Form S-6 Supporting Statement (Names Rule Adoption)

OMB CONTROL NUMBER: 3235-0184

SUPPORTING STATEMENT
For the Paperwork Reduction Act Information Collection Submission for
Form S-6
A. JUSTIFICATION
1. Necessity for the Information Collection
Form S-6 1 is a form used for registration under the Securities Act of 1933
(“Securities Act”) 2 of securities of any unit investment trust (“UIT”) registered under the
Investment Company Act of 1940 (“Investment Company Act”) 3 on Form N-8B-2. 4
Section 5 of the Securities Act requires the filing of a registration statement prior to the
offer of securities to the public and that the statement be effective before any securities
are sold. 5 Section 5(b) of the Securities Act requires that investors be provided with a
prospectus containing the information required in a registration statement prior to the sale
or at the time of confirmation or delivery of the securities.
Section 10(a)(3) of the Securities Act provides that when a prospectus is used
more than nine months after the effective date of the registration statement, the
information therein shall be as of a date not more than sixteen months prior to such use. 6
As a result, most UITs update their registration statements under the Securities Act on an
annual basis in order that their sponsors may continue to maintain a secondary market in
the units. UITs that are registered under the Investment Company Act on Form N-8B-2
file post-effective amendments to their registration statements on Form S-6 in order to
update their prospectuses.
On September 20, 2023, the Commission issued a release adopting rule and form
amendments to enhance and modernize the investor protection provided by the
Investment Company Act’s “names rule,” rule 35d-1 under the Investment Company
Act. 7 The names rule requires registered investment companies whose names suggest a
focus in a particular type of investment (among other areas) to adopt a policy to invest at
least 80 percent of the value of their assets in those investments (an “80 percent
investment policy”). The final amendments, among other things, extend the requirement
1

17 CFR 239.16.

2

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

3

15 U.S.C. 80a-1 et seq.

4

17 CFR 274.12. Form N-8B-2 is the form used by UITs other than separate accounts that are currently
issuing securities, including UITs that are issuers of periodic payment plan certificates and UITs of
which a management investment company is the sponsor or depositor to register under the Investment
Company Act pursuant to Section 8 thereof.

5

15 U.S.C. 77e.

6

15 U.S.C. 77j(a)(3).

7

Investment Company Names, Investment Company Act Release No. 35000, (September 20, 2023) (the
“Names Rule Adopting Release”).

to any fund name with terms suggesting that the fund focuses in in investments that have
(or whose issuers have) particular characteristics.
Further, the Commission adopted final amendments to Form N-8B-2 to require
each fund that is required to adopt and implement an 80 percent investment policy to
include disclosure in its prospectus that defines the terms used in its name, including the
specific criteria the fund uses to select the investments that the term describes, if any. 8
UITs that are updating their registration statements on Form S-6 would be required to
address these disclosure requirements.
2. Purpose and Use of the Information Collection
The purpose of Form S-6 is to meet the filing and disclosure requirements of the
Securities Act and to enable filers to provide investors with information necessary to
evaluate an investment in the security. This information collection differs significantly
from many other federal information collections, which are primarily for the use and
benefit of the collecting agency. The information required to be filed with the
Commission permits verification of compliance with securities law requirements and
assures the public availability and dissemination of the information.
3. Consideration Given to Information Technology
The Commission’s Electronic Data Gathering, Analysis and Retrieval system (or
“EDGAR”) provides for automated filing, processing, and dissemination of full
disclosure filings. This automation has increased the speed, accuracy, and availability of
information, generating benefits to investors and financial markets. Form S-6 is required
to be filed with the Commission electronically on EDGAR. 9 Prospectuses may be sent to
investors by electronic means so long as certain requirements are met. 10
4. Duplication
The Commission periodically evaluates rule-based reporting and recordkeeping
requirements for duplication and reevaluates them whenever it proposes a rule or a
change in a rule. Form S-6 requires a prospectus that includes much of the information
requested in Form N-8B-2. Form N-8B-2, however, is filed only once to register the UIT
under the Investment Company Act. 11

8

See instruction (2) to Item 11 of Form N-8B-2; Names Rule Adopting Release.

9

See rule 101(a)(1)(i) of Regulation S-T [17 CFR 232.101(a)(1)(i)].

10

See Investment Company Act Release No. 21399 (Oct. 6, 1995) [60 FR 53458 (Oct. 13, 1995)].

11

To eliminate the duplicative information presented in the registration forms used by UITs, the
Commission has proposed and reproposed, but has not yet adopted, Form N-7, an integrated disclosure
form under the Securities Act and the Investment Company Act. See Investment Company Act Release

5. Effect on Small Entities
The Commission reviews all rules periodically, as required by the Regulatory
Flexibility Act, 12 to identify methods to minimize recordkeeping or reporting
requirements affecting small businesses. The current disclosure requirements for
registration statements on Form S-6 do not distinguish between small entities and other
investment companies. The burden on smaller investment companies of preparing and
filing registration statements may be proportionately greater than for larger investment
companies. This burden includes the cost of producing, printing, filing, and disseminating
prospectuses. The Commission believes, however, that imposing different requirements
on smaller investment companies would not be consistent with investor protection and
the purposes of the registration statements.
6. Consequences of Not Conducting Collection
The purpose of Form S-6 is to meet the filing and disclosure requirements of the
Securities Act and to enable filers to provide investors with information necessary to
evaluate an investment in the security. Less frequent filing would be inconsistent with the
filing and disclosure requirements of the Securities Act. In addition, if the form were to
be filed less frequently, investors may not be provided with the information necessary to
evaluate an investment in the security.
7. Inconsistencies with Guidelines in 5 CFR 1320.5(d)(2)
This collection is not inconsistent with 5 CFR 1320.5(d)(2).
8. Consultations Outside the Agency
Before determining whether to adopt the proposed amendments affecting Form
S-6, the Commission received and evaluated public comments on the proposal’s
collection of information requirements. The Commission’s solicitation of public
comments included estimating and requesting public comments on the burden estimates
for all information collections under this OMB control number (i.e., both changes
associated with the rulemaking and other burden updates). We did not receive comments
No. 14513 (May 14, 1985) [50 FR 21282 (May 23, 1985)]; Investment Company Act Release No.
15612 (Mar. 9, 1987) [52 FR 8268 (March 17, 1987)].
Duplication has been lessened for insurance company separate accounts organized as UITs that offer
variable annuity or variable life insurance contracts, because each such entity registers offerings of
securities under the Securities Act and registers as an investment company under the Investment
Company Act using a single form, Form N-4 (for insurance company separate accounts organized as
UITs that offer variable annuity contracts) or Form N-6 (for insurance company separate accounts
organized as UITs that offer variable life insurance contracts).
12

5 U.S.C. 601 et seq.

on the Commission’s collection of information requirements for Form S-6. Moreover, the
Commission and the staff of the Division of Investment Management participate in an
ongoing dialogue with representatives of the investment company industry through public
conferences, meetings, and informal exchanges. These various forums provide the
Commission and staff with a means of ascertaining and acting upon paperwork burdens
that may confront the industry.
9. Payment or Gift
No payment or gift to respondents was provided.
10. Confidentiality
No assurance of confidentiality was provided.
11. Sensitive Questions
No information of a sensitive nature, including social security numbers, will be
required under this collection of information. The information collection collects basic
Personally Identifiable Information (“PII”) that may include names, job titles, and work
addresses. However, the agency has determined that the information collection does 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. Burden of Information Collection
The following estimates of average burden hours and costs are made solely for
purposes of the Paperwork Reduction Act of 1995 13 and are not derived from a
comprehensive or even representative, survey or study of the cost of Commission rules
and forms. Compliance with Form S-6 is mandatory. Responses to the collection of
information will not be kept confidential.
Form N-8B-2 is used by UITs to initially register under the Investment Company
Act pursuant to section 8 thereof. UITs are required to file Form S-6 in order to register
offerings of securities with the Commission under the Securities Act. As a result, UITs
file Form N-8B-2 only once when the UIT is initially created and then use Form S-6 to
file all post-effective amendments to their registration statements in order to update their
prospectuses.
13

44 U.S.C. 3501 et seq.

TABLE 1: ESTIMATES FOR AMENDMENTS TO FORM S-6
(AS REFLECTED IN NAMES RULE ADOPTING RELEASE)
Initial
Hours

Annual
hours1

Wage rate2

Internal Costs

Annual
External Costs

CURRENTLY APROVED BURDENS
Draft and Update
Disclosures on Form S-63

24 hours

18 hours

x

$356 (1:1 blend of
compliance attorney and
senior programmer)

$6,408

$27,265

Number of Responses

2,498

2,498

2,498

Current Burden
Requirement

107,359

$16,007,184

$68,107,970

$3,560

$9925

× 785 filings

785 filings

PROPOS PROPOSED BURDENS ED BURDENS
Proposed New Names
Rule Disclosure

7 hours

10 hours

×

$356 (1:1 blend of
compliance attorney and
senior programmer)

× 785 filings4

Number of Responses

TOTAL PROPOSED ESTIMATED BURDENS INCLUDING AMENDMENTS
Total New Annual
Burden

7,850 hours

$2,794,600

$778,720

$4,060

$1,1305

× 764 filings

764 filings

FINAL ESTIMATED BURDENS
New Names Rule
Disclosure
Number of Responses

7 hours

10 hours

×

$406 (1:1 blend of
compliance attorney and
senior programmer)

× 764 filings6
TOTAL FINAL ESTIMATED BURDENS INCLUDING AMENDMENTS

Total New Annual
Burden

7,640 hours

$3,101,840

$863,320

Total New Aggregate
Burden

114,999
hours

$19,109,024

$68,971,290

Notes:
1. Includes initial burden estimates annualized over a 3-year period.
2. The estimated wage figures are based on published rates for the professionals described in this chart, modified to account
for an 1800-hour work-year and inflation. The estimates for the proposed and final burdens were multiplied by 5.35 to account
for bonuses, firm size, employee benefits, and overhead. See Securities Industry and Financial Markets Association’s Report on
Management & Professional Earnings in the Securities Industry 2013.
3. Form S-6 incorporates the disclosure requirements of Form N-8B-2 for UITs on an ongoing basis. Because Form S-6
incorporates the requirements of Form N-8B-2, the amendments would indirectly affect these entities. UITs that have made
their initial deposit of securities prior to the effective date of any final rule would be required to update their disclosure on Form
S-6 to comply with the amended requirements of Form N-8B-2. As discussed above, UITs formed after the adoption of any final
rules would be required to comply with the proposed disclosure requirements upon formation when those UITs file Form N-8B-2
with the Commission.
4. The currently-approved PRA burden for rule 35d-1 was based on the Commission’s estimate that 83% of funds were covered
by rule 35d-1. The Commission estimated that 75% of funds would be covered by our proposed rule amendments, based on this
proposal’s economic analysis above. The prior PRA burden was based on an estimate using a different analytical approach than
we are now employing. The Commission estimated that 62% of funds are currently subject to rule 35d-1 and that our proposed
rule amendments would increase this estimate to 75% of funds. The Commission estimated 49 non-separate account and nonETF UITs registered with the Commission. However, the Commission based its estimate on the belief that using the number of
filings instead of registrants would form a more accurate estimate of annual disclosure burdens. The Commission estimated
1,047 filings based on the average number of filings made on Form S-6 from 2018 to 2020. The Commission therefore
estimated that there would be approximately 785 filings for funds that have names that would be covered by the proposed rule
amendments, or 75% of the filings for UITs covered by the rule amendments (1,047 filings x 75% = 785 filings).

5. The estimated burdens at proposal were based on the estimated wage rate of $496/hour, and at adoption are based on the
estimated wage rate of $565/hour, for 2 hours, for outside legal services. The Commission’s estimates of the relevant wage
rate for external time costs, such as outside legal services, take into account staff experience, a variety of sources including
general information websites, and adjustments for inflation.
6. Based on our current analysis, we estimate that 60% of funds are currently subject to rule 35d-1, and that the final
amendments will increase this estimate to 76% of funds. The Commission estimates 45 non-separate account and non-ETF
UITs registered with the Commission. However, consistent with the Commission’s methodology at proposal, we believe that
using the number of filings instead of the number of registrants will form a more accurate estimate of annual disclosure
burdens. The Commission estimates 1,005 filings based on the average number of filings made on Form S-6 from 2020 to
2022. The Commission therefore estimates that there will be approximately 764 filings for funds that have names that will be
covered by the final amendments, or 76% of the filings for UITs covered by the rule amendments (1,005 filings x 76% = 764
filings).

While the estimates in the Names Rules Adopting Release, as reflected in Table 1,
were based on the previously-approved inventory of 2,498 responses (and hour burden of
107,359 hours), we note that this inventory has been updated in the interim to 1,626
responses (with an hour burden of 68,365 hours). Therefore, instead of a total new
aggregate burden of 114,999 hours, we estimate a total new aggregate burden of 76,005
hours (68,365 hours + 7,640 hours). Likewise, the estimates of total aggregate external
cost were based on the previously-approved estimate of $68,108,956, but this estimate
has been updated in the interim to $53,787,113. Therefore, instead of a total estimated
aggregate external cost of $68,971,290, we estimate a total estimated aggregate external
cost of $54,650,433 ($53,787,113 + $863,320). We continue to estimate that these
burdens would be spread across 1,626 responses. 14
13. Cost to Respondents
Cost burden is the cost of goods and services purchased to prepare and update
registration statements on Form S-6, such as for the services of independent auditors and
outside counsel. The cost burden does not include the hour burden discussed in Item 12
above. Current estimates are based on the Commission’s experience with the filing of
registration forms. We estimate that the annual cost of outside services associated with
the amendments would be approximately $863,320, with a total annual external cost
burden of $54,650,433 as detailed in Item 12 above.
14. Costs to Federal Government
The annual cost of reviewing and processing disclosure documents, including new
registration statements, post-effective amendments, proxy statements, shareholder
reports, and other filings of investment companies amounted to approximately $29
million in fiscal year 2022, based on the Commission’s computation of the value of staff
time devoted to this activity and related overhead.
15. Changes in Burden
The final amendments would result in a number of changes to the currently
approved burden. The disclosure requirements would add approximately 10 annual hours
per response, increasing the total annual aggregate burden from 68,365 hours to 76,005
hours (an increase of 7,640 hours). The estimated cost burden associated has increased
from $53,787,113 to $54,650,433 (an increase of $863,320). This increase is due to the
new requirement for each fund that is required to adopt and implement an 80%
investment policy to include disclosure in its prospectus that defines the terms used in its
name, including the specific criteria the fund uses to select the investments that the term
describes, if any. These changes in burden also reflect the Commission’s revision and
14

Of these responses, we estimate 3 respondents are small entities. See 2023 Names Rule Adopting
Release at section VI.C.

update of burden estimates for all information collections under this OMB control
number (whether or not associated with rulemaking changes), and the Commission
requested public comment on all information collection burden estimates for this OMB
control number.
16. Information Collection Planned for Statistical Purposes
The results of any information collected will not be published.
17. Approval to Omit OMB Expiration Date
We request authorization to omit the expiration date on the electronic version of the
form for design and IT project scheduling reasons. The OMB control number will be
displayed.
18. Exceptions to Certification Statement for Paperwork Reduction Act
Submission
The Commission is not seeking an exception to the certification statement.
B. COLLECTION OF INFORMATION EMPLOYING STATISTICAL
METHODS
The collection of information will not employ statistical methods.