare for an examination. Moreover, having these records submitted and
7
8

(www.sec.gov/investor/pubs/edgarguide.htm.)
(www.sec.gov/divisions/marketreg/ratingagency.htm.)

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stored through EDGAR in a centralized location would assist the Commission from a records
management perspective by establishing a more automated storage process and creating
efficiencies in terms of reducing the volume of paper submissions that must be manually
processed and stored in furtherance of the Commission’s NRSRO oversight function.
Moreover, the Commission preliminarily believes that the electronic submission of the
Form NRSROs and the Rule 17g-3 annual reports would benefit NRSROs in that it would
provide NRSROs with a more efficient way to submit these forms and reports to the
Commission. For example, NRSROs would avoid the uncertainties, delay, and expense related
to the manual delivery of paper submissions. Further, NRSROs would benefit from no longer
having to submit multiple paper copies of these submissions to the Commission.
3.

Consideration Given to Information Technology

Form ID is used to implement improved information dissemination technology.
The EDGAR system is designed to reduce the regulatory burdens of paper filings with
the Commission.
4.

Duplication

EDGAR system function is unique to the Commission; consequently, no
duplication of Form ID exists.
5.

Effect on Small Entities

The EDGAR system is designed to provide all registrants, including small
entities, with greater efficiencies in submitting information to the Commission.
6.

Consequences of Not Conducting Collection

Form ID must be used by registrants and other persons to whom the Commission
has not assigned a CIK to obtain the access codes needed to submit documents on
EDGAR.
7.

Inconsistencies with Guidelines in 5 CFR 1320.8(d)

There are no special circumstances. This collection is consistent with the
guidelines in 5 CFR 1320.8(d).
8.

Consultations Outside the Agency

As stated above, the Commission has issued a release soliciting comment on the
new “collection of information” requirements and associated paperwork burdens. A copy
of the release is attached. Comments on Commission releases are generally received
from registrants, investors, and other market participants. In addition, the Commission
and staff participate in ongoing dialogue with representatives of various market
participants through public conferences, meetings and informal exchanges. Any

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comments received on this proposed rulemaking will be posted on the Commission’s
public website, and made available through http://www.sec.gov/rules/proposed.shtml.
The Commission will consider all comments received prior to publishing the final rule,
and will explain in any adopting release how the final rule responds to such comments, in
accordance with 5 C.F.R. 1320.11(f).
9.

Payment or Gift

No payment or gift would be provided to respondents.
10.

Confidentiality

Form ID is used solely for registering filers on the EDGAR system. No
assurances of confidentiality are provided.
11.

Sensitive Questions

No sensitive questions are asked.
12.

Burden of Information Collection

The Commission previously estimated that 65,784 registrants and other persons
file Form ID each year at an estimated burden of .15 hours per response, all of which is
borne internally by the respondent, for a total annual reporting burden of 9,868 hours.
The Commission expects that NRSROs would need to file a Form ID with the
Commission in order to gain access to the EDGAR system. There are currently ten
NRSROs registered with the Commission. The Commission therefore believes that the
amendments would cause the ten credit rating agencies registered with the Commission
as NRSROs to file a Form ID, which would result in a one-time reporting burden of 1.5
hours (10 NRSROs x .15 hours = 1.5 hours), annualized over a three year period for an
annual reporting burden of .5 hours.
The proposal would therefore increase the annual reporting burden from 9,868 hours to
9,868.5 hours, rounded to 9,869 hours.
13.

Costs to Respondents

It is estimated that the respondent will prepare 100% of the total reporting burden
imposed by the forms and there is no additional cost associated with the information
collection.

14.

Costs to Federal Government

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The Commission has no specific information available concerning the cost for
processing Form ID. However, although the cost is not significant because the
Commission has automated most of the processing required, the Commission has
estimated a cost of approximately $50,000 per year to process Form ID.
15.

Changes in Burden

The changes in the annual reporting burden due to the proposal are due to the
addition of ten respondents—the ten NRSROs registered with the Commission—which
would increase the reporting burden by .5 hours per year for three years on an annualized
basis.
16.

Information Collection Planned for Statistical Purposes

Not applicable.
17.

Display of OMB Approval Date

The Commission requests authorization to omit the expiration date on any
electronic version of Form ID, although the OMB control number would be displayed.
Including the expiration date on an electronic version of this form will result in increased
costs, because the need to make changes to the form may not follow the application’s
scheduled version release dates.
18.

Exceptions to Certification for Paperwork Reduction Act Submissions

This collection complies with the requirements in 5 CFR 1320.9.
B.

Collection of Information Employing Statistical Methods

This collection does not involve statistical methods.