FormT-3.SupportingStatement.2019

SUPPORTING STATEMENT
FOR THE PAPERWORK REDUCTION ACT INFORMATION COLLECTION
SUBMISSION FOR FORM T-3
A.

JUSTIFICATION
1.

Circumstances Making the Collection of Information Necessary

An issuer of debt securities to be offered to the public in an offering that is not registered
under the Securities Act of 1933 must qualify the indenture under the Trust Indenture Act of
1939 (“Act”) by filing a Form T-3 application with the Securities and Exchange Commission
(“Commission”). Qualification of the indenture extends the protection of the Act to debt holders
in offerings that exempt from Securities Act registration but deemed by Congress to merit the
protections afforded by an indenture qualified under the Act. The form includes general
information about the issuer of the debt securities to be offered, the basis for the exemption from
Securities Act registration, a list of affiliates of the applicant, a list of underwriters for the issuer
and of its principal security holders, a list of underwriters for the issuer and summary
capitalization information and a description of the indenture to be qualified.
2.

Purpose and Use of the Information Collection

Form T-3 is reviewed by the staff in deciding whether to qualify an indenture relating to
securities offered to the public in an offering registered under the Securities Act of 1933. The
information in the Form T-3 provides a basis for deciding that the trustee is qualified and that the
proposed trustee is not disqualified because of a conflicting interest.
3.

Consideration Given to Information Technology

The information required by Form T-3 is filed electronically using the Electronic Data
Gathering, Analysis, and Retrieval System (EDGAR) with the Commission.
4.

Duplication of Information

Form T-3 contains information unavailable from other sources.
5.

Reducing the Burden on Small Entities

Small entities do not file Form T-3.
6.

Consequences of Not Conducting Collection

Form T-3 is filed only once. Furthermore, fewer collections would eliminate a basis for
the decision to qualify an indenture.

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7.

Special Circumstances

Not applicable.
8.

Consultations with Persons Outside the Agency

No comments were received on this request during the 60-day comment period prior to
OMB’s review of this submission.
9.

Payment or Gift to Respondents

Not applicable.
10.

Confidentiality

All documents filed with the Commission are public documents.
11.

Sensitive Questions

No information of a sensitive nature, including social security numbers, will be required
under these collections of information. The information collections collect basic Personally
Identifiable Information (PII) that may include name and job title. However, the agency has
determined that the information collections do not constitute a system of record for purposes of
the Privacy Act. Information is not retrieved by a personal identifier. In accordance with Section
208 of the E-Government Act of 2002, the agency has conducted a Privacy Impact Assessment
(PIA) of the EDGAR system, in connection with this collection of information. The EDGAR
PIA, published on January 29, 2016, is provided as a supplemental document and is also
available at https://www.sec.gov/privacy.
12.
Table 1.

Estimate of Respondent Reporting Burden
Estimated paperwork burden hours and Cost Burden for Form T-3
Number of
responses
(A)

Internal Burden
hours/form
(B) = 0.25%

Total burden
hours
(C)=(A)*(B)

Professional
issuer time
(D) = (.75%)

Professional costs
(F)=(E)*(A)

32

External
professional time
per response
(E) = (D) x 400
$12, 800

Form T-3

16

11

176

Total

16

11

176

32

$12,800

$204,800

$204,800

For purposes of the Paperwork Reduction Act (“PRA”), we estimate that Form T-3 takes
approximately 43 hours per response to comply with the collection of information requirements
and is filed by approximately 16 respondents. We derived our burden hour estimates by
estimating the average number of hours it would take the filer to compile the necessary
information and data, prepare and review disclosure, file documents and retain records. In
connection with rule amendments to the form, we occasionally receive PRA estimates from

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public commenters about incremental burdens that are used in our burden estimates. We believe
that the actual burdens will likely vary among individual companies based on the size and
complexity of their organization and the nature of their operations. We further estimate that 25%
of the collection of information burden is carried by the filer internally and that 75% of the
burden of preparation is carried by outside professionals retained by the filer. Based on our
estimates, we calculated that 25% of the 43 hours per response (11 hours) is prepared by the filer
for a total annual reporting burden of 176 hours (11 hours per response x 16 responses). For
administrative convenience, the presentation of the totals related to the paperwork burden hours
have been rounded to the nearest whole number. The estimated burden hours are made solely for
the purpose of the Paperwork Reduction Act.
13.

Estimate of Total Annualized Cost Burden

We estimate that 75% of the 43 hours per response (32 hours) is prepared by the filer’s
outside counsel. We estimate an hourly cost of $400 for outside legal and accounting services
used in connection with public company reporting. This estimate is based on our consultations
with registrants and professional firms who regularly assist registrants in preparing and filing
disclosure documents with the Commission. Our estimates reflect average burdens and
therefore, some companies may experience costs in excess of our estimates and some companies
may experience costs that are lower than our estimates. Based on our estimate, we calculated the
total annual cost to be $204,800 ($400 x 32 hours per response x 16 responses). For
administrative convenience, the presentation of the totals related to the paperwork the cost totals
have been rounded to the nearest dollar. The cost estimate is made solely for the purpose of the
Paperwork Reduction Act. See Table 1.
14.

Costs to Federal Government

The estimated cost to the government is approximately $5,000 a year to administer
Form T-3. This estimate is solely for the purpose of the Paperwork Reduction Act and is not
derived from a comprehensive or even a representative survey or study of the cost of
Commission rules and forms.
15.

Reason for Change in Burden

Table 2.
IC Title
Form T-3

Summary of the Change in Burden Hours and Cost Burden

Annual No. of Responses
Previously
Requested
Change
Approved
12

16

4

Annual Time Burden (Hours)
Previously
Requested
Change
Approved
132

176

44

Annual Burden Cost Burden ($)
Previously
Request
Change
Approved
$153,600

$204,800

$51, 200

The increase in burden of 44 hours and the increase in cost burden of $51,200 are due to increase
in the number of Forms T-3 filed with the Commission.

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16.

Information Collection Planned for Statistical Purposes

Not applicable.
17.

Approval to Omit OMB Expiration Date

We request authorization to omit the expiration date on the electronic version of the form.
Including the expiration date on the electronic version of the 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. The OMB control number will be displayed.
18.

Exceptions to Certification for Paperwork Reduction Act Submissions

Not applicable.
B.

STATISTICAL METHODS
Not applicable.