Document ID: SEC-2006-0122-0016
Agency: sec
Document Type: Notice
Title: PIMCO Funds, et al.; Notice of Application
Posted Date: 2008-07-23T04:00Z

[Federal Register: July 23, 2008 (Volume 73, Number 142)]
[Notices]               
[Page 42838-42840]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr23jy08-79]                         

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SECURITIES AND EXCHANGE COMMISSION

[Investment Company Act Release No. 28331; 812-13513]

 
PIMCO Funds, et al.; Notice of Application

July 17, 2008.
AGENCY: Securities and Exchange Commission (``Commission'').

ACTION: Notice of an application under section 6(c) of the Investment 
Company Act of 1940 (``Act'') for an exemption from rule 12d1-2(a) 
under the Act.

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Summary of Application: Applicants request an order to permit funds of 
funds relying on rule 12d1-2 under the Act to invest in certain 
financial instruments.

Applicants: PIMCO Funds, PIMCO Variable Insurance Trust (``PVIT'') 
(collectively, the ``Trusts''), Allianz Global Investors Distributors 
LLC (``AGID'') and Pacific Investment Management Company LLC 
(``PIMCO'').

Filing Dates: The application was filed on March 25, 2008, and amended 
on

[[Page 42839]]

June 26, 2008. Applicants have agreed to file an amendment during the 
notice period, the substance of which is reflected in this notice.

Hearing or Notification of Hearing: An order granting the application 
will be issued unless the Commission orders a hearing. Interested 
persons may request a hearing by writing to the Commission's Secretary 
and serving applicants with a copy of the request, personally or by 
mail. Hearing requests should be received by the Commission by 5:30 
p.m. on August 11, 2008, 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 who wish to be notified of a hearing may request 
notification by writing to the Commission's Secretary.

ADDRESSES: Secretary, Securities and Exchange Commission, 100 F Street, 
NE., Washington, DC 20549-1090; Applicants, c/o J. Stephen King, Jr., 
Pacific Investment Management Company LLC, 840 Newport Center Drive, 
Newport Beach, CA 92660.

FOR FURTHER INFORMATION CONTACT: Steven I. Amchan, Attorney Adviser, at 
(202) 551-6826, or Marilyn Mann, Branch Chief, at (202) 551-6821 
(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 
Commission's Public Reference Branch, 100 F Street, NE., Washington, DC 
20549-1520 (telephone (202) 551-5850).

Applicants' Representations

    1. PIMCO Funds is organized as a Massachusetts business trust and 
PVIT is organized as a Delaware statutory trust. The Trusts are 
registered under the Act as open-end management investment companies. 
Applicants request the exemption to the extent necessary to permit any 
existing or future registered open-end management investment company or 
series thereof advised by PIMCO or an entity controlling, controlled 
by, or under common control with PIMCO and which invests in other 
registered open-end management investment companies in reliance on 
section 12(d)(1)(G) of the Act, and which is also eligible to invest in 
securities (as defined in section 2(a)(36) of the Act) in reliance on 
rule 12d1-2 under the Act (together with the Trusts and their series, 
the ``Applicant Funds''), to also invest, to the extent consistent with 
its investment objective, policies, strategies and limitations, in 
financial instruments that may not be securities within the meaning of 
section 2(a)(36) of the Act (``Other Investments'').
    2. AGID provides distribution and marketing services for the 
Applicant Funds. AGID is organized as a Delaware limited liability 
company and is an indirect subsidiary of Allianz SE. AGID is a 
registered broker-dealer under the Securities Exchange Act of 1934, as 
amended (``Exchange Act''). PIMCO is the Trusts'' investment adviser 
with overall responsibility for the day-to-day investment management of 
the Trusts and investing the assets of PIMCO Funds and PVIT. PIMCO is 
organized as a Delaware limited liability company and is an indirect 
subsidiary of Allianz SE. PIMCO is a registered investment adviser 
under the Investment Advisers Act of 1940. Allianz SE is a European 
based, multinational insurance and financial services holding company.
    3. Consistent with its fiduciary obligations under the Act, each 
Applicant Fund's board of trustees will review the advisory fees 
charged by the Applicant Fund's investment adviser to ensure that they 
are based on services provided that are in addition to, rather than 
duplicative of, services provided pursuant to the advisory agreement of 
any investment company in which the Applicant Fund may invest.

Applicants' Legal Analysis

    1. Section 12(d)(1)(A) of the Act provides that no registered 
investment company (``acquiring company'') may acquire securities of 
another investment company (``acquired company'') if such securities 
represent more than 3% of the acquired company's outstanding voting 
stock or more than 5% of the acquiring company's total assets, or if 
such securities, together with the securities of other investment 
companies, represent more than 10% of the acquiring company's total 
assets. Section 12(d)(1)(B) of the Act provides that no registered 
open-end investment company may sell its securities to another 
investment company if the sale will cause the acquiring company to own 
more than 3% of the acquired company's voting stock, or cause more than 
10% of the acquired company's voting stock to be owned by investment 
companies.
    2. Section 12(d)(1)(G) of the Act provides that section 12(d)(1) 
will not apply to securities of an acquired company purchased by an 
acquiring company if: (i) The acquiring company and acquired company 
are part of the same group of investment companies; (ii) the acquiring 
company holds only securities of acquired companies that are part of 
the same group of investment companies, government securities, and 
short-term paper; (iii) the aggregate sales loads and distribution-
related fees of the acquiring company and the acquired company are not 
excessive under rules adopted pursuant to section 22(b) or section 
22(c) of the Act by a securities association registered under section 
15A of the Exchange Act or by the Commission; and (iv) the acquired 
company has a policy that prohibits it from acquiring securities of 
registered open-end management investment companies or registered unit 
investment trusts in reliance on section 12(d)(1)(F) or (G) of the Act.
    3. Rule 12d1-2 under the Act permits a registered open-end 
investment company or a registered unit investment trust that relies on 
section 12(d)(1)(G) of the Act to acquire, in addition to securities 
issued by another registered investment company in the same group of 
investment companies, government securities, and short-term paper: (1) 
Securities issued by an investment company that is not in the same 
group of investment companies, when the acquisition is in reliance on 
section 12(d)(1)(A) or 12(d)(1)(F) of the Act; (2) securities (other 
than securities issued by an investment company); and (3) securities 
issued by a money market fund, when the investment is in reliance on 
rule 12d1-1 under the Act. For the purposes of rule 12d1-2, 
``securities'' means any security as defined in section 2(a)(36) of the 
Act.
    4. Section 6(c) of the Act provides that the Commission may exempt 
any person, security, or transaction from any provision of the Act, or 
from any rule under the Act, if such exemption is necessary or 
appropriate in the public interest and consistent with the protection 
of investors and the purposes fairly intended by the policies and 
provisions of the Act.
    5. Applicants state that the proposed arrangement would comply with 
the provisions of rule 12d1-2 under the Act, but for the fact that the 
Applicant Funds may invest a portion of their assets in Other 
Investments. Applicants request an order under section 6(c) of the Act 
for an exemption from rule 12d1-2(a) to allow the Applicant Funds to 
invest in Other Investments. Applicants assert that permitting the 
Applicant Funds to invest in Other Investments as described in the 
application would not raise any of the concerns that the requirements 
of section 12(d)(1) were designed to address.

[[Page 42840]]

Applicants' Condition

    Applicants agree that the order granting the requested relief will 
be subject to the following condition:
    Applicants will comply with all provisions of rule 12d1-2 under the 
Act, except for paragraph (a)(2), to the extent that it restricts any 
Applicant Fund from investing in Other Investments as described in the 
application.

    For the Commission, by the Division of Investment Management, 
under delegated authority.
Florence E. Harmon,
Acting Secretary.
 [FR Doc. E8-16835 Filed 7-22-08; 8:45 am]

BILLING CODE 8010-01-P