Notice2023-11808
Proposed Collection; Comment Request; Extension: Rule 3a-8
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
June 5, 2023
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 88 Issue 107 (Monday, June 5, 2023)</title>
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[Federal Register Volume 88, Number 107 (Monday, June 5, 2023)]
[Notices]
[Pages 36620-36621]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2023-11808]
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SECURITIES AND EXCHANGE COMMISSION
[SEC File No. 270-516, OMB Control No. 3235-0574]
Proposed Collection; Comment Request; Extension: Rule 3a-8
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 et seq.), the Securities and Exchange
Commission (the ``Commission'') is soliciting comments on the
collections of information summarized below. The Commission plans to
submit the existing collection of information to the Office of
Management and Budget for extension and approval.
17 CFR 270.3a-8 (rule 3a-8 of the Investment Company Act of 1940
(15 U.S.C. 80a) (the ``Act'')), serves as a nonexclusive safe harbor
from investment company status for certain research and development
companies (``R&D companies'').
The rule requires that the board of directors of an R&D company
seeking to rely on the safe harbor adopt an appropriate resolution
evidencing that the company is primarily engaged in a non-investment
business and record that resolution contemporaneously in its minute
books or comparable documents.\1\ An R&D company seeking to rely on the
safe harbor must retain these records only as long as such records must
be maintained in accordance with state law.
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\1\ Rule 3a-8(a)(6) (17 CFR 270.3a-8(6)).
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Rule 3a-8 contains an additional requirement that is also a
collection of information within the meaning of the PRA. The board of
directors of a company that relies on the safe harbor under rule 3a-8
must adopt a written policy with respect to the company's capital
preservation investments. We expect that the board of directors will
base its decision to adopt the resolution discussed above, in part, on
investment guidelines that the company will follow to ensure its
investment portfolio is in compliance with the rule's requirements.
The collection of information imposed by rule 3a-8 is voluntary
because the rule is an exemptive safe harbor, and therefore, R&D
companies may choose whether or not to rely on it. The purposes of the
information collection requirements in rule 3a-8 are to ensure that:
(i) the board of directors of an R&D company is involved in determining
whether the company should be considered an investment company and
subject to regulation under the Act, and (ii) adequate records are
available for Commission review, if necessary. Rule 3a-8 would not
require the reporting of any information or the filing of any documents
with the Commission.
Commission staff estimates that there is no annual recordkeeping
burden associated with the rule's requirements. Nevertheless, the
Commission requests authorization to maintain an inventory of one
burden hour for administrative purposes.
Commission staff estimates that approximately 537,619 R&D companies
may take advantage of rule 3a-8.\2\ Given that the board resolutions
and investment guidelines will generally need to be adopted only once
(unless relevant circumstances change),\3\ the Commission believes that
all the R&D companies that existed prior to the adoption of rule 3a-8
adopted their board resolutions and established written investment
guidelines in 2003 when the rule was adopted. We expect that R&D
companies formed subsequent to the adoption of rule 3a-8 would adopt
the board resolution and investment guidelines simultaneously with
their formation documents in the
[[Page 36621]]
ordinary course of business.\4\ Therefore, we estimate that rule 3a-8
does not impose additional burdens.
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\2\ See National Science Foundation, National Center for Science
and Engineering Statistics, Business Enterprise Research and
Development, 2020 Data Tables, Table 10, available at: <a href="https://ncses.nsf.gov/pubs/nsf23314">https://ncses.nsf.gov/pubs/nsf23314</a>.
\3\ In the event of changed circumstances, the Commission
believes that the board resolution and investment guidelines will be
amended and recorded in the ordinary course of business and would
not create additional time burdens.
\4\ In order for these companies to raise sufficient capital to
fund their product development stage, Commission staff believes that
they will need to present potential investors with investment
guidelines. Investors generally want to be assured that the
company's funds are invested consistent with the goals of capital
preservation and liquidity.
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Written comments are invited on: (a) whether the proposed
collection of information is necessary for the proper performance of
the functions of the Commission, including whether the information
shall have practical utility; (b) the accuracy of the Commission's
estimate of the burden of the collection of information; (c) ways to
enhance the quality, utility, and clarity of the information collected;
and (d) ways to minimize the burden of the collection of information on
respondents, including through the use of automated collection
techniques or other forms of information technology. Consideration will
be given to comments and suggestions submitted by August 4, 2023.
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.
Please direct your written comments to: David Bottom, Director/
Chief Information Officer, Securities and Exchange Commission, c/o John
Pezzullo, 100 F Street NE, Washington, DC 20549 or send an email to:
<a href="/cdn-cgi/l/email-protection#3b6b697a64765a52575954437b485e58155c544d"><span class="__cf_email__" data-cfemail="411113001e0c20282d232e39013224226f262e37">[email protected]</span></a>.
Dated: May 30, 2023.
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2023-11808 Filed 6-2-23; 8:45 am]
BILLING CODE 8011-01-P
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