23518 Federal Register / Vol. 77, No. 76 / Thursday, April 19, 2012 / Notices 

30See supra text accompanying note 28. 

31 In the rule 2a–7 submissions, the staff 

estimated that 757 registered money market funds 

have $3.8 trillion in assets under management, or 

$5 billion in assets under management per 

registered money market fund. The staff further 

estimated that 0.2% of those assets are held in small 

money market funds (funds with less than $50 

million in assets under management), 3% are held 

in medium-sized money market funds (funds with 

$50 million to $1 billion in assets under 

management), and the remaining assets are held in 

large money market funds (funds with more than 

$1 billion in assets under management). 

32This estimate is based on the following 

calculations: 30 unregistered money market funds 

× $5 billion = $150 billion. ($150 billion × 0.2% × 

$0.0051295) = $1.5 million for small funds. ($150 

billion × 3% × 0.0005041) = $2.3 million for 

medium-sized funds. ($150 billion × 96.8% × 

0.0000009) = $0.1 million for large funds. $1.5 

million + $2.3 million + $0.1 million = $3.9 million. 

The estimate of cost per dollar of assets is the same 

as that used in the rule 2a–7 submissions. See supra 

note 12. 

33This estimate is based on the following 

calculation: $150 billion × 0.0000132 = $1.98 

million. 

registered money market funds.30 For 

similar reasons, the Commission staff 

estimates that there will be no registered 

money market funds that will adopt 

procedures designed to ensure that the 

unregistered money market funds 

comply with sections 17(a), (d), (e), and 

22(e) of the Act. The staff concludes that 

there will be no burdens associated with 

these collection of information 

requirements. 

Commission staff further estimates 

that unregistered money market funds 

will incur costs to preserve records, as 

required under rule 2a–7. These costs 

will vary significantly for individual 

funds, depending on the amount of 

assets under fund management and 

whether the fund preserves its records 

in a storage facility in hard copy or has 

developed and maintains a computer 

system to create and preserve 

compliance records. In the rule 2a–7 

submissions, Commission staff 

estimated that the amount an individual 

money market fund may spend ranges 

from $100 per year to $300,000. We 

have no reason to believe the range is 

different for unregistered money market 

funds. The Commission does not have 

specific information on the amount of 

assets managed by unregistered money 

market funds or the proportion of those 

assets held in small, medium-sized, or 

large unregistered money market funds. 

Accordingly, Commission staff 

estimates that unregistered money 

market funds in which registered funds 

invest in reliance on rule 12d1–1 are 

similar to registered money market 

funds in terms of amount and 

distribution of assets under 

management.31 Based on a cost of 

$0.0051295 per dollar of assets under 

management for small funds, 

$0.0005041 per dollar of assets under 

management for medium-sized funds 

and $0.0000009 per dollar of assets 

under management for large funds, the 

staff estimates compliance with rule 2– 

7 for these unregistered money market 

funds totals $3.9 million annually.32

Consistent with estimates made in the 

rule 2a–7 submissions, Commission 

staff estimates that unregistered money 

market funds also incur capital costs to 

create computer programs for 

maintaining and preserving compliance 

records for rule 2a–7 of $0.0000132 per 

dollar of assets under management. 

Based on the assets under management 

figures described above, staff estimates 

annual capital costs for all unregistered 

money market funds of $1.98 million.33

Commission staff further estimates 

that, even absent the requirements of 

rule 2a–7, money market funds would 

spend at least half of the amounts 

described above for record preservation 

($2.0 million) and for capital costs 

($0.99 million). Commission staff 

concludes that the aggregate annual 

costs of compliance with the rule are 

$2.0 million for record preservation and 

$0.99 million for capital costs. 

The collections of information 

required for unregistered money market 

funds by rule 12d1–1 are necessary in 

order for acquiring funds to be able to 

obtain the benefits described above. 

Notices to the Commission 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, 

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) 

Thomas Bayer, Director/Chief 

Information Officer, Securities and 

Exchange Commission, c/o Remi PavlikSimon, 6432 General Green Way, 

Alexandria, VA 22312 or send an email 

to: PRA_Mailbox@sec.gov. Comments 

must be submitted to OMB within 30 

days of this notice. 

April 13, 2012. 

Kevin M. O’Neill, 

Deputy Secretary. 

[FR Doc. 2012–9413 Filed 4–18–12; 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 17g–1; SEC File No. 270–208; OMB 

Control No. 3235–0213. 

Notice is hereby given that, pursuant 

to the Paperwork Reduction Act of 1995 

(44 U.S.C. 350l–3520), the Securities 

and Exchange Commission (the 

‘‘Commission’’) has submitted to the 

Office of Management and Budget a 

request for extension of the previously 

approved collection of information 

discussed below. 

Rule 17g–1 (17 CFR 270.17g–1) under 

the Investment Company Act of 1940 

(the ‘‘Act’’) (15 U.S.C. 80a–17(g)) 

governs the fidelity bonding of officers 

and employees of registered 

management investment companies 

(‘‘funds’’) and their advisers. Rule 17g– 

1 requires, in part, the following: 

Independent Directors’ Approval 

The form and amount of the fidelity 

bond must be approved by a majority of 

the fund’s independent directors at least 

once annually, and the amount of any 

premium paid by the fund for any ‘‘joint 

insured bond,’’ covering multiple funds 

or certain affiliates, must be approved 

by a majority of the fund’s independent 

directors. 

Terms and Provisions of the Bond 

The amount of the bond may not be 

less than the minimum amounts of 

coverage set forth in a schedule based 

on the fund’s gross assets; the bond 

must provide that it shall not be 

cancelled, terminated, or modified 

except upon 60-days written notice to 

the affected party and to the 

Commission; in the case of a joint 

insured bond, 60-days written notice 

must also be given to each fund covered 

by the bond; a joint insured bond must 

provide that the fidelity insurance 

company will provide all funds covered 

by the bond with a copy of the 

agreement, a copy of any claim on the 

bond, and notification of the terms of 

the settlement of any claim prior to 

execution of that settlement; and a fund 

that is insured by a joint bond must 

enter into an agreement with all other 

parties insured by the joint bond 

regarding recovery under the bond. 

mstockstill on DSK4VPTVN1PROD with NOTICES

Federal Register / Vol. 77, No. 76 / Thursday, April 19, 2012 / Notices 23519 

1Based on statistics compiled by Commission 

staff, we estimate that there are approximately 3479 

funds that must comply with the collections of 

information under rule 17g–1 and have made a 

filing within the last 12 months. 

Filings With the Commission 

Upon the execution of a fidelity bond 

or any amendment thereto, a fund must 

file with the Commission within 10 

days a copy of the executed bond or any 

amendment to the bond, the 

independent directors’ resolution 

approving the bond, and a statement as 

to the period for which premiums have 

been paid on the bond. In the case of a 

joint insured bond, a fund must also file 

(i) a statement showing the amount the 

fund would have been required to 

maintain under the rule if it were 

insured under a single insured bond and 

(ii) the agreement between the fund and 

all other insured parties regarding 

recovery under the bond. A fund must 

also notify the Commission in writing 

within five days of any claim or 

settlement on a claim under the fidelity 

bond. 

Notices to Directors 

A fund must notify by registered mail 

each member of its board of directors of 

(i) any cancellation, termination, or 

modification of the fidelity bond at least 

45 days prior to the effective date, and 

(ii) the filing or settlement of any claim 

under the fidelity bond when 

notification is filed with the 

Commission. 

Rule 17g–1’s independent directors’ 

annual review requirements, fidelity 

bond content requirements, joint bond 

agreement requirement and the required 

notices to directors are designed to 

ensure the safety of fund assets against 

losses due to the conduct of persons 

who may obtain access to those assets. 

These requirements also facilitate 

oversight of a fund’s fidelity bond. The 

rule’s required filings with the 

Commission are designed to assist the 

Commission in monitoring funds’ 

compliance with the fidelity bond 

requirements. 

Based on conversations with 

representatives in the fund industry, the 

Commission staff estimates that for each 

of the estimated 3479 active funds,1 the 

average annual paperwork burden 

associated with rule 17g–1’s 

requirements is two hours, one hour 

each for a compliance attorney and the 

board of directors as a whole. The time 

spent by compliance attorney includes 

time spent filing reports with the 

Commission for any fidelity losses (if 

any) as well as paperwork associated 

with any notices to directors, and 

managing any updates to the bond and 

the joint agreement (if one exists). The 

time spent by the board of directors as 

a whole includes any time spent 

initially establishing the bond, as well 

as time spent on annual updates and 

approvals. The Commission staff 

therefore estimates the total ongoing 

paperwork burden hours per year for all 

funds required by rule 17g–1 to be 6958 

hours (3479 funds × 2 hours = 6958 

hours). 

These estimates of average burden 

hours are made solely for the purposes 

of the Paperwork Reduction Act. These 

estimates are not derived from a 

comprehensive or even a representative 

survey or study of Commission rules. 

The collection of information required 

by Rule 17g–1 is mandatory and 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, 

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) 

Thomas Bayer, Director/Chief 

Information Officer, Securities and 

Exchange Commission, c/o Remi PavlikSimon, 6432 General Green Way, 

Alexandria, VA 22312 or send an email 

to: PRA_Mailbox@sec.gov. Comments 

must be submitted to OMB within 30 

days of this notice. 

Dated: April 13, 2012. 

Kevin M. O’Neill, 

Deputy Secretary. 

[FR Doc. 2012–9414 Filed 4–18–12; 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 35d–1; SEC File No. 270–491; OMB 

Control No. 3235–0548. 

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’’) has submitted to the 

Office of Management and Budget 

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

previously approved collection of 

information discussed below. 

Rule 35d–1 (17 CFR 270.35d–1) under 

the Investment Company Act of 1940 

(15 U.S.C. 80a–1 et seq.) defines as 

‘‘materially deceptive and misleading’’ 

for purposes of Section 35(d), among 

other things, a name suggesting that a 

registered investment company or series 

thereof (a ‘‘fund’’) focuses its 

investments in a particular type of 

investment or investments, in 

investments in a particular industry or 

group of industries, or in investments in 

a particular country or geographic 

region, unless, among other things, the 

fund adopts a certain investment policy. 

Rule 35d–1 further requires either that 

the investment policy is fundamental or 

that the fund has adopted a policy to 

provide its shareholders with at least 60 

days prior notice of any change in the 

investment policy (‘‘notice to 

shareholders’’). The rule’s notice to 

shareholders provision is intended to 

ensure that when shareholders purchase 

shares in a fund based, at least in part, 

on its name, and with the expectation 

that it will follow the investment policy 

suggested by that name, they will have 

sufficient time to decide whether to 

redeem their shares in the event that the 

fund decides to pursue a different 

investment policy. 

The Commission estimates that there 

are approximately 8,800 open-end and 

closed-end funds that have names that 

are covered by the rule. The 

Commission estimates that of these 

8,800 funds, approximately 29 will 

provide prior notice to shareholders 

pursuant to a policy adopted in 

accordance with this rule per year. The 

Commission estimates that the annual 

burden associated with the notice to 

shareholders requirement of the rule is 

20 hours per response, for an annual 

total of 580 hours per year. 

Estimates of average burden hours are 

made solely for the purposes of the 

Paperwork Reduction Act and are not 

derived from a comprehensive or even 

representative survey or study of the 

costs of Commission rules and forms. 

The collection of information under rule 

35d–1 is mandatory. The information 

provided under rule 35d–1 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 Web site: 

mstockstill on DSK4VPTVN1PROD with NOTICES