Notice2026-15934
Agency Information Collection Activities; Submission for OMB Review; Comment Request; Extension: Rule 35d-1 Under the Investment Company Act of 1940
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
August 6, 2026
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 91 Issue 150 (Thursday, August 6, 2026)</title>
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[Federal Register Volume 91, Number 150 (Thursday, August 6, 2026)]
[Notices]
[Pages 50911-50913]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-15934]
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SECURITIES AND EXCHANGE COMMISSION
[OMB Control No. 3235-0548]
Agency Information Collection Activities; Submission for OMB
Review; Comment Request; Extension: Rule 35d-1 Under the Investment
Company Act of 1940
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. Sec. 3501 et seq.), the Securities and Exchange
Commission (``SEC'' or ``Commission'') is submitting to the Office of
Management and Budget (``OMB'') this request for Extension of the
proposed collection of information.
Section 35(d) of the Investment Company Act of 1940 (``Investment
Company Act'') \1\ prohibits a registered investment company from
adopting as part of the name or title of such company, or of any
securities of which it is the issuer, any word or words that the
Commission finds are materially deceptive or misleading and authorizes
the Commission, by rule, regulation, or order, to define such names or
titles as are materially deceptive or misleading.\2\
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\1\ 15 U.S.C. 80a-1 et seq.
\2\ 15 U.S.C. 80a-34(d); see also Investment Company Names,
Investment Company Act Release No. 35000 (Sept. 20, 2023) [88 FR
70436 (Oct. 27, 2023)] (adopting amendments to rule 35d-1).
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Rule 35d-1 under the Investment Company Act defines as ``materially
deceptive and misleading'' for purposes of section 35(d), among other
things, a name suggesting that a registered investment company or a
business development company (``BDC''), including any series thereof (a
``fund'') focuses its investments in a particular type of investment or
investments, a particular industry or group of industries, particular
countries or geographic regions, or investments that have, or whose
issuers have, particular characteristics, unless, among other things,
the fund adopts a policy to invest at least 80% of the value of its
assets in the type of investment suggested by its name.\3\ The rule
imposes a similar 80% investment policy requirement for funds that have
names suggesting that a fund's distributions are exempt from federal
income tax or from both federal and state income tax (``tax-exempt
funds'').
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\3\ 17 CFR 270.35d-1. A policy that a fund must adopt under rule
35d-1 is referred to as an ``80% investment policy.''
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Rule 35d-1 requires either that (1) the 80% investment policy be
fundamental or, (2) generally in the case of funds other than tax-
exempt funds, registered closed-end funds, and BDCs, that the fund has
adopted a policy to provide its shareholders with at least 60 days
prior notice of any change in the investment policy, or a change to the
fund's name that accompanies the investment policy change (``notice to
shareholders'').\4\ The rule further requires funds that adopt an 80%
investment policy to maintain written records documenting their
compliance with rule 35d-1, including records of any notice sent to the
fund's shareholders pursuant to the rule.\5\ These records must be
retained for no less than six years following the creation of each
required record (or, in the case of notices, following the date the
notice was sent), the first two years in an easily accessible place.
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\4\ 17 CFR 270.35d-1(a)(2)(ii), (a)(3)(i), (d), (f).
\5\ 17 CFR 270.35d-1(b)(3).
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Rule 35d-1 is designed to address certain broad categories of fund
names that, in the Commission's view, are likely to mislead an investor
about a fund's investments and risks. The rule's provisions are
intended to further that goal. For example, the rule's notice to
shareholders provision is designed to ensure that when shareholders
purchase shares in a fund based, at least in part, on its name, and
with the expectation that it will follow the investment policy
suggested by that name, they will have sufficient time to decide
whether to redeem their shares in the event that the fund decides to
pursue a different investment policy. The rule's recordkeeping
requirements are designed to help ensure compliance with the rule's
requirements and aid in oversight.
Rule 35d-1's collection of information requirements include, as
detailed in Table 1 below, the notice requirement and recordkeeping
requirements for funds that are required to adopt an 80% investment
policy. Compliance with these requirements is mandatory. Responses to
these requirements will not be kept confidential.
Table 1--Summary of Revised Annual Responses, Burden Hours, and Monetized Annual Time Burden
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Annual number of responses (funds) Annual time burden (hours) Monetized annual time burden (dollars)
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Currently Revised Currently Revised Currently Revised
approved estimate Change approved estimate Change approved estimate Change
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Rule 35d-1 Notice Requirement 34 \1\ 37 3 680 20 hours per 60 \3\ $289,000 $750 \4\ x 20 $266,000
notice \2\ x hours =
37 funds = 740 $15,000 per
hours. fund. $15,000
x 37 funds =
$555,000.
[[Page 50912]]
Rule 35d-1 Recordkeeping 10,291 \5\ 10,855 564 771,825 75 hours per 42,300 \7\ $600 \8\ x 75 175,114,050
Requirement. fund \6\ x 313,360,950 hours per fund
10,855 funds = = $45,000 per
814,125 hours. fund. $45,000
x 10,855 funds
= $488,475,000.
Total Time Burden (hours) .......... .......... ........... 772,505 814,865 hours.. 42,360 313,649,950 $489,030,000... 175,380,050
and Monetized Annual Time
Burden (dollars).
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\1\ The Commission estimates, across approximately 14,282 open-end and closed-end funds registered with the Commission (12,710 open-end management
investment companies (Form N-1A filers), 707 closed-end management investment companies (Form N-2 filers not classified as BDCs), 693 UITs (Form N-4,
N-6, N-8B-2, and S-6 filers), and 172 BDCs (based on Form 10-K filings and related amendments), as of December 31, 2025) that approximately 76% of
these funds, or approximately 10,855 funds, have names that would require an 80% investment policy. The Commission further estimates that 1% of these
10,855 funds, or approximately 109 funds, would within the next three years provide a notice to shareholders pursuant to rule 35d-1. Therefore, over
the course of 3 years, the Commission estimates that on average approximately 37 funds per year would provide a notice to shareholders under rule 35d-
1.
\2\ The Commission continues to estimate, as under the currently-approved burden, a burden of 20 hours per notice.
\3\ The currently-approved cost burden was estimated as follows: 20 hours per notice x $425 (blended rate for attorneys) x 34 funds = $289,000.
\4\ We estimate $750 as follows: $744 rate for an attorney, rounded up for simplicity = $750. To calculate the occupational hourly rate used in the
Commission's current estimates, the Commission uses occupational mean hourly wage data from the Occupational Employment and Wage Statistics (OEWS)
program of the Bureau of Labor Statistics (BLS) for ``Securities, Commodity Contracts, and Other Financial Investments and Related Activities'' (NAICS
523). See Occupational Employment and Wage Statistics, U.S. BUREAU OF LABOR STATISTICS, <a href="https://www.bls.gov/oes/">https://www.bls.gov/oes/</a>; see also Standard Occupational
Classification, U.S. BUREAU OF LABOR STATISTICS, <a href="https://www.bls.gov/soc/">https://www.bls.gov/soc/</a> (describing occupational classification system used by BLS); EXEC. OFF. OF
THE PRESIDENT, OFF. OF MGMT. & BUDGET, NORTH AMERICAN INDUSTRY CLASSIFICATION SYSTEM (2022), available at <a href="https://www.census.gov/naics/reference_files_tools/2022_NAICS_Manual.pdf">https://www.census.gov/naics/reference_files_tools/2022_NAICS_Manual.pdf</a> (describing the industry classification system used by BLS and other agencies). The mean hourly wage for
each occupation is adjusted for changes in the seasonally adjusted employment cost index for private wages and salaries between the data reference
period and when the data are released by BLS. See Employment Cost Index, U.S. BUREAU OF LABOR STATISTICS, <a href="https://www.bls.gov/eci/">https://www.bls.gov/eci/</a>. The adjusted mean
hourly wage is then multiplied by a factor that accounts for nonwage costs borne by employers, such as bonuses, benefits, and overhead. This factor is
calculated as an average over the 10 most recently available years of data of the ratio of the Bureau of Economic Analysis's annual gross output data
for NAICS 523 to total annual wages across all occupations for NAICS 523 in the OEWS data. See Gross Output by Industry, U.S. BUREAU OF ECONOMIC
ANALYSIS, <a href="https://www.bea.gov/data/industries/gross-output-by-industry">https://www.bea.gov/data/industries/gross-output-by-industry</a>; Occupational Employment and Wage Statistics, U.S. BUREAU OF LABOR STATISTICS,
<a href="https://www.bls.gov/oes/">https://www.bls.gov/oes/</a>. The final product is the occupational hourly rate. See generally UPDATED METHODOLOGY FOR CALCULATING OCCUPATIONAL HOURLY
RATES (Dec. 19, 2025), available at <a href="https://www.sec.gov/files/method-occupational-hourly-rates.pdf">https://www.sec.gov/files/method-occupational-hourly-rates.pdf</a>.
\5\ We estimate that 10,855 funds have names that would require an 80% investment policy. See supra footnote 1 to Table 1.
\6\ The Commission continues to estimate, as under the currently-approved burden, an average annual burden of 75 hours associated with recordkeeping
under rule 35d-1. This burden would be higher for new funds that would have to establish recordkeeping procedures, and lower for funds whose records
(or a significant subset of records) would be able to be automated.
\7\ The currently-approved cost burden was estimated as follows: 75 annual burden hours associated with recordkeeping x $406 (blended rate for
compliance attorney and senior programmer) x 10,291 funds = $313,649,950.
\8\ We estimate $600 as follows: blended rate for an attorney ($744) and a computer programmer ($416) = $580, rounded up for simplicity = $600. See
supra footnote 4 to Table 1 (discussing calculation of occupational hourly rates used in the Commission's current estimates).
Cost burden is the external cost of services purchased to comply
with rule 35d-1, such as for the services of computer programmers,
outside counsel, financial printers, and advertising agencies. The cost
burden does not include the cost of the internal hour burden discussed
in Table 1 above. We estimate a total annual external cost burden to
all respondents of $5,446,000 ($18,500 (notice requirement) +
$5,427,500 (recordkeeping requirement)), as detailed in Table 2 below.
Table 2--Summary of Revised Annual External Cost Burden
[Purchase of services]
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Annual number of responses (funds) Annual external cost burden (dollars)
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Currently Revised Currently
approved estimate Change approved Revised estimate Change
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Rule 35d-1 Notice Requirement............ 34 \1\ 37 3 \2\ $19,210 $750 \3\ x 37 funds = $8,540
$27,750.
Rule 35d-1 Recordkeeping Requirement..... 10,291 \4\ 10,855 564 \5\ 5,814,415 $750 \6\ x 10,855 funds = 2,326,835
$8,141,250.
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Total External Cost Burden (dollars). .............. .............. ............... 5,833,625 $8,169,000.................. 2,335,375
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\1\ See supra footnote 1 to Table 1.
\2\ The currently-approved annual external cost burden was estimated as follows: $565 for 1 hour of external legal services x 34 funds = $19,210.
\3\ We estimate $750 as follows: $744 rate for an attorney, rounded up for simplicity = $750. See supra footnote 4 to Table 1 (discussing calculation of
occupational hourly rates used in the Commission's current estimates).
\4\ See supra footnote 5 to Table 1.
\5\ The currently-approved annual external cost burden was estimated as follows: $565 for 1 hour of external legal services x 10,291 funds = $5,814,415.
\6\ See supra footnote 3 to Table 2.
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 OMB Control Number.
The public may view and comment on this information collection
request at: https://www.reginfo.gov/public/do/
[[Page 50913]]
PRAViewICR?ref_nbr=202605-3235-020 or email comment to
<a href="/cdn-cgi/l/email-protection#ca878892e4858788e48583988be4998f8995aeafb9a195a5acaca3a9afb88aa5a7a8e4afa5bae4ada5bc"><span class="__cf_email__" data-cfemail="105d52483e5f5d523e5f5942513e4355534f7475637b4f7f767679737562507f7d723e757f603e777f66">[email protected]</span></a> within 30 days of the day
after publication of this notice, by September 8, 2026.
Dated: August 3, 2026.
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2026-15934 Filed 8-5-26; 8:45 am]
BILLING CODE 8011-01-P
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