[Federal Register Volume 63, Number 137 (Friday, July 17, 1998)]
[Notices]
[Pages 38681-38682]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-19051]
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SECURITIES AND EXCHANGE COMMISSION
[Rel. No. IC-23311; 812-9982]
Morgan Stanley & Co. Incorporated; Notice of Application
July 10, 1998.
AGENCY: Securities and Exchange Commission (``Commission'' or ``SEC'').
[[Page 38682]]
ACTION: Notice of application for an order under section 12(d)(1)(J) of
the Investment Company Act of 1940 (the ``Act'') for an exemption from
section 12(d)(1) of the Act.
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SUMMARY OF APPLICATION: Morgan Stanley & Co. Incorporated (``Morgan
Stanley'') requests an order to amend a prior order that, among other
things, permits registered investment companies to own a greater
percentage of the total outstanding voting stock of the AJL PEPS Trusts
for which Morgan Stanley serves, or will serve, as a principal
underwriter (collectively, the ``Trusts'') than that permitted by
section 12(d)(1) of the Act (``Prior Order'').\1\ The requested order
would permit companies that are excepted from the defintion of
investment company under section 3(c)(1) or 3(c)(7) of the Act to own a
greater percentage of the total outstanding voting stock of a Trust
than that permitted by section 12(d)(1)(A) of the Act.
\1\ Morgan Stanley & Co. Incorporated, Investment Company Act
Release Nos. 2235 (Sept. 20, 1996) (notice) and 22284 (Oct. 16,
1996) (order).
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FILING DATES: The application was filed on May 5, 1998. Applicant has
agreed to file an amendment, the substance of which is incorporated in
this notice, during the notice period.
HEARING OR NOTIFICATION OF HEARING: An order granting the application
will be issued unless the SEC orders a hearing. Interested persons may
request a hearing by writing to the SEC's Secretary and serving
applicants with a copy of the request, personally or by mail. Hearing
requests should be received by the SEC by 5:30 p.m. on August 3, 1998,
and should be accompanied by proof of service on applicants, in the
form of an affidavit, or, for lawyers, a certificate of service.
Hearing requests should state the nature of the writer's interest, the
reason for the request, and the issues contested. Persons may request
notification of a hearing by writing to the SEC's Secretary.
ADDRESSES: Secretary, SEC, 450 Fifth Street, N.W., Washington, D.C.
20549. Applicant, 1585 Broadway, New York, New York 10036.
FOR FURTHER INFORMATION CONTACT: Brian T. Hourihan, Senior Counsel, at
(202) 942-0526, or Mary Kay Frech, Branch Chief, at (202) 942-0564
(Division of Investment Management, Office of Investment Company
Regulation).
SUPPLEMENTARY INFORMATION: The following is a summary of the
application. The complete application may be obtained for a fee from
the SEC's Public Reference Branch, 450 Fifth Street, N.W., Washington,
D.C. 20549 (tel. (202) 942-8090).
Applicant's Representations
1. The Trusts are limited-life, grantor trusts registered under the
Act as nondiversified, closed-end management investment companies.
Morgan Stanley serves, or will serve, as the principal underwriter for
each Trust.
2. On October 16, 1996, the Commission issued the Prior Order. The
Prior Order, among other things, permits registered investment
companies to own a greater percentage of the total outstanding voting
stock of the Trusts than that permitted by section 12(d)(1) of the Act.
Applicant's Legal Analysis
1. Section 12(d)(1)(A)(i) of the Act prohibits any registered
investment company from owning more than 3 percent of the total
outstanding voting stock of any other investment company, and any
investment company from owning in the aggregate more than 3 percent of
the total outstanding voting stock of any registered investment
company. A company that is excepted from the definition of investment
company under section 3(c)(1) or 3(c)(7) of the Act is deemed to be an
investment company for purposes of section 12(d)(1)(A)(i) of the Act
under sections 3(c)(1) and 3(c)(7)(D) of the Act.
2. Section 12(d)(1)(J) of the Act provides that the Commission may
exempt persons or transactions from any provision of section 12(d)(1),
if, and to the extend that, the exemption is consistent with the public
interest and the protection of investors. Applicant requests that the
Prior Order be amended to permit companies excepted from the definition
of investment company under section 3(c)(1) and 3(c)(7) of the Act to
rely on the exemption from section 12(d)(1)(A) of the Act provided by
the Prior Order.
3. Applicant asserts that investment in the Trusts by companies
relying on section 3(c)(1) or 3(c)(7) of the Act will not raise
concerns under section 12(d)(1) of the Act for the same reasons as
those given in the application for the Prior Order with respect to
registered fund's investment in the Trusts. Applicant agrees that any
company relying on section 3(c)(1) or 3(c)(7) of the Act that invests
in the Trusts may not rely on this order unless it complies with the
terms and conditions of the Prior Order. For these reasons, applicant
believes that the requested relief meets the standards of section
12(d)(1)(J).
For the Commission, by the Division of Investment Management,
pursuant to delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 98-19051 Filed 7-16-98; 8:45 am]
BILLING CODE 8010-01-M
