88428 Federal Register / Vol. 88, No. 244 / Thursday, December 21, 2023 / Notices 

1Section 4(3) of the Act (15 U.S. C. 80a–4(3)) 

defines ‘‘management company’’ as ‘‘any 

investment company other than a face amount 

certificate company or a unit investment trust.’’ 

2This estimate is as of December 2022 and is 

based on the Commission staff’s review of EDGAR 

filings through July 31, 2023; the number of 

management investment company portfolios that 

make distributions for which compliance with rule 

19a–1 is required depends on a wide range of 

factors and can vary greatly across years; therefore, 

the calculation of estimated burden hours below is 

based on the total number of management 

investment company portfolios, each of which may 

be subject to rule 19a–1. 

3A few portfolios make monthly distributions 

from sources other than net income, so the rule 

requires them to send out a statement 12 times a 

year; other portfolios never make such 

distributions. 

4This estimate is based on the following 

calculation: 12,900 management investment 

company portfolios × 2 statements per year × 1 hour 

per statement = 25,800 burden hours. 

5Hourly rates are derived from the Securities 

Industry and Financial Markets Association 

(‘‘SIFMA’’), Management and Professional Earnings 

in the Securities Industry 2013, modified to account 

for an 1800-hour work-year and inflation, and 

multiplied by 5.35 to account for bonuses, firm size, 

employee benefits, and overhead. 

previously approved collection of 

information discussed below. 

Rule 489 (17 CFR 230.489) under the 

Securities Act of 1933 (15 U.S.C. 77a et 

seq.) requires foreign banks and foreign 

insurance companies and holding 

companies and finance subsidiaries of 

foreign banks and foreign insurance 

companies that are exempted from the 

definition of ‘‘investment company’’ by 

virtue of rules 3a–1 (17 CFR 270.3a–1), 

3a–5 (17 CFR 270.3a–5), and 3a–6 (17 

CFR 270.3a–6) under the Investment 

Company Act of 1940 (15 U.S.C. 80a–1 

et seq.) to file Form F–N (17 CFR 

239.43) to appoint an agent for service 

of process when making a public 

offering of securities in the United 

States. The information is collected so 

that the Commission and private 

plaintiffs may serve process on foreign 

entities in actions and administrative 

proceedings arising out of or based on 

the offer or sales of securities in the 

United States by such foreign entities. 

The Commission received an average 

of 25 Form F–N filings per year over the 

last three years (2020–2022). The 

Commission has previously estimated 

that the total annual burden associated 

with information collection and Form 

F–N preparation and submission is one 

hour per filing. Based on the 

Commission’s experience with 

disclosure documents generally, the 

Commission continues to believe that 

this estimate is appropriate. Thus the 

estimated total annual burden for rule 

489 and Form F–N is 25 hours. 

Estimates of the average burden hours 

are made solely for the purposes of the 

Paperwork Reduction Act and are not 

derived from a comprehensive or even 

a representative survey or study of the 

costs of Commission rules and forms. 

Compliance with the collection of 

information requirements of rule 489 

and Form F–N is mandatory to obtain 

the benefit of the exemption. Responses 

to the collection of information 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 background 

documentation for this information 

collection at the following website: 

www.reginfo.gov. Find this particular 

information collection by selecting 

‘‘Currently under 30-day Review—Open 

for Public Comments’’ or by using the 

search function. Written comments and 

recommendations for the proposed 

information collection should be sent 

within 30 days of publication of this 

notice by January 22, 2024 to (i) 

MBX.OMB.OIRA.SEC_desk_officer@

omb.eop.gov and (ii) David Bottom, 

Director/Chief Information Officer, 

Securities and Exchange Commission, c/ 

o John Pezzullo, 100 F Street NE, 

Washington, DC 20549, or by sending an 

email to: PRA_Mailbox@sec.gov. 

Dated: December 18, 2023. 

Sherry R. Haywood, 

Assistant Secretary. 

[FR Doc. 2023–28117 Filed 12–20–23; 8:45 am] 

BILLING CODE P 

SECURITIES AND EXCHANGE 

COMMISSION 

[SEC File No. 270–240, OMB Control No. 

3235–0216] 

Submission for OMB Review; 

Comment Request; Extension: Rule 

19a–1 

Upon Written Request, Copies Available 

From: Securities and Exchange 

Commission, Office of FOIA Services, 

100 F Street NE, Washington, DC 

20549–2736 

Notice is hereby given that, pursuant 

to the Paperwork Reduction Act of 1995 

(44 U.S.C. 3501–3520), 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. 

Section 19(a) (15 U.S.C. 80a–19(a)) of 

the Investment Company Act of 1940 

(the ‘‘Act’’) (15 U.S.C. 80a) makes it 

unlawful for any registered investment 

company to pay any dividend or similar 

distribution from any source other than 

the company’s net income, unless the 

payment is accompanied by a written 

statement to the company’s 

shareholders which adequately 

discloses the sources of the payment. 

Section 19(a) authorizes the 

Commission to prescribe the form of 

such statement by rule. 

Rule 19a–1 (17 CFR 270. 19a–1) under 

the Act, entitled ‘‘Written Statement to 

Accompany Dividend Payments by 

Management Companies,’’ sets forth 

specific requirements for the 

information that must be included in 

statements made pursuant to section 

19(a) by or on behalf of management 

companies.1 The rule requires that the 

statement indicate what portions of 

distribution payments are made from 

net income, net profits from the sale of 

a security or other property (‘‘capital 

gains’’) and paid-in capital. When any 

part of the payment is made from capital 

gains, rule 19a–1 also requires that the 

statement disclose certain other 

information relating to the appreciation 

or depreciation of portfolio securities. If 

an estimated portion is subsequently 

determined to be significantly 

inaccurate, a correction must be made 

on a statement made pursuant to section 

19(a) or in the first report to 

shareholders following the discovery of 

the inaccuracy. 

The purpose of rule 19a–1 is to afford 

fund shareholders adequate disclosure 

of the sources from which distribution 

payments are made. The rule is 

intended to prevent shareholders from 

confusing income dividends with 

distributions made from capital sources. 

Absent rule 19a–1, shareholders might 

receive a false impression of fund gains. 

Based on a review of filings made 

with the Commission, the staff estimates 

that approximately 12,900 series of 

registered investment companies that 

are management companies may be 

subject to rule 19a–1 each year,2 and 

that each portfolio on average mails two 

statements per year to meet the 

requirements of the rule.3 The staff 

further estimates that the time needed to 

make the determinations required by the 

rule and to prepare the statement 

required under the rule is 

approximately 1 hour per statement. 

The total annual burden for all 

portfolios therefore is estimated to be 

approximately 25,800 burden hours.4

The staff estimates that approximately 

one-third of the total annual burden 

(8,600 hours) would be incurred by a 

paralegal with an average hourly wage 

rate of approximately $253 per hour,5

and approximately two-thirds of the 

annual burden (17,200 hours) would be 

incurred by a compliance clerk with an 

average hourly wage rate of $82 per 


khammond on DSKJM1Z7X2PROD with NOTICES
Federal Register / Vol. 88, No. 244 / Thursday, December 21, 2023 / Notices 88429 

6Hourly rates are derived from SIFMA’s 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. 

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

2 17 CFR 240.19b–4. 

3See IM–7150–1. 

4For example, for one instance of 100 contracts, 

the BOX Firm ID would be entitled to an allocation 

of at least 40% or 40 contracts. If the customer order 

is sent as multiple small PIPs for 2 contracts, the 

BOX Participant would receive at least 50% of each 

PIP sent (2 * .40 = .8, rounded up to 1 contract). 

Therefore, the total allocation of the original 100 

contract order would be at least 50% or 50 

contracts, rather than 40% or 40 contracts, a 

potential over allocation of at least 10 contracts. 

Continued 

hour.6 The staff therefore estimates that 

the aggregate annual burden, in dollars, 

of the hours needed to comply with the 

paperwork requirements of the rule is 

approximately $3,586,200 ((8,600 hours 

× $253 = $2,175,800) + (17,200 hours × 

$82 = $1,410,400)). It is estimated that 

there is no cost burden of rule 19a–1 

other than these estimates. 

To comply with state law, many 

investment companies already must 

distinguish the different sources from 

which a shareholder distribution is paid 

and disclose that information to 

shareholders. Thus, many investment 

companies would be required to 

distinguish the sources of shareholder 

dividends whether or not the 

Commission required them to do so 

under rule 19a–1. 

These estimates are made solely for 

the purposes of the Paperwork 

Reduction Act, and are not derived from 

a comprehensive or even a 

representative survey or study of the 

costs of Commission rules. Compliance 

with the collection of information 

required by rule 19a–1 is mandatory for 

management companies that make 

statements to shareholders pursuant to 

section 19(a) of the Act. 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 background 

documentation for this information 

collection at the following website: 

www.reginfo.gov. Find this particular 

information collection by selecting 

‘‘Currently under 30-day Review—Open 

for Public Comments’’ or by using the 

search function. Written comments and 

recommendations for the proposed 

information collection should be sent 

within 30 days of publication of this 

notice by January 22, 2024 to (i) 

MBX.OMB.OIRA.SEC_desk_officer@

omb.eop.gov and (ii) David Bottom, 

Director/Chief Information Officer, 

Securities and Exchange Commission, c/ 

o John Pezzullo, 100 F Street NE, 

Washington, DC 20549, or by sending an 

email to: PRA_Mailbox@sec.gov. 

Dated: December 18, 2023. 

Sherry R. Haywood, 

Assistant Secretary. 

[FR Doc. 2023–28118 Filed 12–20–23; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–99191; File No. SR–BOX– 

2023–30] 

Self-Regulatory Organizations; BOX 

Exchange LLC; Notice of Filing and 

Immediate Effectiveness of a Proposed 

Rule Change To Amend IM–7150–1 and 

Rule 7250 (Quote Mitigation) 

December 15, 2023. 

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

Securities Exchange Act of 1934 

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

notice is hereby given that on December 

11, 2023, BOX Exchange LLC (the 

‘‘Exchange’’) filed with the Securities 

and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I and II 

below, which Items have been prepared 

by the Exchange. The Commission is 

publishing this notice to solicit 

comments on the proposed rule change 

from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to amend IM– 

7150–1 and Rule 7250 (Quote 

Mitigation). The text of the proposed 

rule change is available from the 

principal office of the Exchange, at the 

Commission’s Public Reference Room 

and also on the Exchange’s internet 

website at https://

rules.boxexchange.com/rulefilings. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

self-regulatory organization included 

statements concerning the purpose of, 

and basis for, the proposed rule change 

and discussed any comments it received 

on the proposed rule change. The text 

of these statements may be examined at 

the places specified in Item IV below. 

The self-regulatory organization has 

prepared summaries, set forth in 

Sections A, B, and C below, of the most 

significant aspects of such statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The purpose of the proposed rule 

change is to modernize and improve the 

operation of the rules. Specifically, the 

Exchange is proposing to amend: (1) 

IM–7150–1 to remove certain language 

to provide better consistency with the 

surveillance the Financial Industry 

Regulatory Authority, Inc. (‘‘FINRA’’) 

currently provides for the Exchange; 

and (2) Rule 7250 (Quote Mitigation) to 

update and clarify the quote mitigation 

process used by the Exchange. The 

Exchange is proposing to make such 

changes in response to requests from 

Exchange Regulation Staff in an effort to 

improve the efficacy of the Exchange’s 

existing regulatory framework. 

IM–7150–1 

IM–7150–1 (a) currently provides 

that: ‘‘it shall be considered conduct 

inconsistent with just and equitable 

principles of trade for any Initiating 

Participant to engage in a pattern of 

conduct where the Initiating Participant 

submits Primary Improvement Orders 

into the PIP process for two (2) contracts 

or less for the purpose of manipulating 

the PIP process in order to gain a higher 

allocation percentage than the Initiating 

Participant would have otherwise 

received in accordance with the 

allocation procedures set forth in Rule 

7150.’’ 3 The Exchange now proposes to 

remove the language that states, ‘‘2 

contracts or less.’’ 

FINRA currently provides 

surveillance for this requirement for the 

Exchange and other options exchanges. 

FINRA’s surveillance program monitors 

for manipulative activity by a market 

participant and includes surveillance 

designed to detect activity where an 

Initiating Participant submits Primary 

Improvement Orders into the PIP 

process for four (4) contracts or less for 

the purpose of manipulating the PIP 

process in order to gain a higher 

allocation percentage than the Initiating 

Participant would have otherwise 

received. Even though IM–7150–1 as 

written, notates that a pattern of orders 

for two (2) contracts may indicate 

manipulation of the PIP Process, FINRA 

has identified the potential for 

manipulation for orders greater than two 

(2) contracts and expanded such 

surveillance accordingly. For example, 

unbundling an order for 50 contracts 

into four (4) lots may have the same 

effect as unbundling the order for two 

(2) contracts.4 Under the current rule 


khammond on DSKJM1Z7X2PROD with NOTICES