24160 Federal Register / Vol. 62, No. 85 / Friday, May 2, 1997 / Corrections

SECURITIES AND EXCHANGE

COMMISSION

17 CFR Part 230

[Release Nos. 33-7399; IC-22529; File No.

S7-18-96]

RIN 3235-AH03

Proposed New Disclosure Option for

Open-End Management Investment

Companies

Correction

In proposed rule document 97–5376

beginning on page 10943 in the issue of

Monday, March 10, 1997 make the

following corrections:

(1) On page 10946, in the first

column, footnote 27 should read 27Proposed rule 498(c)(1). The cover page

also would include the date of the profile.

See infra note 84 and accompanying text

regarding the proposed dating requirements.

If the profile is distributed electronically or

as part of another document (e.g., when the

profile is printed in a magazine), rule 498

would require cover page information to

appear at the beginning of the profile.

(2) On the same page, in the third

column, footnote 33 should read: 33Proposed rule 498(c)(2)(i) (incorporating

Item 2(a) of proposed Form N-1A). In

providing this disclosure, a fund could refer

to its investment objectives as investment

goals.

(3) On page 10947, in the third

column:

(a) Footnote 45 should read: 45The 1996 Profile Letter, supra note 9, at

2, requires a fund to disclose without further

explanation that it is non-diversified.

(b) Footnote 46 should read: 46Proposed rule 498 (c)(2)(iii)

(incorporating Item 2(c) of proposed Form N1A).

(c) Footnote 47 should read: 47The 1996 Profile Letter, supra note 9, at

2-3, requires the bar chart and table to appear

under a caption relating to a fund’s past

performance. To help investors use the

information in the bar chart and table, the

proposed rule would require a fund to

explain how the information illustrates the

fund’s risks and performance. Item 2 of

proposed Form N-1A would provide the

following example of this explanation: This

information illustrates the fund’s risks and

performance by showing changes in the

fund’s performance from year to year and by

showing how the fund’s average annual

returns for one, five, and ten years compare

to those of a broad measure of market

performance. A fund also would be required

to disclose that how the fund has performed

in the past is not necessarily an indication of

how the fund will perform in the future.

(d) Footnote 48 should read: 48See Risk Concept Release, supra note 5.

(4) On page 10948, in the first

column, Footnote 51 should read: 51See 1996 Profile Letter, supra note 9, at

3 (permitting a fund, at its option, to compare

its returns to those of an appropriate broadbased securities market index).

(5) On the same page, in the second

column:

(a) Footnote 56 should read: 56Proposed rule 498(c)(2)(iv)

(incorporating Item 3 of proposed Form N1A). See also Item 2(a) of Form N-1A.

(b) Footnote 57 should read: 57See Form N-1A Release, supra note 1

(proposing amendments to improve fee table

disclosure).

(6) On the same page, in the third

column:

(a) ‘‘Other Disclosure Requirements’’

should read ‘‘3. Other Disclosure

Requirements’’.

(b) Footnote 58 should read: 58Proposed rule 498(c)(2)(v). Consistent

with Item 6(a)(2) of proposed Form N-1A,

rule 498 would not require information about

the portfolio manager of a money market

fund or an index fund.

(c) Footnote 59 should read: 59See also ICI Survey Letter, supra note 10,

at 9 (recommending that the profile include

this information).

(d) Footnote 61 should read: 61The 1996 Profile Letter, supra note 9, at

3, permits a fund to disclose that 3 or more

persons manage the fund’s portfolio, without

regard to the percentage of the portfolio

managed by any one person.

(7) On page 10949, in the first

column:

(a) Footnote 64 should read: 64 Information about a fund’s cash

management practices generally would not

be disclosed in the section of the profile that

discusses the fund’s main investment

strategies. See Form N-1A Release, supra

note 1 (prospectus disclosure would focus on

a fund’s principal strategies, which generally

would not include the fund’s cash

management practices).

(b) Footnote 65 should read: 65See 1996 Profile Letter, supra note 9, at

3 (permitting a fund to provide disclosure to

the effect that 3 or more sub-advisers manage

the fund’s portfolio without regard to the

percentage of the portfolio managed by any

one sub-adviser). To further limit the scope

of this exception, a sub-adviser solely

responsible for managing a fund’s cash

positions would not be counted in

determining whether 3 or more sub-advisers

manage the fund’s portfolio.

(8) On the same page, in the second

column footnote 66 should read: 66Proposed rule 498(c)(2)(vi), (vii).

(9) On the same page, in the third

column:

(a) ‘‘Application to Purchase Shares’’

should read ‘‘4. Application to Purchase

Shares’’.

(b) Footnote 69 should read: 69Proposed rule 498(c)(2)(viii). If a fund, as

a result of its investment objectives or

strategies, expects its distributions primarily

to consist of ordinary income (or short-term

capital gains that are taxed as ordinary

income) or capital gains, the fund would be

required to provide disclosure to that effect.

(10) On page 10950, in the first

column ‘‘Disclosure Safeguards’’ should

read ‘‘C. Disclosure Safeguards’’.

(11) On page 10952, in the first

column:

(a) ‘‘General Request for Comments’’

should read ‘‘III. General Request for

Comments’’.

(b) Footnote 98 should read 98Proposed rule 498(c)(4).

(12) On the same page, in the third

column ‘‘Summary of Initial Regulatory

Flexibility Analysis’’ should read ‘‘V.

Summary of Initial Regulatory

Flexibility Analysis’’.

BILLING CODE 1505-01-D

SECURITIES AND EXCHANGE

COMMISSION

17 CFR Parts 230, 239, 270, and 274

[Release Nos. 33-7398; 34-38346; IC 22528;

S7-10-97]

RIN 3235-AE46

Registration Form Used by Open-End

Management Investment Companies

Correction

In proposed rule document 97–5368

beginning on page 10898, in the issue of

Monday, March 10, 1997, make the

following corrections:

1. On page 10899, in columns two and

three, footnotes 12 and 13, the word

‘‘Release’)’’ should read ‘‘Release’’)’’.

2. On page 10900, in column one, in

the fifth paragraph, in the sixth line,

‘‘investors’’ should read ‘‘investors’ ’’.

3. On page 10901, in column one,

footnote 25, in the sixth line, ‘‘supra

note.’’ should read ‘‘supra note 1.’’

4. On page 10902, in column three,

footnote 44, in the fourth line, ‘‘infra

notes- ’’ should read ‘‘infra notes 109-

112’’.

5. On page 10903, in column one,

footnote 47 should read ‘‘47 If

applicable, a fund could indicate that its

annual and semi-annual reports are

available on its Internet site or by Email. In addition, a fund that provides

its MDFP in the prospectus or a money

market fund (which is not required to

prepare a MDFP) would omit the second

sentence of this disclosure.

Instruction 3 to proposed Item 2(b)(2)

would require a fund to send, as

applicable, the annual or semi-annual

report within 3 business days of a

request. The Commission views prompt

delivery of the annual or semi-annual

report or SAI to those investors who

request it to be imperative to the goal of

promoting effective communication

about funds. The Commission’s Office