58550 Federal Register / Vol. 69, No. 189 / Thursday, September 30, 2004 / Notices 

registration. See Direct Wholesale, 69 

FR 11654 (2004); ANM Wholesale, 

supra, 69 FR 11652; Shani Distributors, 

68 FR 62324 (2003). 

Based on the foregoing, the Deputy 

Administrator concludes that granting 

the pending application of Value would 

be inconsistent with the public interest. 

In sum, by its past conduct, Value has 

displayed a continuing history of illegal 

activity and an inability to discharge the 

responsibilities of a registrant. 

Accordingly, the Deputy 

Administrator of the drug Enforcement 

Administration, pursuant to the 

authority vested in her by 21 U.S.C. 823 

and 824 and 28 CFR 0.100(b) and 0.104, 

hereby orders the pending application 

for DEA Certificate of Registration, 

previously submitted by Value 

Wholesale be, and it hereby is, denied. 

This order is effective November 1, 

2004.

Dated: September 13, 2004. 

Michele M. Leonhart, 

Deputy Administrator.

[FR Doc. 04–21948 Filed 9–29–04; 8:45 am] 

BILLING CODE 4410–09–M

DEPARTMENT OF JUSTICE

Drug Enforcement Administration 

Manufacturer of Controlled 

Substances; Notice of Registration 

By Notice dated May 5, 2004, and 

published in the Federal Register on 

May 26, 2004, (69 FR 29979), Varian, 

Inc. Lake Forest, 25200 Commercentre 

Drive, Lake Forest, California 92630–

8810, made application by renewal to 

the Drug Enforcement Administration 

(DEA) for registration as a bulk 

manufacturer of the basic classes of 

controlled substances listed below:

Drug Schedule 

Phencyclidine (7471) .................... II 

1-Piperidinocyclohexane-.

carbonitrile (8603) ..................... II 

Benzoylecgonine (9180) ............... II 

The company plans to manufacture 

small quantities of controlled 

substances for use in diagnostic 

products. 

No comments or objections have been 

received. DEA has considered the 

factors in 21 U.S.C. 823(a) and 

determined that the registration of 

Varian, Inc. Lake Forest to manufacture 

the listed basic classes of controlled 

substances is consistent with the public 

interest at this time. DEA has 

investigated Varian, Inc. Lake Forest to 

ensure that the company’s registration is 

consistent with the public interest. The 

investigation has included inspection 

and testing of the company’s physical 

security systems, verification of the 

company’s compliance with state and 

local laws, and a review of the 

company’s background and history. 

Therefore, pursuant to 21 U.S.C. 823, 

and in accordance with 21 CFR 1301.33, 

the above named company is granted 

registration as a bulk manufacturer of 

the basic classes of controlled 

substances listed.

Dated: September 16, 2004. 

William J. Walker, 

Deputy Assistant Administrator, Office of 

Diversion Control, Drug Enforcement 

Administration.

[FR Doc. 04–21956 Filed 9–29–04; 8:45 am] 

BILLING CODE 4410–09–M

DEPARTMENT OF LABOR

Employment and Training 

Administration 

Workforce Security Programs: 

Unemployment Insurance Program 

Letter Interpreting Federal Law 

The Employment and Training 

Administration interprets Federal law 

requirements pertaining to 

unemployment compensation. These 

interpretations are issued in 

Unemployment Insurance Program 

Letters (UIPLs) to the State Workforce 

Agenices. UIPL 30–04 is published in 

the Federal Register to inform the 

public. 

This UIPL concers the SUTA 

Dumping Prevention Act of 2004 (Pub. 

L. 108–295); SUTA refers to state 

unemployment tax acts. All states will 

need to amend their laws regarding the 

transfer of unemployment experience as 

a result of the new Federal law. This 

UIPL includes a detailed explanation of 

the law in question and answer format, 

draft legislative language, a conformity 

checklist for states, and the text of P.L. 

108–295.

Dated: September 22, 2004. 

Emily Stover DeRocco, 

Assistant Secretary for Employment and 

Training.

Employment and Training 

Administration, Advisory System, U.S. 

Department of Labor, Washington, DC 

20210

Classification: SUTA Dumping. 

Correspondence Symbol: DL. 

Date: August 13, 2004. 

Advisory: Unemployment Insurance 

Program Letter No. 30–04. 

To: State Workforce Agencies. 

From: Cheryl Atkinson s/s, 

Administrator, Office of Workforce 

Security. 

Subject: SUTA Dumping—

Amendments to Federal Law affecting 

the Federal-State Unemployment 

Compensation Program. 

1. Purpose: To advise states of the 

amendments to Federal law designed to 

prohibit ‘‘SUTA Dumping.’’

2. References. Public Law (Pub. L. 

108–295, the ‘‘SUTA Dumping 

Prevention Act of 2004,’’ signed by the 

President on August 9, 2004; the Social 

Security Act (SSA); the Internal 

Revenue Code (IRC), including the 

Federal Unemployment Tax Act 

(FUTA); and Unemployment Insurance 

Program Letters (UIPLs) 29–83 (56 FR 

54891 (October 23, 1991)), 29–83, 

Change 3 (61 FR 39156 (July 26, 1996)), 

30–83, 15–84, and 34–02. 

3. Background.

a. In General. Some employers and 

financial advisors have found ways to 

manipulate state experience rating 

systems so that these employers pay 

lower state unemployment 

compensation (UC) taxes than their 

unemployment experience would 

otherwise allow. This practice is called 

SUTA dumping. (‘‘SUTA’’ refer to state 

unemployment tax acts, but has also 

been said to stand for, among other 

things, ‘‘State Unemployment Tax 

Avoidance.’’) Most frequently, it 

involves merger, acquisition or 

restructuring schemes, especially those 

involving shifting of workforce/payroll. 

The legality of these SUTA dumping 

schemes varies depending on state laws. 

Public Law 108–295 amended the SSA 

to add a new Section 303(k) establishing 

a nationwide minimum standard for 

curbing SUTA dumping. All states will 

need to amend their UC laws to conform 

with new legislation. 

Recissions: None. 

Expiration Date: Continuing. 

b. Experience Rating. All states 

operate experience rating systems in 

order for employers in the state to 

receive the additional credit against the 

Federal unemployment tax. (The tax 

credit scheme is explained in UIPL 30–

83 and experience rating in UIPL 29–

83.) Under experience rating, the state 

unemployment tax rate of an employer 

is, in most states, based on the amount 

of UC paid to former employees. The 

more UC paid to its former employees, 

the higher the tax rate of the employer, 

up to a maximum established by state 

law. Experience ratings helps ensure an 

equitable distribution of costs of the UC 

program among employers, encourages 

employers to stabilize their workforce, 

and provides an incentive for employers 

Federal Register / Vol. 69, No. 189 / Thursday, September 30, 2004 / Notices 58551

1Attachment IV is available on the ETA Website 

at http://ows.eta.gov/dmstree/uipl/uipl2k4/

uipl_3004.htm.

to fully participate in the UC program. 

SUTA dumping thwarts these purposes. 

c. SUTA Dumping and the 

Amendments Made by P.L. 108–295.

The amendments to the SSA made by 

P.L. 108–295 are intended to prohibit 

the following two methods of SUTA 

dumping: 

• An employer escapes poor 

experience (and high experience rates) 

by setting up a shell company and then 

transferring some or all of its workforce 

(and the accompanying payroll) to the 

shell company after the shell has earned 

a low experience rate. The transferred 

payroll is then taxed at the shell’s lower 

rate. 

• An entity commencing a business 

purchases an existing small business 

with a low UC tax rate. Instead of being 

assigned the higher new employer rate, 

the entity receives the small business’s 

lower rate. Typically, the new business 

ceases the business activity of the 

purchased business and commences a 

different type of business activity. 

Among other things, the SSA, as 

amended, requires state laws to prohibit 

these forms of SUTA dumping as a 

condition of states receiving 

administrative grants for the UC 

program. It also requires states to 

impose penalties for knowingly 

violating (or attempting to violate) these 

provisions of state law. 

A more detailed discussion of these 

amendments, including effective dates, 

is contained in Attachment I. Draft 

language for use in crafting state 

legislation is contained in Attachment 

II. Attachment III contains a checklist 

for assisting states in determining the 

conformity of their laws with these 

amendments. Attachment IV contains 

the text of P.L. 108–295. 

P.L. 108–295 also requires the 

Secretary of Labor to conduct a study 

‘‘of the implementation of’’ the 

amendments ‘‘to assess the status and 

appropriateness of State actions to 

meet’’ their requirements. P.L. 108–295 

also requires the Secretary to submit to 

the Congress, not later than July 15, 

2007, a report that (1) assesses the 

statute and appropriateness of state 

actions to meet its new requirements, 

and (2) recommends any further 

Congressional action that the Secretary 

considers necessary to improve the 

effectiveness of the amendments. (See 

Section 2(b) of P.L. 108–295). 

d. Access to the National Directory of 

New Hires. P.L. 108–295 also amended 

the SSA to permit the use of certain 

information in the National Directory of 

New Hires to be used by state UC 

agencies in the administration of 

Federal and state UC laws. The 

Department of Labor (Department) will 

provide more information on this 

amendment and its implementation in 

the future. It is not anticipated that this 

amendment will require states to amend 

their UC laws. 

4. Action. State administrators should 

distribute this advisory to appropriate 

staff. States must adhere to the 

requirements of Federal law contained 

in this advisory. 

5. Inquiries. Questions should be 

addressed to your Regional Office. 

6. Attachments.

Attachment I—Detailed Explanation of 

Section 303(k), SSA—Questions and 

Answers. 

Attachment II—Draft Legislative 

Language. 

Attachment III—Conformity Checklist 

for State SUTA Dumping Laws. 

Attachment IV—Text of P.L. 108–2951

Detailed Explanation of Section 303(k), SSA 

Questions and Answers 

In General 

1. Question: How do the SUTA dumping 

amendments affect the federal-state UC 

program? 

Answer: States must assure their UC laws 

provide for the following: 

• Mandatory Transfers. Unemployment 

experience must be transferred whenever 

there is substantially common ownership, 

management or control of two employers, 

and one of these employers transfers its trade 

or business (including its workforce), or a 

portion thereof, to the other employer. This 

requirement applies to both total and partial 

transfers of business 

• Prohibited Transfers. Unemployment 

experience may not be transferred, and a new 

employer rate (or the state’s standard rate) 

will instead be assigned, when a person who 

is not an employer acquires the trade or 

business of an existing employer. This 

prohibition applies only if the UC agency 

finds that such person acquired the business 

solely or primarily for the purpose of 

obtaining a lower rate of contributions. 

• Penalties for SUTA Dumping. 

‘‘Meaningful’’ civil and criminal penalties 

must be imposed on persons ‘‘knowingly’’

violating or attempting to violate the two 

requirements discussed above. These 

penalties must also be applicable to any 

person (including the person’s employer) 

who knowingly gives advice leading to such 

a violation. 

• Procedures. Procedures for identifying 

SUTA dumping must be established. The 

exact procedures do not need to be specified 

in state law, but state law must specifically 

provide for the establishment of such 

procedures. 

These are the minimum requirements 

which all state laws must meet. States may 

provide for more stringent provisions, 

provided they are otherwise consistent with 

Federal UC law. For example, instead of 

requiring a partial transfer of experience only 

when there is common ownership, 

management or control, a state may require 

transfers of experience whenever a partial 

transfer of trade or business occurs. 

2. Question. Do the SUTA dumping 

amendments require my state to completely 

overhaul its provisions relating to transfers of 

experience? 

Answer. No. The amendments do not 

change the way states handle transfers except 

as discussed in the preceding Q&A. As a 

result, a state may leave its current 

provisions intact while amending its law to 

provide that any state law provisions 

implementing Section 303(k), SSA, override 

these other provisions. The draft legislative 

language attached to this UIPL takes this 

approach. 

Mandatory Transfers—Section 303(k)(1)(A), 

SSA 

3. Question. Under what conditions must 

experience be transferred? 

Answer. Unemployment experience must 

be transferred whenever there is substantially 

common ownership, management or control 

of two employers, and one of these 

employers transfers its trade or business, or 

a portion thereof, to the other employer. 

Thus, this requirement applies to both total 

and partial transfers. 

4. Question. Provide an example of when 

experience must be transferred under the 

amendments. 

Answer. Corporation A is assigned the 

state’s maximum UC contribution rate of 

5.4%. It establishes a shell corporation that 

is treated as a separate employer for UC 

purposes. The shell eventually qualifies for 

the state’s minimum UC contribution rate of 

.5%. (How the new entity obtains this rate 

may vary depending on how it was 

established and on the state’s UC law. It may, 

for example, simply wait out a new employer 

period. If state law permits, it may use 

voluntary contributions to ‘‘buy down’’ to the 

minimum rate.) Corporation A then transfers 

all or some of its workforce to the shell. The 

result, absent the amendments, would be 

that, even though Corporation A controls the 

shell and its operations, it escapes a rate of 

5.4% on the transferred workforce and 

instead pays at a rate of .5%. 

Under the amendments, if the workforce is 

transferred to the shell, then the 

unemployment experience attributable to the 

transferred workforce must also be 

transferred to the shell. The shell’s 

experience would be recomputed based on 

its experience as well as the experience 

transferred from Corporation A. Assuming a 

total transfer of workforce and experience to 

the shell, the shell might even continue to 

receive the maximum rate of 5.4%. 

It does not matter whether the employer 

transfers all or some of its trade or business 

to the shell. Experience commensurate with 

the trade or business transferred must be 

transferred to the shell. 

5. Question. Why is the employer’s 

workforce part of the employer’s ‘‘trade or 

business’’ and thus subject to the SUTA 

dumping amendments? 

Answer. The employer’s workforce is 

necessarily a part of its business and is the 

58552 Federal Register / Vol. 69, No. 189 / Thursday, September 30, 2004 / Notices 

means by which an employer effectuates its 

trade or business. Without a workforce, there 

would be neither trade nor business. Thus, 

when some or all of the workforce is 

transferred, the employer no longer has the 

means of performing its trade or business 

with respect to the transferred workforce. 

As noted elsewhere in this UIPL, the bestknown means of SUTA dumping is the 

manipulation of an employer’s workforce/

payroll. Senate Majority Leader Frist 

specifically addressed this manipulation on 

the floor of the Senate when he stated that 

the amendment ‘‘prohibits shifting 

employees into shell companies * * * ’’ (150 

Cong. Rec. S8804 (daily ed. July 22, 2004)). 

The mandatory transfer provisions of the 

SUTA dumping amendments would have 

little, if any, effect if the workforce/payroll 

were not considered to be part of the 

employer’s trade or business. 

6. Question. How does a state determine if 

there is ‘‘substantially’’ common ownership, 

management, or control of two employers? 

Answer. The state must examine the facts 

of each case using reasonable factors. Among 

other things, the state would consider the 

extent of commonality or similarity of: 

Ownership; any familial relationships; 

principals or corporate officers; 

organizational structure; day-to-day 

operations; assets and liabilities; and stated 

business purposes. The Department is not at 

this time establishing a bright line test of who 

constitutes ‘‘substantially’’ common 

ownership, management, or control. 

Nothing prohibits a state from exceeding 

the minimum Federal requirement by 

lowering this threshold test to ‘‘any’’

common ownership, management or control. 

This will meet the Federal law requirement 

as it will include all cases where 

‘‘substantially common ownership, 

management or control’’ exists. 

7. Question. When is the transfer of trade 

or business effective? 

Answer. When an acquisition of trade or 

business is concluded is usually determined 

by examining the legal documents related to 

any purchase or acquisition of the trade or 

business. However, in SUTA dumping cases 

among businesses with common ownership, 

management, or control, such an acquisition 

will generally not take place. Instead, there 

may simply be a different entity issuing the 

paychecks. That a different entity is issuing 

paychecks is both an indication of the 

transfer of the workforce and the effective 

date of the transfer of the workforce. 

8. Question. Following the mandatory 

transfer of experience, when must states 

reassign the employers’ rates? 

Answer. Although the amendments require 

that the experience be combined, it does not 

specify when revised rates must be 

reassigned. As a result, states may either (1) 

assign revised rates for the predecessor and 

successor employers immediately upon 

completion of the transfer of trade or 

business, or (2) assign revised rates for the 

predecessor and successor the next time the 

state calculates rates for all employers.

For purposes of implementing this new 

mandatory transfer, the Department strongly 

recommends that states reassign rates 

immediately upon completion of the transfer. 

If rates are not reassigned until a later date, 

it is possible that a successful ‘‘SUTA dump’’

will be achieved during the period between 

the completion of the transfer and the 

assignment of a new rate. For example, if an 

employer with a rate of 5.4% transfers 1,000 

employees into a shell with a rate of .1% on 

the first day of the rate year, the employer 

will have accomplished a ‘‘SUTA’’ dump for 

that rate year. 

9. Question: An employee of one legal 

entity is moved to another legal entity. 

Although each entity is treated as a separate 

employer for UC purposes, there is 

substantially common control over the two 

entities. Does this mean that unemployment 

experience must be transferred? 

Answer: No. When a single person is 

moved from one entity to another, it is 

merely a transfer of an individual rather than 

a transfer of trade or business. 

10. Question: A state’s UC law provides 

that any corporate shell or spin-offs where 

there is ‘‘a continuity of control of the 

business enterprise’’ will not be treated as a 

new employer for UC purposes, but instead 

as the same employer. Does this constitute an 

acceptable alternative to the mandatory 

transfer requirement? 

Answer: While this provision prohibits 

many (if not most) SUTA dumps, it will not 

necessarily address all situations where there 

are cases of ‘‘substantially common 

ownership, management, or control.’’

(Emphasis added.) There may, for example, 

be cases where substantially common 

ownership exists, but that ownership does 

not exert a controlling interest. (For example, 

it is possible that a majority owner of two 

corporations could have non-voting stock.) 

This situation would require a transfer of 

experience under Section 303(k), SSA, even 

if ‘‘substantially common control’’ did not 

exist. 

States with such ‘‘continuity’’ provisions 

will meet the requirements of Section 

303(k)(1)(A), SSA, concerning mandatory 

transfers if they amend their provisions to be 

as specific as the Federal requirement. This 

is, the ‘‘continuity’’ provision may be 

amended to provide that there is no new 

employer where there is ‘‘substantially 

common ownership, management, or 

control.’’

Instead of providing for amendments 

addressing the mandatory transfer of 

experience, states may wish to amend their 

laws to provide for a ‘‘continuity’’ provision. 

A ‘‘continuity’’ provision may be easier to 

administer because, if all entities with 

substantially common ownership, 

management and control are always treated 

as being a single employer under the state UC 

law, the issue of transfers or experience 

would not arise. An example of such a law 

is California’s, which was quoted in UIPL 

34–02. (Note that California’s law is limited 

to continuity of control, and thus, does not 

currently meet the Federal requirement.) The 

penalties described below would need to 

apply to violations and attempted violations 

of any ‘‘continuity’’ provision. 

11. Question: How are professional 

employer organizations (PEOs) affected by 

the new mandatory transfer requirement? 

Answer: The same rules apply to PEOs as 

any other employer. If a PEO sets up a shell 

corporation and transfers some or all of its 

trade or business to the shell, then the 

unemployment experience associated with 

the transferred trade or business must be 

transferred to the shell. Similarly, if the 

conditions prohibiting transfers of experience 

are met, as discussed in Questions and 

Answers 16–18, they would apply to PEOs. 

Except for these mandatory/prohibited 

transfers, the amendments do not otherwise 

affect the relationship between the PEO and 

its clients. States currently vary in their 

treatment of PEOs and their clients for 

experience rating purposes. Some states treat 

the client as the employer for experience 

rating purposes and others treat the PEO as 

the employer for these purposes. The 

amendments do not require states to change 

this treatment. 

12. Question: A PEO sets up several 

different shells. Each year it shifts all its 

clients to a different shell. For example, in 

the first year the client contracts with Shell 

A; in the second, it contracts with Shell B; 

and in the third it contracts with Shell C. 

When this occurs, must experience be 

transferred from Shell A to Shell B and then 

to Shell C? 

Answer: Yes. By dictating that the client 

must sign with a particular shell (or 

otherwise manipulating which shell the 

client signs with), the PEO is effectively 

transferring its trade/business—that is, the 

trade/business of performing services as a 

PEO for a client—from Shell A to Shell B and 

then to Shell C. The control exercised by the 

PEO over which shell is the contracting 

entity meets the test of ‘‘substantial control.’’

Since a transfer of trade/business has 

occurred and substantial commonality of 

control exists, experience must be 

transferred. 

13. Question: May my state limit the 

mandatory transfer provision to large 

transfers of experience, such as those where 

300 or more employees are transferred? 

Answer: No. The SUTA dumping 

amendments apply to all transfers, large and 

small, where there is substantially common 

ownership, management or control. 

14. Question: Current state law requires 

partial transfers of experience only when an 

‘‘identifiable and segregable’’ component of 

an employer has been transferred to another 

employer. Is this an acceptable limitation on 

partial transfers? 

Answer: No. States must transfer 

experience whenever ‘‘a part’’ of an existing 

business is transferred. 

The bill that eventually became P.L. 108–

295 was H.R. 3463. As introduced, H.R. 3463 

required transfers of experience only when 

there was a transfer of an ‘‘identifiable and 

segregable’’ component of the employer. That 

language was deleted after the Department 

alerted Congressional staff of concerns that it 

would create a loophole allowing SUTA 

dumping. Thus, states must transfer 

experience whenever ‘‘a part’’ of an existing 

business is transferred. 

For example, larger businesses are often 

divided into separate legal entities. Under the 

‘‘identifiable and segregable’’ test as 

commonly applied under many current state 

UC laws, a transfer of experience would be 

mandated only if all of the trade and business 

Federal Register / Vol. 69, No. 189 / Thursday, September 30, 2004 / Notices 58553

of one legal entity is acquired by another 

legal entity. Conversely, if only a part of the 

entity is acquired by another entity, then no 

‘‘identifiable and segregable’’ component 

could be identified and no transfer of 

experience would be required. As a result, 

the limitation relating to an ‘‘identifiable and 

segregable’’ component could easily be 

circumvented through transferring the 

majority of employees from one entity into a 

shell that had earned the state’s minimum tax 

rate. 

15. Question: How is experience 

transferred when no identifiable and 

segregable component of a business can be 

identified? For example, Business A sets up 

a shell. Business A then transfers 90% of its 

workforce to the shell. 

Answer: States may prorate the payroll of 

the employees transferred against benefit 

charges/ reserve balance/benefit wages, 

whichever is appropriate. In determining the 

payroll transferred, the state may use either 

taxable or total payroll, but it must be the 

payroll immediately prior to the transfer of 

workforce. 

Thus, assuming a state uses total payroll, 

if 90% of Business A’s total payroll was 

transferred to the shell, 90% of the 

experience attributable to Business A (that is, 

benefit charges, reserve balance, or benefit 

wages, or payroll, whichever is appropriate) 

must be transferred to the shell. This method 

is acceptable only when no identifiable and 

segregable component can be identified. 

It should be noted that, in this case, a 

‘‘continuity’’ provision, as discussed in 

Question and Answer #10, would hold that 

the shell is not a separate employer. As a 

result, the issue of a transfer of experience 

would not arise. 

Prohibited Transfers—Section 303(k)(1)(B), 

SSA 

16. Question: Under what conditions are 

states prohibited from transferring experience 

under the SUTA dumping amendments? 

Answer: Unemployment experience may 

not be transferred, and a new employer rate 

or the state’s standard rate will instead be 

assigned, when a person who is not an 

employer acquires the trade or business of an 

existing employer. However, this prohibition 

applies only if the UC agency finds that such 

person acquired the business solely or 

primarily for the purpose of obtaining a 

lower rate of contributions. (The 

identification of a state’s standard rate is 

explained in UIPL 15–84.)

17. Question: Provide an example of when 

experience may not be transferred under the 

amendments. 

Answer: The amendment prohibiting 

transfers is intended to address situations 

where a person, who is not an employer, 

purchases a small business solely or 

primarily for the purpose of obtaining its low 

rate of contributions when it commences its 

new business. Generally, the small business 

is converted to a different type of business. 

For example, Person A is not an employer. 

Person A purchases a flower shop, which has 

earned the minimum UC rate of .5 percent to 

begin a manufacturing business. Person A 

either stops the flower business, or it 

becomes incidental as non-flower-shop 

payroll overwhelms it. Had Person A not 

purchased the flower shop, it would have 

been assigned a new employer rate of 4.5 

percent based on its non-flower shop 

industry. The facts here should lead the state 

UC agency to conclude that the purchase was 

primarily for the purpose of obtaining a 

lower rate of contributions. Thus, under the 

amendments, state laws may not permit the 

experience of the flower shop to be 

transferred to Person A. Instead, Person A 

will be assigned the applicable new employer 

rate (or the state’s standard rate) until such 

time as Person A qualifies for a rate based on 

experience. 

18. Question: How will a state determine 

if the acquisition of an employer was made 

‘‘solely or primarily for the purpose of 

obtaining a lower rate of contributions?’’

Answer: The state should ‘‘use objective 

factors which may include the cost of 

acquiring the business, whether the person 

continued the business enterprise of the 

acquired business, how doing such business 

enterprise was continued, or whether a 

substantial number of new employees were 

hired for performance of duties unrelated to 

the business activity conducted prior to 

acquisition.’’ (The quoted language is from 

the Draft Legislative Language in Attachment 

II.) The cost of acquiring a business may be 

used as an objective factor because this cost, 

as compared with any potential savings in 

contributions costs, will indicate the extent 

to which UC tax savings may accrue. 

State law may not arbitrarily limit the 

criteria to be used. For example, some state 

laws currently consider only whether the 

business enterprise of the acquired business 

is continued. This limitation would allow an 

impermissible SUTA dump to occur as it 

does not address situations where the 

purchaser continues the acquired business 

while flooding the business (and the 

experience account) with a substantial 

number of employees performing duties 

unrelated to the acquired business. For this 

reason, the draft legislative language is 

written to refer to ‘‘objective factors which 

include’’ those listed. (Emphasis added.) 

Required Penalties—Section 303(k)(1)(D), 

SSA 

19. Question: What penalties must be 

imposed under state law? 

Answer: State law must provide that 

‘‘meaningful civil and criminal penalties’’ are 

imposed with respect to—

• Persons who ‘‘knowingly violate or 

attempt to violate’’ those provisions of the 

state’s UC law that implement Section 303(k), 

SSA. 

• Persons who ‘‘knowingly advise another 

person to violate those provisions of’’ state 

UC laws that implement Section 303(k), SSA.

‘‘Knowingly’’ is defined as ‘‘having actual 

knowledge of or acting with deliberate 

ignorance of or reckless disregard for the 

prohibition involved.’’ (Emphasis added. 

Section 303(k)(2)(E), SSA.) 

20. Question: Must penalties be imposed in 

every case of SUTA dumping that is 

identified? 

Answer: No. The penalties only apply to 

persons who ‘‘knowingly violate or attempt 

to violate’’ the SUTA dumping provisions of 

state law. 

However, when a determination issued by 

the appropriate authority or a consent order 

establishes that a person ‘‘knowingly’’

violated (or attempted to violate) a state’s 

SUTA dumping provisions, then civil 

penalties must be imposed. States will take 

into account the amounts at issue and the 

likelihood of successful projection in 

determining which cases will result in 

criminal prosecutions. 

In cases where a SUTA dumping 

investigation results in a settlement between 

the state and the employer in which the 

employer admits no wrongdoing, their has 

been no clear establishment of SUTA 

dumping. In such cases, Federal law does not 

require the imposition of a penalty. 

21. Question: What is a ‘‘meaningful’’

penalty? 

Answer: To be ‘‘meaningful,’’ the penalty 

musts have the effect of curtailing SUTA 

dumping. Minimal penalties will not 

accomplish this end. 

Concerning cases where only civil 

penalties are imposed, a monetary penalty 

must be of sufficient size that an employer 

will not be tempted to SUTA dump. A flat 

fine against SUTA dumping may not be a 

meaningful deterrent. For example, if a 

corporation that attempted to dump $2 

million in SUTA taxes is fined $5,000, this 

will likely not be a meaningful deterrent 

against future attempts to SUTA dump. For 

that reason, the draft legislative language 

attached to this UIPL takes the approach that 

an employer who violated (or attempted to 

violate) the SUTA dumping prohibitions be 

assessed the maximum tax rate, or, if 

assigning the maximum rate does not result 

in a rate increase of at least 2% of taxable 

wages, then a penalty rate of 2% of taxable 

wages will instead be assessed for the rate 

year in which the violation occurred (or was 

attempted) and the following three years. 

States are free to vary this penalty (including 

assessing both rate increases and fines) but 

any penalty must have significant financial 

impact to have a deterrent effect.

22. Question: May state law limit the civil 

penalties to rate increases? 

Answer: No. UC rate increases are not 

applicable to self-employed individuals who 

knowingly advise employers to SUTA dump. 

As a result, state law also needs to provide 

for fines against individuals. The draft 

legislative language attached to this UIPL 

takes the approach that rate increases will be 

applied to employers and fines to nonemployers. 

23. Question: Do the SUTA dumping 

amendments specify the uses of any financial 

penalties collected by the UC agency? 

Answer. No. The draft legislative language 

attached to this UIPL operates on the 

assumption that, as is the case with any other 

UC contributions payable under a state’s UC 

law, any amounts paid due to any rate 

increase will be deposited in the state’s 

unemployment fund in which case they may 

be withdrawn only for the payment of 

benefits. Also, under the draft legislative 

language, any fines will be deposited in the 

state’s penalty and interest account. States 

may limit the use of these fines to SUTA 

dumping and other integrity activities. 

58554 Federal Register / Vol. 69, No. 189 / Thursday, September 30, 2004 / Notices 

Payrolling 

24. Question: Do the SUTA dumping 

amendments address situations where one 

employer reports its payroll under another 

employer’s account? 

Answer: No. Although this practice, 

commonly called ‘‘payrolling,’’ has been 

known for some time, it is not addressed by 

the amendments. ‘‘Payrolling’’ may also 

include cases where two unrelated 

businesses negotiate for a fee to have all or 

part of the employer with the higher UC rate 

report its payroll as belonging to the other 

employer. A PEO was recently found to be 

‘‘payrolling’’ by shifting its payroll to the 

account of a client with a lower rate. In each 

case, the employers are fraudulently 

reporting who is the employer of an 

individual. 

Unlike the manipulations the SUTA 

dumping amendments are designed to 

prevent, ‘‘payrolling’’ should already be 

explicitly prohibited under all states’ UC 

laws since it involves an employer 

submitting fraudulent documents concerning 

who is an individual’s employer for UC 

purposes. 

Recognizing that ‘‘payrolling’’ has the same 

effect as SUTA dumping, the Draft 

Legislative Language is written so that its 

penalties will apply to ‘‘payrollers.’’ It 

provides that the penalties apply not just to 

the mandatory and prohibited transfers 

required by new Section 303(k), SSA but also 

to violations or attempted violations of ‘‘any 

other provision of this Chapter related to 

determining the assignment of a contribution 

rate.’’

Establishing Procedures—Section 

303(k)(1)(E), SSA 

25. Question: What must my state law say 

regarding establishing procedures to detect 

SUTA dumping? 

Answer: The state law must say that the 

state will establish procedures to ‘‘identify 

the transfer or acquisition of a business for 

purposes of’’ detecting SUTA dumping. 

(Section 303(k)(1)(E), SSA.) The state law is 

not required to specify the procedures. The 

Department does not believe that it is 

desirable to legislate what these procedures 

must be as the most effective procedures may 

vary over time. As a result, the Draft 

Language does not specify procedures. 

However, the state must implement 

procedures to detect SUTA dumping. 

Other 

26. Question: What does ‘‘person’’ mean 

for purposes of the amendments? 

Answer: ‘‘Person’’ has ‘‘the meaning given 

such term by section 7701(a)(1) of the 

Internal Revenue of 1986.’’ (Section 

303(k)(2)(F), SSA.) Section 7701(a)(1), IRC, 

defines ‘‘person’’ as meaning ‘‘an individual, 

a trust, estate, partnership, association, 

company or corporation.’’ Thus, the term 

‘‘person’’ is very broad; it includes entities 

that may be employers under state law and 

it includes individuals who are not 

employers. 

27. Question: What does ‘‘employer’’ mean 

for purposes of the amendments? 

Answer: ‘‘Employer’’ means ‘‘an employer 

as defined under state law.’’ (Section 

303(k)(2)(B), SSA) Typically, ‘‘employer’’

will mean an entity that pays sufficient 

wages based on employment to be subject to 

the state’s UC law. If state UC law does not 

use the term ‘‘employer,’’ then, for purposes 

of determining what entity is an employer, 

the state should use whatever term it uses to 

describe this entity. For example, many states 

use the term ‘‘employing unit’’ to describe 

this entity. 

28. Question: What does ‘‘business’’ mean 

for purposes of the amendments? 

Answer: ‘‘Business’’ means ‘‘a trade or 

business (or a part thereof).’’ (Section 

303(k)(2)(c), SSA.)

Effective Date 

29. Question: By what date must the states 

amend their UC laws? 

Answer: The amendments do not specify a 

date. Instead, they apply to ‘‘rate years 

beginning after the end of the 26-week period 

beginning on the first day of the first 

regularly scheduled session of the State 

legislature beginning on or after the date of 

the enactment’’ of Public Law 108–295, 

which was August 9, 2004. (See Section 2(c) 

of Public Law 108–295.) Thus, transfer of 

experience required or prohibited under the 

amendments must be effective for such rate 

years. Notice prohibits states from providing 

for earlier effective dates. Indeed, states are 

encouraged to make their amendments 

effective as soon as possible. 

All states currently have rate years 

beginning either January 1 or July 1. Also, 

almost all states’ first legislative sessions 

following the date of enactment will begin in 

the first three months of 2005. As a result, 

after taking into account the 26-week grace 

period, the amendments in most states must 

be effective for rate years beginning on or 

after January 1, 2006, or on or after July 1, 

2006, whichever is applicable in the state. 

For purposes of determining when the 26-

week period ends, the state should start 

counting on the first day of the first regularly 

scheduled session of the state legislature and 

count up to 182 (26 weeks × 7 days = 182 

days). Any rate year beginning after the 

182nd day must apply the SUTA dumping 

amendments. 

The following table indicates the required 

effective dates:

EFFECTIVE DATES

First day of state’s first regularly scheduled session State’s rate year

begins 

Effective for rate years 

beginning 

January 1–July 3, 2005 ................................................................................................................... January 1 ................ January 1, 2006. 

July 1 ....................... July 1, 2006. 

July 4–December 31, 2005 ............................................................................................................. January 1 ................ January 1, 2007. 

July 1 ....................... July 1, 2006. 

January 1–July 3, 2006 ................................................................................................................... January 1 ................ January 1, 2007. 

July 1 ....................... July 1, 2007. 

30. Question: The state’s legislature has 

adjourned. However, it is scheduled to meet 

in a one-day session that is limited to overriding vetoes. This one-day session is 

consistently scheduled to occur a specific 

number of days after the state legislature has 

adjourned. Although the legislature 

adjourned prior to the date of enactment of 

Public Law 108–295, the one-day session 

occurs after the date of enactment. Does this 

veto session count as the ‘‘first day of the first 

regularly scheduled session’’ following 

enactment? 

Answer: No. The effective date provisions 

recognize that states need time to amend 

their laws. A legislative session where the 

introduction and enactment of new 

legislation is prohibited will, therefore, not 

be considered as starting the clock for 

purposes of determining when rates must be 

assigned consistent with new Section 303(k), 

SSA. If, one the other hand, legislation may 

be introduced and enacted in such a one-day 

session, the clock will start.

Attachment II 

Draft Legislative Language 

The following language is provided for 

state use in developing language that meets 

the requirements of Section 303(k), SSA, as 

added by Public Law 108–295, on SUTA 

dumping. 

States will need to modify the language to 

accord with state usage. For example, 

‘‘Commissioner’’ should be changed to the 

name of the agency administering the state’s 

UC program if that is the state convention. 

Similarly, legal usages, such as ‘‘Chapter’’ to 

refer to the state’s UC law, should be changed 

to accord with state convention. 

The following language assumes the state 

wishes to add a separate section addressing 

SUTA dumping. States may chose instead to 

integrate the following provisions into 

existing state law. If this is the case, states 

should use this language in conjunction with 

the Checklist in Attachment III to assure all 

necessary amendments are made. Similarly, 

states modifying the language should test 

such modifications against the Checklist. 

Section llll. Special Rules Regarding 

Transfers of Experience and Assignment of 

Rates. Notwithstanding any other provision 

Federal Register / Vol. 69, No. 189 / Thursday, September 30, 2004 / Notices 58555

1See Question and Answer 8, which contains the 

Department’s recommendation that rates be 

recomputed immediately.

2The term ‘‘person’’ is used consistent with the 

usage in Section (k)(1)(B), SSA. It encompasses a 

broad range of entities who are not ‘‘employers.’’ It 

includes both entities who are not ‘‘employers’’

because they have no payroll or insufficient payroll. 

Note the definition of ‘‘person’’ given in subsection 

(e)(1) of the draft language.

3States should determine if ‘‘employer’’ is the 

appropriate term here and in other appearances in 

this draft language. For example, a state may use the 

term ‘‘employing unit’’, ‘‘subject employer,’’ or 

‘‘employer liable for contributions’’ to describe an 

entity that is subject to taxation under the state’s UC 

law. 4The word ‘‘applicable’’ is intended to address 

situations where not all ‘‘new’’ employers receive 

the same rate. For example, many states assign new 

employer rates by industry code. 5See Question and Answer 24 regarding 

payrolling. 6This provision permits penalty to be applied to 

self-employed financial advisers and individual 

employees of business. See Question and Answer 

23 regarding the deposit of the fines in the penalty 

and interest account.

7This provisions—paragraph (3)—is optional. An 

actual listing of violations may help to deter these 

violations.

8States should assure that the criminal penalties 

cited are applicable to both individuals and 

corporations.

9See Question and Answer 5 regarding whether 

workforce is part of the employer’s ‘‘trade or 

business.’’ This definition assures that questions 

will not arise about whether an employer’s 

workforce is included in ‘‘trade or business.’’

10Subsection (f) is optional. States are encouraged 

to include such language to avoid potential 

conflicts with any Federal regulations finalized 

after enactment of state law. The language is written 

in terms of minimum Federal requirements to 

assure states are free to adopt more stringent 

protections to avoid SUTA dumping.

of law, the following shall apply regarding 

assignment of rates and transfers of 

experience: 

(a) If an employer transfers its trade or 

business, or a portion thereof, to another 

employer and, at the time of the transfer, 

there is substantially common ownership, 

management or control of the two employers, 

then the unemployment experience 

attributable to the transferred trade or 

business shall be transferred to the employer 

to whom such business is so transferred. The 

rates of both employers shall be recalculated 

and made effective immediately upon the 

date of the transfer of trade or business.1

(b) Whenever a person 2 who is not an 

employer 3 under this Chapter at the time it 

acquires the trade or business of an 

employer, the unemployment experience of 

the acquired business shall not be transferred 

to such person if the Commissioner finds that 

such person acquired the business solely or 

primarily for the purpose of obtaining a 

lower rate of contributions. Instead, such 

person shall be assigned the [applicable] 4

new employer rate under section [insert 

section of state law]. In determining whether 

the business was acquired solely or primarily 

for the purpose of obtaining a lower rate of 

contributions, the Commissioner shall use 

objective factors which may include the cost 

of acquiring the business, whether the person 

continued the business enterprise of the 

acquired business, how long such business 

enterprise was continued, or whether a 

substantial number of new employees were 

hired for performance of duties unrelated to 

the business activity conducted prior to 

acquisition.

(c)(1) If a person knowingly violates or 

attempts to violate subsections (a) and (b) or 

any other provision of this Chapter related to 

determining the assignment of a contribution 

rate,5 or if a person knowingly advises 

another person in a way that results in a 

violation of such provision, the person shall 

be subject to the following penalties:

(A) If the person is an employer, than such 

employer shall be assigned the highest rate 

assignable under this Chapter for the rate 

year during which such violation or 

attempted violation occurred and the three 

rate years immediately following this rate 

year. However, if the person’s business is 

already at such highest rate for any year, or 

if the amount of increase in the person’s rate 

would be less than 2 percent for such year, 

then a penalty rate of contributions of 2 

percent of taxable wages shall be imposed for 

such year. 

(B) If the person is not an employer, such 

person shall be subject to a civil money 

penalty of not more than $5,000. Any such 

fine shall be deposited in the penalty and 

interest account established under [insert 

appropriate section of state law.]’’6

(2) For purposes of this section, the term 

‘‘knowingly’’ means having actual knowledge 

of or acting with deliberate ignorance or 

reckless disregard for the prohibition 

involved. 

(3) For purposes of this section, the term 

‘‘violates or attempts to violate’’ includes, but 

is not limited to, intent to evade, 

misrepresentation or willful nondisclosure.7

(4) In addition to the penalty imposed by 

paragraph (1), any violation of this section 

may be prosecuted as a [insert appropriate 

language; for example ‘‘a class A felony’’ or 

‘‘a Class B misdemeanor’’] under Section 

[insert appropriate section] of the Criminal 

Code.8

(d) The Commissioner shall establish 

procedures to identify the transfer or 

acquisition of a business for purposes of this 

section. 

(e) For purposes of this section—

(1) ‘‘Person’’ has the meaning given such 

term by section 7701(a)(1) of the Internal 

Revenue Code of 1986, and 

(2) ‘‘Trade of business’’ shall include the 

employer’s workforce.9

(f) This section shall be interpreted and 

applied in such a manner as to meet the 

minimum requirements contained in any 

guidance or regulations issued by the United 

States Department of Labor.10

Attachment III

Conformity Checklist for State SUTA Dumping Laws

Questions Yes or no

1. Mandatory Transfers. If Employer A transfers its trade or business (including its workforce) to Employer B, does the state 

law mandate the transfer of experience from Employer A to Employer B when there is ‘‘substantially common’’ ownership, 

management or control: 

Does this mandate apply to both total and partial transfers? 

2. Prohibited Transfer. Does state law prohibit the transfer of experience (that is, does it require a new employer rate be assigned) when a person becomes an employer by acquiring an existing employer if the purpose of the acquisition was to obtain 

a lower rate? 

Does this prohibition apply to a ‘‘person’’ who, prior to the acquisition of the employer, had (a) no individuals in its employ 

and (b) some employment, but not enough to be an ‘‘employer’’ for purposes of state law? 

3. Penalties. Does state law impose ‘‘meaningful civil penalties’’ for ‘‘knowingly’’ violating and attempting to violate the above? 

Why is the penalty ‘‘meaningful?’’

Does state law impose meaningful criminal penalties for the same? 

Are these penalties applicable to both the person who commits the violation and any person (including the employer of the 

advice-giver) who knowingly gives advice leading to such a violation? 

Does state law address the situation where the person giving the advice may not be an employer? (E.g., self-employed financial advisors?) 

Does the definition of ‘‘knowingly’’ at a minimum mean ‘‘having actual knowledge of or acting with deliberate ignorance of or 

reckless disregard of the law’’? 

4. Procedures. Does the law require the establishment of procedures to identify SUTA dumping? 

5. Additional Procedures/Mandates. Optional. Does state law require/prohibit the transfer of experience in accordance with 

any regulations of the Secretary of Labor may prescribe? (If not, future amendments to state laws may be necessary.) 

58556 Federal Register / Vol. 69, No. 189 / Thursday, September 30, 2004 / Notices 

[FR Doc. 04–21917 Filed 9–29–04; 8:45 am] 

BILLING CODE 4510–30–M

OFFICE OF PERSONNEL 

MANAGEMENT 

[RI 20–64, RI 20–64A, and RI 20–64B] 

Proposed Collection; Comment 

Request for Review of a Revised 

Information Collection

AGENCY: Office of Personnel 

Management.

ACTION: Notice.

SUMMARY: In accordance with the 

Paperwork Reduction Act of 1995 (Pub. 

L. 104–13, May 22, 1995), this notice 

announces that the Office of Personnel 

Management (OPM) intends to submit to 

the Office of Management and Budget 

(OMB) a request for review of a revised 

information collection. RI20–64, You 

May Provide a Survivor Annuity for 

Your Former Spouse, is used by the 

Civil Service Retirement System to 

provide information about the amount 

of annuity payable after a survivor 

reduction and to offer eligible 

annuitants an opportunity to make a 

former spouse survivor annuity election. 

RI 20–64A, Former Spouse Survivor 

Annuity Election, is the election form 

the annuitant uses to make such an 

election. RI 20–64B, Information on 

Electing a Survivor Annuity for Your 

Former Spouse, is a pamphlet that 

provides important information to 

retirees under the Civil Service 

Retirement System who want to provide 

a survivor annuity for a former spouse. 

Comments are particularly invited on: 

whether this information is necessary 

for the proper performance of functions 

of OPM, and whether it will have 

practical utility; whether our estimate of 

the public burden of this collection of 

information is accurate, and based on 

valid assumptions and methodology; 

and ways in which we can minimize the 

burden of the collection of information 

on those who are to respond, through 

the use of appropriate technological 

collection techniques or others forms of 

information technology. 

Approximately 30 RI 20–64A forms 

are completed annually. The form takes 

approximately 45 minutes to complete. 

The annual estimated burden is 23 

hours. 

For copies of this proposal, contact 

Mary Beth Smith-Toomey on (202) 606–

8358, FAX (202) 418–3251 or via e-mail 

to mbtoomey@opm.gov. Please include 

a mailing address with your request.

DATES: Comments on this proposal 

should be received within 60 calendar 

days from the date of this publication.

ADDRESSES: Send or deliver comments 

to—Ronald W. Melton, Deputy Assistant 

Director, Retirement Services Program, 

Center for Retirement and Insurance 

Services, U.S. Office of Personnel 

Management, 1900 E Street, NW., Room 

3305, Washington, DC 20415–3540. 

For Information Regarding 

Administrative Coordination—Contact:

Cyrus S. Benson, Team Leader, 

Publications Team, Administrative 

Services Branch, (202) 606–0623.

U.S. Office of Personnel Management. 

Kay Coles James, 

Director.

[FR Doc. 04–21923 Filed 9–29–04; 8:45 am] 

BILLING CODE 6325–38–P

SECURITIES AND EXCHANGE 

COMMISSION 

Submission for OMB Review; 

Comment Request 

Upon written request, copies available 

from: Securities and Exchange 

Commission, Office of Filings and 

Information Services, 450 Fifth Street, 

NW., Washington, DC 20549.

Extension: 

Rule 15g–9, SEC File No. 270–325, OMB 

Control No. 3235–0385.

Notice is hereby given that pursuant 

to the Paperwork Reduction Act of 1995 

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

Securities and Exchange Commission 

(‘‘Commission’’) has submitted to the 

Office of Management and Budget a 

request for extension of the previously 

approved collection of information 

discussed below. 

Section 15(c)(2) of the Securities 

Exchange Act of 1934 (the ‘‘Exchange 

Act’’) authorizes the Commission to 

promulgate rules that prescribe means 

reasonably designed to prevent 

fraudulent, deceptive, or manipulative 

practices in connection with over-thecounter (‘‘OTC’’) securities transactions. 

Pursuant to this authority, the 

Commission in 1989 adopted Rule 15a–

6 (the ‘‘Rule’’), which was subsequently 

redesignated as Rule 15g–9, 17 CFR 

240.15g–9. The Rule requires brokerdealers to produce a written suitability 

determination for, and to obtain a 

written customer agreement to, certain 

recommended transactions in lowpriced stocks that are not registered on 

a national securities exchange or 

authorized for trading on NASDAQ, and 

whose issuers do not meet certain 

minimum financial standards. The Rule 

is intended to prevent the 

indiscriminate use by broker-dealers of 

fraudulent, high pressure telephone 

sales campaigns to sell low-priced 

securities to unsophisticated customers. 

The staff estimates that approximately 

240 broker-dealers incur an average 

burden of 78 hours per year to comply 

with this rule. Thus, the total burden 

hours to comply with the Rule is 

estimated at 18,720 hours (240 × 78). 

The broker-dealer must keep the 

written suitability determination and 

customer agreement required by the 

Rule for at least three years. Completing 

the suitability determination and 

obtaining the customer agreement in 

writing is mandatory for broker-dealers 

who effect transactions in penny stocks 

and do not qualify for an exemption, but 

does not involve the collection of 

confidential information. Please note 

that 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. 

General comments regarding the 

estimated burden hours should be 

directed to (i) the Desk Officer for the 

SEC, by sending an email to 

David_Rostker@omb.eop.gov; and (ii) R. 

Corey Booth, Director/Chief Information 

Officer, Office of Information 

Technology, Securities and Exchange 

Commission, 450 Fifth Street, NW., 

Washington, DC 20549. Comments must 

be submitted to OMB within 30 days of 

this notice.

Dated: September 20, 2004. 

Margaret H. McFarland, 

Deputy Secretary.

[FR Doc. E4–2412 Filed 9–29–04; 8:45 am] 

BILLING CODE 8010–01–P

SECURITIES AND EXCHANGE 

COMMISSION 

Submission for OMB Review; 

Comment Request 

Upon written request, copies available 

from: Securities and Exchange 

Commission, Office of Filings and 

Information Services, Washington, DC 

20549.

Extension: 

Rule 17a–1, SEC File No. 270–244, OMB 

Control No. 3235–0208.

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. 

Rule 17a–1 under the Securities 

Exchange Act of 1934 (the ‘‘Act’’)