[Federal Register Volume 64, Number 98 (Friday, May 21, 1999)]
[Rules and Regulations]
[Pages 27888-27897]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-12811]
[[Page 27887]]
_______________________________________________________________________
Part IV
Securities and Exchange Commission
_______________________________________________________________________
17 CFR Part 230 et al.
Rulemaking for EDGAR System; Adoption of Updated EDGAR Filer Manual;
Final Rules
Federal Register / Vol. 64, No. 98 / Friday, May 21, 1999 / Rules and
Regulations
[[Page 27888]]
SECURITIES AND EXCHANGE COMMISSION
17 CFR Parts 230, 232, 239, 240, 270, and 274
[Release Nos. 33-7684; 34-41410; IC-23843 File No. S7-9-99]
RIN 3235-AH70
Rulemaking for EDGAR System
AGENCY: Securities and Exchange Commission.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: The Securities and Exchange Commission is modernizing the
Electronic Data Gathering, Analysis, and Retrieval (EDGAR) system.
Beginning June 28, 1999, we will be able to accept filings submitted to
EDGAR in HyperText Markup Language (HTML) in addition to documents
submitted in the current American Standard Code for Information
Interchange (ASCII) format; filers also will have the option of
accompanying their required filings with unofficial copies in Portable
Document Format (PDF). Beginning May 24, 1999, and continuing through
June 25, 1999 (the test period), filers may submit test filings that
include documents in HTML and PDF format; filers electing to submit
test HTML and/or PDF documents during the test period must do so in
accordance with the new rule provisions. In this release, we are
adopting rule amendments reflecting initial changes to filing
requirements resulting from EDGAR modernization, as well as other
changes clarifying or updating our rules.
EFFECTIVE DATE: These rules are effective on June 28, 1999 and apply to
filings submitted on or after that date.
FOR FURTHER INFORMATION CONTACT: If you have questions about the rules
we are adopting, please contact one of the following members of our
staff: in the Division of Investment Management, Ruth Armfield Sanders,
Senior Counsel, (202) 942-0633; and in the Division of Corporation
Finance, Margaret R. Black, EDGAR Specialist, (202) 942-2940. If you
have questions about the development of the modernized EDGAR system,
please contact Richard D. Heroux, EDGAR Program Manager, (202) 942-
8885, in the Office of Information Technology.
SUPPLEMENTARY INFORMATION: Today we are adopting amendments to the
following rules relating to electronic filing on the EDGAR system:
Rules 485, 486, 487, 495, and 497,1 and Form S-
6,2 under the Securities Act of 1933 (Securities Act);
3 Rules 10, 11, 101, 102, 302, 303, 304, 305, 306, 307, and
310 of Regulation S-T; 4 Schedule 14A 5 under the
Securities Exchange Act of 1934 (Exchange Act); 6 Rules 8b-
23 and 8b-32,7 and Form N-SAR,8 under the
Investment Company Act of 1940 (Investment Company Act); 9
and Forms N-1, N-1A, N-2, N-3, N-4, and N-5 10 under the
Securities Act and the Investment Company Act. We also are adding the
following new rules to Regulation S-T: Rules 104, 105, and 106.
---------------------------------------------------------------------------
\1\ 17 CFR 230.485, 230.486, 230.487, 230.495, and 230.497.
\2\ 17 CFR 239.16.
\3\ 15 U.S.C. 77a, et seq.
\4\ 17 CFR 232.10, 232.11, 232.101, 232.102, 232.302, 232.303,
232.304, 232.305, 232.306, 232.307, and 232.310.
\5\ 17 CFR 240.101.
\6\ 15 U.S.C. 78a, et seq.
\7\ 17 CFR 270.8b-23 and 8b-32.
\8\ 17 CFR 274.101.
\9\ 15 U.S.C. 80a-1, et seq.
\10\ 17 CFR 239.15 and 274.11, 17 CFR 239.15A and 274.11A, 17
CFR 239.14 and 274.11a-1, 17 CFR 239.17a and 274.11b, 17 CFR 239.17b
and 274.11c, 17 CFR 239.24 and 274.5.
---------------------------------------------------------------------------
I. Modernization of EDGAR
A. Background
In 1984, we initiated the EDGAR system to automate the receipt,
processing, and dissemination of documents required to be filed with us
under the Securities Act, the Exchange Act, the Public Utility Holding
Company Act of 1935 (Public Utility Act),11 the Trust
Indenture Act of 1939,12 and the Investment Company Act.
Since 1996, we have required all domestic public companies to file with
us electronically through the EDGAR system, absent an exemption. EDGAR
filings are disseminated electronically and displayed on our web site
at http://www.sec.gov, in the form in which we receive them. The EDGAR
system's broad and rapid dissemination benefits the public by allowing
investors and others to obtain information rapidly in electronic
format. Electronic format is easily searchable and lends itself to
ready financial analysis, using spreadsheets and other methods.
---------------------------------------------------------------------------
\11\ 15 U.S.C. 79a, et seq.
\12\ 15 U.S.C. 77sss, et seq.
---------------------------------------------------------------------------
Recent technological advances, most notably the rapidly expanding
use of the Internet, have led to unprecedented changes in the means
available to corporations, government agencies, and the investing
public to obtain and disseminate information. Today many companies,
regardless of size, make information available to the public through
Internet web sites. On those sites and through links from one web site
to others, individuals may obtain a vast amount of information in a
matter of seconds. Advanced data presentation methods using audio,
video, and graphic and image material are now available through even
the most inexpensive personal computers or laptops.
As discussed below, we are modernizing the EDGAR system to
accommodate some of the changes in technology that have occurred since
the system was developed. On March 10, 1999, we issued a release
proposing amendments to our rules to reflect initial changes to filing
requirements resulting from EDGAR modernization, as well as certain
other changes to clarify or update the rules.13 In that
release, we proposed to accept filings submitted to EDGAR in HTML
format as well as documents submitted in ASCII format and to allow
filers to accompany their required filings with unofficial copies in
PDF format.14 Today we are adopting these amendments as
proposed.
---------------------------------------------------------------------------
\13\ Rulemaking for EDGAR System, Release Nos. 33-7653; 34-
41150; IC-23735 (Mar. 10, 1999) [64 FR 12908] (the proposing
release).
\14\ In the proposing release, we also described further changes
to the system that we plan to make after the HTML implementation
period. We will propose corresponding rule changes closer to that
time.
---------------------------------------------------------------------------
We received a number of comment letters with suggestions concerning
the evolving EDGAR system. Many of these comments addressed divergent
concerns of filers, filing agents, disseminators, and public users of
the EDGAR database. We appreciate the need to balance the competing
interests of these parties in order to have a system that adequately
addresses the fundamental needs of each. We have considered and will
continue to consider these comments in connection with future planning
for the system and future rulemaking related to the next stage of EDGAR
modernization following the HTML implementation period.15
---------------------------------------------------------------------------
\15\ You may read and copy comment letters in our Public
Reference Room, 450 Fifth Street, N.W., Washington, D.C. 20549 in
File No. S-7-9-99. You also may read the comment letters that were
submitted electronically on our web site (http://www.sec.gov).
---------------------------------------------------------------------------
Some disseminators and information providers commented that they
would not have enough time to make the required modifications to their
systems to begin accepting HTML and PDF documents on May 24, 1999. We
have decided not to make the rules effective on May 24 as planned.
Instead, during the test period from May 24 through June 25, 1999,
filers may submit test filings that include documents in HTML and PDF
format. Live filings, however,
[[Page 27889]]
must continue to be in ASCII format. The test period should provide
disseminators with sufficient time to assure completion of system
changes and will provide filers the opportunity to test the EDGAR
system's new features. Beginning June 28, filers may make live filings
including documents in HTML and PDF format.
B. Implementation of HTML/PDF Environment
With EDGAR modernization, we hope to make the system easier for
filers to use and the documents more attractive and readable for the
users of public information. Currently, filers must submit electronic
filings to the EDGAR system in a text-based ASCII format. In the
modernized system, for most filings, filers may choose to submit
documents to us in either HTML or in ASCII. We expect that HTML will
eventually replace ASCII for most filings. Filers also may submit
unofficial PDF copies of filings. Unlike ASCII documents, HTML and PDF
documents can include graphics, varied fonts, and other visual displays
that filers use when they create Internet presentations or material for
distribution to shareholders and other investors. In this release, we
refer to the required filings that filers must submit only in either
ASCII or HTML formats as official filings. We refer to the PDF
documents as unofficial PDF copies because filers may not use them
instead of HTML or ASCII documents to meet filing requirements.
Beginning on June 28, 1999 (and on May 24, 1999 on a test basis)
and extending until early 2000 (the HTML implementation period), we are
imposing certain limitations on HTML documents. These limitations are
necessary due to technical issues that we must resolve before full
implementation of the new HTML component of the EDGAR
system.16 We will provide limited support for HTML by
allowing only certain tags (commands and identifying information) to be
accepted by the EDGAR system. Later, we plan to further modernize the
EDGAR system so that it will be able to accept and display HTML
documents that use graphic and other visual presentations. In this
release, we describe how the EDGAR system is changing for the initial
HTML implementation period, and we adopt rule changes to govern EDGAR
filing during this period.17
---------------------------------------------------------------------------
\16\ As we stated in the proposing release, the modernized EDGAR
system is designed to be Year 2000 compliant. During the summer of
1999, we will turn the dates forward on the EDGAR system at
specified times to give filers an opportunity to submit test filings
so they can assure themselves that the Commission-owned and -
operated EDGAR components will operate after January 1, 2000. We
will issue an announcement with the details shortly. The
announcement will be posted on our web site. We advise filers to
have their own operating environments certified to be Year 2000
compliant.
\17\ We also have revised the EDGAR Filer Manual. See Release
No. 33-7685 (May 17, 1999). The EDGAR Filer Manual sets forth the
technical formatting requirements governing the preparation and
submission of electronic filings through the EDGAR system. Filers
must comply with the provisions of the Filer Manual to assure timely
acceptance and processing of electronic filings. See Rule 301 of
Regulation S-T [17 CFR 232.301].
---------------------------------------------------------------------------
C. Use of HTML
Although the EDGAR system will be able to accept HTML documents
beginning on June 28, 1999 (and on May 24, 1999 on a test basis), we
are not now requiring the use of HTML. However, we expect to require
HTML for most filings in the future, so we encourage filers to use it
and gain experience with this format if they do not have it
already.18 We are providing technical support for filers to
assist them in submitting and correcting HTML documents through our
filer technical support function.
---------------------------------------------------------------------------
\18\ See footnote 35 and accompanying text for submissions that
we will keep in ASCII format.
---------------------------------------------------------------------------
As proposed, during the HTML implementation period, if HTML is
used, each EDGAR document may consist of no more than one HTML file.
Filers may not submit EDGAR documents composed of multiple linked HTML
files. The EDGAR system will suspend any submission containing any HTML
document composed of more than one file.
D. Use of PDF
In addition to permitting the use of HTML in filings, we are
permitting filers to submit a single unofficial PDF copy of each
electronic document.19 These copies will be disseminated
publicly. We believe that filers may want to submit these copies
because PDF documents retain all the fonts, formatting, colors, images,
and graphics contained in an original document. The unofficial PDF copy
will be optional, but if a filer submits an unofficial PDF copy of a
document, that PDF document must be substantively equivalent
20 to the official HTML or ASCII document of which it is a
copy. Further, filers may not make a submission consisting solely of
PDF documents; filers must include unofficial PDF copies only in
submissions containing official documents in HTML or ASCII format.
---------------------------------------------------------------------------
\19\ For example, if a filing consists of a registration
statement plus five exhibits, there are six electronic documents for
EDGAR purposes. Generally, the filer can submit all of these as HTML
documents, all as ASCII documents, or some as HTML and some as ASCII
documents. The filer also has the option to accompany any or all of
the six documents with an unofficial PDF copy. But the rules do not
permit a filer to submit a single unofficial PDF copy including the
registration statement and exhibits; each PDF document should
reflect only one ASCII or HTML document. The rules prohibit filers
from including more PDF documents than the total number of HTML and
ASCII documents combined.
\20\ Substantively equivalent documents are the same in all
respects except for the formatting and inclusion of graphics
(instead of the narrative and/or tabular description of the
graphics). For documents to be substantively equivalent, the text of
the two documents must be identical.
---------------------------------------------------------------------------
E. Graphic and Image Material
During the HTML implementation period, we will not accept graphic
or image material in HTML documents.21 The EDGAR system will
suspend submissions made during the HTML implementation period if they
contain tags for graphic or image files. However, the optional,
unofficial PDF copy of an EDGAR document may contain static graphic
and/or image material. After the HTML implementation period, we intend
to propose that filers may include graphic and image material in HTML
documents.
---------------------------------------------------------------------------
\21\ Filers should continue to provide a fair and accurate
description of the differences between a version including graphic
or image material and the filed version, as required by Rule 304 of
Regulations S-T [17 CFR 232.304].
---------------------------------------------------------------------------
We also will prohibit any EDGAR submission containing animated
graphics (e.g., files with moving corporate logos or other animation),
either in any official document or any unofficial PDF copy. We are
imposing this requirement due to the issues concerning how to capture
and represent the animated graphics, which we cannot print or search,
in defining the official filing.
F. Limitation on Hypertext Links
During the HTML implementation period, we are prohibiting hypertext
links from HTML documents to external web sites. Similarly, we are
prohibiting hypertext links from HTML documents to external documents
(including exhibits), whether or not the document is part of the same
filing. However, electronic filers may include hypertext links to
different sections within a single HTML document.22 A
document may include an inactive textual reference to external sites or
documents for informational purposes,23 but it may not
include a link to the external site or
[[Page 27890]]
document. We will consider expanding the use of hypertext links after
the HTML implementation period.
---------------------------------------------------------------------------
\22\ For example, companies might wish to include a prospectus
table of contents containing links to the various sections of the
prospectus.
\23\ It is the staff's position that such an inactive textual
reference will not be deemed to incorporate the material by
reference into the filing. See ITT Corp. (Dec. 6, 1996) and
Baltimore Gas & Electric Co. (Jan. 6, 1997).
---------------------------------------------------------------------------
G. HTML Standard; Permissible Tag Set
We are adopting a specific HTML standard for HTML documents
submitted on the EDGAR system during the HTML implementation period.
Because different Internet browsers used by filers or the public may
display the information presented in an HTML document in a different
fashion, a document viewed through one browser may have a different
appearance and layout from the same filing viewed through a different
browser. This would be especially evident when a filing printed in hard
copy from one browser appears significantly different from the same
filing printed out from another browser. Initially, we are maximizing
the likelihood of consistent document appearance across different
browsers by specifying HTML 3.2 as the required standard for HTML
documents.
Some commenters expressed the view that the selection of HTML 3.2
as the standard imposes a burden on systems that are not browser-based.
Other commenters, however, expressed the view that HTML 3.2 was
necessary for standardization and consistency. Still other commenters
urged us to adopt a higher standard such as HTML 4.0. We believe HTML
3.2 represents the best approach at this time. We will consider the
evolution of this standard when appropriate.
We also are adopting a set of permissible HTML 3.2 tags for use in
HTML documents during the HTML implementation period. These permissible
tags allow for most HTML 3.2 formatting capability while eliminating
active content and certain classes of hypertext links.24 We
have included the tag list in the EDGAR Filer Manual. In general, the
EDGAR system will suspend submissions which contain tags that are not
permitted. We anticipate that the permitted tag set will evolve over
time to accommodate the industry standard and needs of filers.
---------------------------------------------------------------------------
\24\ The permissible tag set does not include proprietary
extensions that are not supported by all browsers.
---------------------------------------------------------------------------
As proposed, we are not at this time allowing EDGAR submissions to
include tables within tables (nested tables). This is because users of
EDGAR information may find it difficult to locate and use information
in documents with nested tables. In addition, as proposed, EDGAR
submissions may not contain tags used to include executable code,
either in any official submission or any unofficial PDF copy, at any
time, either during the HTML implementation period or
subsequently.25 The EDGAR system will suspend any submission
containing executable code.
---------------------------------------------------------------------------
\25\ See note 40 and accompanying text.
---------------------------------------------------------------------------
II. Rule Amendments To Accommodate EDGAR Modernization
We are adopting the following amendments to our rules and
regulations to accommodate the initial modernization of EDGAR. We are
amending all of the rules as proposed.
A. Amendments to Regulation S-T.
We are amending several provisions of Regulation S-T, which governs
the preparation and submission of electronic filings to us, in
connection with the addition of HTML documents and unofficial PDF
copies to the EDGAR environment.
Rule 11--Definition of Terms used in Part 232. Rule 11
26 contains definitions used in Regulation S-T. We are
adding to the definition section of Regulation S-T the following new
terms: animated graphics; ASCII document; disruptive code; electronic
document; executable code; HTML document; hypertext links or
hyperlinks; and unofficial PDF copy. We also are revising the
definition of electronic filing to make it clear that an electronic
filing may include more than one document.
---------------------------------------------------------------------------
\26\ 17 CFR 232.11.
---------------------------------------------------------------------------
New Rule 104--Unofficial PDF Copies Included in an Electronic
Submission. Rule 104 provides that an electronic submission may include
one unofficial PDF copy of each electronic document contained within an
electronic submission.27 Each unofficial PDF copy must be
substantively equivalent to its associated ASCII or HTML document
contained in the submission.28 Filers wanting to submit an
unofficial PDF copy to replace one with errors, or to include an
omitted one, must submit the unofficial PDF copy as part of another
electronic submission containing an amendment to the original
submission. The amendment must include an explanatory note that the
purpose of the amendment was to add or replace an unofficial PDF
copy.29 If the amendment was being filed to add or resubmit
an unofficial PDF copy of one or more exhibits, the submission must
include an exhibit document for each exhibit for which an unofficial
PDF copy was being submitted.30
---------------------------------------------------------------------------
\27\ Rule 104(a) [17 CFR 232.104(a)]. We also are permitting the
filer to submit an unofficial PDF copy of correspondence or a cover
letter document.
\28\ See note 20 and accompanying text.
\29\ The amendment may consist solely of the cover page (or the
first page of the document), the explanatory note, and the signature
page and exhibit index (where appropriate), and the corresponding
unofficial PDF copy may include the complete text of the official
filing for which the amendment was being submitted.
\30\ The amendment may consist of the cover page (or first page
of the document), the explanatory note, the signature page (where
appropriate), the exhibit index, a separate electronic document for
each exhibit for which an unofficial PDF copy is being submitted,
and the corresponding unofficial PDF copy of each exhibit document.
However, the text of the official exhibit document(s) could contain
only the following legend: RESUBMITTED TO ADD/REPLACE UNOFFICIAL PDF
COPY OF EXHIBIT.
---------------------------------------------------------------------------
Rule 104 provides that unofficial PDF copies are not official
filings.31 The rule makes it clear that unofficial PDF
copies that are prospectuses retain prospectus liability under Section
12 of the Securities Act.32 The rule also makes it clear
that an unofficial PDF copy may contain graphic and image material even
though its ASCII (and, during the implementation period, HTML)
counterpart does not contain such material.33
---------------------------------------------------------------------------
\31\ Rule 104(d) [17 CFR 232.104(d)].
\32\ Rule 104(e) [17 CFR 232.104(e)].
\33\ Rule 104(b) [17 CFR 232.104(b)].
---------------------------------------------------------------------------
We will accept electronic submissions even if an unofficial PDF
copy is flawed and not accepted. In such a case, we will accept the
submission but not the PDF document.34 Otherwise, filers
would risk having a late time-sensitive filing because of a problem
with the unofficial PDF copy.
---------------------------------------------------------------------------
\34\ See the discussion of Rule 106 [17 CFR 232.106] below.
---------------------------------------------------------------------------
New Rule 105--Limitation on Use of HTML Documents and Unofficial
PDF Copies; Use of Hypertext Links. Filers may not submit Form N-SAR,
Form 13F, or Financial Data Schedules as HTML documents.35
These documents have standard formats and tagging designed for
presentation in ASCII, and their current format facilitates their
downloading and use in other computer applications.
---------------------------------------------------------------------------
\35\ Rule 105(a) [17 CFR 232.105(a)]. We are allowing filers the
option of submitting all exhibits to Form N-SAR except Financial
Data Schedules as HTML documents.
---------------------------------------------------------------------------
Rule 105 prohibits electronic filers from including in HTML
documents hypertext links to sites or documents outside the HTML
document that is filed with us.36 However, the rule allows
electronic filers to include hypertext links to different sections
within a single HTML document. Rule 105 provides that, if an accepted
filing includes external links in contravention of this rule, we will
not consider information contained in the linked material to be part of
the official filing for determining compliance with reporting
obligations. Such information will, however, continue to be subject to
[[Page 27891]]
the civil liability and anti-fraud provisions of the federal securities
laws.37
---------------------------------------------------------------------------
\36\ Rule 105(b) [17 CFR 232.105(b)].
\37\ The rule provides that information contained in the linked
material is not part of the official filing for reporting purposes
in order to prevent a filing from being considered complete when the
entire content of the filing is not available without reference to
another document. This provision should not, however, be viewed as a
statement that linked material is not considered to be part of the
filed document for other purposes.
---------------------------------------------------------------------------
Some commenters expressed concerns that this rule would represent
our general position on liability for linked material, including
information that companies and broker-dealers put on their own web
sites. This rule, however, applies only to EDGAR filings and is
narrowly drawn to address the initial stages of EDGAR modernization. We
will further consider the status of links in EDGAR filings if we
propose to expand filers' ability to use links to other documents or
external sites after the HTML implementation period.38
---------------------------------------------------------------------------
\38\ We are considering giving more general public guidance on a
variety of issues arising from the use of electronic media in
contexts other than EDGAR, which could include link liability
issues. See note 327 in ``The Regulation of Securities Offerings,''
Securities Act Release No. 7606A (Nov. 13, 1998)[63 FR 67174].
---------------------------------------------------------------------------
New Rule 106--Prohibition Against Electronic Submissions Containing
Executable Code. The modernized EDGAR system is designed to minimize
security risks. Accordingly, Rule 106 39 prohibits any EDGAR
submission containing executable code, either in any official
submission or any unofficial PDF copy, at any time, either during the
HTML implementation period or subsequently.40 Executable
code includes, but is not limited to, disruptive code.41
This requirement is necessary to protect the integrity of the EDGAR
system and database, by reducing the possibility of unauthorized access
to sensitive information, and to reduce the possibility of introducing
viruses or other destructive applications into the EDGAR system (and to
any disseminator receiving data from the EDGAR system).
---------------------------------------------------------------------------
\39\ 17 CFR 232.106.
\40\ Executable code is defined as instructions to a computer to
carry out operations that use features beyond the ability of the
viewer, reader, or Internet browser to interpret and display HTML,
PDF, and static graphic files. Such code may be in binary (machine
language) or in script form. See the definition of executable code
in Rule 11 of Regulation S-T [17 CFR 232.11]. Thus, scripting
languages, such as JavaScript and similar scripting languages, fall
into this class of executable code, as does Java, ActiveX,
Postscript, and any other programming language.
\41\ The term disruptive code means any active content or other
executable code, or any program or set of electronic computer
instructions inserted into a computer, operating system, or program
that replicates itself or that actually or potentially modifies or
in any way alters, damages, destroys or disrupts the file content or
the operation of any computer, computer file, computer database,
computer system, computer network or software, or as otherwise set
forth in the EDGAR Filer Manual. A violation of Rule 106 or the
relevant provision of the EDGAR Filer Manual also may be a violation
of the Computer Fraud and Abuse Act of 1986, as amended, and other
statutes and laws.
---------------------------------------------------------------------------
We will, in general, suspend any attempted submission that our
staff determines contains executable code.42 The EDGAR
system is programmed to detect and prohibit acceptance of such code
during acceptance processing. If a submission is accepted, and our
staff later determines that the accepted submission contains executable
code, our staff may delete any document contained in the electronic
submission from the EDGAR system and direct the electronic filer to
resubmit electronically replacement documents for all or selected
documents deleted from the submission. We are aware that suspending
acceptance of a filing, or deleting it from the EDGAR database, could
have significant consequences to the filer, such as causing a filing to
miss its due date or preventing a time-sensitive filing from moving
forward. Nevertheless, we need to take whatever steps are necessary to
address potential security problems, and our staff will work with
filers to minimize any adverse consequences.
---------------------------------------------------------------------------
\42\ If the executable code is contained only in one or more PDF
documents, we will accept the submission but not the PDF
document(s).
---------------------------------------------------------------------------
Rule 302--Signatures. Rule 302 43 currently provides
that signatures to or within electronic documents must be in typed
form. We are amending this rule to make it clear that this provision
relates only to required signatures to or within electronic
submissions.44 We anticipate allowing signatures that are
not required to appear as script in HTML documents once we permit
graphic and image material.
---------------------------------------------------------------------------
\43\ 17 CFR 232.302.
\44\ We are keeping the rule that required signatures be typed
to ensure legibility of these signatures. We are not requiring
signatures in unofficial PDF copies.
---------------------------------------------------------------------------
Rule 304--Graphic, Image, Audio and Video Material. Rule 304
45 currently prohibits the inclusion of graphic, image, or
audio material in an EDGAR document. We are adding the word ``video''
to the rule to make it clear that that information also is
prohibited.46 Rule 304 applies only to official filings, not
to unofficial PDF copies, which may contain graphic and image material
(but not animated graphics, audio or video material).47
---------------------------------------------------------------------------
\45\ 17 CFR 232.304.
\46\ As part of a later rulemaking proposal, we anticipate
proposing to lift the prohibition on graphic and image material (but
not on audio or video material) after the HTML implementation
period.
\47\ See Rule 104 [17 CFR 232.104].
---------------------------------------------------------------------------
Rule 305--Number of Characters per Line; Tabular and Columnar
Information. Currently, Rule 305 48 limits the number of
characters per line. We are adding paragraph (b) to the rule to provide
that the limitations of paragraph (a) 49 do not apply to
HTML documents.50
---------------------------------------------------------------------------
\48\ 17 CFR 232.305.
\49\ I.e., the narrative portion of an electronic document may
not exceed certain character limitations per line and other
formatting restrictions.
\50\ Rule 305(b) [17 CFR 232.305(b)].
---------------------------------------------------------------------------
Rule 306--Foreign Language Documents and Symbols. Rule 306
51 provides that foreign currency denominations be expressed
in words or letters in the English language rather than representative
symbols. We are amending Rule 306 to allow HTML documents to include
the representative foreign currency symbols specified in the EDGAR
Filer Manual and to provide that the limitations would not apply to
documents which are unofficial PDF copies.
---------------------------------------------------------------------------
\51\ 17 CFR 232.306.
---------------------------------------------------------------------------
Rule 307--Bold-Face Type. Rule 307 provides that filers should
present required bold-face type as capital letters in ASCII documents.
We are amending Rule 307 to make it clear that the provision does not
apply to HTML documents because filers are able to include bold-face
type in HTML documents.
Rule 310--Marking Changed Material. Rule 310 52 provides
that the requirement for marking changed materials is satisfied by
inserting the tag before and the tag following a paragraph
containing changed material. We are retaining this redlining convention
and extending it to HTML documents. 53 Further, we are
allowing filers to mark changed material in HTML documents within
paragraphs, as well.54
---------------------------------------------------------------------------
\52\ 17 CFR 232.310.
\53\ Filers should not redline PDF documents. While the EDGAR
system will remove the redlining tags from HTML documents before
they are publicly disseminated (just as is currently the case with
ASCII documents), the EDGAR system will not remove the redlining
tags from PDF documents. Therefore, if a filer includes redlining
tags in a PDF document, the disseminated PDF document will contain
redlining tags.
\54\ We caution filers that, while evidence of redlining tags in
HTML documents will not be viewable in the browser, it may be
viewable in the HTML source code.
---------------------------------------------------------------------------
[[Page 27892]]
B. Other Rule Amendment in Connection With EDGAR Modernization
Paragraph (k)(2)(ii) of Rule 497 55 requires investment
company filers to submit additional copies of certain forms of profiles
in the primary form intended for distribution to investors (e.g., paper
or electronic media) or, if the profile is distributed primarily on the
Internet, to provide the electronic address (URL) of the profile
page(s) in an exhibit to the electronic filing. We are amending
paragraph (k)(2)(ii) of Rule 497 to allow a filer to submit with its
electronically filed definitive form of profile an unofficial PDF copy
of the profile instead.
---------------------------------------------------------------------------
\55\ 17 CFR 230.497(k)(2)(ii).
---------------------------------------------------------------------------
C. Miscellaneous Amendments
We also are adopting several electronic filing rule amendments that
are not directly associated with EDGAR modernization.
1. Amendments to Regulation S-T
Rule 10--Form ID. Rule 10 56 provides that filers must
file Form ID, the uniform application for access codes to file on the
EDGAR system, before they begin electronic filing. We are amending Rule
10 to make it clear that filers must submit Form ID in paper format.
---------------------------------------------------------------------------
\56\ 17 CFR 232.10.
---------------------------------------------------------------------------
Rule 101(a)--Mandated Electronic Submissions and Exceptions. The
note to paragraph (a)(1)(iii) of Rule 101 instructs filers filing
Schedules 13D and 13G with respect to foreign private issuers to file
in paper because one of the required data elements--the IRS tax
identification number--is not available for foreign issuers. However, a
paper filing is no longer necessary. The staff advises these filers to
include in the EDGAR submission header all zeroes (i.e., 00-0000000)
for the IRS tax identification number, so that they may file
electronically. We are amending the note to this rule to formalize the
existing practice and permit electronic filing.
Rules 101(b), 102(e), and 303--Permitted Electronic Submissions;
Exhibits; and Incorporation by Reference.
Currently, electronic filers may submit exhibits to Forms N-SAR,
other than the Financial Data Schedule, either electronically or in
paper.57 We have allowed filers to submit these exhibits in
paper because, during phase-in to electronic filing, registrants could
file their Forms N-SAR electronically on a voluntary basis in advance
of their phase-in date, at a time when they were not able to make any
other electronic filings. With the completion of phase-in, we are now
requiring that filers submit all Form N-SAR exhibits
electronically.58
---------------------------------------------------------------------------
\57\ See the former provisions of Rules 101(b)(7), 102(e)(2),
and 303(a)(3)(ii) [17 CFR 101(b)(8), 102(e)(2), and 202(a)(3)(ii)].
\58\ We are removing the last sentence of Instruction F(2) of
Form N-SAR [17 CFR 274.101], which allowed filers to submit exhibits
to the form in paper, and removing the exemption for small business
investment companies, which are now phased-in to electronic filing.
Finally, we are revising Instruction F(1) to correctly reference
Sub-Item 77Q1 (Exhibits).
---------------------------------------------------------------------------
Because phase-in has been completed, we also are removing the
references to phase-in for registered investment companies and business
development companies.
2. Other Rule Amendments
Item 22(a)(4) of Schedule 14A and Forms N-1, N-1A, N-2, N-3, N-4,
N-5, and S-6--Financial Data Schedules. We are revising provisions
concerning Financial Data Schedules (Schedules) submitted by registered
investment companies and business development companies. We believe
that electronic filers that are registered investment companies will
provide us with sufficient financial information in Schedule form by
filing their Schedules with their Forms N-SAR.59 Therefore,
we are removing the requirement for registered investment companies to
submit Schedules with other forms and filings.60 Business
development companies will continue to submit Schedules with their Form
10-K filings; face amount certificate companies and other investment
companies filing on forms not unique to investment companies will
continue to submit Schedules with the relevant forms.61
---------------------------------------------------------------------------
\59\ Unit investment trusts are not required to submit the
Schedule with their N-SARs.
\60\ See revisions to Item 22(a)(4) of Schedule 14A [17 CFR
240.101]; and Forms N-1 [Secs. 239.15 and 274.11], N-1A
[Secs. 239.15A and 274.11A], N-2 [Secs. 239.14 and 274.11a-1], N-3
[Secs. 239.17a and 274.11b], N-4 [Secs. 239.17b and 274.11c], N-5
[Secs. 239.24 and 274.5], and S-6 [Sec. 239.16]. We also are
revising Rules 485, 486, 487, and 495 [17 CFR 230.485, 486, 487, and
495], which refer to Financial Data Schedule requirements within
registration statement forms.
The staff of the Division of Investment Management will not
object if investment companies do not include Financial Data
Schedules in filings under the above rule and forms submitted before
the effective date of the amendments.
\61\ See Rule 483(e)(2)(ii) [17 CFR 483(e)(2)(ii)].
---------------------------------------------------------------------------
Investment Company Act Rules 8b-23 and 8b-32--Incorporation by
Reference; Incorporation of Exhibits by Reference. We are making minor
revisions to Rules 8b-23 and 8b-32 62 to remove the
reference to Regulation S-T Rule 102. This reference is no longer
relevant following completion of phase-in by investment company
registrants.
---------------------------------------------------------------------------
\62\ 17 CFR 270.8b-23 and 270.8b-32.
---------------------------------------------------------------------------
III. Cost-Benefit Analysis
Our determination in 1984 to disseminate our EDGAR database to the
public marked a milestone in public access to timely information
relating to the nation's securities markets. Since that time,
technology has evolved rapidly. The rules we adopt today reflect this
reality. They represent the first stage of our modernization program,
which will more closely align our technology to industry standards and
maintain the effectiveness of this important resource.
EDGAR modernization will ultimately result in significant benefits
to the securities markets, investors, and other members of the public,
by increasing the accessibility of the information that is filed and
made available through the EDGAR system. Investors will benefit from
EDGAR modernization because they will receive documents that
communicate more effectively. For example, the on-line presentation of
documents formatted in HTML (unlike in ASCII) better accommodates the
sort of indentation, spacing, bullet points, and highlighting that we
encourage in our plain English guidance. Acceptance of unofficial
documents in PDF format should allow even greater preservation of the
original presentation of the document. We are aware that the process of
converting a document to an ASCII format can result in a document that
is difficult to read. Allowing the voluntary filing of HTML documents
is an important first step in the transition to a broader use of HTML
in filings.
Companies that make public filings will benefit from having the
option to file HTML documents and to submit unofficial PDF copies
because their HTML and PDF documents will communicate more effectively
with shareholders and be more attractive for marketing and other
purposes. As investors find that they can more effectively obtain the
information they seek from the EDGAR system, filers should get fewer
requests for paper copies of filings. Some filers that prepare
documents in HTML for purposes of offerings or of company web site
postings may find it less burdensome to convert documents into the
version of HTML provided for in the rules than to convert them into
ASCII.
At the same time, we recognize that the full transition to HTML
formatting will impose some hardware, software, and staffing costs
associated with the modernization of computer systems to industry
standards. At this stage, issuers need not incur any immediate costs
because filing in HTML is voluntary. Some issuers may use filing
agents, such
[[Page 27893]]
as financial printers, if they wish to submit HTML documents without
incurring the system costs themselves. Filing agents that are not HTML-
ready may incur some immediate additional costs to meet any customer
demand for this service. Disseminators of EDGAR information will face
some transitional costs as they revise their software and expand their
storage capacity to accommodate HTML and PDF documents.63
The volume of HTML and PDF documents is likely to be limited at first,
allowing such disseminators of EDGAR information time to scale up their
operations over time. As technology continues to evolve, we believe
these transition costs will be outweighed by longer-term benefits. We
do not have the data to quantify the costs or benefits of these
amendments. We requested comment on the costs and benefits but received
no data.
---------------------------------------------------------------------------
\63\ We continually attempt to reduce the costs of the EDGAR
system and to pass those costs along when possible. For example, in
November 1998, under the new EDGAR contract, we were able to effect
a cost savings with the implementation of a new privatized
dissemination system. This resulted in our passing along a cost
savings of nearly $200,000 per year to disseminators when their
yearly subscription cost was reduced from $278,000 to $79,686.
---------------------------------------------------------------------------
We are providing a month-long test period during which filers may
submit test filings which include documents in HTML and PDF format.
This test period should provide disseminators with sufficient time to
assure completion of system changes to accommodate acceptance of HTML
and PDF documents. During the test period, our rules will still require
that filers submit live filings entirely in ASCII. Therefore, the
operations of the disseminators should not be disrupted during the test
period. The test period also will provide filers the opportunity to
test the EDGAR system's new features. We considered a further delay in
the implementation of the rules we adopted today. However, in balancing
the interests of all the affected groups, we do not believe that
further delay is warranted.
The rules we adopt today impose no costs related to substantive
disclosure because the new EDGAR rules do not substantively change the
information and disclosure we currently require. Rather, the rules
merely modify and supplement current rules to reflect the expanded
filing formats and modes of presentation through which filers may
submit information to us electronically.
IV. Analysis of Burdens on Competition, Capital Formation and
Efficiency
Section 23(a)(2) of the Exchange Act requires us, in adopting rules
under the Exchange Act, to consider the anti-competitive effects of any
rules that we adopt thereunder. Furthermore, Section 2(b) of the
Securities Act,64 Section 3(f) of the Exchange
Act,65 and Section 2(c) 66 of the Investment
Company Act require us, when engaging in rulemaking, and considering or
determining whether an action is necessary or appropriate in the public
interest, to consider whether the action will promote efficiency,
competition, and capital formation. In compliance with our
responsibilities under these sections, we requested comment on whether
the proposals, if adopted, would promote efficiency, competition, and
capital formation. We encouraged commenters to provide empirical data
or other facts to support their views. We received no comments in
response to the above request.
---------------------------------------------------------------------------
\64\ 15 U.S.C. 77b(b).
\65\ 15 U.S.C. 78c(f).
\66\ 15 U.S.C. 80a-2(c).
---------------------------------------------------------------------------
In compliance with our responsibilities under the previously
mentioned provisions, we considered whether the amendments would
promote efficiency, competition and capital formation. Although filing
agents and information disseminators may be disparately affected
depending on their technical readiness and programming formats, we
believe that the new rules and amendments will not impose any burden on
competition not necessary or appropriate in the furtherance of the
purposes of the securities laws.
We believe that the new rules and amendments will not have any
adverse effect on capital formation. We believe the amendments will
promote efficiency by giving investors information in a more readable
format and by more closely aligning our technical standards to the
industry's. The new rules and amendments apply equally to all entities
currently required to file on EDGAR. Because the proposed rules and
amendments are designed in part to permit filers to provide information
in a format that will be more useful to investors, the amendments are
appropriate in the public interest and for the protection of investors.
V. Summary of Regulatory Flexibility Act Certification
Our Chairman has certified, under Section 605(b) of the Regulatory
Flexibility Act, 5 U.S.C. 605(b), that the new rules and rule
amendments in this release would not have a significant economic impact
on a substantial number of small entities. The certification,
documenting the factual basis therefor, was attached to the proposing
release as Appendix B. We received no comments on the certification.
VI. Paperwork Reduction Act
The new rules and amendments do not come within the scope of the
Paperwork Reduction Act of 1995 67 because the new rules and
amendments do not create a new collection of information.68
---------------------------------------------------------------------------
\67\ 44 U.S.C. 3501, et seq.
\68\ 5 CFR 1320.5(g).
---------------------------------------------------------------------------
VII. Statutory Basis
We are adopting the new rules and rule amendments outlined above
under Sections 6, 7, 8, 10 and 19(a) of the Securities Act, Sections 3,
12, 13, 14, 15(d), 23(a) and 35A of the Exchange Act, Sections 3, 5, 6,
7, 10, 12, 13, 14, 17 and 20 of the Public Utility Act,69
Section 319 of the Trust Indenture Act of 1939,70 and
Sections 8, 30, 31 and 38 of the Investment Company Act.71
---------------------------------------------------------------------------
\69\ 15 U.S.C. 79a, et seq.
\70\ 15 U.S.C. 77aaa, et seq.
\71\ 15 U.S.C. 80a-1, et seq.
---------------------------------------------------------------------------
List of Subjects
17 CFR Parts 230 and 270
Confidential business information, Investment companies, Reporting
and recordkeeping requirements, Securities.
17 CFR Part 232
Administrative practice and procedure, Confidential business
information, Reporting and recordkeeping requirements, Securities.
17 CFR Part 239
Reporting and recordkeeping requirements, Securities.
17 CFR Part 240
Confidential business information, Reporting and recordkeeping
requirements, Securities.
17 CFR Part 274
Investment companies, Reporting and recordkeeping requirements,
Securities.
Text of the Amendments
In accordance with the foregoing, Title 17, Chapter II of the Code
of Federal Regulations is amended as follows:
PART 230--GENERAL RULES AND REGULATIONS, SECURITIES ACT OF 1933
1. The authority citation for part 230 continues to read in part as
follows:
Authority: 15 U.S.C. 77b, 77f, 77g, 77h, 77j, 77r, 77s, 77sss,
78c, 78d, 78l, 78m, 78n, 78o, 78w, 78ll(d), 79t, 80a-8, 80a-24, 80a-
28,
[[Page 27894]]
80a-29, 80a-30, and 80a-37, unless otherwise noted.
* * * * *
Sec. 230.485 [Amended]
2. By amending Sec. 230.485 by removing paragraph (f)(2) before the
Note and redesignating paragraph (f)(1) as paragraph (f).
Sec. 230.486 [Amended]
3. By amending Sec. 230.486 by removing paragraph (f)(2) before the
Note and redesignating paragraph (f)(1) as paragraph (f).
Sec. 230.487 [Amended]
4. By amending Sec. 230.487 by removing paragraph (d)(2) and
redesignating paragraph (d)(1) as paragraph (d).
Sec. 230.495 [Amended]
5. By amending Sec. 230.495 by removing paragraph (e)(2) and
redesignating paragraph (e)(1) as paragraph (e).
Sec. 230.497 [Amended]
6. By amending Sec. 230.497 by adding a sentence before the last
sentence in paragraph (k)(2)(ii) to read as follows:
Sec. 230.497 Filing of investment company prospectuses--number of
copies.
* * * * *
(k) * * *
(2) Filing procedures. * * *
(ii) * * * Filers may fulfill the requirements of this paragraph by
submitting with their definitive form of profile filed electronically
under paragraph (k)(1)(ii) of this section an unofficial PDF copy of
the profile in accordance with Sec. 232.104 of this chapter. * * *
PART 232--REGULATION S-T--GENERAL RULES AND REGULATIONS FOR
ELECTRONIC FILINGS
7. The authority citation for part 232 continues to read as
follows:
Authority: 15 U.S.C. 77f, 77g, 77h, 77j, 77s(a), 77sss(a),
78c(b), 78l, 78m, 78n, 78o(d), 78w(a), 78ll(d), 79t(a), 80a-8, 80a-
29, 80a-30 and 80a-37.
8. By amending Sec. 232.10 by revising paragraph (b) before the
Note to read as follows:
Sec. 232.10 Application of part 232.
* * * * *
(b) Each registrant, third party, or agent must file in paper
format a Form ID (Secs. 239.63, 249.446, 259.602, 269.7 and 274.402 of
this chapter), the uniform application for access codes to file on
EDGAR, before beginning to file electronically.
* * * * *
9. By amending Sec. 232.11 by removing all paragraph designations;
revising the definition of ``electronic filing,'' and adding the
definitions of ``animated graphics,'' ``ASCII document,'' ``disruptive
code,'' ``electronic document,'' ``executable code,'' ``HTML
document,'' ``hypertext links'' or ``hyperlinks,'' and ``unofficial PDF
copy'' in alphabetical order to read as follows:
Sec. 232.11 Definition of terms used in part 232.
* * * * *
Animated graphics. The term animated graphics means text or images
that do not remain static but that may move when viewed in a browser.
ASCII document. The term ASCII document means an electronic text
document with contents limited to American Standard Code for
Information Interchange (ASCII) characters and that is tagged with
Standard Generalized Mark Up Language (SGML) tags in the format
required for ASCII/SGML documents by the EDGAR Filer Manual.
* * * * *
Disruptive code. The term disruptive code means any active content
or other executable code, or any program or set of electronic computer
instructions inserted into a computer, operating system, or program
that replicates itself or that actually or potentially modifies or in
any way alters, damages, destroys or disrupts the file content or the
operation of any computer, computer file, computer database, computer
system, computer network or software, and as otherwise set forth in the
EDGAR Filer Manual.
* * * * *
Electronic document. The term electronic document means the portion
of an electronic submission separately tagged as an individual document
in the format required by the EDGAR Filer Manual.
* * * * *
Electronic filing. The term electronic filing means one or more
electronic documents filed under the federal securities laws that are
transmitted or delivered to the Commission in electronic format.
* * * * *
Executable code. The term executable code means instructions to a
computer to carry out operations that use features beyond the viewer's,
reader's, or Internet browser's native ability to interpret and display
HTML, PDF, and static graphic files. Such code may be in binary
(machine language) or in script form. Executable code includes
disruptive code.
HTML document. The term HTML document means an electronic text
document tagged with HyperText Markup Language tags in the format
required by the EDGAR Filer Manual.
* * * * *
Hypertext links or hyperlinks. The term hypertext links or
hyperlinks means the representation of an Internet address in a form
that an Internet browser application can recognize as an Internet
address.
* * * * *
Unofficial PDF copy. The term unofficial PDF copy means an optional
copy of an electronic document that may be included in an EDGAR
submission tagged as a Portable Document Format document in the format
required by the EDGAR Filer Manual and submitted in accordance with
Rule 104 of Regulation S-T (Sec. 232.104).
10. By amending Sec. 232.101 by revising the note to paragraph
(a)(1)(iii) and by removing paragraph (b)(7) to read as follows:
Sec. 232.101 Mandated electronic submissions and exceptions.
(a) Mandated electronic submissions. (1) * * *
(iii) * * *
Note to paragraph (a)(1)(iii): Electronic filers filing
Schedules 13D and 13G with respect to foreign private issuers should
include in the submission header all zeroes (i.e., 00-0000000) for
the IRS tax identification number because the EDGAR system requires
an IRS number tag to be inserted for the subject company as a
prerequisite to acceptance of the filing.
* * * * *
11. By amending Sec. 232.102 by revising paragraph (e) to read as
follows:
Sec. 232.102 Exhibits.
* * * * *
(e) Notwithstanding the provisions of paragraphs (a) through (d) of
this section, any incorporation by reference by a registered investment
company or a business development company must relate only to documents
that have been filed in electronic format, unless the document has been
filed in paper under a hardship exemption (Sec. 232.201 or 232.202) and
any required confirming copy has been submitted.
* * * * *
12-15. By adding Secs. 232.104, 232.105 and 232.106 to read as
follows:
[[Page 27895]]
Sec. 232.104 Unofficial PDF copies included in an electronic
submission.
(a) An electronic submission may include one unofficial PDF copy of
each electronic document contained within that submission, tagged in
the format required by the EDGAR Filer Manual.
(b) Except as provided in paragraph (c) of this section, each
unofficial PDF copy must be substantively equivalent to its associated
electronic document contained in the electronic submission. An
unofficial PDF copy may contain graphic and image material (but not
animated graphics, or audio or video material), notwithstanding the
fact that its HTML or ASCII document counterpart may not contain such
material but must contain a fair and accurate narrative description or
tabular representation of any omitted graphic or image material.
(c) If a filer omits an unofficial PDF copy from, or submits one or
more flawed unofficial PDF copies in, the electronic submission of an
official filing, the filer may add or resubmit an unofficial PDF copy
by electronically submitting an amendment to the filing to which it
relates. The amendment must include an explanatory note that the
purpose of the amendment is to add or to correct an unofficial PDF
copy.
(1) If such an amendment is filed, the official amendment may
consist solely of the cover page (or first page of the document), the
explanatory note, and the signature page and exhibit index (where
appropriate). The corresponding unofficial copy must include the
complete text of the official filing document for which the amendment
is being submitted.
(2) If the amendment is being filed to add or resubmit an
unofficial PDF copy of one or more exhibits, the submission may consist
of the following: the official filing--consisting of the cover page (or
first page of the document), the explanatory note, the signature page
(where appropriate), the exhibit index, and a separate electronic
exhibit document for each exhibit for which an unofficial PDF copy is
being submitted--and the corresponding unofficial PDF copy of each
exhibit document. However, the text of the official exhibit document
need not repeat the text of the exhibit; that document may contain only
the following legend: RESUBMITTED TO ADD/REPLACE UNOFFICIAL PDF COPY OF
EXHIBIT.
(d) An unofficial PDF copy is not filed for purposes of section 11
of the Securities Act (15 U.S.C. 77k), section 18 of the Exchange Act
(15 U.S.C. 78r), section 16 of the Public Utility Act (15 U.S.C. 79p),
section 323 of the Trust Indenture Act (15 U.S.C. 77www), or section
34(b) of the Investment Company Act (15 U.S.C. 80a-33(b)), or otherwise
subject to the liabilities of such sections, and is not part of any
registration statement to which it relates. An unofficial PDF copy is,
however, subject to all other civil liability and anti-fraud provisions
of the above Acts or other laws.
(e) Unofficial PDF copies that are prospectuses are subject to
liability under Section 12 of the Securities Act (15 U.S.C. 77l).
Sec. 232.105 Limitation on use of HTML documents and hypertext links.
(a) Electronic filers must submit the following documents in ASCII:
Form N-SAR (Sec. 274.101 of this chapter), Form 13F (Sec. 249.325 of
this chapter), and Financial Data Schedules submitted in accordance
with Item 601(c) of Regulation S-K (Sec. 229.601(c) of this chapter),
Item 601(c) of Regulation S-B (Sec. 228.601(c) of this chapter), or
Rule 483(e) (Sec. 230.483(e) of this chapter). Notwithstanding the
foregoing provision, electronic filers may submit exhibits to Form N-
SAR in HTML, except for Financial Data Schedules, which filers must
submit in ASCII.
(b) Electronic filers may not include in any HTML document
hypertext links to sites, locations, or documents outside the HTML
document, including links to exhibit documents. Electronic filers may
include within an HTML document hypertext links to different sections
within that single HTML document.
(c) If, notwithstanding paragraph (b) of this section, electronic
filers include hypertext links to external sites within a submission,
information contained in such links will not be considered part of the
official filing for determining compliance with reporting obligations;
however, this information is subject to the civil liability and anti-
fraud provisions of the federal securities laws.
Sec. 232.106 Prohibition against electronic submissions containing
executable code.
(a) Electronic submissions must not contain executable code.
Attempted submissions identified as containing executable code will be
suspended, unless the executable code is contained only in one or more
PDF documents, in which case the submission will be accepted but the
PDF document(s) containing executable code will be deleted and not
disseminated.
(b) If an electronic submission has been accepted, and the
Commission staff later determines that the accepted submission contains
executable code, the staff may delete from the EDGAR system the entire
accepted electronic submission or any document contained in the
accepted electronic submission. The Commission staff may direct the
electronic filer to resubmit electronically replacement document(s) or
a replacement submission in its entirety, in compliance with this
provision and the EDGAR Filer Manual.
Note to Sec. 232.106: A violation of this section or the
relevant EDGAR Filer Manual section also may be a violation of the
Computer Fraud and Abuse Act of 1986, as amended, and other statutes
and laws.
16. By amending Sec. 232.302 by revising paragraph (a) to read as
follows:
Sec. 232.302 Signatures.
(a) Required signatures to or within any electronic submission must
be in typed form rather than manual format. When used in connection
with an electronic filing, the term ``signature'' means an electronic
entry in the form of a magnetic impulse or other form of computer data
compilation of any letter or series of letters or characters comprising
a name, executed, adopted or authorized as a signature. Signatures are
not required in unofficial PDF copies submitted in accordance with Rule
104 of Regulation S-T (Sec. 232.104).
* * * * *
17. By amending Sec. 232.303 by revising paragraph (a)(3) to read
as follows:
Sec. 232.303 Incorporation by reference.
(a) * * *
(3) For a registered investment company or a business development
company, documents that have not been filed in electronic format,
unless the document has been filed in paper under a hardship exemption
(Sec. 232.201 or 232.202 of this chapter) and any required confirming
copy has been submitted.
* * * * *
18. By amending Sec. 232.304 by revising the section heading,
paragraphs (a) and (b) and the first sentence of paragraph (c) to read
as follows:
Sec. 232.304 Graphic, image, audio and video material.
(a) If a filer includes graphic, image, audio or video material in
a document delivered to investors and others that may not, in
accordance with the requirements of the EDGAR Filer Manual, be
reproduced in an electronic filing, the electronically filed version of
that document must include a fair and accurate narrative description,
tabular representation or transcript of the omitted material. Such
descriptions, representations or transcripts may be included in the
text of the electronic filing at the point where the graphic, image,
audio or video material is
[[Page 27896]]
presented in the delivered version, or they may be listed in an
appendix to the electronic filing. Immaterial differences between the
delivered and electronically filed versions, such as pagination, color,
type size or style, or corporate logo need not be described.
(b)(1) The graphic, image, audio and video material in the version
of a document delivered to investors and others is deemed part of the
electronic filing and subject to the civil liability and anti-fraud
provisions of the federal securities laws.
(2) Narrative descriptions, tabular representations or transcripts
of graphic, image, audio and video material included in an electronic
filing or appendix thereto also are deemed part of the filing. However,
to the extent such descriptions, representations or transcripts
represent a good faith effort to fairly and accurately describe omitted
graphic, image, audio or video material, they are not subject to the
civil liability and anti-fraud provisions of the federal securities
laws.
(c) An electronic filer must retain for a period of five years a
copy of each publicly distributed document, in the format used, that
contains graphic, image, audio or video material where such material is
not included in the version filed with the Commission. * * *
* * * * *
19. By amending Sec. 232.305 by designating the existing text as
paragraph (a) and adding paragraph (b) to read as follows:
Sec. 232.305 Number of characters per line; tabular and columnar
information.
(a) * * *
(b) Paragraph (a) of this section does not apply to HTML documents.
20. By amending Sec. 232.306 by revising paragraph (b) to read as
follows:
Sec. 232.306 Foreign language documents and symbols.
(a) * * *
(b) Foreign currency denominations must be expressed in words or
letters in the English language rather than representative symbols,
except that HTML documents may include any representative foreign
currency symbols that the EDGAR Filer Manual specifies. The limitations
of this paragraph do not apply to unofficial PDF copies submitted in
accordance with Rule 104 of Regulation S-T (Sec. 232.104).
21. By amending Sec. 232.307 by designating the existing text as
paragraph (a) and by adding paragraph (b) to read as follows:
Sec. 232.307 Boldface type.
(a) * * *
(b) Paragraph (a) of this section does not apply to HTML documents.
22. By revising Sec. 232.310 to read as follows:
Sec. 232.310 Marking changed material.
Provisions requiring the marking of changed materials are satisfied
in ASCII and HTML documents by inserting the tag before and the tag
following a paragraph containing changed material. HTML documents
may be marked to show changed materials within paragraphs. Financial
statements and notes thereto need not be marked for changed material.
PART 239--FORMS PRESCRIBED UNDER THE SECURITIES ACT OF 1933
23. The authority citation for part 239 continues to read in part
as follows:
Authority: 15 U.S.C. 77f, 77g, 77h, 77j, 77s, 77z-2,77sss, 78c,
78l, 78m, 78n, 78o(d), 78u-5, 78w(a), 78ll(d), 79e, 79f, 79g, 79j,
79l, 79m, 79n, 79q, 79t, 80a-8, 80a-24, 80a-29, 80a-30 and 80a-37,
unless otherwise noted.
24. By amending Form S-6 (referenced in Sec. 239.16) by removing
Instruction 5 of Instructions as to Exhibits.
Note--The text of Form S-6 and the amendments will not appear in
the Code of Federal Regulations.
PART 240--GENERAL RULES AND REGULATIONS, SECURITIES EXCHANGE ACT OF
1934
24a. The authority citation for part 240 continues to read in part
as follows:
Authority: 15 U.S.C. 77c, 77d, 77g, 77j, 77s, 77z-2, 77eee,
77ggg, 77nnn, 77sss, 77ttt, 78c, 78d, 78f, 78i, 78j, 78j-1, 78k,
78k-1, 78l, 78m, 78n, 78o, 78p, 78q, 78s, 78u-5, 78w, 78x, 78ll(d),
79q, 79t, 80a-20, 80a-23, 80a-29, 80a-37, 80b-3, 80b-4 and 80b-11,
unless otherwise noted.
* * * * *
25. By amending Sec. 240.14a-101 by removing paragraph (a)(4) of
Item 22.
PART 270--RULES AND REGULATIONS, INVESTMENT COMPANY ACT OF 1940
26. The authority citation for part 270 continues to read in part
as follows:
Authority: 15 U.S.C. 80a-1 et seq., 80a-34(d), 80a-37, 80a-39
unless otherwise noted:
* * * * *
27. By amending Sec. 270.8b-23 by revising paragraph (a) to read as
follows:
Sec. 270.8b-23 Incorporation by reference.
(a) Any registrant may incorporate by reference, in answer or
partial answer to any item of a registration statement or report, any
information contained elsewhere in the statement or report or any
information contained in any other statement, report or prospectus
filed with the Commission under any Act administered by it, so long as
a copy of the other statement, report or prospectus is filed with each
copy of the registration statement or report in which it is
incorporated by reference. In the case of a registration statement,
report, or prospectus filed in electronic format, the registrant need
not file a copy of the document incorporated by reference if that
document also was filed in electronic format. A registrant may
incorporate by reference matter contained in an exhibit, however, only
to the extent permitted by Secs. 270.8b-24 and 270.8b-32. A registrant
may not incorporate by reference a Financial Data Schedule.
* * * * *
28. By amending Sec. 270.8b-32 by revising paragraph (c) to read as
follows:
Sec. 270.8b-32 Incorporation of exhibits by reference.
* * * * *
(c) Electronic filings. (1) A registrant may incorporate by
reference into a registration statement or report required to be filed
electronically only exhibits that have been filed in electronic format,
unless the exhibit has been filed in paper under a hardship exemption
(Sec. 232.201 or 232.202 of this chapter) and any required confirming
copy has been submitted.
(2) Notwithstanding paragraph (c)(1) of this section, a registrant
may not incorporate by reference a Financial Data Schedule.
PART 274--FORMS PRESCRIBED UNDER THE INVESTMENT COMPANY ACT OF 1940
29. The authority citation for part 274 continues to read as
follows:
Authority: 15 U.S.C. 77f, 77g, 77h, 77j, 77s, 78c(b), 78l, 78m,
78n, 78o(d), 80a-8, 80a-24, and 80a-29, unless otherwise noted.
30. By amending Form N-SAR (referenced in Sec. 274.101) by revising
General Instruction F to read as follows:
Note--The text of Form N-SAR and the amendments will not appear
in the Code of Federal Regulations.
Instructions and Form
FORM N-SAR
SEMI-ANNUAL REPORT
FOR REGISTERED INVESTMENT COMPANIES
* * * * *
GENERAL INSTRUCTIONS
* * * * *
[[Page 27897]]
F. Filings on EDGAR
(1) Attention is directed to Sub-Item 77Q1 (Exhibits) for certain
items of financial information that are required (Financial Data
Schedule).
(2) Management investment companies must file Form N-SAR
electronically by direct electronic transmission only, and in
accordance with the EDGAR Filer Manual. Filing of the form on magnetic
tapes or diskettes is not permitted.
* * * * *
PART 239--FORMS PRESCRIBED UNDER THE SECURITIES ACT OF 1933
PART 274--FORMS PRESCRIBED UNDER THE INVESTMENT COMPANY ACT OF 1940
Note--The text of Forms N-2, N-1, N-1A, N-3, N-4 and N-5 and the
amendments will not appear in the Code of Federal Regulations.
31. By amending Form N-2 (referenced in Secs. 239.14 and 274.11a-1)
by removing General Instruction I and redesignating General Instruction
J as General Instruction I and removing paragraph 2.r of Item 24 of
Part C.
32. By amending Form N-1 (referenced in Secs. 239.15 and 274.11) by
removing General Instruction H and paragraph (b)(16) to Item 1 of Part
II.
33. By amending Form N-1A (referenced in Secs. 239.15A and 274.11A)
by removing paragraph (n) of Item 23 and by redesignating paragraph (o)
of Item 23 as paragraph (n).
34. By amending Form N-3 (referenced in Secs. 239.17a and 274.11b)
by removing General Instruction J and paragraph (b)(17) to Item 28 of
Part C.
35. By amending Form N-4 (referenced in Secs. 239.17b and 274.11c)
by removing General Instruction J and paragraph (b)(14) to Item 24 of
Part C.
36. By amending Form N-5 (referenced in Secs. 239.24 and 274.5) by
removing General Instruction H and Instruction 13 to Instructions as to
Exhibits.
Dated: May 17, 1999.
By the Commission.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 99-12811 Filed 5-20-99; 8:45 am]
BILLING CODE 8010-01-U
