43082 Federal Register / Vol. 87, No. 137 / Tuesday, July 19, 2022 / Notices 

1Business Conduct Standards for Security-Based 

Swap Dealers and Major Security-Based Swap 

Participants, Exchange Act Release 77617 (Apr. 14, 

2016), 81 FR 29959 (May 13, 2016). See also 

Business Conduct Standards for Security-Based 

Swap Dealers and Major Security-Based Swap 

Participants; Correction, Exchange Act Release 

77617A (May 19, 2016), 81 FR 32643 (May 24, 

2016). (together, ‘the Business Conduct Rules for 

SBSDs and MSBSPs’’ or ‘‘BCS Rules’’) 

2 Id. 

3Commission staff has prepared separate 

supporting statements pursuant to the Paperwork 

Reduction Act (‘‘PRA’’) regarding final Rules 3a71– 

3(c) and 3a71–6, which address the cross-border 

application of the business conduct standards and 

the availability of substituted compliance. The 

Office of Management and Budget (‘‘OMB’’) has 

assigned control number 3235–0717 to Rule 3a71– 

3(c) and 3235–0715 to Rule 3a71–6. Rule 3a67– 

10(d) is a definitional rule and does not have a PRA 

burden associated with it. Rules 3a71–3(a), 15Fh– 

1 and 15Fh–2(b) and (c) address scope of the rules 

and definitions and so do not have PRA burdens 

associated with them. 

4Unless otherwise noted, estimates were derived 

from the DTCC–TIW data set (November 2006 

through December 2020). 

SECURITIES AND EXCHANGE 

COMMISSION 

[SEC File No. 270–779; OMB Control No. 

3235–0732] 

Submission for OMB Review; 

Comment Request: Extension: 

Business Conduct Standards for 

Security-Based Swap Dealers and 

Major Security-Based Swap 

Participants 

Upon Written Request, Copies Available 

From: U.S. 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 

(‘‘PRA’’) (44 U.S.C. 3501 et seq.), the 

Securities and Exchange Commission 

(‘‘Commission’’) has submitted to the 

Office of Management and Budget 

(‘‘OMB’’) a request for approval of 

extension of the previously approved 

collection of information provided for in 

Business Conduct Standards for 

Security-Based Swap Dealers and Major 

Security-Based Swap Participants.1 (17 

CFR 240.3a67–10, 240.3a71– 

3,240.3a71–6, 240.15Fh–1 through 

15Fh–6 and 240.15Fk–1), under the 

Securities Exchange Act of 1934 (15 

U.S.C. 78a et seq.). 

In 2010, Congress passed the DoddFrank Act, establishing a comprehensive 

framework for regulating the over-thecounter swaps markets. As required by 

Title VII of the Dodd-Frank Act, new 

section 15F(h) of the Exchange Act 

established business conduct standards 

for security-based swap (‘‘SBS’’) Dealers 

and Major SBS Participants 

(‘‘collectively ‘‘SBS Entities’’) in their 

dealings with counterparties, including 

special entities. In 2016, in order to 

implement the Dodd-Frank Act, the 

Commission adopted the BCS Rules for 

SBS Dealers and Major SBS 

Participants,2 a comprehensive set of 

business conduct standards and chief 

compliance officer requirements 

applicable to SBS Entities, that are 

designed to enhance transparency, 

facilitate informed customer decisionmaking, and heighten standards of 

professional conduct to better protect 

investors.3

Rules 15Fh–1 through 15Fh–6 and 

15Fk–1 require SBS Entities to: 

• Verify whether a counterparty is an 

eligible contract participant and 

whether it is a special entity; 

• Disclose to the counterparty 

material information about the SBS, 

including material risks, characteristics, 

incentives and conflicts of interest; 

• Provide the counterparty with 

information concerning the daily mark 

of the SBS; 

• Provide the counterparty with 

information regarding the ability to 

require clearing of the SBS; 

• Communicate with counterparties 

in a fair and balanced manner based on 

principles of fair dealing and good faith; 

• Establish a supervisory and 

compliance infrastructure; and 

• Designate a chief compliance officer 

that is required to fulfill the described 

duties and provide an annual 

compliance report. 

The rules also require SBS Dealers to: 

• Determine that recommendations 

they make regarding SBS are suitable for 

their counterparties. 

• Establish, maintain and enforce 

written policies and procedures 

reasonably designed to obtain and retain 

a record of the essential facts concerning 

each known counterparty that are 

necessary to conduct business with such 

counterparty; and 

• Comply with rules designed to 

prevent ‘‘pay-to-play.’’ 

The rules also define what it means to 

‘‘act as an advisor’’ to a special entity, 

and require an SBS Dealer who acts as 

an advisor to a special entity to: 

• Make a reasonable determination 

that any security-based swap or trading 

strategy involving a security-based swap 

recommended by the SBS Dealer is in 

the best interests of the special entity 

whose identity is known at a reasonably 

sufficient time prior to the execution of 

the transaction to permit the SBS Dealer 

to comply with this obligation; and 

• Make reasonable efforts to obtain 

such information that the SBS Dealer 

considers necessary to make a 

reasonable determination that a 

security-based swap or trading strategy 

involving a security-based swap is in 

the best interests of the known special 

entity. 

In addition, the rules require SBS 

Entities acting as counterparties to 

special entities to reasonably believe 

that the counterparty has an 

independent representative who meets 

the following requirements: 

• Has sufficient knowledge to 

evaluate the transaction and risks; 

• Is not subject to a statutory 

disqualification; 

• Undertakes a duty to act in the best 

interests of the special entity; 

• Makes appropriate and timely 

disclosures to the special entity of 

material information concerning the 

security-based swap; 

• Evaluates, consistent with any 

guidelines provided by the special 

entity, the fair pricing and the 

appropriateness of the security-based 

swap; 

• Is independent of the security-based 

swap dealer or major security-based 

swap participant that is the 

counterparty to a proposed securitybased swap. 

Under the rules, the special entity’s 

independent representative must also be 

subject to pay-to-play regulations, and if 

the special entity is an ERISA plan, the 

independent representative must be an 

ERISA fiduciary. 

The information that must be 

collected pursuant to the BCS Rules is 

intended to increase accountability and 

transparency in the market. The 

information will therefore help establish 

a framework that protects investors and 

promotes efficiency, competition and 

capital formation. 

Based on a review of recent data, as 

of 2020, the Commission estimates the 

number of respondents to be as follows: 

44 SBS Dealers, 0 Major SBS 

Participants, for a total of 44 ‘‘SBS 

Entities’’.4 Further, we estimate that 

approximately 41 of these 44 SBS 

Entities will be dually registered with 

the CFTC as Swap Entities. We also 

estimate that there are currently 15,187 

security-based swap market participants 

of which 11,531 are also swap market 

participants. In 2020, there were 

approximately 354,814 security-based 

swap transactions between an SBS 

Dealer and counterparty that is not an 

SBS Dealer of which 225,924 were new 

and 6,841 amended trades (totaling 

232,765). The Commission estimates 

there are 329 independent, third-party 

representatives and 23 in-house 


jspears on DSKJM1Z7X2PROD with NOTICES
Federal Register / Vol. 87, No. 137 / Tuesday, July 19, 2022 / Notices 43083 

5See, Exchange Act Rule 15Fh–5. 

independent representatives.5 We 

estimate that there are approximately 

11,219 unique SBS Dealer and non-SBSDealer pairs. We have used these 

estimates in calculating the hour and 

cost burdens for the rule provisions that 

we anticipate have a ‘‘collection of 

information’’ burden within the 

meaning of the PRA. 

The Commission estimates that the 

aggregate burden of the ongoing 

reporting and disclosures required by 

the BCS Rules, as described above, is 

approximately 486,535 hours and 

$1,812,800 calculated as follows: 

Section Type of burden Respondents 

Ongoing 

annual burden 

Ongoing 

annual burden 

Industry-wide 

annual burden 

Industry-wide 

annual burden 

Hours Cost Hours Cost 

15Fh–3(b), (c), (d): 

Disclosures—SBS Entities .............................. Reporting ............... 44 4,120 $0 181,280 $0 

15Fh–3(b), (c), (d): 

Disclosures—SBS Transactions Between 

SBS Dealer and Non-SBSD Counterparty.

Reporting ............... 232,765 1 0 232,765 0 

15Fh–3(e), (f): 

Know Your Counterparty and Recommendations (SBS Dealers).Reporting ............... 44 128 0 5,610 0 

15Fh–3(g): 

Fair and Balanced Communications ............... Reporting ............... 44 2 3,600 88 158,400 

15Fh–3(h): 

Supervision ...................................................... Reporting ............... 44 540 4,800 23,760 211,200 

15Fh–5: 

SBS Entities Acting as Counterparties to Special Entities.Reporting ............... 44 352 0 15,488 0 

15Fh–5: 

SBS Entities Acting as Counterparties to Special Entities.Third-Party Disclosure.44 352 0 15,488 0 

15Fh–6: 

Political Contributions ...................................... Reporting ............... 44 1 25,600 44 1,126,400 

15Fk–1: 

Chief Compliance Officer ................................ Reporting ............... 44 273 7,200 12,012 316,800 

Total .......................................................... ................................ .......................... .......................... .......................... 486,535 1,812,800 

An agency may not conduct or 

sponsor, and a person is not required to 

respond to, a collection of information 

under the PRA 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 by 

August 18, 2022 to (i) www.reginfo.gov/ 

public/do/PRAMain 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: July 13, 2022. 

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2022–15315 Filed 7–18–22; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Investment Company Act Release No. 

34648; 812–15319] 

Quaker Investment Trust and 

Community Capital Management, LLC 

July 13, 2022. 

AGENCY: Securities and Exchange 

Commission (‘‘Commission’’ or ‘‘SEC’’). 

ACTION: Notice. 

Notice of an application under section 

6(c) of the Investment Company Act of 

1940 (‘‘Act’’) for an exemption from 

section 15(a) of the Act, and rule 18f– 

2 under the Act, as well as from certain 

disclosure requirements in rule 20a–1 

under the Act, Item 19(a)(3) of Form N– 

1A, Items 22(c)(1)(ii), 22(c)(1)(iii), 

22(c)(8) and 22(c)(9) of Schedule 14A 

under the Securities Exchange Act of 

1934, and Sections 6–07(2)(a), (b), and 

(c) of Regulation S–X (‘‘Disclosure 

Requirements’’). 

Summary of Application: The 

requested exemption would permit 

Applicants to enter into and materially 

amend subadvisory agreements with 

certain subadvisors without shareholder 

approval and grant relief from the 

Disclosure Requirements as they relate 

to fees paid to the subadvisors. 

Applicants: Quaker Investment Trust 

and Community Capital Management, 

LLC. 

Filing Dates: The application was 

filed on April 14, 2022, and amended on 

June 10, 2022 and June 29, 2022. 

Hearing or Notification of Hearing: An 

order granting the requested relief will 

be issued unless the Commission orders 

a hearing. Interested persons may 

request a hearing on any application by 

emailing the SEC’s Secretary at 

Secretarys-Office@sec.gov and serving 

the Applicants with a copy of the 

request by email, if an email address is 

listed for the relevant Applicant below, 

or personally or by mail, if a physical 

address is listed for the relevant 

Applicant below. Hearing requests 

should be received by the Commission 

by 5:30 p.m. on August 8, 2022, and 

should be accompanied by proof of 

service on the Applicants, in the form 

of an affidavit, or, for lawyers, a 

certificate of service. Pursuant to rule 0– 

5 under the Act, hearing requests should 

state the nature of the writer’s interest, 

any facts bearing upon the desirability 

of a hearing on the matter, the reason for 

the request, and the issues contested. 

Persons who wish to be notified of a 

hearing may request notification by 

emailing the Commission’s Secretary. 


jspears on DSKJM1Z7X2PROD with NOTICES