35304 Federal Register / Vol. 83, No. 143 / Wednesday, July 25, 2018 / Notices 

1 15 U.S.C. 80a-10(f). 

2 17 CFR 270.10f–3. 

3These estimates are based on staff extrapolations 

from filings with the Commission. 

4Unless stated otherwise, the information 

collection burden estimates are based on 

conversations between the staff and representatives 

of funds. 

5This estimate is based on the following 

calculation: (0.5 hours × 2,928 = 1,464 hours). 

6This estimate is based on the following 

calculations: (20 minutes × 2,928 transactions = 

58,560 minutes; 58,560 minutes/60 = 976 hours). 

7This estimate is based on the following 

calculation: (1 hour per quarter × 4 quarters × 236 

funds = 944 hours). 

8These averages take into account the fact that in 

most years, fund attorneys and boards spend little 

or no time modifying procedures and in other years, 

they spend significant time doing so. 

9This estimate is based on the following 

calculation: (236 funds × 2 hours = 472 hours). 

Commission’s experience with 

disclosure documents, we estimate that 

the burden from compliance with Form 

1–E and the offering circular requires 

approximately 100 hours per filing. The 

annual burden hours for compliance 

with Form 1–E and the offering circular 

would be 200 hours (2 responses × 100 

hours per response). Estimates of the 

burden hours are made solely for the 

purposes of the PRA, and are not 

derived from a comprehensive or even 

a representative survey or study of the 

costs of SEC rules and forms. 

Compliance with the information 

collection requirements of the rules is 

necessary to obtain the benefit of relying 

on the rules. The information provided 

on Form 1–E and in the offering circular 

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 OMB control 

number. 

The public may view the background 

documentation for this information 

collection at the following website, 

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 email to: Shagufta_

Ahmed@omb.eop.gov; and (ii) Pamela 

Dyson, Director/Chief Information 

Officer, Securities and Exchange 

Commission, c/o Candace Kenner, 100 F 

Street NE, Washington, DC 20549 or 

send an email to: PRA_Mailbox@

sec.gov. Comments must be submitted to 

OMB within 30 days of this notice. 

Dated: July 19, 2018. 

Eduardo A. Aleman, 

Assistant Secretary. 

[FR Doc. 2018–15855 Filed 7–24–18; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

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 10f–3; SEC File No. 270–237, OMB 

Control No. 3235–0226 

Notice is hereby given that, pursuant 

to the Paperwork Reduction Act of 1995 

(44 U.S.C. 3501–3520), the Securities 

and Exchange Commission 

(‘‘Commission’’) is soliciting comments 

on the collections of information 

discussed below. The Commission plans 

to submit these existing collections of 

information to the Office of 

Management and Budget (‘‘OMB’’) for 

extension and approval. 

Section 10(f) of the Investment 

Company Act of 1940 (15 U.S.C. 80a) 

(the ‘‘Act’’) prohibits a registered 

investment company (‘‘fund’’) from 

purchasing any security during an 

underwriting or selling syndicate if the 

fund has certain relationships with a 

principal underwriter for the security.1

Congress enacted this provision in 1940 

to protect funds and their shareholders 

by preventing underwriters from 

‘‘dumping’’ unmarketable securities on 

affiliated funds. 

Rule 10f–3 permits a fund to engage 

in a securities transaction that otherwise 

would violate section 10(f) if, among 

other things: (i) The fund’s directors 

have approved procedures for purchases 

made in reliance on the rule, regularly 

review fund purchases to determine 

whether they comply with these 

procedures, and approve necessary 

changes to the procedures; and (ii) a 

written record of each transaction 

effected under the rule is maintained for 

six years, the first two of which in an 

easily accessible place.2 The written 

record must state: (i) From whom the 

securities were acquired; (ii) the identity 

of the underwriting syndicate’s 

members; (iii) the terms of the 

transactions; and (iv) the information or 

materials on which the fund’s board of 

directors has determined that the 

purchases were made in compliance 

with procedures established by the 

board. 

Rule 10f–3 also conditionally allows 

managed portions of fund portfolios to 

purchase securities offered in otherwise 

off-limits primary offerings. To qualify 

for this exemption, rule 10f-3 requires 

that the subadviser that is advising the 

purchaser be contractually prohibited 

from providing investment advice to 

any other portion of the fund’s portfolio 

and consulting with any other of the 

fund’s advisers that is a principal 

underwriter or affiliated person of a 

principal underwriter concerning the 

fund’s securities transactions. 

These requirements provide a 

mechanism for fund boards to oversee 

compliance with the rule. The required 

recordkeeping facilitates the 

Commission staff’s review of rule 10f– 

3 transactions during routine fund 

inspections and, when necessary, in 

connection with enforcement actions. 

The staff estimates that approximately 

236 funds engage in a total of 

approximately 2,928 rule 10f–3 

transactions each year.3 Rule 10f–3 

requires that the purchasing fund create 

a written record of each transaction that 

includes, among other things, from 

whom the securities were purchased 

and the terms of the transaction. The 

staff estimates 4 that it takes an average 

fund approximately 30 minutes per 

transaction and approximately 1,464 

hours 5 in the aggregate to comply with 

this portion of the rule. 

The funds also must maintain and 

preserve these transactional records in 

accordance with the rule’s 

recordkeeping requirement, and the staff 

estimates that it takes a fund 

approximately 20 minutes per 

transaction and that annually, in the 

aggregate, funds spend approximately 

976 hours 6 to comply with this portion 

of the rule. 

In addition, fund boards must, no less 

than quarterly, examine each of these 

transactions to ensure that they comply 

with the fund’s policies and procedures. 

The information or materials upon 

which the board relied to come to this 

determination also must be maintained 

and the staff estimates that it takes a 

fund 1 hour per quarter and, in the 

aggregate, approximately 944 hours 7

annually to comply with this rule 

requirement. 

The staff estimates that reviewing and 

revising as needed written procedures 

for rule 10f-3 transactions takes, on 

average for each fund, two hours of a 

compliance attorney’s time per year.8

Thus, annually, in the aggregate, the 

staff estimates that funds spend a total 

of approximately 472 hours 9 on 

monitoring and revising rule 10f–3 

procedures. 

Based on an analysis of fund filings, 

the staff estimates that approximately 

299 fund portfolios enter into 


daltland on DSKBBV9HB2PROD with NOTICES
Federal Register / Vol. 83, No. 143 / Wednesday, July 25, 2018 / Notices 35305 

10Based on information in Commission filings, 

we estimate that 38 percent of funds are advised by 

subadvisers. 

11This estimate is based on the following 

calculation (3 hours ÷ 4 rules = .75 hours). 

12These estimates are based on the following 

calculations: (0.75 hours × 299 portfolios = 224 

burden hours). 

13This estimate is based on the following 

calculation: (1,464 hours + 976 hours + 944 hours 

+ 472 + 224 hours = 4,080 total burden hours). 

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

2 17 CFR 240.19b–4. 

3 15 U.S.C. 78s(b)(3)(A)(iii). 

4 17 CFR 240.19b–4(f)(6). 

subadvisory agreements each year.10

Based on discussions with industry 

representatives, the staff estimates that 

it will require approximately 3 attorney 

hours to draft and execute additional 

clauses in new subadvisory contracts in 

order for funds and subadvisers to be 

able to rely on the exemptions in rule 

10f–3. Because these additional clauses 

are identical to the clauses that a fund 

would need to insert in their 

subadvisory contracts to rely on rules 

12d3–1, 17a–10, and 17e–1, and because 

we believe that funds that use one such 

rule generally use all of these rules, we 

apportion this 3 hour time burden 

equally to all four rules. Therefore, we 

estimate that the burden allocated to 

rule 10f–3 for this contract change 

would be 0.75 hours.11 Assuming that 

all 299 funds that enter into new 

subadvisory contracts each year make 

the modification to their contract 

required by the rule, we estimate that 

the rule’s contract modification 

requirement will result in 224 burden 

hours annually.12

The staff estimates, therefore, that rule 

10f–3 imposes an information collection 

burden of 4,080 hours.13

Written comments are invited on: (a) 

Whether the collections of information 

are 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 collections of 

information; (c) ways to enhance the 

quality, utility, and clarity of the 

information collected; and (d) ways to 

minimize the burdens of the collections 

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 Pamela Dyson, Director/Chief 

Information Officer, Securities and 

Exchange Commission, C/O Candace 

Kenner, 100 F Street NE, Washington, 

DC 20549; or send an email to: PRA_

Mailbox@sec.gov. 

Dated: July 19, 2018. 

Eduardo A. Aleman, 

Assistant Secretary. 

[FR Doc. 2018–15853 Filed 7–24–18; 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 FOIA Services, 

100 F Street NE, Washington, DC 

20549–2736 

Extension: 

Interagency Statement on Sound Practices, 

SEC File No. 270–560, OMB Control No. 

3235–0622 

Notice is hereby given that pursuant 

to the Paperwork Reduction Act of 1995 

(‘‘PRA’’) (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 previously approved 

collection of information provided for in 

the Interagency Statement on Sound 

Practices Concerning Elevated Risk 

Complex Structured Finance Activities 

(‘‘Statement’’) under the Securities 

Exchange Act of 1934 (15 U.S.C. 78a et 

seq.) (‘‘Exchange Act’’) and the 

Investment Advisers Act of 1940 (15 

U.S.C. 80b et seq.) (‘‘Advisers Act’’). 

The Statement was issued by the 

Commission, together with the Office of 

the Comptroller of the Currency, the 

Board of Governors of the Federal 

Reserve System, the Federal Deposit 

Insurance Corporation, and the Office of 

Thrift Supervision (together, the 

‘‘Agencies’’), in May 2006. The 

Statement describes the types of internal 

controls and risk management 

procedures that the Agencies believe are 

particularly effective in assisting 

financial institutions to identify and 

address the reputational, legal, and 

other risks associated with elevated risk 

complex structured finance 

transactions. 

The primary purpose of the Statement 

is to ensure that these transactions 

receive enhanced scrutiny by the 

institution and to ensure that the 

institution does not participate in illegal 

or inappropriate transactions. 

The Commission estimates that 

approximately 5 registered brokerdealers or investment advisers will 

spend an average of approximately 25 

hours per year complying with the 

Statement. Thus, the total compliance 

burden is estimated to be approximately 

125 burden-hours per year. 

An agency may not conduct or 

sponsor, and a person is not required to 

respond to, a collection of information 

under the PRA unless it displays a 

currently valid OMB control number. 

The public may view background 

documentation for this information 

collection at the following website, 

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 email to: Shagufta_

Ahmed@omb.eop.gov; and (ii) Pamela 

Dyson, Director/Chief Information 

Officer, Securities and Exchange 

Commission, c/o Candace Kenner 100 F 

Street NE Washington, DC 20549, or by 

sending an email to: PRA_Mailbox@

sec.gov. Comments must be submitted to 

OMB within 30 days of this notice. 

Dated: July 19, 2018. 

Eduardo A. Aleman, 

Assistant Secretary. 

[FR Doc. 2018–15856 Filed 7–24–18; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–83672; File No. SR–CBOE– 

2018–052] 

Self-Regulatory Organizations; Cboe 

Exchange, Inc.; Notice of Filing and 

Immediate Effectiveness of a Proposed 

Rule Change To Extend the Credit 

Option Margin Pilot Program Through 

July 18, 2019 

July 19, 2018. 

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 July 18, 

2018, Cboe Exchange, Inc. (the 

‘‘Exchange’’ or ‘‘Cboe Options’’) filed 

with the Securities and Exchange 

Commission (the ‘‘Commission’’) the 

proposed rule change as described in 

Items I and II below, which Items have 

been prepared by the Exchange. The 

Exchange filed the proposal as a ‘‘noncontroversial’’ proposed rule change 

pursuant to Section 19(b)(3)(A)(iii) of 

the Act3 and Rule 19b–4(f)(6) 

thereunder.4 The Commission is 

publishing this notice to solicit 


daltland on DSKBBV9HB2PROD with NOTICES