1550 Federal Register / Vol. 86, No. 5 / Friday, January 8, 2021 / Notices 

1 15 U.S.C. 80a. 

2For example, fund directors must approve 

investment advisory and distribution contracts. See 

15 U.S.C. 80a–15(a), (b), and (c). 

3 Investment Company Act Release No. 4 (Oct. 29, 

1940) (5 FR 4316 (Oct. 31, 1940)). Note that rule 0– 

1 was originally adopted as rule N–1. 

4The relevant exemptive rules are: Rule 10f–3 (17 

CFR 270.10f–3), rule 12b–1 (17 CFR 270.12b–1), 

rule 15a–4(b)(2) (17 CFR 270.15a–4(b)(2)), rule 17a– 

7 (17 CFR 270.17a–7), rule 17a–8 (17 CFR 270.17a– 

-8), rule 17d–1(d)(7) (17 CFR 270.17d–1(d)(7)), rule 

17e–1(c) (17 CFR 270.17e–1(c)), rule 17g–1 (17 CFR 

270.17g–1), rule 18f–-3 (17 CFR 270.18f–3), and rule 

23c-3 (17 CFR 270.23c–3). 

5See Role of Independent Directors of Investment 

Companies, Investment Company Act Release No. 

24816 (Jan. 2, 2001) (66 FR 3735 (Jan. 16, 2001)). 6A ‘‘control person’’ is any person—other than a 

fund—directly or indirectly controlling, controlled 

by, or under common control, with any of the 

fund’s management organizations. See 17 CFR 

270.01(a)(6)(iv)(B). 

7Based on statistics compiled by Commission 

staff, we estimate that there are approximately 3373 

funds that could rely on one or more of the 

exemptive rules (this figure reflects the three-year 

average of open-end and closed-end funds (3,329) 

and business development companies (104)). Of 

those funds, we assume that approximately 90 

percent (3,035) actually rely on at least one 

exemptive rules annually. 

8We assume that the independent directors of the 

remaining two-thirds of those funds will choose not 

to have counsel, or will rely on counsel who has 

not recently represented the fund’s management 

organizations or control persons. In both 

circumstances, it would not be necessary for the 

fund’s independent directors to make a 

determination about their counsel’s independence. 

9The estimated hourly wages used in this PRA 

analysis were derived from the Securities Industry 

and Financial Markets Association’s Reports on 

Management and Professional Earnings in the 

Securities Industry (2013) (modified to account for 

an 1800-hour work year and multiplied by 5.35 to 

account for bonuses, firm size, employee benefits 

and overhead) (adjusted for inflation), and Office 

Salaries in the Securities Industry (2013) (modified 

to account for an 1800-hour work year and 

multiplied by 2.93 to account for bonuses, firm size, 

employee benefits and overhead) (adjusted for 

inflation). 

10 (505 × $312/hour) + (253 × $71hour) = 

$175,523. 

[FR Doc. 2021–00153 Filed 1–7–21; 8:45 am] 

BILLING CODE 7590–01–P 

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[SEC File No. 270–472, OMB Control No. 

3235–0531] 

Proposed Collection; Comment 

Request, Upon Written Request Copies 

Available From: Securities and 

Exchange Commission, Office of FOIA 

Services, 100 F Street NE, Washington, 

DC 20549–2736 

Extension: 

Rule 0–1 

Notice is hereby given that, pursuant 

to the Paperwork Reduction Act of 1995 

(44 U.S.C. 350l et seq.), the Securities 

and Exchange Commission 

(‘‘Commission’’) plans to submit to the 

Office of Management and Budget a 

request for extension of the previous 

approved collection of information 

discussed below. 

The Investment Company Act of 1940 

(the ‘‘Act’’) 1 establishes a 

comprehensive framework for regulating 

the organization and operation of 

investment companies (‘‘funds’’). A 

principal objective of the Act is to 

protect fund investors by addressing the 

conflicts of interest that exist between 

funds and their investment advisers and 

other affiliated persons. The Act places 

significant responsibility on the fund 

board of directors in overseeing the 

operations of the fund and policing the 

relevant conflicts of interest.2

In one of its first releases, the 

Commission exercised its rulemaking 

authority pursuant to sections 38(a) and 

40(b) of the Act by adopting rule 0–1 (17 

CFR 270.0–1).3 Rule 0–1, as 

subsequently amended on numerous 

occasions, provides definitions for the 

terms used by the Commission in the 

rules and regulations it has adopted 

pursuant to the Act. The rule also 

contains a number of rules of 

construction for terms that are defined 

either in the Act itself or elsewhere in 

the Commission’s rules and regulations. 

Finally, rule 0–1 defines terms that 

serve as conditions to the availability of 

certain of the Commission’s exemptive 

rules. More specifically, the term 

‘‘independent legal counsel,’’ as defined 

in rule 0–1, sets out conditions that 

funds must meet in order to rely on any 

of ten exemptive rules (‘‘exemptive 

rules’’) under the Act.4

The Commission amended rule 0–1 to 

include the definition of the term 

‘‘independent legal counsel’’ in 2001.5

This amendment was designed to 

enhance the effectiveness of fund boards 

of directors and to better enable 

investors to assess the independence of 

those directors. The Commission also 

amended the exemptive rules to require 

that any person who serves as legal 

counsel to the independent directors of 

any fund that relies on any of the 

exemptive rules must be an 

‘‘independent legal counsel.’’ This 

requirement was added because 

independent directors can better 

perform the responsibilities assigned to 

them under the Act and the rules if they 

have the assistance of truly independent 

legal counsel. 

If the board’s counsel has represented 

the fund’s investment adviser, principal 

underwriter, administrator (collectively, 

‘‘management organizations’’) or their 

‘‘control persons’’ 6 during the past two 

years, rule 0–1 requires that the board’s 

independent directors make a 

determination about the adequacy of the 

counsel’s independence. A majority of 

the board’s independent directors are 

required to reasonably determine, in the 

exercise of their judgment, that the 

counsel’s prior or current representation 

of the management organizations or 

their control persons was sufficiently 

limited to conclude that it is unlikely to 

adversely affect the counsel’s 

professional judgment and legal 

representation. Rule 0–1 also requires 

that a record for the basis of this 

determination is made in the minutes of 

the directors’ meeting. In addition, the 

independent directors must have 

obtained an undertaking from the 

counsel to provide them with the 

information necessary to make their 

determination and to update promptly 

that information when the person begins 

to represent a management organization 

or control person, or when he or she 

materially increases his or her 

representation. Generally, the 

independent directors must re-evaluate 

their determination no less frequently 

than annually. 

Any fund that relies on one of the 

exemptive rules must comply with the 

requirements in the definition of 

‘‘independent legal counsel’’ under rule 

0–1. We assume that approximately 

3035 funds rely on at least one of the 

exemptive rules annually.7 We further 

assume that the independent directors 

of approximately one-third (1,010) of 

those funds would need to make the 

required determination in order for their 

counsel to meet the definition of 

independent legal counsel.8 We 

estimate that each of these 1,010 funds 

would be required to spend, on average, 

0.75 hours annually to comply with the 

recordkeeping requirement associated 

with this determination, for a total 

annual burden of approximately 758 

hours. Based on this estimate, the total 

annual cost for all funds’ compliance 

with this rule is approximately 

$175,523. To calculate this total annual 

cost, the Commission staff assumed that 

approximately two-thirds of the total 

annual hour burden (505 hours) would 

be incurred by a compliance manager 

with an average hourly wage rate of 

$312 per hour,9 and one-third of the 

annual hour burden (253 hours) would 

be incurred by compliance clerk with an 

average hourly wage rate of $71 per 

hour.10

These burden hour estimates are 

based upon the Commission staff’s 

experience and discussions with the 

fund industry. The estimates of average 

burden hours are made solely for the 

purposes of the Paperwork Reduction 


tkelley on DSKBCP9HB2PROD with NOTICES
Federal Register / Vol. 86, No. 5 / Friday, January 8, 2021 / Notices 1551 

1The estimated number of responses to rule 34b– 

1 is composed of 7,362 responses filed with FINRA 

and 351 responses filed with the Commission in 

2019. 

2 7,713 responses × 6 hours per response = 46,278 

hours. 

Act. These estimates are not derived 

from a comprehensive or even a 

representative survey or study of the 

costs of Commission rules. 

Written comments are invited on: (a) 

Whether the collection of information is 

necessary for the proper performance of 

the functions of the Commission, 

including whether the information has 

practical utility; (b) the accuracy of the 

Commission’s estimate of the burdens of 

the collection of information; (c) ways to 

enhance the quality, utility, and clarity 

of the information collected; and (d) 

ways to minimize the burdens of the 

collection of information on 

respondents, including through the use 

of automated collection techniques or 

other forms of information technology. 

Consideration will be given to 

comments and suggestions submitted in 

writing within 60 days of this 

publication. 

Please direct your written comments 

to David Bottom, Director/Chief 

Information Officer, Securities and 

Exchange Commission, C/O Cynthia 

Roscoe, 100 F Street, NE Washington, 

DC 20549; or send an email to: PRA_

Mailbox@sec.gov. 

Dated: January 5, 2021. 

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2021–00144 Filed 1–7–21; 8:45 am] 

BILLING CODE 8011–01–P 

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Sunshine Act Meeting; Cancellation 

FEDERAL REGISTER CITATION OF PREVIOUS

ANNOUNCEMENT: 85 FR 157, January 4, 

2021. 

PREVIOUSLY ANNOUNCED TIME AND DATE OF

THE MEETING: Wednesday, January 6, 

2021 at 2:00 p.m. 

CHANGES IN THE MEETING: The closed 

meeting scheduled for Wednesday, 

January 6, 2021 at 2:00 p.m., has been 

cancelled. 

CONTACT PERSON FOR MORE INFORMATION: 

For further information; please contact 

Vanessa A. Countryman from the Office 

of the Secretary at (202) 551–5400. 

Dated: January 6, 2021. 

Vanessa A. Countryman, 

Secretary. 

[FR Doc. 2021–00319 Filed 1–6–21; 4:15 pm] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[SEC File No. 270–305, OMB Control No. 

3235–0346] 

Proposed Collection; Comment 

Request 

Upon Written Request, Copies Available 

From: Securities and Exchange 

Commission, Office of FOIA Services, 

100 F Street NE, Washington, DC 

20549–2736 

Extension: 

Rule 34b–1 

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 (the 

‘‘Commission’’) is soliciting comments 

on the collection of information 

summarized below. The Commission 

plans to submit this existing collection 

of information to the Office of 

Management and Budget for extension 

and approval. 

Rule 34b–1 under the Investment 

Company Act (17 CFR 270.34b–1) 

governs sales material that accompanies 

or follows the delivery of a statutory 

prospectus (‘‘sales literature’’). Rule 

34b–1 deems to be materially 

misleading any investment company 

(‘‘fund’’) sales literature required to be 

filed with the Securities and Exchange 

Commission (‘‘Commission’’) by Section 

24(b) of the Investment Company Act 

(15 U.S.C. 80a–24(b)) that includes 

performance data, unless the sales 

literature also includes the appropriate 

uniformly computed data and the 

legend disclosure required in 

investment company advertisements by 

rule 482 under the Securities Act of 

1933 (17 CFR 230.482). Requiring the 

inclusion of such standardized 

performance data in sales literature is 

designed to prevent misleading 

performance claims by funds and to 

enable investors to make meaningful 

comparisons among funds. 

The Commission estimates that on 

average approximately 351 respondents 

file 7,362 1 responses that include the 

information required by rule 34b–1 each 

year. The burden resulting from the 

collection of information requirements 

of rule 34b–1 is estimated to be 6 hours 

per response. The total hourly burden 

for rule 34b–1 is approximately 46,278 

hours per year in the aggregate.2

The collection of information under 

rule 34b–1 is mandatory. The 

information provided under rule 34b–1 

is not kept confidential. The 

Commission may not conduct or 

sponsor, and a person is not required to 

respond to, a collection of information 

unless it displays a currently valid OMB 

control number. 

Written comments are invited on: (a) 

Whether the proposed collection of 

information is necessary for the 

proposed performance of the functions 

of the agency, including whether 

information will have practical utility; 

(b) the accuracy of the agency’s estimate 

of the burden of the collection of 

information; (c) ways to enhance the 

quality, utility, and clarity of the 

information collected; and (d) ways to 

minimize the burden of the collection of 

information on respondents, including 

through the use of automated collection 

techniques or other forms of information 

technology. Consideration will be given 

to comments and suggestions submitted 

in writing within 60 days of this 

publication. 

Please direct your written comments 

to David Bottom, Director/Chief 

Information Officer, Securities and 

Exchange Commission, C/O Cynthia 

Roscoe, 100 F Street NE, Washington, 

DC 20549; or send an email to: PRA_

Mailbox@sec.gov. 

Dated: January 5, 2021. 

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2021–00145 Filed 1–7–21; 8:45 am] 

BILLING CODE 8011–01–P 

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[Investment Company Act Release No. 

34161; 812–15106] 

Esoterica Thematic Trust and 

Esoterica Capital LLC; Notice of 

Application 

January 4, 2021. 

AGENCY: Securities and Exchange 

Commission (‘‘Commission’’). 

ACTION: Notice. 

Notice of an application under section 

6(c) of the Investment Company Act of 

1940 (‘‘Act’’) for an exemption from 

section 15(a) of the Act, as well as from 

certain disclosure requirements in rule 

20a–1 under the Act, Item 19(a)(3) of 

Form N–1A, Items 22(c)(1)(ii), 

22(c)(1)(iii), 22(c)(8) and 22(c)(9) of 

Schedule 14A under the Securities 

Exchange Act of 1934 (‘‘1934 Act’’), and 

sections 6–07(2)(a), (b), and (c) of 


tkelley on DSKBCP9HB2PROD with NOTICES