34332 Federal Register / Vol. 87, No. 108 / Monday, June 6, 2022 / Notices 

19This estimate is based on the following 

calculation: (124 money market funds (121 existing 

funds + 3 new funds) that file reports on Form N– 

MFP in house × $3,900 per fund, per year) + (229 

money market funds (224 existing funds + 5 new 

funds) that file reports on Form N–MFP using a 

service provider × $9,300 per fund, per year) = 

$2,613,300. 

1Prevention of Certain Unlawful Activities with 

Respect to Registered Investment Companies, 

Investment Company Act Release No. 11421 (Oct. 

31, 1980) (45 FR 73915 (Nov. 7, 1980)). 

2Personal Investment Activities of Investment 

Company Personnel, Investment Company Act 

Release No. 23958 (Aug. 20, 1999) (64 FR 46821 

(Aug. 27, 1999)). 

3 Investment Adviser Codes of Ethics, Investment 

Advisers Act Release No. 2256 (Jul. 2, 2004) (69 FR 

41696 (Jul. 9, 2004)). 

4Rule 17j–1(a)(1) defines an ‘‘access person’’ as 

‘‘Any Advisory Person of a Fund or of a Fund’s 

investment adviser. If an investment adviser’s 

primary business is advising Funds or other 

advisory clients, all of the investment adviser’s 

directors, officers, and general partners are 

presumed to be Access Persons of any Fund advised 

by the investment adviser. All of a Fund’s directors, 

officers, and general partners are presumed to be 

Access Persons of the Fund.’’ The definition of 

Access Person also includes ‘‘Any director, officer 

or general partner of a principal underwriter who, 

in the ordinary course of business, makes, 

participates in or obtains information regarding, the 

purchase or sale of Covered Securities by the Fund 

for which the principal underwriter acts, or whose 

functions or duties in the ordinary course of 

business relate to the making of any 

recommendation to the Fund regarding the 

purchase or sale of Covered Securities.’’ Rule 17j– 

1(a)(1). 

5A ‘‘Covered Security’’ is any security that falls 

within the definition in section 2(a)(36) of the Act, 

except for direct obligations of the U.S. 

Government, bankers’ acceptances, bank certificates 

of deposit, commercial paper and high quality 

short-term debt instruments, including repurchase 

agreements, and shares issued by open-end funds. 

Rule 17j–1(a)(4). 

6Rule 17j–1(d)(2) contains the following 

exceptions: (i) an Access Person need not file a 

report for transactions effected for, and securities 

held in, any account over which the Access Person 

does not have control; (ii) an independent director 

of the fund, who would otherwise be required to 

report solely by reason of being a fund director and 

who does not have information with respect to the 

fund’s transactions in a particular security, does not 

fund per year. In addition, we estimate 

that money market funds that use a 

service provider to prepare and file 

reports on Form N–MFP pay an average 

fee of $9,300 per fund per year. In sum, 

we estimate that all money market funds 

incur on average, in the aggregate, 

external annual costs of $2,613,300.19

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 July 6, 2022 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: May 31, 2022. 

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2022–12018 Filed 6–3–22; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[SEC File No. 270–239, OMB Control No. 

3235–0224] 

Submission for OMB Review; 

Comment Request; Extension: Rule 

17j–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. 

Conflicts of interest between 

investment company personnel (such as 

portfolio managers) and their funds can 

arise when these persons buy and sell 

securities for their own accounts 

(‘‘personal investment activities’’). 

These conflicts arise because fund 

personnel have the opportunity to profit 

from information about fund 

transactions, often to the detriment of 

fund investors. Beginning in the early 

1960s, Congress and the Securities and 

Exchange Commission (‘‘Commission’’) 

sought to devise a regulatory scheme to 

effectively address these potential 

conflicts. These efforts culminated in 

the addition of section 17(j) to the 

Investment Company Act of 1940 (the 

‘‘Investment Company Act’’) (15 U.S.C. 

80a–17(j)) in 1970 and the adoption by 

the Commission of rule 17j–1 (17 CFR 

270.17j–1) in 1980.1 The Commission 

proposed amendments to rule 17j–1 in 

1995 in response to recommendations 

made in the first detailed study of fund 

policies concerning personal investment 

activities by the Commission’s Division 

of Investment Management since rule 

17j–1 was adopted. Amendments to rule 

17j–1, which were adopted in 1999, 

enhanced fund oversight of personal 

investment activities and the board’s 

role in carrying out that oversight.2

Additional amendments to rule 17j–1 

were made in 2004, conforming rule 

17j–1 to rule 204A–1 under the 

Investment Advisers Act of 1940 (15 

U.S.C. 80b), avoiding duplicative 

reporting, and modifying certain 

definitions and time restrictions.3

Section 17(j) makes it unlawful for 

persons affiliated with a registered 

investment company (‘‘fund’’) or with 

the fund’s investment adviser or 

principal underwriter (each a ‘‘17j–1 

organization’’), in connection with the 

purchase or sale of securities held or to 

be acquired by the investment company, 

to engage in any fraudulent, deceptive, 

or manipulative act or practice in 

contravention of the Commission’s rules 

and regulations. Section 17(j) also 

authorizes the Commission to 

promulgate rules requiring 17j–1 

organizations to adopt codes of ethics. 

In order to implement section 17(j), 

rule 17j–1 imposes certain requirements 

on 17j–1 organizations and ‘‘Access 

Persons’’ 4 of those organizations. The 

rule prohibits fraudulent, deceptive or 

manipulative acts by persons affiliated 

with a 17j–1 organization in connection 

with their personal securities 

transactions in securities held or to be 

acquired by the fund. The rule requires 

each 17j–1 organization, unless it is a 

money market fund or a fund that does 

not invest in Covered Securities,5 to: (i) 

adopt a written codes of ethics, (ii) 

submit the code and any material 

changes to the code, along with a 

certification that it has adopted 

procedures reasonably necessary to 

prevent Access Persons from violating 

the code of ethics, to the fund board for 

approval, (iii) use reasonable diligence 

and institute procedures reasonably 

necessary to prevent violations of the 

code, (iv) submit a written report to the 

fund describing any issues arising under 

the code and procedures and certifying 

that the 17j–1 entity has adopted 

procedures reasonably necessary to 

prevent Access Persons form violating 

the code, (v) identify Access Persons 

and notify them of their reporting 

obligations, and (vi) maintain and make 

available to the Commission for review 

certain records related to the code of 

ethics and transaction reporting by 

Access Persons. 

The rule requires each Access Person 

of a fund (other than a money market 

fund or a fund that does not invest in 

Covered Securities) and of an 

investment adviser or principal 

underwriter of the fund, who is not 

subject to an exception,6 to file: (i) 


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Federal Register / Vol. 87, No. 108 / Monday, June 6, 2022 / Notices 34333 

have to file an initial holdings report or a quarterly 

transaction report,; (iii) an Access Person of a 

principal underwriter of the fund does not have to 

file reports if the principal underwriter is not 

affiliated with the fund (unless the fund is a unit 

investment trust) or any investment adviser of the 

fund and the principal underwriter of the fund does 

not have any officer, director, or general partner 

who serves in one of those capacities for the fund 

or any investment adviser of the fund; (iv) an 

Access Person to an investment adviser need not 

make quarterly reports if the report would duplicate 

information provided under the reporting 

provisions of the Investment Adviser’s Act of 1940; 

(v) an Access Person need not make quarterly 

transaction reports if the information provided in 

the report would duplicate information received by 

the 17j–1 organization in the form of broker trade 

confirmations or account statements or information 

otherwise in the records of the 17j–1 organization; 

and (vi) an Access Person need not make quarterly 

transaction reports with respect to transactions 

effected pursuant to an Automatic Investment Plan. 

7 If information collected pursuant to the rule is 

reviewed by the Commission’s examination staff, it 

will be accorded the same level of confidentiality 

accorded to other responses provided to the 

Commission in the context of its examination and 

oversight program. See section 31(c) of the 

Investment Company Act (15 U.S.C. 80a–30(c)). 

within 10 days of becoming an Access 

Person, a dated initial holdings report 

that sets forth certain information with 

respect to the Access Person’s securities 

and accounts; (ii) dated quarterly 

transaction reports within 30 days of the 

end of each calendar quarter providing 

certain information with respect to any 

securities transactions during the 

quarter and any account established by 

the Access Person in which any 

securities were held during the quarter; 

and (iii) dated annual holding reports 

providing information with respect to 

each Covered Security the Access 

Person beneficially owns and accounts 

in which securities are held for his or 

her benefit. In addition, rule 17j–1 

requires investment personnel of a fund 

or its investment adviser, before 

acquiring beneficial ownership in 

securities through an initial public 

offering (IPO) or in a private placement, 

to obtain approval from the fund or the 

fund’s investment adviser. 

The requirements that the 

management of a rule 17j–1 organization 

provide the fund’s board with new and 

amended codes of ethics and an annual 

issues and certification report are 

intended to enhance board oversight of 

personal investment policies applicable 

to the fund and the personal investment 

activities of Access Persons. The 

requirements that Access Persons 

provide initial holdings reports, 

quarterly transaction reports, and 

annual holdings reports and request 

approval for purchases of securities 

through IPOs and private placements 

are intended to help fund compliance 

personnel and the Commission’s 

examinations staff monitor potential 

conflicts of interest and detect 

potentially abusive activities. The 

requirement that each rule 17j–1 

organization maintain certain records is 

intended to assist the organization and 

the Commission’s examinations staff in 

determining if there have been 

violations of rule 17j–1. 

We estimate that annually there are 

approximately 85,927 respondents 

under rule 17j–1, of which 15,927 are 

rule 17j–1 organizations and 70,000 are 

Access Persons. In the aggregate, these 

respondents make approximately 

107,363 responses annually. We 

estimate that the total annual burden of 

complying with the information 

collection requirements in rule 17j–1 is 

approximately 376,628 hours. This hour 

burden represents time spent by Access 

Persons that must file initial and annual 

holdings reports and quarterly 

transaction reports, investment 

personnel that must obtain approval 

before acquiring beneficial ownership in 

any securities through an IPO or private 

placement, and the responsibilities of 

Rule 17j–1 organizations arising from 

information collection requirements 

under rule 17j–1. These include 

notifying Access Persons of their 

reporting obligations, preparing an 

annual rule 17j–1 report and 

certification for the board, documenting 

their approval or rejection of IPO and 

private placement requests, maintaining 

annual rule 17j–1 records, maintaining 

electronic reporting and recordkeeping 

systems, amending their codes of ethics 

as necessary, and, for new fund 

complexes, adopting a code of ethics. 

We estimate that there is an annual 

cost burden of approximately $5,000 per 

fund complex, for a total of $4,020,000, 

associated with complying with the 

information collection requirements in 

rule 17j–1. This represents the costs of 

purchasing and maintaining computers 

and software to assist funds in carrying 

out rule 17j–1 recordkeeping. 

These burden hour and cost estimates 

are based upon the Commission staff’s 

experience and discussions with the 

fund industry. The estimates of average 

burden hours and costs 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 the 

costs of Commission rules. 

Compliance with the collection of 

information requirements of the rule is 

mandatory and is necessary to comply 

with the requirements of the rule in 

general. 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. Rule 17j–1 requires that 

records be maintained for at least five 

years in an easily accessible place.7

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 July 6, 2022 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: May 31, 2022. 

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2022–12019 Filed 6–3–22; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–95007; File No. 10–239] 

24X National Exchange LLC; Notice of 

Filing of Application for Registration 

as a National Securities Exchange 

Under Section 6 of the Securities 

Exchange Act of 1934 

May 31, 2022. 

On March 25, 2022, 24X National 

Exchange LLC (‘‘24X’’ or ‘‘Applicant’’) 

submitted to the Securities and 

Exchange Commission (‘‘Commission’’) 

a Form 1 application under the 

Securities Exchange Act of 1934 

(‘‘Exchange Act’’), seeking registration 

as a national securities exchange under 

Section 6 of the Exchange Act. The 

Applicant’s Form 1 application provides 

detailed information on how 24X 

proposes to satisfy the requirements of 

the Exchange Act. 

The Commission is publishing this 

notice to solicit comments on 24X’s 

Form 1 application. The Commission 

will take any comments it receives into 

consideration in making its 

determination about whether to grant 

24X’s request to be registered as a 

national securities exchange. The 

Commission will grant the registration if 

it finds that the requirements of the 

Exchange Act and the rules and 


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