60 Day Notice

Federal Register / Vol. 86, No. 166 / Tuesday, August 31, 2021 / Notices

khammond on DSKJM1Z7X2PROD with NOTICES

hours.2 Commission staff further
estimates that the cost of the hourly
burden per repurchase is approximately
$330.50 (one half hour of a compliance
attorney’s time at $373 per hour,3 and
two hours of clerical time at $72 per
hour).4 The total annual cost for all
funds is estimated to be $185,080.5
In addition, the fund must file with
the Commission a copy of any written
solicitation to purchase securities given
by or on behalf of the fund to 10 or more
persons. The copy must be filed as an
exhibit to Form N–CSR (17 CFR
249.331and 274.128).6 The burden
associated with filing Form N–CSR is
addressed in the submission related to
that form.
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.
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 of this
publication.
Please direct your written comments
to David Bottom, Director/Chief
Information Officer, Securities and
Exchange Commission, C/O Cynthia
Roscoe, 100 F Street NE, Washington,
2 This estimate is based on the following
calculation: 224 repurchases × 2.5 hours per
repurchase = 560 hours.
3 The $373/hour figure for a compliance attorney
is from SIFMA’s Management & Professional
Earnings in the Securities Industry 2013, updated
for 2021, 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.
4 The $72/hour figure for a compliance clerk is
from SIFMA’s Office Salaries in the Securities
Industry 2013, updated for 2021, 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.
5 This estimate is based on the following
calculation: 560 repurchases × $330.5 per
repurchase = $185,080.
6 In addition, Item 9 of Form N–CSR requires
closed-end funds to disclose information similar to
the information that was required in Form N–23C–
1, which was discontinued in 2004.

VerDate Sep<11>2014

20:08 Aug 30, 2021

Jkt 253001

DC 20549; or send an email to: PRA_
[email protected].
Dated: August 25, 2021.
Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2021–18697 Filed 8–30–21; 8:45 am]
BILLING CODE 8011–01–P

SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–92750; File No. SR–NSCC–
2021–007]

Self-Regulatory Organizations;
National Securities Clearing
Corporation; Notice of Designation of
Longer Period for Commission Action
on Proposed Rule Change Relating to
Confidential Information, Market
Disruption Events, Systems
Disconnect, and Other Changes
August 25, 2021.

I. Introduction
On June 25, 2021, National Securities
Clearing Corporation (‘‘NSCC’’) filed
with the Securities and Exchange
Commission (‘‘Commission’’) proposed
rule change SR–NSCC–2021–007 (the
‘‘Proposed Rule Change’’) pursuant to
Section 19(b)(1) of the Securities
Exchange Act of 1934 (‘‘Act’’) 1 and Rule
19b–4 thereunder 2 to amend NSCC’s
rules relating to confidentiality
requirements, market disruption events,
systems disconnect, and other changes.
The Proposed Rule Change was
published for comment in the Federal
Register on July 13, 2021,3 and the
Commission received a comment, which
addresses issues that also appear in this
Proposed Rule Change.4
Section 19(b)(2) of the Act 5 provides
that within 45 days of the publication of
notice of the filing of a proposed rule
change, or within such longer period up
to 90 days as the Commission may
designate if it finds such longer period
to be appropriate and publishes its
reasons for so finding or as to which the
1 15

U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 Securities Exchange Act Release No. 92334
(June 25, 2021), 86 FR 36815 (July 13, 2021) (File
No. SR–NSCC–2021–007) (‘‘Notice of Filing’’).
4 Specifically, the Commission received a
comment letter on a proposed rule change filed by
NSCC’s affiliate, the Depository Trust Company
(‘‘DTC’’), regarding parallel changes to DTC’s Rules.
See Securities Exchange Act Release No. 92342
(June 25, 2021), 86 FR 36833 (July 13, 2021) (File
No. SR–DTC–2021–011). The comment letter is
available on the Commission’s website at https://
www.sec.gov/comments/sr-dtc-2021-011/
srdtc2021011.htm. Because the comment addresses
issues that also appear in this Proposed Rule
Change, the Commission will consider it in
connection with NSCC’s proposal as well.
5 15 U.S.C. 78s(b)(2).
2 17

PO 00000

Frm 00129

Fmt 4703

Sfmt 4703

48787

self-regulatory organization consents,
the Commission shall either approve the
proposed rule change, disapprove the
proposed rule change, or institute
proceedings to determine whether the
proposed rule change should be
disapproved. The 45th day after
publication of the notice for the
Proposed Rule Change is effectively
Friday, August 27, 2021.
The Commission is extending the 45day review period for Commission
action on the Proposed Rule Change. In
order to provide the Commission with
sufficient time to consider the Proposed
Rule Change, the Commission finds that
it is appropriate to designate a longer
period within which to take action on
the Proposed Rule Change.
Accordingly, pursuant to Section
19(b)(2) of the Act 6 and for the reasons
stated above, the Commission
designates Friday, October 8, 2021, as
the date by which the Commission shall
either approve, disapprove, or institute
proceedings to determine whether to
disapprove the Proposed Rule Change
(File No. SR–NSCC–2021–007).
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.7
Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2021–18672 Filed 8–30–21; 8:45 am]
BILLING CODE 8011–01–P

SECURITIES AND EXCHANGE
COMMISSION
[SEC File No. 270–233, OMB Control No.
3235–0223]

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 17f–2

Notice is hereby given that, pursuant
to the Paperwork Reduction Act of 1995
(44 U.S.C. 350l 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 17f–2 (17 CFR 270.17f–2),
entitled ‘‘Custody of Investments by
6 Id.
7 17

E:\FR\FM\31AUN1.SGM

CFR 200.30–3(a)(31).

31AUN1

48788

Federal Register / Vol. 86, No. 166 / Tuesday, August 31, 2021 / Notices

khammond on DSKJM1Z7X2PROD with NOTICES

Registered Management Investment
Company,’’ establishes safeguards for
arrangements in which a registered
management investment company or
business development company
(‘‘fund’’) is deemed to maintain custody
of its own assets, such as when the fund
maintains its assets in a facility that
provides safekeeping but not custodial
services.1 The rule includes four
distinct requirements that are an
information collection under the
Paperwork Reduction Act. First, fund’s
directors must prepare a resolution
designating not more than five fund
officers or responsible employees who
may have access to the fund’s assets.
Secondly, the fund’s board must vote to
approve this resolution. Third, the
designated access persons (two or more
of whom must act jointly when
handling fund assets) must prepare a
written notation providing certain
information about each deposit or
withdrawal of fund assets, and must
transmit the notation to another officer
or director designated by the directors.
Lastly, an independent public
accountant must verify the fund’s assets
three times each year, and two of those
examinations must be unscheduled.2
Rule 17f–2’s requirements are
designed to safeguard fund assets from
loss by requiring certain specific
controls when those assets are not
placed and maintained in the custody of
a bank or other custodian as permitted
under section 17(f) of the Investment
Company Act of 1940 (15 U.S.C. 80a–
17(f)) (‘‘Act’’) and the rules thereunder.
Specifically, the requirement that
directors designate access persons is
intended to ensure that directors
evaluate the trustworthiness of insiders
who handle fund assets. The
requirements that access persons act
jointly in handling fund assets, prepare
a written notation of each transaction,
and transmit the notation to another
designated person are intended to
reduce the risk of misappropriation of
fund assets by access persons, and to
ensure that adequate records are
prepared, reviewed by a responsible
third person, and available for
examination by the Commission. The
1 The rule generally requires all assets to be
deposited in the safekeeping of a ‘‘bank or other
company whose functions and physical facilities
are supervised by Federal or State authority.’’
2 The accountant must transmit to the
Commission promptly after each examination a
certificate describing the examination on Form N–
17f–2. The preparation and filing of Form N–17f–
2, which largely serves as a cover-sheet for the
accountant’s certification of their audit, is covered
by a separate information collection. The third
(scheduled) examination may coincide with the
annual verification required for every fund by
section 30(g) of the Act (15 U.S.C. 80a–29(g)).

VerDate Sep<11>2014

20:08 Aug 30, 2021

Jkt 253001

requirement that auditors verify fund
assets without notice twice each year is
intended to provide an additional
deterrent to the misappropriation of
fund assets and to detect any
irregularities. Less frequent
examinations by a fund’s accountants
could impair the ability of the
Commission’s examination staff to
ascertain the fund’s compliance with
the rule.
The Commission staff estimates that
each fund makes 974 responses and
spends an average of 252 hours annually
in complying with the rule’s
requirements.3 Commission staff
estimates that on an annual basis it
takes: (i) 0.5 hours of fund accounting
personnel at a total cost of $111 and 1
hour of fund attorney personnel time at
a cost of $425, for a total of 1.5 hours
and a cost of $536 to draft director
resolutions; 4 (ii) 0.5 hours of the fund’s
board of directors at a total cost of
$2,385 to adopt the resolution; 5 (iii) 244
hours for the fund’s accounting
personnel at a total cost of $71,102 to
prepare written notations of
transactions; 6 and (iv) 3 hours for the
fund’s controller or administrator at a
total cost of $1,494 to assist the
independent public accountants when
they perform verifications of fund
assets.7 The total of these four
requirements would then be 249 hours
at a cost of $75,517 per respondent.
Commission staff estimates that
approximately 183 funds file Form N–
3 The 974 responses are: 1 (one) response to draft
and adopt the resolution and 973 notations.
Estimates of the number of hours are based on
conversations with individuals in the fund
industry. The actual number of hours may vary
significantly depending on individual fund assets.
4 The estimate relating to fund accounting
personnel is based on the following calculation: 0.5
(burden hours per fund) × $221 (senior accountant’s
hourly rate) = approximately $111. Unless
otherwise indicated, the hourly wage figures used
herein are from the Securities Industry and
Financial Markets Association’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.
5 The staff has estimated the average cost of board
of director time as $4,770 per hour for the board as
a whole, based on information received from funds
and their counsel.
6 Respondents estimated that each fund makes
973 responses on an annual basis and spends a total
of 0.25 hours per response. The fund personnel
involved are Accounts Payable Manager ($208
hourly rate), Operations Manager ($373 hourly rate)
and Accounting Manager ($296 hourly rate). The
average hourly rate of these personnel is
approximately $292. The estimated cost of
preparing notations is based on the following
calculation: 974 × 0.25 × $292 = $71,102.
7 This estimate is based on the following
calculation: 3 × $498 (fund controller’s hourly rate)
= $1,494.

PO 00000

Frm 00130

Fmt 4703

Sfmt 4703

17f–2 each year.8 Thus, the total annual
hour burden for rule 17f–2 is estimated
to be 45,384 hours.9 Based on the total
costs per fund listed above, the total
cost of rule 17f–2’s collection of
information requirements is estimated
to be approximately $13,819,611.10
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.
Complying with the collections of
information required by rule 17f–2 is
mandatory for those funds that maintain
custody of their own assets. Responses
will not be kept confidential. 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 of this
publication.
Please direct your written comments
to David Bottom, Director/Chief
Information Officer, Securities and
Exchange Commission, C/O Cynthia
Roscoe, 100 F Street NE, Washington,
DC 20549; or send an email to: PRA_
[email protected].
Dated: August 25, 2021.
Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2021–18695 Filed 8–30–21; 8:45 am]
BILLING CODE 8011–01–P
8 On average, each year approximately 183 funds
filed Form N–17f–2 with the Commission during
calendar years 2018–2020. As every fund subject to
rule 17f–2 must file Form N–17f–2, we believe this
is a good estimate for the number of respondents
to the rule.
9 This estimate is based on the following
calculation: 183 (funds) × 249 (total annual hourly
burden per fund) = 45,384 hours for rule. The
annual burden for rule 17f–2 does not include time
spent preparing Form N–17f–2. The burden for
Form N–17f–2 is included in a separate collection
of information.
10 This estimate is based on the following
calculation: $75,517 (total annual cost per fund) ×
183 funds = $13,819,611.

E:\FR\FM\31AUN1.SGM

31AUN1