[Federal Register Volume 63, Number 119 (Monday, June 22, 1998)]
[Notices]
[Pages 33960-33961]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-16555]


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DEPARTMENT OF LABOR

Pension and Welfare Benefits Administration


Proposed Extension of Information Collection Request Submitted 
for Public Comment and Recommendations

ACTION: Notice.

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SUMMARY: The Department of Labor, as part of its continuing effort to 
reduce paperwork and respondent burden, conducts a preclearance 
consultation program to provide the general public

[[Page 33961]]

and other federal agencies with an opportunity to comment on proposed 
and continuing collections of information in accordance with the 
Paperwork Reduction Act of 1995 (PRA 95) (44 U.S.C. 3506(c)(2)(A)). 
This program helps to ensure that requested data can be provided in the 
desired format, reporting burden (time and financial resources) is 
minimized, collection instruments are clearly understood, and the 
impact of collection requirements on respondents can be properly 
assessed. Currently, the Pension and Welfare Benefits Administration is 
soliciting comments concerning the proposed extension of a currently 
approved collection of information, Class Exemption 77-4 for certain 
transactions between investment companies and employee benefit plans. A 
copy of the proposed information collection request (ICR) can be 
obtained by contacting the office listed below in the addresses section 
of this notice.

DATES: Written comments must be submitted to the office listed in the 
ADDRESSES section below on or before August 21, 1998. The Department of 
Labor is particularly interested in comments which:
    <bullet> Evaluate whether the proposed collection of information is 
necessary for the proper performance of the functions of the agency, 
including whether the information will have practical utility;
    <bullet> Evaluate the accuracy of the agency's estimate of the 
burden of the proposed collection of information, including the 
validity of the methodology and assumptions used;
    <bullet> Enhance the quality, utility, and clarity of the 
information to be collected;
    <bullet> Minimize the burden of the collection of information on 
those who are to respond, including through the use of appropriate 
automated, electronic, mechanical, or other technological collection 
techniques or other forms of information technology, e.g., permitting 
electronic submission of responses.

ADDRESSES: Interested parties are invited to submit written comments 
regarding the collection of information of any or all of the Agencies. 
Send comments to Mr. Gerald B. Lindrew, Office of Policy and Research, 
U.S. Department of Labor, Pension and Welfare Benefits Administration, 
200 Constitution Avenue, NW, Room N-5647, Washington, D.C. 20210. 
Telephone: (202) 219-4782 (this is not a toll-free number).

SUPPLEMENTARY INFORMATION:

I. Background

    Prohibited Transaction Class Exemption 77-4 permits the purchase 
and sale by an employee benefit plan of shares of a registered, open-
end investment company (mutual fund) when a fiduciary with respect to 
the plan (e.g., investment manager) is also the investment advisor for 
the investment company. In absence of the exemption, certain aspects of 
these transactions might be prohibited by section 406 of the Employee 
Retirement Income Security Act (ERISA).

II. Current Actions

    The Office of Management and Budget's approval of this ICR will 
expire on September 30, 1998. This existing collection of information 
should be continued because without the relief provided by this 
exemption, an open-end mutual fund could not sell shares to or purchase 
shares from a plan when the fiduciary with respect to the plan is also 
the investment advisor for the mutual fund. As a result, plans would be 
compelled to liquidate their existing investments involving such 
transactions and establish new investment structures and policies, and 
amend their plan documents.
    In order to insure that the exemption is not abused and that the 
rights of participants and beneficiaries are protected, the Department 
has included in the exemption two basic disclosure requirements. The 
first is intended to put the plan on notice of possible fees associated 
with the redemption of open-end mutual fund shares. It requires 
disclosure of any redemption fees in the current prospectus of the 
open-end mutual fund (the prospectus in effect at the time of the 
plan's acquisition or disposal of such shares). The second requires at 
the time of the purchase or sale of such mutual fund shares that the 
plan's independent fiduciary receive a copy of the current prospectus 
issued by the open-end mutual fund and a full and detailed written 
statement of the investment advisory fees charged to or paid by the 
plan and the open-end mutual fund to the investment advisor.
    Agency: Department of Labor, Pension and Welfare Benefits 
Administration.
    Title: Class Exemption 77-4 for Certain Transactions Between 
Investment Companies and Employee Benefit Plans.
    Type of Review: Extension of a currently approved collection.
    OMB Numbers: 1210-0049.
    Affected Public: Individuals or households; Business or other for-
profit; Not-for-profit institutions.
    Total Respondents: 624.
    Total Responses: 46,800.
    Frequency of Response: On occasion.
    Total Annual Burden: 4,212 hours.
    Comments submitted in response to this notice will be summarized 
and/or included in the request for Office of Management and Budget 
approval of the information collection request; they will also become a 
matter of public record.

    Dated: June 17, 1998.
Gerald B. Lindrew,
Deputy Director, Pension and Welfare Benefits Administration, Office of 
Policy and Research.
[FR Doc. 98-16555 Filed 6-19-98; 8:45 am]
BILLING CODE 4510-29-M