30 Day Notice

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Federal Register / Vol. 86, No. 190 / Tuesday, October 5, 2021 / Notices
off if June 19 fell on a Saturday or
Sunday. The Exchange further states
that the proposed change does not raise
any new or novel issues. For these
reasons, the Commission believes that
waiver of the 30-day operative delay is
consistent with the protection of
investors and the public interest.
Accordingly, the Commission hereby
waives the operative delay and
designates the proposed rule change
operative upon filing.14
At any time within 60 days of the
filing of such proposed rule change, the
Commission summarily may
temporarily suspend such rule change if
it appears to the Commission that such
action is necessary or appropriate in the
public interest, for the protection of
investors, or otherwise in furtherance of
the purposes of the Act. If the
Commission takes such action, the
Commission shall institute proceedings
to determine whether the proposed rule
change should be approved or
disapproved.

communications relating to the
proposed rule change between the
Commission and any person, other than
those that may be withheld from the
public in accordance with the
provisions of 5 U.S.C. 552, will be
available for website viewing and
printing in the Commission’s Public
Reference Room, 100 F Street NE,
Washington, DC 20549 on official
business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of such
filing also will be available for
inspection and copying at the principal
office of the Exchange. All comments
received will be posted without change.
Persons submitting comments are
cautioned that we do not redact or edit
personal identifying information from
comment submissions. You should
submit only information that you wish
to make available publicly. All
submissions should refer to File
Number SR–NYSENAT–2021–18, and
should be submitted on or before
October 26, 2021.

IV. Solicitation of Comments
Interested persons are invited to
submit written data, views, and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
Comments may be submitted by any of
the following methods:

For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.15
J. Matthew DeLesDernier,
Assistant Secretary.

Electronic Comments
• Use the Commission’s internet
comment form (http://www.sec.gov/
rules/sro.shtml); or
• Send an email to rule-comments@
sec.gov. Please include File Number SR–
NYSENAT–2021–18 on the subject line.

SECURITIES AND EXCHANGE
COMMISSION

Paper Comments
• Send paper comments in triplicate
to Secretary, Securities and Exchange
Commission, 100 F Street NE,
Washington, DC 20549–1090.
All submissions should refer to File
Number SR–NYSENAT–2021–18. This
file number should be included on the
subject line if email is used. To help the
Commission process and review your
comments more efficiently, please use
only one method. The Commission will
post all comments on the Commission’s
internet website (http://www.sec.gov/
rules/sro.shtml). Copies of the
submission, all subsequent
amendments, all written statements
with respect to the proposed rule
change that are filed with the
Commission, and all written

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

14 For purposes only of waiving the 30-day
operative delay, the Commission also has
considered the proposed rule’s impact on
efficiency, competition, and capital formation. See
15 U.S.C. 78c(f).

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[FR Doc. 2021–21740 Filed 10–4–21; 8:45 am]
BILLING CODE 8011–01–P

[SEC File No. 270–541, OMB Control No.
3235–0620]

Submission for OMB Review;
Comment Request

Extension:
Rule 22c–2

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’’) has submitted to the
Office of Management and Budget a
request for extension of the previously
approved collection of information
discussed below.
Rule 22c–2 (17 CFR 270.22c–2) under
the Investment Company Act of 1940
(15 U.S.C. 80a) (the ‘‘Investment
Company Act’’ or ‘‘Act’’) requires the
board of directors (including a majority
of independent directors) of most
registered open-end investment
15 17

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companies (‘‘funds’’) to either approve a
redemption fee of up to two percent or
determine that imposition of a
redemption fee is not necessary or
appropriate for the fund. Rule 22c–2
also requires a fund to enter into written
agreements with their financial
intermediaries (such as broker-dealers
and retirement plan administrators)
under which the fund, upon request,
can obtain certain shareholder identity
and trading information from the
intermediaries. The written agreement
must also allow the fund to direct the
intermediary to prohibit further
purchases or exchanges by specific
shareholders that the fund has
identified as being engaged in
transactions that violate the fund’s
market timing policies. These
requirements enable funds to obtain the
information that they need to monitor
the frequency of short-term trading in
omnibus accounts and enforce their
market timing policies.
The rule includes three ‘‘collections
of information’’ within the meaning of
the Paperwork Reduction Act of 1995
(‘‘PRA’’).1 First, the rule requires boards
to either approve a redemption fee of up
to two percent or determine that
imposition of a redemption fee is not
necessary or appropriate for the fund.
Second, funds must enter into
information sharing agreements with all
of their ‘‘financial intermediaries’’ 2 and
maintain a copy of the written
information sharing agreement with
each intermediary in an easily
accessible place for six years. Third,
pursuant to the information sharing
agreements, funds must have systems
that enable them to request frequent
trading information upon demand from
their intermediaries, and to enforce any
restrictions on trading required by funds
under the rule.
The collections of information created
by rule 22c–2 are necessary for funds to
effectively assess redemption fees,
enforce their policies in frequent
trading, and monitor short-term trading,
1 44

U.S.C. 3501–3520.
rule defines a Financial Intermediary as: (i)
Any broker, dealer, bank, or other person that holds
securities issued by the fund in nominee name; (ii)
a unit investment trust or fund that invests in the
fund in reliance on section 12(d)(i)(E) of the Act;
and (iii) in the case of a participant directed
employee benefit plan that owns the securities
issued by the fund, a retirement plan’s
administrator under section 316(A) of the Employee
Retirement Security Act of 1974 (29 U.S.C.
1002(16)(A) or any person that maintains the plans’
participant records. Financial Intermediary does not
include any person that the fund treats as an
individual investor with respect to the fund’s
policies established for the purpose of eliminating
or reducing any dilution of the value of the
outstanding securities issued by the fund. Rule 22c–
2(c)(1).
2 The

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Federal Register / Vol. 86, No. 190 / Tuesday, October 5, 2021 / Notices

including market timing, in omnibus
accounts. These collections of
information are mandatory for funds
that redeem shares within seven days of
purchase. The collections of information
also are necessary to allow Commission
staff to fulfill its examination and
oversight responsibilities.
Rule 22c–2(a)(1) requires the board of
directors of all registered open-end
management investment companies and
series thereof (except for money market
funds, ETFs, or funds that affirmatively
permit short-term trading of its
securities) to approve a redemption fee
for the fund, or instead make a
determination that a redemption fee is
either not necessary or appropriate for
the fund. Commission staff understands
that the boards of all funds currently in
operation have undertaken this process
for the funds they currently oversee, and
the rule does not require boards to
review this determination periodically
once it has been made. Accordingly, we
expect that only boards of newly
registered funds or newly created series
thereof would undertake this
determination. Commission staff
estimates that 36 funds (excluding
money market funds and ETFs) are
newly formed each year and would
need to make this determination.3
Based on conversations with fund
representatives,4 Commission staff
estimates that it takes 2 hours of the
board’s time as a whole (at a rate of
$4,465 per hour) 5 to approve a
redemption fee or make the required
determination on behalf of all series of
the fund. In addition, Commission staff
estimates that it takes compliance
personnel of the fund 8 hours (at a rate
of $72 per hour) 6 to prepare trading,
compliance, and other information
regarding the fund’s operations to
enable the board to make its
determination, and takes internal
compliance counsel of the fund 3 hours
(at a rate of $373 per hour) 7 to review

this information and present its
recommendations to the board.
Therefore, for each fund board that
undertakes this determination process,
Commission staff estimates it expends
13 hours 8 at a cost of $10,625.9 As a
result, Commission staff estimates that
the total time spent for all funds on this
process is 468 hours at a cost of
$382,500.10
Rule 22c–2(a)(2) also requires a fund
to enter into information-sharing
agreements with each of its financial
intermediaries. Commission staff
understands that all currently registered
funds have already entered into such
agreements with their intermediaries.
Funds enter into new relationships with
intermediaries from time to time,
however, which requires them to enter
into new information sharing
agreements. Commission staff
understands that, in general, funds enter
into information-sharing agreement
when they initially establish a
relationship with an intermediary,
which is typically executed as an
addendum to the distribution
agreement. The Commission staff
understands that most shareholder
information agreements are entered into
by the fund group (a group of funds
with a common investment adviser),
and estimates that there are currently
840 currently active fund groups.11
Commission staff estimates that, on
average, each active fund group enters
into relationships with 3 new
intermediaries each year. Commission
staff understands that funds generally
use a standard information sharing
agreement, drafted by the fund or an
outside entity, and modifies that
agreement according to the
requirements of each intermediary.
Commission staff estimates that
negotiating the terms and entering into
an information sharing agreement takes
a total of 4 hours of attorney time (at a
rate of $425 per hour) 12 per

3 This estimate is based on the number of
registrants filing initial Form N–1A or N–3 from
2017 to 2019. This estimate does not carve out
money market funds, ETFs, or funds that
affirmatively permit short-term trading of their
securities, so this estimate corresponds to the outer
limit of the number of registrants that would have
to make this determination.
4 Unless otherwise stated, estimates throughout
this analysis are derived from a survey of funds and
conversations with fund representatives.
5 The estimate of $4,465 per hour for the board’s
time as a whole is based on conversations with
representatives of funds and their legal counsel.
6 The $72 per hour figure for a compliance clerk
is from SIFMA’s Office Salaries in the Securities
Industry 2013, modified by Commission staff to
account for an 1,800-hour work-year and inflation,
and multiplied by 2.93 to account for bonuses, firm
size, employee benefits and overhead.
7 The $373 per hour figure for internal
compliance counsel is from SIFMA’s Management

& Professional Earnings in the Securities Industry
2013, modified by Commission staff to account for
an 1,800-hour work-year and inflation, and
multiplied by 5.35 to account for bonuses, firm size,
employee benefits and overhead.
8 This calculation is based on the following
estimates: (2 hours of board time + 3 hours of
internal compliance counsel time + 8 hours of
compliance clerk time = 13 hours).
9 This calculation is based on the following
estimates: ($8,930 ($4,465 board time × 2 hours =
$8,930) + $576 ($72 compliance time × 8 hours =
$576) + $1,119 ($373 attorney time × 3 hours =
$1,119) = $10,625).
10 This calculation is based on the following
estimates: (13 hours × 36 funds = 468 hours);
($10,625 × 36 funds = $382,500).
11 ICI, 2020 Investment Company Fact Book at Fig
2.12 (2020) (https://www.ici.org/research/stats/
factbook).
12 The $425 per hour figure for attorneys is from
SIFMA’s Management & Professional Earnings in

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intermediary (representing 2.5 hours of
fund attorney time and 1.5 hours of
intermediary attorney time).
Accordingly, Commission staff
estimates that it takes 12 hours at a cost
of $5,100 each year 13 to enter into new
information sharing agreements, and all
existing market participants incur a total
of 10,080 hours at a cost of $4,284,000.14
In addition, newly created funds
advised by new entrants (effectively
new fund groups) must enter into
information sharing agreements with all
of their financial intermediaries.
Commission staff estimates that there
are 41 new fund groups that form each
year that will have to enter into
information sharing agreements with
each of their intermediaries.15
Commission staff estimates that fund
groups formed by new advisers typically
have relationships with significantly
fewer intermediaries than existing fund
groups, and estimates that new fund
groups will typically enter into 100
information sharing agreements with
their intermediaries when they begin
operations.16 As discussed previously,
Commission staff estimates that it takes
4 hours of attorney time (at a rate of
$425 per hour) 17 per intermediary to
enter into information sharing
agreements. Therefore, Commission staff
estimates that each newly formed fund
group will incur 400 hours of attorney
time at a cost of $170,000 18 and that all
newly formed fund groups will incur a
total of 16,400 hours at a cost of
$6,970,000 to enter into information
sharing agreements with their
intermediaries.19
the Securities Industry 2013, modified by
Commission staff to account for an 1,800-hour
work-year and inflation, and multiplied by 5.35 to
account for bonuses, firm size, employee benefits
and overhead.
13 This estimate is based on the following
calculations: (4 hours × 3 new intermediaries = 12
hours); (12 hours × $425 = $5,100).
14 This estimate is based on the following
calculations: (12 hours × 840 fund groups = 10,080
hours); (10,080 hours × $425 = $4,284,000).
15 ICI, 2020 Investment Company Fact Book at Fig
2.12 (2020) (https://www.ici.org/research/stats/
factbook).
16 Commission staff understands that funds
generally use a standard information sharing
agreement, drafted by the fund or an outside entity,
and then modifies that agreement according to the
requirements of each intermediary.
17 The $425 per hour figure for an attorney is from
SIFMA’s Management & Professional Earnings in
the Securities Industry 2013, modified by
Commission staff to account for an 1,800-hour
work-year and inflation, and multiplied by 5.35 to
account for bonuses, firm size, employee benefits
and overhead.
18 This estimate is based on the following
calculations: (4 hours × 100 intermediaries = 400
hours); (400 hours × $425 = $170,000).
19 This estimate is based on the following
calculations: (41 fund groups × 400 hours = 16,400
hours); ($425 × 16,400 = $6,970,000).

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Federal Register / Vol. 86, No. 190 / Tuesday, October 5, 2021 / Notices
Rule 22c–2(a)(3) requires funds to
maintain records of all informationsharing agreements for 6 years in an
easily accessible place. Commission
staff understands that most shareholder
information agreements are stored at the
fund group level and estimates that
there are currently approximately 840
fund groups.20 Commission staff
understands that information-sharing
agreements are generally included as
addendums to distribution agreements
between funds and their intermediaries,
and that these agreements would be
stored as required by the rule as a matter
of ordinary business practice. Therefore,
Commission staff estimates that
maintaining records of informationsharing agreements requires 10 minutes
of time spent by a general clerk (at a rate
of $64 per hour) 21 per fund, each year.
Accordingly, Commission staff
estimates that all funds will incur 140
hours at a cost of $8,960 22 in complying
with the recordkeeping requirement of
rule 22c–2(a)(3).
Therefore, Commission staff estimates
that to comply with the information
sharing agreement requirements of rule
22c–2(a)(2) and (3), it requires a total of
26,620 hours at a cost of $11,262,960.23
The Commission staff estimates that
on average, each fund group requests
shareholder information once a week,
and gives instructions regarding the
restriction of shareholder trades every
day, for a total of 417 responses related
to information sharing systems per fund
group each year, and a total 350,280
responses for all fund groups
annually.24 In addition, as described
above, the staff estimates that funds
make 36 responses related to board
determinations, 2,520 responses related
to new intermediaries of existing fund
groups, 4,100 responses related to new
fund group information sharing
agreements, and 840 responses related
to recordkeeping, for a total of 7,496
responses related to the other
requirements of rule 22c–2. Therefore,

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20 ICI,

2020 Investment Company Fact Book at Fig
2.12 (2020) (https://www.ici.org/research/stats/
factbook).
21 The $64 per hour figure for a general clerk is
derived from SIFMA’s Office Salaries in the
Securities Industry 2013 modified to account for an
1800-hour work-year and inflation, and multiplied
by 2.93 to account for bonuses, firm size, employee
benefits, and overhead.
22 This estimate is based on the following
calculations: (10 minutes × 840 fund groups = 8,400
minutes); (8,400 minutes/60 = 140 hours); (140
hours × $64 = $8,960).
23 This estimate is based on the following
calculations: (10,080 hours + 16,400 hours + 140
hours = 26,620 hours); ($4,284,000 + $6,970,000 +
$8,960 = $11,262,960).
24 This estimate is based on the following
calculations: (52 + 365 = 417); (417 × 840 fund
groups = 350,280).

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the Commission staff estimates that the
total number of responses is 357,776
(350,280 + 7,496 = 357,776).
The Commission staff estimates that
the total hour burden for rule 22c–2 is
27,088 hours at a cost of $11,645,460.25
Responses provided to the Commission
will be accorded the same level of
confidentiality accorded to other
responses provided to the Commission
in the context of its examination and
oversight program. Responses provided
in the context of the Commission’s
examination and oversight program are
generally kept confidential. Complying
with the information collections of rule
22c–2 is mandatory for funds that
redeem their shares within 7 days of
purchase. 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 public may view background
documentation for this information
collection at the following website:
www.reginfo.gov. Find this particular
information collection by selecting
‘‘Currently under 30-day Review—Open
for Public Comments’’ or by using the
search function. Written comments and
recommendations for the proposed
information collection should be sent
within 30 days of publication of this
notice to (i) www.reginfo.gov/public/do/
PRAMain and (ii) David Bottom,
Director/Chief Information Officer,
Securities and Exchange Commission,
c/o Cynthia Roscoe, 100 F Street NE,
Washington, DC 20549, or by sending an
email to: [email protected].
Dated: September 29, 2021.
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2021–21583 Filed 10–4–21; 8:45 am]
BILLING CODE 8011–01–P

SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–93177; File No. SR–ICC–
2021–019]

Self-Regulatory Organizations; ICE
Clear Credit LLC; Notice of Filing of
Proposed Rule Change Relating to the
ICC CDS Instrument On-Boarding
Policies and Procedures
September 29, 2021.

Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934,1 and
25 This estimate is based on the following
calculations: (468 hours (board determination) +
26,620 hours (information sharing agreements) =
27,088 total hours); ($382,500 (board determination)
+ $11,262,960 (information sharing agreements) =
$11,645,460).
1 15 U.S.C. 78s(b)(1).

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Rule 19b–4,2 notice is hereby given that
on September 22, 2021, ICE Clear Credit
LLC (‘‘ICC’’) filed with the Securities
and Exchange Commission the proposed
rule change as described in Items I, II
and III below, which Items have been
prepared primarily by ICC. The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
I. Clearing Agency’s Statement of the
Terms of Substance of the Proposed
Rule Change
The principal purpose of the
proposed rule change is to revise the
CDS Instrument On-boarding Policies
and Procedures (‘‘Instrument Onboarding Policy’’). These revisions do
not require any changes to the ICC
Clearing Rules (‘‘Rules’’).
II. Clearing Agency’s Statement of the
Purpose of, and Statutory Basis for, the
Proposed Rule Change
In its filing with the Commission, ICC
included statements concerning the
purpose of and basis for the proposed
rule change, security-based swap
submission, or advance notice and
discussed any comments it received on
the proposed rule change, securitybased swap submission, or advance
notice. The text of these statements may
be examined at the places specified in
Item IV below. ICC has prepared
summaries, set forth in sections (A), (B),
and (C) below, of the most significant
aspects of these statements.
(A) Clearing Agency’s Statement of the
Purpose of, and Statutory Basis for, the
Proposed Rule Change
(a) Purpose
ICC proposes to amend the Instrument
On-boarding Policy. This document
provides an overview of ICC’s onboarding process for new instruments,
which includes selecting new
instruments for clearing, configuring
internal systems, notifying and
receiving feedback from stakeholders,
and ensuring operational readiness by
ICC and its Clearing Participants
(‘‘CPs’’). The proposed changes amend
the guiding principles that ICC
maintains for instrument selection. ICC
believes that such changes will facilitate
the prompt and accurate clearance and
settlement of securities transactions and
derivative agreements, contracts, and
transactions for which it is responsible.
ICC proposes to make such changes
effective following Commission
approval of the proposed rule change.
The proposed rule change is described
in detail as follows.
2 17

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CFR 240.19b–4.

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