Federal Register / Vol. 76, No. 73 / Friday, April 15, 2011 / Notices 21415 

1The Commission staff estimates that a senior 

executive, such as the fund’s chief compliance 

officer, will spend an average of 62 hours and a 

mid-level compliance attorney will spend an 

average of 92 hours to comply with this collection 

of information: 62 hours + 92 hours = 154 hours. 

8 funds × 154 burden hours = 1,232 burden hours. 

The Commission staff estimate that the chief 

compliance officer is paid $423 per hour and the 

compliance attorney is paid $320 per hour. ($423 

per hour × 62 hours) + ($320 per hour × 92 hours) 

= $55,666 per fund. $55,666 × 8 funds = $445,328. 

The $423 and $320 per hour figures are based on 

salary information compiled by SIFMA’s 

Management & Professional Earnings in the 

Securities Industry, 2010. The Commission staff has 

modified SIFMA’s information to account for an 

1800-hour work year and multiplied by 5.35 to 

account for bonuses, firm size, employee benefits, 

and overhead. 

2This understanding is based on conversations 

with representatives from the fund industry. 

3The estimate is based on the following 

calculation: $93,131 × 8 funds = $745,048. 

Information and Regulatory Affairs, 

Office of Management and Budget, 

Room 10102, New Executive Office 

Building, Washington, DC 20503 or by 

sending an e-mail to: 

Shagufta_Ahmed@omb.eop.gov; and (ii) 

Thomas Bayer, Chief Information 

Officer, Securities and Exchange 

Commission, c/o Remi Pavlik-Simon, 

6432 General Green Way, Alexandria, 

VA 22312 or send an e-mail to: 

PRA_Mailbox@sec.gov. Comments must 

be submitted within 30 days of this 

notice. 

April 11, 2011. 

Cathy H. Ahn, 

Deputy Secretary. 

[FR Doc. 2011–9187 Filed 4–14–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

Submission for OMB Review; 

Comment Request 

Upon Written Request, Copies 

Available From: Securities and 

Exchange Commission, Office of 

Investor Education and Advocacy, 

Washington, DC 20549–0213. 

Extension: 

Rule 17d–1; SEC File No. 270–505; OMB 

Control No. 3235–0562. 

Notice is hereby given that, pursuant 

to the Paperwork Reduction Act of 1995 

(44 U.S.C. 3501 et seq.), the Securities 

and Exchange Commission 

(‘‘Commission’’) has submitted to the 

Office of Management and Budget 

(‘‘OMB’’) a request for extension of the 

previously approved collection of 

information discussed below. 

Section 17(d) (15 U.S.C. 80a–17(d)) of 

the Investment Company Act of 1940 

(15 U.S.C. 80a et seq.) (the ‘‘Act’’) 

prohibits first- and second-tier affiliates 

of a fund, the fund’s principal 

underwriters, and affiliated persons of 

the fund’s principal underwriters, acting 

as principal, to effect any transaction in 

which the fund or a company controlled 

by the fund is a joint or a joint and 

several participant in contravention of 

the Commission’s rules. Rule 17d–1 (17 

CFR 270.17d–1) prohibits an affiliated 

person of or principal underwriter for 

any fund (a ‘‘first-tier affiliate’’), or any 

affiliated person of such person or 

underwriter (a ‘‘second-tier affiliate’’), 

acting as principal, from participating in 

or effecting any transaction in 

connection with a joint enterprise or 

other joint arrangement in which the 

fund is a participant, unless prior to 

entering into the enterprise or 

arrangement ‘‘an application regarding 

[the transaction] has been filed with the 

Commission and has been granted by an 

order.’’ In reviewing the proposed 

affiliated transaction, the rule provides 

that the Commission will consider 

whether the proposal is (i) consistent 

with the provisions, policies, and 

purposes of the Act, and (ii) on a basis 

different from or less advantageous than 

that of other participants in determining 

whether to grant an exemptive 

application for a proposed joint 

enterprise, joint arrangement, or profitsharing plan. 

Rule 17d–1 also contains a number of 

exceptions to the requirement that a 

fund must obtain Commission approval 

prior to entering into joint transactions 

or arrangements with affiliates. For 

example, funds do not have to obtain 

Commission approval for certain 

employee compensation plans, certain 

tax-deferred employee benefit plans, 

certain transactions involving small 

business investment companies, the 

receipt of securities or cash by certain 

affiliates pursuant to a plan of 

reorganization, certain arrangements 

regarding liability insurance policies 

and transactions with ‘‘portfolio 

affiliates’’ (companies that are affiliated 

with the fund solely as a result of the 

fund (or an affiliated fund) controlling 

them or owning more than five percent 

of their voting securities) so long as 

certain other affiliated persons of the 

fund (e.g., the fund’s adviser, persons 

controlling the fund, and persons under 

common control with the fund) are not 

parties to the transaction and do not 

have a ‘‘financial interest’’ in a party to 

the transaction. The rule excludes from 

the definition of ‘‘financial interest’’ any 

interest that the fund’s board of 

directors (including a majority of the 

directors who are not interested persons 

of the fund) finds to be not material, as 

long as the board records the basis for 

its finding in their meeting minutes. 

Thus, the rule contains two filing and 

recordkeeping requirements that 

constitute collections of information. 

First, rule 17d–1 requires funds that 

wish to engage in a joint transaction or 

arrangement with affiliates to meet the 

procedural requirements for obtaining 

exemptive relief from the rule’s 

prohibition on joint transactions or 

arrangements involving first- or secondtier affiliates. Second, rule 17d–1 

permits a portfolio affiliate to enter into 

a joint transaction or arrangement with 

the fund if a prohibited participant has 

a financial interest that the fund’s board 

determines is not material and records 

the basis for this finding in their 

meeting minutes. These requirements of 

rule 17d–1 are designed to prevent fund 

insiders from managing funds for their 

own benefit, rather than for the benefit 

of the funds’ shareholders. 

Based on an analysis of past filings, 

Commission staff estimates that 8 funds 

file applications under section 17(d) and 

rule 17d–1 per year. The staff 

understands that funds that file an 

application generally obtain assistance 

from outside counsel to prepare the 

application. The cost burden of using 

outside counsel is discussed below. 

Based on a limited survey of persons in 

the mutual fund industry, the 

Commission staff estimates that each 

applicant will spend an average of 154 

hours to comply with the Commission’s 

applications process. The Commission 

staff therefore estimates the annual 

burden hours per year for all funds 

under rule 17d–1’s application process 

to be 1,232 hours at a cost of $445,328.1

The Commission, therefore, requests 

authorization to increase the inventory 

of total burden hours per year for all 

funds under rule 17d–1 from the current 

authorized burden of 616 hours to 1,232 

hours. The increase is due to an increase 

in the number of funds that filed 

applications for exemptions under rule 

17d–1. 

As noted above, the Commission staff 

understands that funds that file an 

application under rule 17d–1 generally 

use outside counsel to assist in 

preparing the application.2 The staff 

estimates that, on average, funds spend 

an additional $93,131 for outside legal 

services in connection with seeking 

Commission approval of affiliated joint 

transactions. Thus, the staff estimates 

that the total annual cost burden 

imposed by the exemptive application 

requirements of rule 17d–1 is $745,048.3

Based on staff discussions with fund 

representatives, we estimate that funds 

currently do not rely on the exemption 

from the term ‘‘financial interest’’ with 

respect to any interest that the fund’s 


srobinson on DSKHWCL6B1PROD with NOTICES
21416 Federal Register / Vol. 76, No. 73 / Friday, April 15, 2011 / Notices 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

board of directors (including a majority 

of the directors who are not interested 

persons of the fund) finds to be not 

material. Accordingly, we estimate that 

annually there will be no transactions 

under rule 17d–1 that will result in this 

aspect of the collection of information. 

Based on these calculations, the total 

annual hour burden is estimated to be 

1,232 hours and the total annual cost 

burden is estimated to be $745,048. 

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. 

Complying with these collections of 

information requirements is necessary 

to obtain the benefit of relying on rule 

17d–1. Responses will not be kept 

confidential. An agency may not 

conduct or sponsor, and a person is not 

required to respond to, a collection of 

information unless it displays a 

currently valid control number. 

The public may view the background 

documentation for this information 

collection at the following Web site, 

http//www.reginfo.gov. Comments 

should be directed to: (i) Desk Officer 

for the Securities and Exchange 

Commission, Office of Information and 

Regulatory Affairs, Office of 

Management and Budget, Room 10102, 

New Executive Office Building, 

Washington, DC 20503, or by sending an 

e-mail to: 

Shagufta_Ahmed@omb.eop.gov; and (ii) 

Thomas Bayer, Chief Information 

Officer, Securities and Exchange 

Commission, c/o Remi Pavlik-Simon, 

6432 General Green Way, Alexandria, 

VA 22312 or send an e-mail to: 

PRA_Mailbox@sec.gov. Comments must 

be submitted to OMB within 30 days of 

this notice. 

April 11, 2011. 

Cathy H. Ahn, 

Deputy Secretary. 

[FR Doc. 2011–9189 Filed 4–14–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

Submission for OMB Review; 

Comment Request 

Upon Written Request, Copies Available 

From: U.S. Securities and Exchange 

Commission, Office of Investor 

Education and Advocacy, 

Washington, DC 20549–0213. 

Extension: 

Rule 104; SEC File No. 270–411; OMB 

Control No. 3235–0465. 

Notice is hereby given that pursuant 

to the Paperwork Reduction Act of 1995 

(44 U.S.C. 3501 et seq.), the Securities 

and Exchange Commission 

(‘‘Commission’’) has submitted to the 

Office of Management and Budget 

(‘‘OMB’’) a request for approval of 

extension of the existing collection of 

information provided for in the 

following rule: Rule 104 of Regulation 

M (17 CFR 242.104). 

Rule 104 permits stabilizing by a 

distribution participant during a 

distribution so long as the distribution 

participant discloses information to the 

market and investors. This rule requires 

disclosure in offering materials of the 

potential stabilizing transactions and 

that the distribution participant inform 

the market when a stabilizing bid is 

made. It also requires the distribution 

participants (i.e. the syndicate manager) 

to maintain information regarding 

syndicate covering transactions and 

penalty bids. 

There are approximately 745 

respondents per year that require an 

aggregate total of 149 hours to comply 

with this rule. Each respondent makes 

an estimated 1 annual response. Each 

response takes approximately 0.20 

hours (12 minutes) to complete. Thus, 

the total compliance burden per year is 

149 burden hours. The total internal 

labor compliance cost for the 

respondents is approximately $9,983.00, 

resulting in an estimate of $13.40 (i.e., 

$9,983.00/745 responses) per response. 

An agency may not conduct or 

sponsor, and a person is not required to 

respond to, a collection of information 

unless it displays a currently valid 

control number. Background 

documentation for this information 

collection may be viewed at the 

following link, http://www.reginfo.gov. 

Comments should be directed to (i) 

Desk Officer for the Securities and 

Exchange Commission, Office of 

Information and Regulatory Affairs, 

Office of Management and Budget, 

Room 10102, New Executive Office 

Building, Washington, DC 20503 or by 

sending an e-mail to: 

Shagufta_Ahmed@omb.eop.gov; and (ii) 

Thomas Bayer, Chief Information 

Officer, Securities and Exchange 

Commission, c/o Remi Pavlik-Simon, 

6432 General Green Way, Alexandria, 

VA 22312 or send an e-mail to: 

PRA_Mailbox@sec.gov. Comments must 

be submitted within 30 days of this 

notice. 

April 11, 2011. 

Cathy H. Ahn, 

Deputy Secretary. 

[FR Doc. 2011–9188 Filed 4–14–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–64292; File No. SR–ISE– 

2011–22] 

Self-Regulatory Organizations; 

International Securities Exchange, 

LLC; Notice of Filing and Immediate 

Effectiveness of Proposed Rule 

Change Relating to Network Fees 

April 11, 2011. 

Pursuant to Section 19(b)(1) of the 

Securities Exchange Act of 1934 (the 

‘‘Act’’),1 and Rule 19b–4 thereunder,2

notice is hereby given that on April 7, 

2011, the International Securities 

Exchange, LLC (the ‘‘Exchange’’ or the 

‘‘ISE’’) filed with the Securities and 

Exchange Commission the proposed 

rule change, as described in Items I, II, 

and III below, which items have been 

prepared by the self-regulatory 

organization. The Commission is 

publishing this notice to solicit 

comments on the proposed rule change 

from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The ISE is proposing to adopt fees for 

a 10 Gigabit network connection. The 

text of the proposed rule change is 

available on the Exchange’s Web site 

(http://www.ise.com), at the principal 

office of the Exchange, and at the 

Commission’s Public Reference Room. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

self-regulatory organization included 

statements concerning the purpose of, 

and basis for, the proposed rule change 

and discussed any comments it received 

on the proposed rule change. The text 

of these statements may be examined at 

the places specified in Item IV below. 

The self-regulatory organization has 

prepared summaries, set forth in 

sections A, B and C below, of the most 

significant aspects of such statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The purpose of this proposed rule 

change is to amend the Exchange’s 

Schedule of Fees to adopt fees for a 10 

Gigabit (GB) network connection. The 

Exchange currently has a tiered 


srobinson on DSKHWCL6B1PROD with NOTICES