Notice2026-18532
Agency Information Collection Activities; Submission for OMB Review; Comment Request; Extension: Rule 0-1 Under the Investment Company Act of 1940, Definition of Terms Used in This Part
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
September 11, 2026
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 91 Issue 175 (Friday, September 11, 2026)</title>
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[Federal Register Volume 91, Number 175 (Friday, September 11, 2026)]
[Notices]
[Page 57948]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-18532]
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SECURITIES AND EXCHANGE COMMISSION
[OMB Control No. 3235-0531]
Agency Information Collection Activities; Submission for OMB
Review; Comment Request; Extension: Rule 0-1 Under the Investment
Company Act of 1940, Definition of Terms Used in This Part
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 described below.
The Investment Company Act of 1940 (the ``Investment Company Act'')
\1\ establishes a comprehensive framework for regulating the
organization and operation of investment companies (``funds''). A
principal objective of the Investment Company Act is to protect fund
investors by addressing the conflicts of interest that exist between
funds and their investment advisers and other affiliated persons. The
Investment Company Act places significant responsibility on the fund
board of directors in overseeing the operations of the fund and
policing the relevant conflicts of interest.\2\ Rule 0-1 (17 CFR 270.0-
1), as amended, provides definitions for the terms used by the
Commission in the rules and regulations it has adopted pursuant to the
Investment Company Act. The rule also contains a number of rules of
construction for terms that are defined either in the Investment
Company Act itself or elsewhere in the Commission's rules and
regulations. Finally, rule 0-1 defines terms that serve as conditions
to the availability of certain of the Commission's exemptive rules.
More specifically, the term ``independent legal counsel,'' as defined
in paragraph (a)(6) of rule 0-1, sets out conditions that funds must
meet in order to rely on any of ten exemptive rules (``exemptive
rules'') under the Investment Company Act.\3\
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\1\ 15 U.S.C. 80a et seq.
\2\ For example, fund directors must approve investment advisory
and distribution contracts. See 15 U.S.C. 80a-15(a), (b), and (c).
\3\ See 17 CFR 270.0-1(a)(7). The relevant exemptive rules are:
rule 10f-3 (17 CFR 270.10f-3), rule 12b-1 (17 CFR 270.12b-1), rule
15a-4(b)(2) (17 CFR 270.15a-4(b)(2)), rule 17a-7 (17 CFR 270.17a-7),
rule 17a-8 (17 CFR 270.17a-8), rule 17d-1(d)(7) (17 CFR 270.17d-
1(d)(7)), rule 17e-1(c) (17 CFR 270.17e-1(c)), rule 17g-1 (17 CFR
270.17g-1), rule 18f-3 (17 CFR 270.18f-3), and rule 23c-3 (17 CFR
270.23c-3).
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If the board's counsel has represented the fund's investment
adviser, principal underwriter, administrator (collectively,
``management organizations'') or their ``control persons'' \4\ during
the past two years, rule 0-1 requires that the board's independent
directors make a determination about the adequacy of the counsel's
independence. A majority of the board's independent directors are
required to reasonably determine, in the exercise of their judgment,
that the counsel's prior or current representation of the management
organizations or their control persons was sufficiently limited to
conclude that it is unlikely to adversely affect the counsel's
professional judgment and legal representation.\5\ Rule 0-1 also
requires that a record for the basis of this determination is made in
the minutes of the directors' meeting. In addition, the independent
directors must have obtained an undertaking from the counsel to provide
them with the information necessary to make their determination and to
update promptly that information when the person begins to represent a
management organization or control person, or when he or she materially
increases his or her representation.\6\ Generally, the independent
directors must re-evaluate their determination no less frequently than
annually.
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\4\ A ``control person'' is any person--other than a fund--
directly or indirectly controlling, controlled by, or under common
control, with any of the fund's management organizations. See 17 CFR
270.01(a)(6)(iv)(B).
\5\ 17 CFR 270.0-1(a)(6)(i)(A).
\6\ 17 CFR 270.0-1(a)(6)(i)(B).
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Under rule 0-1, if a majority of a fund's independent directors
makes a determination that the counsel's representation of fund
management organizations (or any of their control persons) is or was so
limited that it will not adversely affect the counsel's ability to
provide impartial advice to the independent directors, the basis for
that determination must be recorded in the board's meeting minutes. The
records maintained under the rule are not submitted to the Commission,
but may be reviewed by the Commission staff upon request to ensure
compliance with the rule. Compliance with rule 0-1 is required to
obtain or retain benefits.
We estimate that approximately 920 funds would need to make the
required determination in order for their counsel to meet the
definition of independent legal counsel under rule 0-1. Based on
conversations with fund representatives and the Commission's experience
with the use of rule 0-1, we estimate that the recordkeeping burden of
compliance with rule 0-1 is approximately 1 hour per respondent. This
time is spent, for example, preparing the materials and minutes.
Accordingly, we calculate the total estimated annual internal burden of
complying with rule 0-1 to be approximately 920 hours. The total annual
external cost is estimated to be $0.
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: <a href="https://www.reginfo.gov/public/do/PRAViewICR?ref_nbr=202606-3235-020">https://www.reginfo.gov/public/do/PRAViewICR?ref_nbr=202606-3235-020</a> or email comment to
<a href="/cdn-cgi/l/email-protection#c8858a90e687858ae687819a89e69b8d8b97acadbba397a7aeaea1abadba88a7a5aae6ada7b8e6afa7be"><span class="__cf_email__" data-cfemail="d09d9288fe9f9d92fe9f998291fe8395938fb4b5a3bb8fbfb6b6b9b3b5a290bfbdb2feb5bfa0feb7bfa6">[email protected]</span></a> within 30 days of the day
after publication of this notice, by October 13, 2026.
Dated: September 8, 2026.
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2026-18532 Filed 9-10-26; 8:45 am]
BILLING CODE 8011-01-P
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