Federal Register 30-Day Notice

8544

Federal Register / Vol. 90, No. 19 / Thursday, January 30, 2025 / Notices

3642 and 3632(b)(3), on January 23,
2025, it filed with the Postal Regulatory
Commission a USPS Request to Add
Priority Mail & USPS Ground
Advantage® Contract 602 to
Competitive Product List. Documents
are available at www.prc.gov, Docket
Nos. MC2025–1153, K2025–1153.
Sean Robinson,
Attorney, Corporate and Postal Business Law.
[FR Doc. 2025–01918 Filed 1–29–25; 8:45 am]
BILLING CODE 7710–12–P

POSTAL SERVICE
Product Change—Priority Mail
Express, Priority Mail, and USPS
Ground Advantage® Negotiated
Service Agreement
Postal ServiceTM.
ACTION: Notice.
AGENCY:

The Postal Service gives
notice of filing a request with the Postal
Regulatory Commission to add a
domestic shipping services contract to
the list of Negotiated Service
Agreements in the Mail Classification
Schedule’s Competitive Products List.
DATES: Date of required notice: January
30, 2025.
FOR FURTHER INFORMATION CONTACT:
Sean C. Robinson, 202–268–8405.
SUPPLEMENTARY INFORMATION: The
United States Postal Service® hereby
gives notice that, pursuant to 39 U.S.C.
3642 and 3632(b)(3), on January 23,
2025, it filed with the Postal Regulatory
Commission a USPS Request to Add
Priority Mail Express, Priority Mail &
USPS Ground Advantage® Contract
1321 to Competitive Product List.
Documents are available at
www.prc.gov, Docket Nos. MC2025–
1152, K2025–1152.
SUMMARY:

Sean C. Robinson,
Attorney, Corporate and Postal Business Law.
[FR Doc. 2025–01913 Filed 1–29–25; 8:45 am]
BILLING CODE 7710–12–P

SECURITIES AND EXCHANGE
COMMISSION

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[SEC File No. 270–450, OMB Control No.
3235–0505]

Submission for OMB Review;
Comment Request; Extension: Rule
303 of Regulation ATS
Upon Written Request, Copies Available
From: Securities and Exchange
Commission, Office of FOIA Services,
100 F Street NE, Washington, DC
20549–2736

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Jkt 265001

Notice is hereby given that pursuant
to the Paperwork Reduction Act of 1995
(‘‘PRA’’) (44 U.S.C. 3501 et seq.), the
Securities and Exchange Commission
(‘‘Commission’’) has submitted to the
Office of Management and Budget
(‘‘OMB’’) a request for approval of
extension of the previously approved
collection of information provided for in
Rule 303 of Regulation ATS (17 CFR
242.303) under the Securities Exchange
Act of 1934 (15 U.S.C. 78a et seq.)
(‘‘Exchange Act’’).
Regulation ATS sets forth a regulatory
regime for ‘‘alternative trading systems’’
(‘‘ATSs’’), which are entities that carry
out exchange functions but are not
required to register as national securities
exchanges under the Act. In lieu of
exchange registration, an ATS can
instead opt to register with the
Commission as a broker-dealer and, as
a condition to not having to register as
an exchange, must instead comply with
Regulation ATS. Rule 303 of Regulation
ATS (17 CFR 242.303) describes the
record preservation requirements for
ATSs. Rule 303 also describes how such
records must be maintained, what
entities may perform this function, and
how long records must be preserved.
Under Rule 303, ATSs are required to
preserve all records made pursuant to
Rule 302, which includes information
relating to subscribers, trading
summaries, and time-sequenced order
information. Rule 303 also requires
ATSs to preserve any notices provided
to subscribers, including, but not
limited to, notices regarding the ATSs
operations and subscriber access. For an
ATS subject to the fair access
requirements described in Rule
301(b)(5)(ii) of Regulation ATS, Rule
303 further requires the ATS to preserve
at least one copy of its standards for
access to trading, all documents relevant
to the ATS’s decision to grant, deny, or
limit access to any person, and all other
documents made or received by the ATS
in the course of complying with Rule
301(b)(5) of Regulation ATS. For an ATS
subject to the capacity, integrity, and
security requirements for automated
systems under Rule 301(b)(6) of
Regulation ATS, Rule 303 requires an
ATS to preserve all documents made or
received by the ATS related to its
compliance, including all
correspondence, memoranda, papers,
books, notices, accounts, reports, test
scripts, test results and other similar
records. Rule 303(a)(1)(v) of Regulation
ATS requires every ATS to preserve the
written safeguards and written
procedures mandated under Rule
301(b)(10). As provided in Rule
303(a)(1), ATSs are required to keep all

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of these records, as applicable, for a
period of at least three years, the first
two in an easily accessible place. In
addition, Rule 303 requires ATSs to
preserve records of partnership articles,
articles of incorporation or charter,
minute books, stock certificate books,
copies of reports filed pursuant to Rule
301(b)(2) and Rule 304, and records
made pursuant to Rule 301(b)(5) for the
life of the ATS. ATSs that trade both
NMS Stock and securities other than
NMS Stock are required to file, and also
preserve under Rule 303, both Form
ATS and related amendments and Form
ATS–N and related amendments.
The information contained in the
records required to be preserved by Rule
303 will be used by examiners and other
representatives of the Commission, state
securities regulatory authorities, and the
self-regulatory organizations (‘‘SROs’’)
to ensure that ATSs are in compliance
with Regulation ATS as well as other
applicable rules and regulations.
Without the data required by the Rule,
regulators would be limited in their
ability to comply with their statutory
obligations, provide for the protection of
investors, and promote the maintenance
of fair and orderly markets.
Respondents consist of ATSs that
choose to register as broker-dealers and
comply with the requirements of
Regulation ATS. There are currently 107
respondents. The Commission believes
that the average ongoing hourly burden
for a respondent to comply with the
baseline record preservation
requirements under Rule 303 is
approximately 15 hours per year. We
thus estimate that the average aggregate
ongoing burden to comply with the
baseline Rule 303 record preservation
requirements is approximately 1,605
hours per year. (107 ATSs × 15 hours =
1,605 hours) In addition, there are
currently two ATSs that transact in both
NMS stock and non-NMS stock on their
ATSs. These two ATSs have a slightly
greater burden because they have to
keep both Form ATS and Form ATS–N
and related documents (e.g.,
amendments). For these two ATSs, we
estimate that the ongoing burden above
the current baseline estimate for
preserving records will be
approximately 1 hour annually per ATS
for a total annual burden above the
current baseline burden estimate of 2
hours for all respondents. Thus, the
estimated average annual aggregate
burden for alternative trading systems to
comply with Rule 303 is approximately
1,607 hours (1,605 hours + 2 hours).
Compliance with Rule 303 is
mandatory. The information required by
Rule 303 is available only for the
examination of the Commission staff,

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Federal Register / Vol. 90, No. 19 / Thursday, January 30, 2025 / Notices
state securities authorities and the
SROs. Subject to the provisions of the
Freedom of Information Act, 5 U.S.C.
522 (‘‘FOIA’’), and the Commission’s
rules thereunder (17 CFR
200.80(b)(4)(iii)), the Commission does
not generally publish or make available
information contained in any reports,
summaries, analyses, letters, or
memoranda arising out of, in
anticipation of, or in connection with an
examination or inspection of the books
and records of any person or any other
investigation.
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.
The public may view and comment
on this information collection request
at: https://www.reginfo.gov/public/do/
PRAViewICR?ref_nbr=202411-3235-003
or send an email comment to
MBX.OMB.OIRA.SEC_desk_officer@
omb.eop.gov within 30 days of the day
after publication of this notice by March
3, 2025.
Dated: January 27, 2025.
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2025–01965 Filed 1–29–25; 8:45 am]
BILLING CODE 8011–01–P

SECURITIES AND EXCHANGE
COMMISSION
[SEC File No. 270–188, OMB Control No.
3235–0212]

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Proposed Collection; Comment
Request; Extension: Rule 12b–1
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
(44 U.S.C. 3501 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 (‘‘OMB’’) for
extension and approval.
Section 12(b) of the Investment
Company Act of 1940 (the ‘‘Act’’) 1
prohibits a registered open-end
investment company (‘‘fund’’), other
than a fund complying with Section
10(d) of the Act,2 from acting as a
1 15

U.S.C. 80a–1 et seq.
2 15 U.S.C. 80a–10(d).

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distributor of securities that it has
issued, except through an underwriter,
in contravention of Commission rules.3
Rule 12b–1 under the Act permits a
fund to bear expenses associated with
the distribution of its shares, provided
that the fund complies with certain
requirements.4
Rule 12b–1 requires, among other
things, that the fund adopt a written
plan describing all material aspects of
the proposed financing of distribution
(‘‘rule 12b–1 plan’’).5 The rule 12b–1
plan must be in writing and approved
by the fund’s board of directors, and
separately by the ‘‘independent’’
directors (as described in the rule).6 If
the rule 12b–1 plan is being adopted
after public offering of the fund’s voting
securities, it must also be approved
initially by a vote of at least a majority
of the fund’s outstanding voting
securities.7 Similarly, any material
amendments to the rule 12b–1 plan
must be approved by the fund’s
directors, including the independent
directors, and any material increase in
the amount to be spent under the rule
12b–1 plan must be approved by the
fund’s shareholders.8 In considering the
implementation or continuance of a rule
12b–1 plan, the fund’s board must
request and evaluate information
reasonably necessary to make an
informed decision.9 The board also
must conclude, in the exercise of
reasonable business judgment and in
light of the directors’ fiduciary duties,
that there is a reasonable likelihood that
the rule 12b–1 plan will benefit the fund
and its shareholders.10
The rule 12b–1 plan and, in certain
instances, any related agreements must
incorporate certain specified provisions,
including that: (i) the plan or agreement
will continue in effect for more than one
year only if the board, including the
independent directors, approve the
continuance at least annually; 11 (ii) the
fund’s board will review quarterly
reports of the amounts spent under the
plan; 12 and (iii) the plan may be
terminated at any time by a majority
vote of the independent directors or
outstanding voting securities.13 Rule
12b–1 also requires the fund to preserve
for six years copies of the rule 12b–1
plan and any related agreements and
3 15

U.S.C. 80a–12(b).
CFR 270.12b–1.
5 17 CFR 270.12b–1(b).
6 17 CFR 270.12b–1(b)(2).
7 17 CFR 270.12b–1(b)(1).
8 17 CFR 270.12b–1(b)(4).
9 17 CFR 270.12b–1(d).
10 17 CFR 270.12b–1(e).
11 17 CFR 270.12b–1(b)(3)(i).
12 17 CFR 270.12b–1(b)(3)(ii).
13 17 CFR 270.12b–1(b)(3)(iii).
4 17

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8545

reports, as well as minutes of board
meetings that describe the factors
considered and the basis for
implementing or continuing the rule
12b–1 plan.14
Rule 12b–1 also prohibits funds from
paying for distribution of fund shares
with brokerage commissions on their
portfolio transactions.15 The rule
requires funds that use broker-dealers
that sell their shares to also execute
their portfolio securities transactions, to
implement policies and procedures
reasonably designed to prevent: (i) the
persons responsible for selecting brokerdealers to effect transactions in fund
portfolio securities from taking into
account broker-dealers’ promotional or
sales efforts when making those
decisions; and (ii) a fund, its adviser, or
its principal underwriter, from entering
into any agreement under which the
fund directs brokerage transactions or
revenue generated by those transactions
to a broker-dealer to pay for distribution
of the fund’s (or any other fund’s)
shares.16
The board and shareholder approval
requirements of the rule are designed to
ensure that fund shareholders and
directors receive adequate information
to evaluate and approve a rule 12b–1
plan and, thus, are necessary for
investor protection. The provisions that
require the board to be provided with
quarterly reports and termination
authority are designed to ensure that the
rule 12b–1 plan continues to benefit the
fund and its shareholders. The
recordkeeping requirements of the rule
are necessary to enable Commission
staff to oversee compliance with the
rule. The requirement that funds or their
advisers implement, and fund boards
approve, policies and procedures in
order to prevent persons charged with
allocating fund brokerage from taking
distribution efforts into account is
designed to ensure that funds’ selection
of brokers to effect portfolio securities
transactions is not influenced by
considerations about the sale of fund
shares.
Commission staff estimates that there
are approximately 5,246 funds (for
purposes of this estimate, registered
open-end investment companies or
series thereof) that have at least one
share class subject to a rule 12b–1 plan
and approximately 250 fund families
with common boards of directors that
have at least one fund with a 12b–1
plan. The Commission further estimates
that the annual hour burden for
complying with the rule is 425 hours for
14 17

CFR 270.12b–1(f).
CFR 270.12b–1(h)(1).
16 17 CFR 270.12b–1(h)(2)(ii).
15 17

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