60 Day Notice

Federal Register / Vol. 88, No. 91 / Thursday, May 11, 2023 / Notices

ddrumheller on DSK120RN23PROD with NOTICES1

designation of a physical location as a
clearing office); and (iii) expand
requirements with regard to members’
operational capability, personnel, and
reporting, as well as testing (e.g.,
participation in business continuity
testing). The Commission believes that
such enhancements to OCC’s financial
and operational standards for Clearing
Members should help to ensure that
OCC’s Clearing Members are capable of
meeting their obligations to OCC, which
in turn will help ensure that OCC
continues to promote the prompt and
accurate clearance and settlement of
securities transactions.
Further, OCC proposes to consolidate
its admission procedures and
requirements and modify such
admission procedures and requirements
to help streamline the application
review process. The Commission
believes that such streamlining should
promote consistent application across
membership types, which, in turn may
reduce the likelihood of unfair
discrimination in the admission of
OCC’s Clearing Members. OCC also
proposes to amend its conditions for
member admission (e.g., an applicant
must notify OCC in writing if it is or
becomes subject to Statutory
Disqualification), and directly address
voluntary membership termination.
The Commission believes, therefore,
that the proposal is consistent with the
requirements of section 17A(b)(3)(F) of
the Exchange Act.
C. Consistency With Section
17A(b)(3)(G) of the Exchange Act
Section 17A(b)(3)(G) of the Exchange
Act requires, among other things, that
the rules of a clearing agency provide
that its participants shall be
appropriately disciplined for violation
of any provision of the rules of that
clearing agency by expulsion,
suspension, limitation of activities,
functions, and operations, fine, censure,
or any other fitting sanction.46
As described above, OCC proposes to
broaden its authority to impose
protective measures on Clearing
Members who may pose a risk to OCC.
Such measures include the imposition
of financial obligations, such as
additional margin requirements, as well
as activity restrictions. OCC also
proposes to raise fines, reduce the
threshold for instituting a disciplinary
proceeding, define when fines for
uncontested violations become due, and
make other strengthening changes to the
way it enforces and addresses minor
rule violations. The Commission
believes that strengthening OCC’s ability

to respond to risks and violations in this
way is consistent with the requirements
of section 17A(b)(3)(G) of the Exchange
Act.
D. Consistency With Rule 17Ad–
22(e)(2)(i) of the Exchange Act
Rule 17Ad–22(e)(2)(i) requires that a
covered clearing agency establish,
implement, maintain, and enforce
written policies and procedures
reasonably designed to provide for
governance arrangements that are clear
and transparent.47
OCC’s existing membership eligibility
requirements, admissions criteria, and
ongoing standards are scattered across
OCC’s By-Laws and Rules. As described
above, OCC proposes to reorganize,
relocate, or consolidate such rule text
into chapters 2 and 3 of OCC’s Rules
(along with supporting definitional
changes to chapter 1 of OCC’s rules).
Further, OCC proposes other nonsubstantive wording changes throughout
its rules (e.g., changing ‘‘will’’ to
‘‘shall’’). Because such changes would
improve the readability of OCC’s
publically available rules, which, in
turn, would make such rules clearer and
more transparent to members and the
public, the Commission believes that
such changes are consistent with Rule
17Ad–22(e)(2)(i).48
E. Consistency With Rule 17Ad–
22(e)(18) of the Exchange Act
Rule 17Ad–22(e)(18) requires a
covered clearing agency to establish,
implement, maintain, and enforce
policies and procedures reasonably
designed to, among other things,
establish objective, risk-based, and
publically disclosed criteria for
participation, which permit fair and
open access by direct participants,
require participants to have sufficient
financial resources and robust
operational capacity to meet obligations
arising from participation in the clearing
agency, and to monitor compliance with
such participation requirements on an
ongoing basis.49
As stated above, OCC proposes to
align and strengthen its financial
responsibility standards for members.
OCC also proposes to modify its
operational requirements for members
to (i) reflect changes in technology (e.g.,
allowing for reliance on electronic
signatures); (ii) remove provisions no
longer applicable to current practice
(e.g., the use of authorization stamps or
designation of a physical location as a
clearing office); and (iii) expand
47 17

CFR 240.17Ad–22(e)(2)(i).
CFR 240.17Ad–22(e)(2)(i).
49 17 CFR 240.17Ad–22(e)(18).
48 17

46 15

U.S.C. 78q–1(b)(3)(G).

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requirements with regard to members’
operational capability, personnel, and
reporting, as well as testing (e.g.,
participation in business continuity
testing). The Commission believes that
such enhancements to OCC’s financial
and operational standards should help
to ensure that OCC’s membership has
sufficient financial resources and robust
operational capacity to meet obligations
for participation in OCC. Further, OCC
proposes to modify and consolidate its
admission procedures and requirements
to help streamline the application
review process. The Commission
believes that such streamlining should
promote consistent application across
membership types, which, in turn,
would permit fair and open access by
direct participants.
Therefore, the Commission believes,
therefore, that the proposal is consistent
with the requirements of Rule 17Ad–
22(e)(18) of the Exchange Act.50
VI. Conclusion
On the basis of the foregoing, the
Commission finds that the proposed
rule change is consistent with the
requirements of the Exchange Act, and
in particular the requirements of section
17A of the Exchange Act 51 and the rules
and regulations thereunder.
It is therefore ordered, pursuant to
section 19(b)(2) of the Exchange Act,52
that the proposed rule change (SR–
OCC–2023–002) be, and hereby is,
approved.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.53
J. Matthew DeLesDernier,
Deputy Secretary.
[FR Doc. 2023–10029 Filed 5–10–23; 8:45 am]
BILLING CODE 8011–01–P

SECURITIES AND EXCHANGE
COMMISSION
[SEC File No. 270–524, OMB Control No.
3235–0582]

Proposed Collection; Comment
Request; Extension: Form N–PX
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
50 17

CFR 240.17Ad–22(e)(18).
approving this proposed rule change, the
Commission has considered the proposed rules’
impact on efficiency, competition, and capital
formation. See 15 U.S.C. 78c(f).
52 15 U.S.C. 78s(b)(2).
53 17 CFR 200.30–3(a)(12).
51 In

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Federal Register / Vol. 88, No. 91 / Thursday, May 11, 2023 / Notices

(44 U.S.C. 3501 et seq.) (‘‘Paperwork
Reduction Act’’), 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 (‘‘OMB’’) for
extension and approval.
On November 2, 2022, the
Commission adopted rule and form
amendments (‘‘Amendments’’) that
would enhance the information funds
report on Form N–PX and make that
information easier to analyze.1 The
Commission also adopted a new rule
that would require an institutional
investment manager subject to section
13(f) of the Securities Exchange Act of
1934 (‘‘Exchange Act’’) to report
annually on Form N–PX how it voted
proxies relating to executive
compensation matters, as required by
section 14A of the Exchange Act. The

Amendments require funds (and, for
executive compensation matters,
institutional investment managers) to (i)
identify voting matters using language
from the issuer’s form of proxy (with
certain exceptions for issuers who are
not subject to the Commission’s proxy
rules) and categorize their votes from a
list of categories; (ii) disclose
quantitative information regarding the
number of votes cast (or instructed to be
cast) and the number of shares not voted
because they are out on loan; and (iii)
file reports in an XML structured data
language using a standardized format. In
addition, the Amendments included
changes to Forms N–1A, N–2, and N–3
that require funds, if they have a
website, to disclose that their proxy
voting records are publicly available on
or through their websites, free of charge,
and to make this information available
on or through its website as soon as
reasonably practicable after filing a

report on Form N–PX with the
Commission.
The purpose of Form N–PX is to meet
the filing and disclosure requirements of
rules under the Act and also to enable
funds to provide investors with
information necessary to evaluate
overall patterns in the manager’s voting
behavior. This information collection is
primarily for the use and benefit of
investors. The information filed with
the Commission also permits the
verification of compliance with
securities law requirements and assures
the public availability and
dissemination of the information. Due to
the Amendments, Form N–PX will also
be used by institutional investment
managers to meet the filing and
disclosure requirements of section 14A
under the Exchange Act.
The table below summarizes our
estimates associated with the
amendments to Form N–PX that the
Amendments address:

FORM N–PX PRA ESTIMATES
Internal
initial
burden hours

Internal
annual
burden hours 1

Internal
time costs

Wage rate 2

Annual
external
cost burden

Funds Holding Equity Securities
Estimated annual burden of current Form
N–PX per response ..............................
Estimated initial burden to accommodate
new reporting requirements .................
Additional estimated annual burden associated with amendments to Form N–
PX .........................................................
Website availability requirement 6 ............
Estimated number of annual responses 8
Total annual burden ..........................

........................

7.2

×

3 $400

$2,880

$1,000

36

12

×

4 349

$4,188

$500

........................
........................
........................

12
0.5
× 5,496

×
×

5 349

........................

$4,188
$136
× 5,496

$1,000
........................
× 5,496

........................

188,490

........................

........................

$67,737,479

$14,865,142

3 400

$68

........................

........................
........................

........................
× 2,588

........................
........................

........................

$176,005

........................

7 272

Funds Not Holding Equity Securities
Estimated annual burden of current Form
N–PX per response ..............................
Additional estimated annual burden associated with amendments to Form N–
PX .........................................................
Estimated number of annual responses 8

........................

0.17

........................
........................

........................
× 2,588

Total annual burden ..........................

........................

440

×

........................

ddrumheller on DSK120RN23PROD with NOTICES1

Funds of Funds
Estimated annual burden of current Form
N–PX per response ..............................
Additional estimated annual burden associated with amendments to Form N–
PX .........................................................
Website availability requirement 6 ............
Estimated number of annual responses 8

........................

1

×

3 400

$400

$100

........................
........................
........................

0.5
0.5
× 1,619

×
×

3 400

........................

$200
$136
× 1,619

$100
........................
× 1,619

Total annual burden ..........................

........................

3,238

........................

$1,191,584

$323,800

1 Enhanced Reporting of Proxy Votes by
Registered Management Investment Companies;

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Reporting of Executive Compensation Votes by
Institutional Investment Managers, Investment

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Company Release No. 34745 (November 2, 2022)
[87 FR 78770 (Dec. 22, 2022)] (‘‘Adopting Release’’).

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Federal Register / Vol. 88, No. 91 / Thursday, May 11, 2023 / Notices
FORM N–PX PRA ESTIMATES—Continued
Internal
initial
burden hours

Internal
annual
burden hours 1

Internal
time costs

Wage rate 2

Annual
external
cost burden

Institutional Investment Managers
Changes to systems to accommodate
new reporting requirements .................
Estimated annual burden associated with
Form N–PX filing requirement ..............
Estimated number of annual responses ..

45

15

×

9 349

$5,235

$500

........................
........................

7.5
× 8,381

×

10 343
........................

$2,573
× 8,381

$2,000
× 8,381

Total annual burden ..........................

........................

188,572

........................

........................

$65,438,848

$20,952,500

Total Burden
Currently Approved Burden .....................
Additional Burden Associated with
Amendments ........................................

........................

47,984

........................

........................

$17,657,958

........................

332,757

........................

........................

$18,483,484

Total Burden .....................................

........................

380,741

........................

........................

$36,141,445

........................

ddrumheller on DSK120RN23PROD with NOTICES1

Certain products and sums do not tie due to rounding.
1 Includes initial burden estimates amortized over a three-year period.
2 The Commission’s estimates of the relevant wage rates are based on salary information for the securities industry compiled by the Securities
Industry and Financial Markets Association’s Office Salaries in the Securities Industry 2013. The estimated figures are modified by firm size, employee benefits, overhead, and adjusted annually to account for the effects of inflation, with the last adjustment before the adoption of the
Amendments occurring in early 2022. See Securities Industry and Financial Markets Association, Report on Management & Professional Earnings in the Securities Industry 2013.
3 Represents the estimated hourly wage rate of a compliance attorney.
4 Represents the blended estimated hourly wage rates of a programmer and a compliance attorney and includes, inter alia, the costs of obtaining from service providers data on the number of shares on loan but not recalled. In the case of the final estimates, the blended hourly rate is
based on 18 hours for a programmer at $297 per hour and 18 hours for a compliance attorney at $400 per hour.
5 Represents the blended estimated hourly wage rates of a programmer and a compliance attorney. In the case of the final estimates, the
blended hourly rate is based on 6 hours for a programmer at $297 per hour and 6 hours for a compliance attorney at $400 per hour.
6 While the Amendments will require funds to disclose that their proxy voting records both are available on fund websites and will be delivered
to investors upon request, the Form N–PX PRA estimates includes only the burdens associated with website posting. Funds’ registration forms
currently require them to disclose that they either make their proxy voting records available on their websites or deliver them upon request. We
understand most funds deliver proxy voting records upon request and, therefore, the burdens of delivery upon request are already included in the
information collection burdens of each relevant registration form.
7 Represents the estimated hourly wage rate of a webmaster.
8 These estimates are conducted for each fund portfolio, not for each filing, and are an average estimate across all Form N–PX reporting persons. In certain cases, a single Form N–PX filing will report the proxy voting records of multiple fund portfolios. In those circumstances, the reporting person will bear the burden associated with each fund portfolio it reported. This average estimate takes into account higher costs for
funds filing reports for multiple portfolios without assuming any economies of scale that multiple-portfolio fund complexes may be able to achieve.
9 Represents the blended estimated hourly wage rates of a programmer and a compliance attorney. In the case of the final estimates,the
blended hourly rate is based on 22.5 hours for a programmer at $297 per hour and 22.5 hours for a compliance attorney at $400 per hour.
10 Represents the blended estimated hourly wage rates of a programmer and a compliance attorney. In the case of the final estimates, the
blended hourly rate is based on 3 hours for a programmer at $297 per hour and 4.5 hours for a compliance attorney at $400 per hour.

The table above summarizes our PRA
initial and ongoing annual burden
estimates associated with Form N–PX,
as amended. In the aggregate, we
estimate the total annual burden to
comply with amended Form N–PX to be
380,741 hours, with an average external
cost of $36,141,445.
Compliance with Form N–PX is
mandatory. Responses to the collection
of information requirements will not be
kept confidential.
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.
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 OMB control
number.

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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 July 10, 2023.
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.

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Please direct your written comments
to: David Bottom, Director/Chief
Information Officer, Securities and
Exchange Commission, c/o John
Pezzullo, 100 F Street NE, Washington,
DC 20549 or send an email to: PRA_
[email protected].
Dated: May 5, 2023.
J. Matthew DeLesDernier,
Deputy Secretary.
[FR Doc. 2023–10002 Filed 5–10–23; 8:45 am]
BILLING CODE 8011–01–P

SMALL BUSINESS ADMINISTRATION
[Docket No.: SBA–2023–0005]

Development Company Loan
Program—Job Creation and Retention
Requirements; Additional Areas for
Higher Portfolio Average
AGENCY:

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Small Business Administration.

11MYN1