2023-26406. Submission for OMB Review; Comment Request; Extension: Rule 30b1-10, Form N-RN

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”) has submitted to the Office of Management and Budget a request for extension of the previously approved collection of information discussed below.

Rule 30b1–10 [17 CFR 270.30b1–10] and Form N–RN [17 CFR 274.223] require registered open-end management investment companies (not including entities regulated as money market funds under 17 CFR 270.2a–7), registered closed-end funds, and business development companies (collectively, “funds”), to file a current report on Form N–RN on a non-public basis when certain events related to their liquidity and events regarding funds' compliance with the VaR-based limit on fund leverage risk in 17 CFR 270.18f–4 (“rule 18f–4”) occur. The first category of information reported on Form N–RN concerns events under which more than 15% of an open-end fund's net assets are, or become, illiquid investments that are assets as defined in 17 CFR 270.22e–4 (“rule 22e–4”) and when holdings in illiquid investments are assets that previously exceeded 15% of a fund's net assets have changed to be less than or equal to 15% of the fund's net assets. The second category of information reported on Form N–RN regards events for certain open-end funds under which a fund's holdings in assets that are highly liquid investments fall below the fund's highly liquid investment minimum defined in rule 22e–4 for more than 7 consecutive calendar days. The third category of information reported on Form N–RN regards information about a fund's breaches of the VaR test under rule 18f–4. A report on Form N–RN is required to be filed, as applicable, within one business day of the occurrence of one or more of these events. In addition, a fund is in certain cases required to file a second Form N–RN when it is no longer in breach of the applicable limit.

Based on historical filing data and projected estimates of the annual number of VAR-based filings, the staff estimates that the Commission will receive roughly 66 reports per year on Form N–RN on average When filing a report on Form N–RN, staff estimates that a fund will spend on average approximately 3 hours of a in house compliance attorney's time and 1 hour of a senior programmer time to prepare, review, and submit Form NRN at a total time cost of $1,661.^[1] Accordingly, in the aggregate, staff estimates that compliance with rule 30b1–10 and Form N–LIQUID will result in a total annual burden of approximately 264 burden hours and total annual time costs of approximately $109,626.^[2]

Compliance with rule 30b1–10 is mandatory for all funds. Responses to the disclosure requirements will be kept confidential. The estimate of average burden hours is made solely for the purposes of the PRA. The estimate is not derived from a comprehensive or even a representative survey or study of the costs of Commission rules. Complying with this collection of information requirement is necessary to enable the Commission to receive information on fund liquidity events more uniformly and efficiently, and to enhance the Commission's oversight of funds when significant liquidity events occur and its ability to respond to market events. An agency may not conduct or sponsor, and a person is not required to respond to a collection of information unless it displays a currently valid control number.

The public may view background documentation for this information collection at the following website: www.reginfo.gov. Find this particular information collection by selecting “Currently under 30-day Review—Open for Public Comments” or by using the search function. Written comments and recommendations for the proposed information collection should be sent within 30 days of publication of this notice by January 2, 2024 to (i) [e-mail] and (ii) David Bottom, Director/Chief Information Officer, Securities and Exchange Commission, c/o John Pezzullo, 100 F Street NE, Washington, DC 20549, or by sending an email to: [e-mail].

Dated: November 27, 2023.

Christina Z. Milnor,

Assistant Secretary.

Footnotes

1. This estimate is based on the following calculations: (3 hours × $425/hour for an in house compliance attorney = $1,275 plus (1 hour × $386/hour for a senior programmer = $386, for a combined total of 4 hours at total time costs of $1,661. The estimates concerning the wage rates for an in house compliance attorney and a senior programmer time are based on salary information for the securities industry compiled by the Securities Industry and Financial Markets Association. The estimated wage figure is based on published rates for in-house compliance attorneys and senior programmers, modified to account for a 1,800-hour work-year and inflation, and multiplied by 5.35 to account for bonuses, firm size, employee benefits, and overhead. See Securities Industry and Financial Markets Association, Report on Management & Professional Earnings in the Securities Industry 2013.

2. This estimate is based on the following calculations: 66 reports filed per year × 4 hours per report = approximately 264 total annual burden hours. 66 reports filed per year × $1,661 in costs per report = $109,626 total annual costs.