98-5727. Existing Collection; Comment Request  

  • [Federal Register Volume 63, Number 43 (Thursday, March 5, 1998)]
    [Notices]
    [Pages 10959-10960]
    From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
    [FR Doc No: 98-5727]
    
    
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    SECURITIES AND EXCHANGE COMMISSION
    
    
    Existing Collection; Comment Request
    
    Upon written request, copies available from: Securities and Exchange 
    Commission, Office of Filings and Information Services, 450 5th 
    Street, N.W., Washington, D.C. 20549.
    
    Extension: Rule 23c-3 and Form N-23c-3, SEC File No. 270-373, OMB 
    Control No. 3235-0422.
    
        Notice is hereby given that, pursuant to the Paperwork Reduction 
    Act of 1995 (44 U.S.C. 3501-3520), the Securities and Exchange 
    Commission (the ``Commission'') is soliciting comments on the 
    collections of information summarized below. The Commission plans to 
    submit these existing collections of information to the Office
    
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    of Management and Budget (``OMB'') for extension and approval.
        Rule 23c-3 under the Investment Company Act of 1940 [17 CFR 
    270.23c-3] permits certain closed-end investment companies (``closed-
    end funds'' or ``funds'') periodically to offer to repurchase from 
    shareholders a limited number of shares at net asset value. The rule 
    includes several reporting and recordkeeping requirements. The fund 
    must send shareholders a notification that contains specified 
    information each time the fund makes a repurchase offer (on a 
    quarterly, semi-annual, or annual basis, or for certain funds, on a 
    discretionary basis not more often than every two years). The fund also 
    must file copies of the shareholder notification with the Commission 
    (electronically through the Commission's Electronic Data Gathering, 
    Analysis and Retrieval System (``EDGAR'') or by sending three paper 
    copies) attached to Form N-23c-3 [17 CFR 274.221], a cover sheet that 
    provides limited information about the fund and the type of offer the 
    fund is making.\1\ The fund must describe in its annual report to 
    shareholders to fund's policy concerning repurchase offers and the 
    results of any repurchase offers made during the reporting period. The 
    fund's board of directors must adopt written procedures designed to 
    ensure that the fund's investment portfolio is sufficiently liquid to 
    meet its repurchase obligations and other obligations under the rule. 
    The board periodically must review the composition of the fund's 
    portfolio and change the liquidity procedures as necessary. The fund 
    also must file copies of advertisements and other sales literature with 
    the Commission as if it were an open-end investment company subject to 
    section 24 of the Investment Company Act [15 U.S.C. 80a-24] and the 
    rules that implement section 24.\2\
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        \1\ Form N-23c-3 requires the fund to state its registration 
    number, its full name and address, the date of the accompanying 
    shareholder notification, and the type of offer being made 
    (periodic, discretionary, or both).
        \2\ Rule 24b-3 under the Investment Company Act [17 CFR 270.24b-
    3], however, would generally exempt the fund from that requirement 
    when the materials are filed instead with the National Association 
    of Securities Dealers (``NASD''), as nearly always occurs under NASD 
    procedures, which apply to the underwriter of every fund.
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        The requirement that the fund send a notification to shareholders 
    of each offer is intended to ensure that a fund provides material 
    information to shareholders about the terms of each offer, which may 
    differ from previous offers on such matters as the maximum amount of 
    shares to be repurchased (the maximum repurchase amount may range from 
    5% to 25% of outstanding shares). The requirement that copies be sent 
    to the Commission is intended to enable the Commission to monitor the 
    fund's compliance with the notification requirement. The requirement 
    that the shareholder notification be attached to Form N-23c-3 is 
    intended to ensure that the fund provides basic information necessary 
    for the Commission to process the notification and to monitor the 
    fund's use of repurchase offers. The requirement that the fund describe 
    its current policy on repurchase offers and the results of recent 
    offers in the annual shareholder report is intended to provide 
    shareholders current information about the fund's repurchase policies 
    and its recent experience. The requirement that the board approve and 
    review written procedures designed to maintain portfolio liquidity is 
    intended to ensure that the fund has enough cash or liquid securities 
    to meet its repurchase obligations, and that written procedures are 
    available for review by shareholders and examination by the Commission. 
    The requirement that the fund file advertisements and sales literature 
    as if it were an open-end investment company is intended to facilitate 
    the review of these materials by the Commission or the NASD to prevent 
    incomplete, inaccurate, or misleading disclosure about the special 
    characteristics of a closed-end fund that makes periodic repurchase 
    offers.
        The Commission estimates that 10 funds currently rely upon the 
    rule. The Commission estimates that each fund spends approximately 80 
    hours annually in preparing, mailing, and filing shareholder 
    notifications for each repurchase offer, 4 hours annually in preparing 
    and filing Form N-23c-3, 6 hours annually in preparing disclosures in 
    the annual shareholder report concerning the fund's repurchase policy 
    and recent offers, 28 hours annually in preparing procedures to protect 
    portfolio liquidity, and 8 hours annually in performing subsequent 
    reviews of these procedures. The total annual burden of the rule's 
    paperwork requirements for all funds thus is estimated to be 1,260 
    hours. This represents an increase of 940 hours from the prior estimate 
    of 320 hours. The increase results primarily from the recognition that 
    sending notifications to shareholders and completing Form N-23c-3 
    imposes burdens in addition to the burden of preparing and filing the 
    shareholder notifications with the Commission.\3\ The remaining 
    increase results from a more accurate calculation of the component 
    parts of other previously combined information burdens.
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        \3\ The Commission has not previously submitted to OMB a request 
    for approval under the Paperwork Reduction Act for the collection of 
    information in Form N-23c-3.
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        The estimate of average burden hours is made solely for the 
    purposes of the Paperwork Reduction Act. The estimate is not derived 
    from a comprehensive or even a representative survey or study of the 
    costs of Commission rules and forms.
        Written comments are invited on: (a) whether the collections of 
    information are necessary for the proper performance of the functions 
    of the Commission, including whether the information has practical 
    utility; (b) the accuracy of the Commission's estimate of the burdens 
    of the collections of information; (c) ways to enhance the quality, 
    utility, and clarity of the information collected; and (d) ways to 
    minimize the burdens of the collections of information on respondents, 
    including through the use of automated collection techniques or other 
    forms of information technology. Consideration will be given to 
    comments and suggestions submitted in writing within 60 days of this 
    publication.
        Please direct your written comments to Michael E. Bartell, 
    Associate Executive Director, Office of Information Technology, 
    Securities and Exchange Commission, Mail Stop 0-4, 450 5th Street, 
    N.W., Washington, DC 20549.
    
        Dated: February 25, 1998.
    Margaret H. McFarland,
    Deputy Secretary.
    [FR Doc. 98-5727 Filed 3-4-98; 8:45 am]
    BILLING CODE 8010-01-M
    
    
    

Document Information

Published:
03/05/1998
Department:
Securities and Exchange Commission
Entry Type:
Notice
Document Number:
98-5727
Pages:
10959-10960 (2 pages)
PDF File:
98-5727.pdf