Federal Register / Vol. 61, No. 97 / Friday, May 17, 1996 / Notices 24967

contention must be one which, if

proven, would entitle the petitioner to

relief. A petitioner who fails to file such

a supplement which satisfies these

requirements with respect to at least one

contention will not be permitted to

participate as a party.

Those permitted to intervene become

parties to the proceeding, subject to any

limitations in the order granting leave to

intervene, and have the opportunity to

participate fully in the conduct of the

hearing, including the opportunity to

present evidence and cross-examine

witnesses.

If a hearing is requested, the

Commission will make a final

determination on the issue of no

significant hazards consideration. The

final determination will serve to decide

when the hearing is held.

If the final determination is that the

amendment request involves no

significant hazards consideration, the

Commission may issue the amendment

and make it immediately effective,

notwithstanding the request for a

hearing. Any hearing held would take

place after issuance of the amendment.

If the final determination is that the

amendment request involves a

significant hazards consideration, any

hearing held would take place before

the issuance of any amendment.

A request for a hearing or a petition

for leave to intervene must be filed with

the Secretary of the Commission, U.S.

Nuclear Regulatory Commission,

Washington, DC 20555–0001, Attention:

Docketing and Services Branch, or may

be delivered to the Commission’s Public

Document Room, the Gelman Building,

2120 L Street, NW., Washington, DC, by

the above date. Where petitions are filed

during the last 10 days of the notice

period, it is requested that the petitioner

promptly so inform the Commission by

a toll-free telephone call to Western

Union at 1–(800) 248–5100 (in Missouri

1–(800) 342–6700). The Western Union

operator should be given Datagram

Identification Number N1023 and the

following message addressed to Jocelyn

A. Mitchell, Acting Director, Project

Directorate I–1, petitioner’s name and

telephone number, date petition was

mailed, plant name, and publication

date and page number of this Federal

Register notice. A copy of the petition

should also be sent to the Office of the

General Counsel, U.S. Nuclear

Regulatory Commission, Washington,

DC 20555–0001, and to Nicholas S.

Reynolds, Winston & Strawn, 1400 L

Street, NW., Washington, DC 20005,

attorney for the licensee.

Nontimely filings of petitions for

leave to intervene, amended petitions,

supplemental petitions and/or requests

for hearing will not be entertained

absent a determination by the

Commission, the presiding officer or the

presiding Atomic Safety and Licensing

Board that the petition and/or request

should be granted based upon a

balancing of the factors specified in 10

CFR 2.714(a)(1)(i)–(v) and 2.714(d).

For further details with respect to this

action, see the application for

amendment dated May 8, 1996, as

supplemented May 10, 1996, which is

available for public inspection at the

Commission’s Public Document Room,

the Gelman Building, 2120 L Street,

NW., Washington, DC, and at the local

public document room located at the

Rochester Public Library, 115 South

Avenue, Rochester, New York.

Dated at Rockville, Maryland, this

fourteenth day of May 1996.

For the Nuclear Regulatory Commission.

Guy S. Vissing,

Senior Project Manager, Project Directorate

I–1, Division of Reactor Projects—I/II, Office

of Nuclear Reactor Regulation.

[FR Doc. 96–12616 Filed 5–16–96; 8:45 am]

BILLING CODE 7590–01–P

SECURITIES AND EXCHANGE

COMMISSION

[Rel. No. IC–21956; 812–9920]

Blue Chip Value Fund, Inc.; Notice of

Application

May 14, 1996.

AGENCY: Securities and Exchange

Commission (‘‘SEC’’).

ACTION: Notice of Application for

Exemption under the Investment

Company Act of 1940 (the ‘‘Act’’).

APPLICANT: Blue Chip Value Fund, Inc.

RELEVANT ACT SECTIONS: Exemption

requested under section 6(c) of the Act

that would grant an exemption from

section 19(b) of the Act and rule 19b–

1 thereunder.

SUMMARY OF APPLICATION: Applicant

requests an order to make up to four

distributions of long-term capital gains

in any one taxable year, so long as

applicant maintains in effect a

distribution policy calling for quarterly

distributions of a fixed percentage of its

net asset value.

FILING DATES: The application was filed

on January 2, 1996, and amended on

April 18, 1996.

HEARING OR NOTIFICATION OF HEARING: An

order granting the application will be

issued unless the SEC orders a hearing.

Interested persons may request a

hearing by writing to the SEC’s

Secretary and serving applicants with a

copy of the request, personally or by

mail. Hearing requests should be

received by the SEC by 5:30 p.m. on

June 10, 1996, and should be

accompanied by proof of service on

applicants, in the form of an affidavit or,

for lawyers, a certificate of service.

Hearing requests should state the nature

of the writer’s interest, the reason for the

request, and the issues contested.

Persons may request notification of a

hearing by writing to the SEC’s

Secretary.

ADDRESSES: Secretary, SEC, 450 5th

Street N.W., Washington, D.C. 20549.

Applicant, 1225 Seventeenth Street,

26th Floor, Denver, Colorado 80202.

FOR FURTHER INFORMATION CONTACT:

Elaine M. Boggs, Staff Attorney, at (202)

942–0572, or Alison E. Baur, Branch

Chief, at (202) 942–0564 (Division of

Investment Management, Office of

Investment Company Regulation).

SUPPLEMENTARY INFORMATION: The

following is a summary of the

application. The complete application

may be obtained for a fee at the SEC’s

Public Reference Branch.

Applicant’s Representations

1. Applicant is closed-end

management investment company

organized as a Maryland corporation.

Applicant’s investment objective is to

seek a high level of total investment

return, comprised of capital

appreciation and current income,

through investment primarily in a

diversified portfolio of equity securities.

2. From 1989 to April 1994, applicant

had a fixed distribution policy calling

for four quarterly distributions of an

amount equal to 2.5% of its net asset

value at the time of the declaration, for

a total of approximately 10% of its net

asset value per year. Any realized

capital gains from 1989 through 1993

were offset by capital loss

carryforwards. On April 4, 1994,

applicant announced a change in its

distribution policy to three quarterly

distributions of net investment income,

followed by a fourth distribution of an

amount equal to the greater of 10% of

net asset value less the prior three

distributions or the sum of applicant’s

net investment income and net capital

gains.

3. Applicant requests relief to permit

it to make up to four distributions of net

long-term capital gains in any one

taxable year, so long as it maintains in

effect a distribution policy calling for

quarterly distributions of a fixed

percentage of its net asset value (the

‘‘Pay-Out Policy’’).
24968 Federal Register / Vol. 61, No. 97 / Friday, May 17, 1996 / Notices

Applicant’s Legal Analysis

1. Section 19(b) provides that

registered investment companies may

not, in contravention of such rules,

regulations, or orders as the SEC may

prescribe, distribute long-term capital

gains more often than once every twelve

months. Rule 19b–1 limits the number

of capital gains distributions, as defined

in section 852(b)(3)(C) of the Internal

Revenue Code of 1986, as amended, (the

‘‘Code’’), that applicant may make with

respect to any one taxable year to one,

plus a supplemental distribution made

pursuant to section 855 of the Code not

exceeding 10% of the total amount

distributed for the year, plus one

additional long-term capital gains

distribution made to avoid the excise

tax under section 4982 of the Code.

2. Rule 19b–1, by limiting the number

of net long-term capital gain

distributions that applicant may make

with respect to any one year, has

prevented the operation of the Pay-Out

Policy because applicant’s realized net

long-term capital gains in any year may

exceed the total of the fixed quarterly

distributions that under rule 19b–1 may

include such capital gains. In that

situation, the rule effectively forces the

fixed quarterly distributions, that under

the rule may not include such capital

gains, to be funded with returns of

capital (to the extent net investment

income and realized short-term capital

gains are insufficient), even though net

realized long-term capital gains would

otherwise be available therefor. The

long-term capital gains in excess of the

fixed quarterly distributions permitted

by the rule then must either be added

as an ‘‘extra’’ on one of the permitted

capital gains distributions, thus

exceeding the total annual amount

called for by the Pay-Out Policy, or be

retained by applicant (with applicant

paying taxes thereon).

3. Applicant believes that granting the

required relief would limit applicant’s

return of capital distributions to that

amount necessary to make up any

shortfall between applicant’s guaranteed

distribution and the total of its

investment income and capital gains.

The likelihood that applicant’s

shareholders would be subject to

additional tax return complexities

involved when applicant retains and

pays taxes on long-term capital gains

would therefore be avoided.

4. One of the concerns leading to the

adoption of section 19(b) and rule 19b–

1 was that shareholders might be unable

to distinguish between frequent

distributions of capital gains and

dividends from investment income. In

accordance with rule 19a–1, a separate

statement showing the source of the

distribution (net investment income, net

realized capital gains, or returns of

capital) will accompany each

distribution (or the confirmation of the

reinvestment thereof under applicant’s

dividend reinvestment plan). In

addition, a statement showing the

amount and source of distributions

received during the year will be

included with applicant’s IRS Form

1099–DIV reports sent to each

shareholder who received distributions

during the year (including shareholders

who sold shares during the year). This

information will also be included in

applicant’s annual report to

shareholders. Through these disclosures

and other communications with

shareholders, applicant states that its

shareholders will understand that

applicant’s fixed distributions are not

tied to its investment income and

realized capital gains and will not

represent yield or investment return.

5. Another concern that led to the

adoption of section 19(b) and rule 19b–

1 was that frequent capital gain

distributions could facilitate improper

fund distribution practices, including

the practice of urging an investor to

purchase fund shares on the basis of an

upcoming dividend (‘‘selling the

dividend’’), where the dividend results

in an immediate corresponding

reduction in net asset value and is in

effect a return of the investor’s capital.

Applicant believes that this concern

does not apply to closed-end investment

companies, such as applicant, which do

not continuously distribute shares.

Although, to date, applicant has

completed one rights offering of

additional shares to shareholders, the

rights offering was short in duration and

involved a relatively small number of

new shares. The rights in the rights

offering were non-transferable and

offered only to existing shareholders.

The rights were offered only by means

of the statutory prospectus, without

solicitation by brokers and without

payment of any commission or other

underwriting fee.

6. Applicant states that another

concern leading to the adoption of

section 19(b) and rule 19b–1, increase in

administrative costs, is not present

because applicant will continue to make

quarterly distributions regardless of

what portion thereof is composed of

capital gains.

7. Section 6(c) of the Act provides that

the SEC may exempt any person,

security, or transaction, or any class or

classes of persons, securities, or

transactions, from any provisions of the

Act, if and to the extent such exemption

is necessary or appropriate in the public

interest and consistent with the

protection of investors and the purposes

fairly intended by the policy and

provisions of the Act. For the reasons

stated above, applicant believes that the

requested exemption meets the

standards set forth in section 6(c).

Applicant’s Condition

Applicant agrees that the order

granting the exemption shall terminate

upon the effective date of a registration

statement under the Securities Act of

1933 for any future public offering by

applicant of its shares other than: (i) a

non-transferable rights offering to

shareholders of applicant, provided that

such offering does not include

solicitation by brokers or the payment of

any commissions or underwriting fee;

and (ii) an offering in connection with

a merger, consolidation, acquisition, or

reorganization.

For the Commission, by the Division

of Investment Management, pursuant to

delegated authority.

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 96–12465 Filed 5–16–96; 8:45 am]

BILLING CODE 8010–01–M

[Rel. No. IC—21952; 812–10064]

Emerging Markets Growth Fund, Inc. et

al.; Notice of Application

May 10, 1996.

AGENCY: Securities and Exchange

Commission (‘‘SEC’’).

ACTION: Notice of Application for

Exemption under the Investment

Company Act of 1940 (the ‘‘Act’’).

APPLICANTS: Emerging Markets Growth

Fund, Inc. (‘‘EMGF’’), New World

Investment Fund (‘‘NWIF’’), IBM

Retirement Plan Trust (‘‘Trust I’’), and

General Motors Employees Global

Group pension Trust (‘‘Trust II’’).

RELEVANT ACT SECTIONS: Order requested

under section 17(b) of the Act granting

an exemption from section 17(a).

SUMMARY OF APPLICATION: Applicants

request an order to permit EMGF to

acquire all of the assets of NWIF.

Because of certain affiliations, the two

funds may not rely on rule 17a–8 under

the Act.

FILING DATES: The application was filed

on March 28, 1996 and amended on

May 9, 1996.

HEARING OR NOTIFICATION OF HEARING: An

order granting the application will be

issued unless the SEC orders a hearing.

Interested persons may request a

hearing by writing to the SEC’s

Secretary and serving applicants with a

copy of the request, personally or by