99-12811. Rulemaking for EDGAR System  

  • [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]
    
    
    
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    _______________________________________________________________________
    
    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
    
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    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.
    
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    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.
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        \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.
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    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.
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        \11\ 15 U.S.C. 79a, et seq.
        \12\ 15 U.S.C. 77sss, et seq.
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        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.
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        \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.
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        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
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        \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).
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        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,
    
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    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
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        \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].
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    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.
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        \18\ See footnote 35 and accompanying text for submissions that 
    we will keep in ASCII format.
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        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.
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        \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.
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    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.
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        \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].
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        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
    
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    document. We will consider expanding the use of hypertext links after 
    the HTML implementation period.
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        \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).
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    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.
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        \24\ The permissible tag set does not include proprietary 
    extensions that are not supported by all browsers.
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        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.
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        \25\ See note 40 and accompanying text.
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    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.
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        \26\ 17 CFR 232.11.
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        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
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        \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.
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        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
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        \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)].
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        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.
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        \34\ See the discussion of Rule 106 [17 CFR 232.106] below.
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        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.
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        \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.
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        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
    
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    the civil liability and anti-fraud provisions of the federal securities 
    laws.37
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        \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.
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        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
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        \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].
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        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).
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        \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.
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        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.
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        \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).
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        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.
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        \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.
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        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
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        \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].
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        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
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        \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.
    
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    [[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
    
    
    

Document Information

Effective Date:
6/28/1999
Published:
05/21/1999
Department:
Securities and Exchange Commission
Entry Type:
Rule
Action:
Final rule.
Document Number:
99-12811
Dates:
These rules are effective on June 28, 1999 and apply to filings submitted on or after that date.
Pages:
27888-27897 (10 pages)
Docket Numbers:
Release Nos. 33-7684, 34-41410, IC-23843 File No. S7-9-99
RINs:
3235-AH70: EDGAR System (Modernization)
RIN Links:
https://www.federalregister.gov/regulations/3235-AH70/edgar-system-modernization-
PDF File:
99-12811.pdf
CFR: (21)
17 CFR 230.485
17 CFR 230.486
17 CFR 230.487
17 CFR 230.495
17 CFR 230.497
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