Securities Offering Reform for Closed-End Investment Companies

1 15 U.S.C. 77a et seq.
2 15 U.S.C. 78a et seq.
3 15 U.S.C. 80a–1 et seq.
SECURITIES AND EXCHANGE
COMMISSION
17 CFR Parts 229, 230, 232, 239, 240, 243, 249, 270, and 274 [Release Nos. 33–10771; 34–88606; IC– 33836; File No. S7–03–19] RIN 3235–AM31 Securities Offering Reform for ClosedEnd Investment Companies AGENCY: Securities and Exchange Commission. ACTION: Final rule. SUMMARY: The Securities and Exchange Commission (the ‘‘Commission’’) is adopting rules that will modify the registration, communications, and offering processes for business development companies (‘‘BDCs’’) and other closed-end investment companies under the Securities Act of 1933. As directed by Congress, we are adopting rules that will allow these investment companies to use the securities offering rules that are already available to operating companies. These rules will extend to closed-end investment companies offering reforms currently available to operating company issuers by expanding the definition of ‘‘wellknown seasoned issuer’’ to allow these investment companies to qualify; streamlining the registration process for these investment companies, including the process for shelf registration; permitting these investment companies to satisfy their final prospectus delivery requirements by filing the prospectus with the Commission; and permitting additional communications by and about these investment companies during a registered public offering. In addition, we are amending certain rules and forms to tailor the disclosure and regulatory framework to these investment companies. These amendments also will modernize our approach to securities registration fee payment by requiring closed-end investment companies that operate as ‘‘interval funds’’ to pay securities registration fees using the same method as mutual funds and exchange-traded funds and extend the ability to use this payment method to issuers of certain continuously offered, exchange-traded products (‘‘ETPs’’). Additionally, we are expanding the ability of certain registered closed-end funds or BDCs that conduct continuous offerings to make changes to their registration statements on an immediately effective basis or on an automatically effective basis a set period of time after filing. Lastly, we are adopting certain structured data reporting requirements, including for filings on the form providing annual notice of securities sold pursuant to the rule under the Investment Company Act of 1940 that prescribes the method by which certain investment companies (including mutual funds) calculate and pay registration fees. DATES:
Effective Dates: This rule is effective August 1, 2020, except for amendatory instructions 21, 22, 30, 31, 33, 34, 41, 42, and 45 which are effective August 1, 2021. Compliance Dates: The applicable compliance dates are discussed below in section II.J. FOR FURTHER INFORMATION CONTACT: Asaf Barouk, Attorney-Adviser; Joel Cavanaugh, Senior Counsel; Terri G. Jordan, Senior Counsel; Amy Miller, Senior Counsel; Angela Mokodean, Senior Counsel; Amanda Hollander Wagner, Branch Chief; David J. Marcinkus, Branch Chief; Jacob D. Krawitz, Branch Chief; or Brian McLaughlin Johnson, Assistant Director, at (202) 551–6792, Investment Company Regulation Office, Division of Investment Management; Charles Kwon, Senior Counsel, Office of Rulemaking, at (202) 551–3430, Division of Corporation Finance; U.S. Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549. SUPPLEMENTARY INFORMATION: The Commission is adopting amendments to:
Commission reference
CFR citation
(17 CFR)
SECURITIES ACT OF 1933 (‘‘SECURITIES ACT’’) 1 Rule 134 .................... § 230.134 Rule 138 .................... § 230.138 Rule 156 .................... § 230.156 Rule 163 .................... § 230.163 Rule 163A ................. § 230.163A Rule 164 .................... § 230.164 Rule 168 .................... § 230.168 Rule 169 .................... § 230.169 Rule 172 .................... § 230.172 Rule 173 .................... § 230.173 Rule 405 .................... § 230.405 Rule 415 .................... § 230.415 Rule 418 .................... § 230.418 Rule 424 .................... § 230.424 Rule 430A ................. § 230.430A Rule 430B ................. § 230.430B Rule 433 .................... § 230.433 Rule 456 .................... § 230.456 Rule 457 .................... § 230.457 Rule 462 .................... § 230.462 Rule 486 .................... § 230.486 Commission reference CFR citation (17 CFR) Rule 497 .................... § 230.497 Form S–1 .................. § 239.11 Form S–3 .................. § 239.13 Form N–14 ................ § 239.23 Form F–1 .................. § 239.31 Form F–3 .................. § 239.33 REGULATION S–T [17 CFR 232.10 THROUGH 232.903] Rule 11 ...................... § 232.11 Rule 405 .................... § 232.405 SECURITIES EXCHANGE ACT OF 1934 (‘‘EXCHANGE ACT’’) 2
Schedule 14A ............ § 240.14a–101
Rule 103 of Regulation FD.
§ 243.103
INVESTMENT COMPANY ACT OF 1940 (‘‘INVESTMENT COMPANY ACT’’) 3 Rule 8b–16 ................ § 270.8b–16 Rule 23c–3 ................ § 270.23c–3 Rule 24f–2 ................. § 270.24f–2 Form 24F–2 .............. § 274.24 SECURITIES ACT AND INVESTMENT COMPANY ACT Form N–2 .................. §§ 239.14 and 274.11a–1 EXCHANGE ACT AND INVESTMENT COMPANY ACT Form N–CSR ............ §§ 249.331 and 274.128
Table of Contents
I. Introduction
II. Discussion
A. Scope of Closed-End Investment Companies Affected by the Final Rule B. Registration Process
1. Current Shelf Offering Process for
Affected Funds
2. Amendments to the Registration Process
for Affected Funds
3. Short-Form Registration on Form N–2
C. Well-Known Seasoned Issuer Status
1. WKSI Definition
2. WKSI Eligibility
3. Ineligible Issuer Definition
D. Automatic or Immediate Effectiveness for Filings by Affected Funds Conducting Certain Continuous Offerings E. Final Prospectus Delivery Reforms F. Communications Reforms
1. Offering Communications
2. Broker-Dealer Research Reports
G. Other Rule Amendments
1. Rule 418 Supplemental Information
2. Amendments to Incorporation by
Reference Into Proxy Statements
3. Rule 103 of Regulation FD
H. New Registration Fee Payment Method for Interval Funds and Issuers of Certain Exchange-Traded Products
I. Disclosure and Reporting Parity
Proposals

4BDCs are a category of closed-end investment companies that do not register under the Investment Company Act, but rather elect to be subject to the provisions of sections 55 through 65 of the Investment Company Act. See section 2(a)(48) of the Investment Company Act [15 U.S.C. 80a– 2(a)(48)]. Congress established BDCs for the purpose of making capital more readily available to small, developing and financially troubled companies that do not have ready access to the public capital markets or other forms of conventional financing. See H.R. Rep. No. 1341, 96th Cong., 2d Sess. 21 (1980). See infra section II.A for additional discussion of the definition of ‘‘affected funds.’’ ‘‘Interval funds’’ are a type of registered CEF or BDC that make periodic repurchase offers pursuant to rule 23c–3 under the Investment Company Act. See 17 CFR 270.23c–3 (‘‘rule 23c–3’’). 5Securities Offering Reform, Securities Act Release No. 8591 (July 19, 2005) [70 FR 44721 (Aug. 3, 2005)] (‘‘Securities Offering Reform Adopting Release’’). In this release we generally use the term ‘‘operating company’’ to refer to issuers that are not investment companies and that are currently eligible to rely on the rules we are amending. 6See, e.g., id. at 44727 (discussing the exclusion of investment companies registered under the Investment Company Act and BDCs from the definition of ‘‘well-known seasoned issuer’’); id. at 44735 (discussing the exclusion of such companies from the safe harbors for factual business information and forward-looking information); id. at 44784 (discussing the exclusion of such companies from final prospectus delivery reforms). 7Section 803(b) of Small Business Credit Availability Act, Public Law 115–141, 132 Stat. 348 (2018) (‘‘BDC Act’’). This section also directs us to make specified revisions to allow a BDC to use the proxy rules that are available to such other issuers. Id. Affected funds generally use the proxy rules that are available to operating companies already. One current difference applicable to these entities, however, is a more limited ability to incorporate information into their proxy statements by reference. The BDC Act directs that we eliminate this difference by providing these entities parity with operating companies. Section 803(b)(2)(N) of the BDC Act; see also infra section II.G.2. 8See section 803(b)(2) of the BDC Act. 9Section 509(a) of Economic Growth, Regulatory Relief, and Consumer Protection Act, Public Law 115–174, 132 Stat. 1296 (2018) (‘‘Registered CEF Act’’). The Registered CEF Act also refers to proxy rules, as does the BDC Act. See supra footnote 7. 10Securities Offering Reform for Closed-End Investment Companies, Investment Company Act Release No. 33427 (Mar. 20, 2019) [84 FR 14448 (Apr. 10, 2019)] (‘‘Proposing Release’’). 11See, e.g., Comment Letter of the Federal Regulation of Securities Committee of the Business Law Section of the American Bar Association (July 3, 2019) (‘‘ABA Comment Letter’’); Comment Letter of
Alternative Credit Council (June 10, 2019) (‘‘ACC Comment Letter’’); Comment Letter of Coalition for Business Development (June 10, 2019) (‘‘CBD Comment Letter’’). The comment letters on the Proposing Release (File No. S7–03–19) are available at https://www.sec.gov/comments/s7-03-19.htm. 12See, e.g., Comment Letter of Calcbench, Inc. (May 13, 2019) (‘‘Calcbench Comment Letter’’); Comment Letter of GraniteShares LLC (June 26,
2019) (‘‘GraniteShares Comment Letter’’); Comment
Letter of Institute for Portfolio Alternatives (June 10,
2019) (‘‘IPA Comment Letter’’).
1. Structured Data Requirements
2. Periodic Reporting Requirements
3. Current Reporting Requirements for
Affected Funds
4. Online Availability of Information
Incorporated by Reference
5. Amendments to Certain Registered CEFs’
Annual Report Disclosure J. Effective and Compliance Dates
III. Economic Analysis
A. Introduction and Baseline
1. Number of Affected Funds
2. Current Securities Offering
Requirements for Affected Funds
3. Current Disclosure Obligations of
Affected Funds
B. Potential Benefits Resulting From the Proposed Implementation of the Statutory Mandates
1. Improved Access to Capital and Lower
Cost of Capital
2. Facilitated Communication With
Investors
C. Potential Costs Resulting From the
Proposed Implementation of the Statutory Mandates
1. Compliance Costs
2. Other Costs
D. Alternatives to Adopted Approach To Implementing Statutory Mandates E. Discussion of Discretionary Choices
1. New Registration Fee Payment Method
for Interval Funds and Issuers of Certain Exchange-Traded Products
2. Structured Data Requirements
3. Periodic Reporting Requirements
4. Discretionary Amendments to
Incorporation by Reference Requirements
5. Automatic or Immediate Effectiveness of
Filings by Affected Funds Conducting Certain Continuous Offerings
IV. Paperwork Reduction Act Analysis
A. Background
B. Summary of the Amendments and Impact on Information Collections
1. Amendments to Form N–2 Registration
Statement
2. Structured Data Reporting Requirements
3. New Annual Reporting Requirements
Under 17 CFR 270.30e–1 (Rule 30e–1) and Exchange Act Periodic Reporting Requirements for BDCs
4. Securities Offering Communications
5. Prospectus Delivery Requirements
6. Form 24F–2
7. Amendments Permitting the Registration
of Offerings of an Indeterminate Number of Exchange-Traded Vehicle Securities and the Payment of Registration Fees for Such Offerings on an Annual Net Basis
8. Amendments to Form N–14
V. Final Regulatory Flexibility Analysis
A. Need and Objectives of the Final Rule B. Significant Issues Raised by Public Comments
C. Small Entities Subject to the Rule
D. Projected Reporting, Recordkeeping, and Other Compliance Requirements
1. Registration Process and Final
Prospectus Delivery
2. Communications Rules
3. New Registration Fee Payment Method
for Interval Funds
4. Disclosure and Reporting Requirements
5. Automatic or Immediate Effectiveness
for Filings by Affected Funds Conducting Certain Continuous Offerings E. Agency Action To Minimize Effect on Small Entities
1. Alternatives to the Adopted Approach
To Implementing Statutory Mandates
2. Alternative Approaches to Discretionary
Choices
VI. Other Matters
VII. Statutory Authority
I. Introduction
We are adopting rules that will modify the registration, communications, and offering processes for business development companies (‘‘BDCs’’) and registered closed-end investment companies (‘‘registered CEFs’’), including interval funds (collectively, ‘‘affected funds’’) under the Securities Act.4 In 2005, the Commission adopted securities offering reforms for operating companies to modernize the securities offering and communication processes while maintaining the protection of investors under the Securities Act.5 At that time, the Commission specifically excluded all investment companies—including affected funds—from the scope of the reforms.6 Now, as directed by Congress, we are adopting rules that will allow affected funds to use the securities offering rules that are already available to operating companies. The Small Business Credit Availability Act (the ‘‘BDC Act’’) directs us to allow a BDC to use the securities offering rules that are available to other issuers required to file reports under
section 13(a) or section 15(d) of the
Exchange Act.7 As discussed in detail below, the BDC Act identifies with specificity the required revisions.8 The Economic Growth, Regulatory Relief, and Consumer Protection Act (the ‘‘Registered CEF Act’’) (and, together with the BDC Act, the ‘‘Acts’’) directs us to adopt rules to allow any registered CEF that is listed on a national securities exchange (a ‘‘listed registered CEF’’) or that makes periodic repurchase offers under rule 23c–3 to use the securities offering rules that are available to other issuers that are required to file reports under section 13(a) or section 15(d) of the Exchange Act, subject to appropriate conditions.9 Unlike the BDC Act, the Registered CEF Act does not identify with specificity the revisions that are required. In 2019, we proposed rules that would modify the registration, communications, and offering processes for affected funds under the Securities Act.10 As discussed in greater detail below, most commenters supported the proposal.11 Many of the commenters who supported the proposal generally also recommended modifications to some of the proposed rules.12 For example, some commenters recommended further expanding the scope of issuers that would qualify as ‘‘well-known seasoned issuers’’ to include smaller issuers or those without

13See infra section II.C.
14See infra section II.I.3.
15See ABA Comment Letter; Comment Letter of Investment Company Institute (June 10, 2019) (‘‘ICI Comment Letter’’). 16See, e.g., Comment Letter of United States Commodity Funds LLC (June 10, 2019) (‘‘USCF Comment Letter’’); Comment Letter of World Gold Council (June 10, 2019) (‘‘WGC Comment Letter’’). 17Comment Letter of Dale White (Apr. 3, 2019) (‘‘White Comment Letter’’). 18See General Instruction I.B.1 of Form S–3 (defining ‘‘aggregate market value’’). In this release, we use ‘‘public float’’ to mean the aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant. See General Instruction I.B.1 of Form S–3. Certain issuers with less than $75 million in public float also are eligible to use Form S–3 to register a primary offering but are limited as to the amount of securities they can register. See General Instruction I.B.6 of Form S–3. The Commission has stated that the calculations of an issuer’s public float for the purpose of determining an issuer’s eligibility to use Form S– 3 and for determining WKSI status under rule 405 are the same. See Securities Offering Reform Adopting Release, supra footnote 5, at n.50. 19See rule 405 (defining WKSI). 20See amended rules 486(a) and 486(b) under the Securities Act. See also supra section II.D. public float.13 Commenters also recommended eliminating or modifying the proposed requirement that certain additional affected funds file current reports on Form 8–K.14 Other commenters recommended that the Commission expand the scope of issuers permitted to file certain immediately effective registration statements.15 Several commenters that are sponsors to exchange-traded products recommended that the Commission expand the scope of issuers permitted to pay registration fees on an annual net basis.16 Finally, one commenter expressed concern with the proposal, recommending that large BDCs and registered CEFs be subject to additional scrutiny.17 As discussed in detail below, we are adopting the proposed rules with certain modifications, after consideration of comments received. Our action will institute a number of reforms:

First, it will streamline the
registration process to allow eligible affected funds to use a short-form shelf registration statement to sell securities ‘‘off the shelf’’ more quickly and efficiently in response to market opportunities.
Second, the final rule will allow
affected funds to qualify as ‘‘wellknown seasoned issuers’’ (‘‘WKSIs’’) under rule 405 under the Securities Act.
Third, it will allow affected funds
to satisfy final prospectus delivery requirements using the same method as operating companies.
Fourth, it will allow affected funds
to use certain rules currently available to operating companies, such as communications safe harbors for certain factual business information and forward-looking information, ‘‘free writing prospectuses,’’ and brokerdealer research reports (referred throughout this release as the ‘‘communications rules’’).
Fifth, the final rule will allow
certain continuously-offered affected funds to make certain changes to their registration statements on an immediately-effective basis or on an automatically effective basis a set period of time after filing.
Finally, it will tailor the disclosure
and regulatory framework for affected funds in light of the amendments to the offering rules applicable to them. These amendments include structured data requirements to make it easier for investors and others to analyze fund data; new annual report disclosure requirements to provide key information in annual reports; a requirement that interval funds pay securities registration fees using the same method that mutual funds and exchange-traded funds (‘‘ETFs’’) use today; and a provision that will allow certain ETPs that are not registered under the Investment Company Act to elect to pay securities registration fees in the same manner. As discussed in detail below, the final rule will affect different categories of affected funds differently, just as different categories of operating companies are treated differently under these rules currently. For example, some of the provisions will apply to all affected funds, that is, all BDCs and registered CEFs. Many of the provisions, however, will apply only to ‘‘seasoned funds.’’ These are listed affected funds that are current and timely in their reporting and therefore generally eligible to file a short-form registration statement under the proposal if they have at least $75 million in ‘‘public float.’’ 18 Some of the provisions will apply only to seasoned funds that also qualify as WKSIs, that is, listed affected funds that qualify as seasoned funds and generally have at least $700 million in public float.19 Additionally, the final rule provides unlisted affected funds with the flexibility to make certain filings that become effective either immediately upon filing or automatically after 60 days.20 The final rule therefore will provide additional flexibilities to both listed and unlisted affected funds. Tables 1 and 2 below summarize these different impacts.
TABLE 1
Entity Summary definition Affected funds .......................... Affected funds include all BDCs and registered CEFs, including interval funds. Seasoned funds 1 ..................... Seasoned funds are affected funds that are current and timely in their reporting and therefore generally eligible to file a short-form registration statement if they have at least $75 million in ‘‘public float.’’ See supra footnote 18. WKSIs ....................................... WKSIs are seasoned funds that generally have at least $700 million in ‘‘public float.’’ ETPs ......................................... ETPs are issuers that are not registered investment companies and whose assets consist primarily of commodities, currencies or derivative instruments that reference commodities or currencies; whose securities are listed for trading on a national securities exchange; and that purchase or redeem securities for a ratable share of their assets at NAV. Notes:
1.Some of the rule changes that are shown below as affecting ‘‘seasoned funds’’ will only affect those seasoned funds that elect to file a registration statement on Form N–2 using an instruction permitting funds to use the form to file a short-form registration statement.

TABLE 2
Rule Summary description of rule Entities affected by changes Discussed below in Affected Funds (Including BDCs, Registered CEFs, and Interval Funds) Registration Provisions:
General Instruction F.4.a of Form N–2. Requires online posting of information incorporated by reference. Affected Funds ....................... Section II.I.4. Securities Act Rules 424 and 497. Provide the processes for filing prospectus supplements. Affected Funds ....................... Section II.B.3.d. Investment Company Act Rule 23c–3. Subjects interval funds to the registration fee payment system based on annual net sales. Interval Funds ......................... Section II.H. Securities Act Rule 486 .... Allows continuously-offered unlisted affected funds to make certain filings that are immediately effective upon filing or automatically effective 60 days after filing. Continuously-offered unlisted affected funds not relying on rule 23c–3.
Section II.D.
General Instruction G of Form N–14.
Permits certain registrants to incorporate by reference. BDCs ...................................... Section II.B.3.b. Communication Provisions:
Securities Act Rule 134 .... Permits issuers to publish factual information about the issuer or the offering, including ‘‘tombstone ads.’’. Affected Funds ....................... Section II.F.1. Securities Act Rule 163A .. Permits issuers to communicate without risk of violating the gun-jumping provisions until 30 days prior to filing a registration statement. Affected Funds ....................... Section II.F.1. Securities Act Rules 168 and 169. Permit the publication and dissemination of regularly released factual and forward-looking information. Affected Funds ....................... Section II.F.1. Securities Act Rules 164 and 433. Permit use of a ‘‘free writing prospectus.’’ ..... Affected Funds ....................... Section II.F.1. Prospectus Delivery Provisions:
Securities Act Rules 172 and 173.
Permit issuers, brokers, and dealers to satisfy final prospectus delivery obligations if certain conditions are satisfied. Affected Funds ....................... Section II.E. Periodic Reporting Provisions:
Investment Company Act
Rule 8b–16.
A requirement that funds that rely on paragraph (b) of the rule describe in the annual report the fund’s current investment objectives, policies and risks, and certain key changes in enough detail to allow investors to understand each change and how it may affect the fund. Registered CEFs .................... Section II.I.5. Instruction 4.g to Item 24 of Form N–2. A requirement for narrative disclosure about the fund’s performance in the fund’s annual report. Registered CEFs .................... Section II.I.2.b. Item 4 of Form N–2; Instruction 10 to Item 24 of Form N–2. Requires disclosure of certain financial information. BDCs ...................................... Section II.I.2.c. Structured Data Reporting Requirements:
Structured Financial Statement Data. A requirement that BDCs tag their financial statements using Inline eXtensible Business Reporting Language (‘‘Inline XBRL’’) format. BDCs ...................................... Section II.I.1.a. Prospectus Structured Data Requirements. A requirement that registrants tag certain information required by Form N–2 using Inline XBRL. Affected Funds ....................... Sections II.I.1.b and II.I.1.c. Form 24F–2 Structured Format. A requirement that filings on Form 24F–2 be submitted in a structured format. Form 24F–2 Filers, including open-end funds and unit investment trusts.
Section II.I.1.d.
Seasoned Funds
Registration Provisions:
Securities Act Rule 415 .... Permits registration of securities to be offered on a delayed or a continuous basis. Seasoned Funds .................... Section II.B.3. General Instructions A.2 and F.3 of Form N–2. Provide for backward and forward incorporation by reference. Seasoned Funds .................... Section II.B.3.b. Securities Act Rule 430B .. Permits certain issuers to omit certain information from their prospectuses at effectiveness. Seasoned Funds .................... Section II.B.3.d.

21Listed BDCs are publicly traded BDCs that are listed on a stock exchange. Unlisted BDCs include non-traded BDCs, which are offered via a continuous offering up to a preset maximum amount, and private BDCs, which are offered via a private placement offering. 22See section 509(a) of the Registered CEF Act. Similar to BDCs, registered CEFs include listed and unlisted funds, including publicly traded CEFs that are listed on a stock exchange, non-traded CEFs, and interval funds. 23Proposing Release, supra footnote 10, at section II.
TABLE 2—Continued
Rule Summary description of rule Entities affected by changes Discussed below in Securities Act Rule 418 .... Exempts some registrants from an obligation to furnish certain engineering, management, or similar reports. Seasoned Funds .................... Section II.G.1. Regulation FD Rule 103 ... Provides that a failure to make a public disclosure required solely by 17 CFR 243.100 (rule 100 of Regulation FD) will not disqualify a ‘‘seasoned’’ issuer from use of certain forms. Seasoned Funds .................... Section II.G.3. Communication Provisions:
Securities Act Rule 138 .... Permits a broker or dealer to publish or distribute certain research reports about securities other than those it is distributing. Seasoned Funds .................... Section II.F.2. Proxy Statements:
Item 13 of Schedule 14A .. Permits certain registrants to use incorporation by reference to provide information that otherwise must be furnished with certain types of proxy statements. Seasoned Funds .................... Section II.G.2. Periodic Reporting Provisions:
Instruction 4.h.(2) to Item 24 of Form N–2. A requirement for information about the investor’s costs and expenses in the registrant’s annual report. Seasoned Funds .................... Section II.I.2.a. Instruction 4.h.(3) to Item 24 of Form N–2. A requirement for information about the share price of the registrant’s stock and any premium or discount in the registrant’s annual report. Seasoned Funds .................... Section II.I.2.a. Instruction 4.h.(1) to Item 24 of Form N–2. A requirement for information about each of a fund’s classes of senior securities in the registrant’s annual report. Seasoned Funds .................... Section II.I.2.a. Instruction 4.h.(4) to Item 24 of Form N–2. A requirement to disclose outstanding material unresolved staff comments that remain unresolved for a substantial period of time. Seasoned Funds .................... Section II.I.2.d. WKSIs Registration Provisions:
Securities Act Rule 462 .... Provides for effectiveness of registration statements immediately upon filing with the Commission. WKSIs ..................................... Section II.B.3.c. Communication Provisions:
Securities Act Rule 163 .... Permits oral and written communications by or on behalf of WKSIs at any time. WKSIs ..................................... Section II.F.1. ETPs Registration Provisions:
Securities Act Rules 415, 424, 456 and 457; Forms S–1, S–3, F–1 and F–3. Permits ETPs to register an indeterminate amount of certain securities and pay registration fees based on annual net sales. ETPs ....................................... Section II.H.
II. Discussion
A. Scope of Closed-End Investment Companies Affected by the Final Rule As we proposed, the final rule will apply to all BDCs and registered CEFs, with certain conditions and exceptions discussed below and generally illustrated in Tables 1 and 2 above. The BDC Act applies to all BDCs, including BDCs that are listed on a securities exchange and those that are unlisted.21 In contrast, the Registered CEF Act extends to all registered CEFs listed on a securities exchange, as well as interval funds, but excludes other unlisted registered CEFs.22 Although the Registered CEF Act only requires us to allow interval funds and listed registered CEFs to use the securities offering rules available to operating companies, that Act does not preclude us from exercising our discretion to extend these rules to all registered CEFs. The Commission therefore proposed to apply the rules to all BDCs and all registered CEFs, including unlisted registered CEFs, with certain conditions and exceptions.23 We believed that this approach would benefit unlisted registered CEFs and their investors by avoiding the adverse consequences that could result from treating unlisted registered CEFs differently from all other registered CEFs and unlisted BDCs. We believed that applying such a distinction is unnecessary because, for purposes of these rules, unlisted registered CEFs are not distinguishable

24 Id.
25 Id.
26 Id. (explaining the similarity of the BDC Act’s and the Registered CEF Act’s broad mandates). 27See Proposing Release, supra footnote 10, at n.17 (discussing rule 415(a)(1)). 28 In this release we use the term ‘‘seasoned’’ to refer generally to an issuer that meets the registrant requirements in General Instruction I.A of Form S– 3 and, when referring to seasoned funds, a fund that meets these Form S–3 registrant requirements as well as certain modifications for registered CEFs. See Proposing Release, supra footnote 10, at n.18 (explaining the requirements under General Instruction I.A. of Form S–3). 29 Issuers that rely on rule 415(a)(1)(x) must file a new registration statement every three years, with unsold securities and fees paid thereon carried forward to the new registration statement. See Securities Act rule 415(a)(5) and (6). If the new registration statement is an automatic shelf registration statement filed by a WKSI, it will be effective immediately upon filing. 30See Proposing Release, supra footnote 10, at n.20. 31The base prospectus of a shelf registration statement will generally describe in broad terms the types of securities and offerings that the issuer may conduct at some later time. 32See Proposing Release, supra footnote 10, at n.22 (discussing ‘‘backward incorporation’’). 33The fund’s registration statement must include all required information to avoid liability from selling securities from an out-of-date prospectus and to satisfy section 10(a) of the Securities Act. See infra footnotes 83–84 and accompanying text. 34See Proposing Release, supra footnote 10, at n.24. 35These post-effective amendments become effective pursuant to section 8(c) of the Securities Act on such date as the Commission may determine and are typically declared effective by the staff acting pursuant to delegated authority. In contrast, Form S–3 is updated through the filing of an annual report on Form 10–K, which contains the issuer’s audited financial statements for its most recently completed fiscal year. See Securities Offering Reform Adopting Release, supra footnote 5, at n.61; see also Proposing Release, supra footnote 10, at n.25. 36See id. at n.26. 37The final rule will give certain affected funds greater flexibility to control the timing of their capital raising. As discussed in the Proposing Release, section 23(b) of the Investment Company Act generally prohibits a registered CEF from issuing its shares at a price below the fund’s current net asset value (‘‘NAV’’) without shareholder approval (this provision applies to BDCs as well with certain modifications). See id. at n.27. Because the shares of affected funds often trade at a discount to NAV, by allowing certain affected funds to sell securities ‘‘off the shelf,’’ the final rule will avoid potential delays associated with updating the funds’ registration statements if they seek to access the markets when their shares are trading at a premium. from unlisted BDCs, which the rule
amendments must cover. Unlisted registered CEFs, like unlisted BDCs, also would benefit from parity of treatment.24 We did not receive comment on this aspect of the proposal. Because we continue to believe that this approach will benefit unlisted registered CEFs and their investors by providing new investor protections and avoiding adverse consequences from differential treatment, the final rule will apply to all BDCs and registered CEFs as proposed. The Commission proposed to generally apply the specific requirements of the BDC Act to both BDCs and registered CEFs because it believed that, except where dictated by meaningful differences between BDCs and registered CEFs, consistent application of the proposed rules across affected funds would result in more efficient offering processes and more consistent investor protections.25 We continue to believe that both Acts share the overall purpose of providing offering and communication rule parity to the investment companies covered by each Act.26 We did not receive public comment on this aspect of the proposal, and, for the reasons stated above, we are adopting it as proposed. B. Registration Process We are adopting, substantially as proposed, amendments to our rules and forms to streamline the registration process for affected funds by permitting them to use the more flexible registration process available to operating companies. These amendments collectively will allow affected funds to offer and sell securities ‘‘off the shelf’’ more quickly and efficiently in response to market opportunities.

Current Shelf Offering Process for
Affected Funds
Issuers, including affected funds, whose offerings are registered or qualified to be registered on Form S–3 may conduct primary offerings ‘‘off the shelf’’ under Securities Act rule 415(a)(1)(x), the provision for offerings made on a delayed or continuous basis.27 In a rule 415(a)(1)(x) shelf offering, a seasoned issuer can register an unallocated dollar amount of securities for sale at a later time.28 The issuer can then take down securities ‘‘off the shelf’’ for sale in a public offering as market conditions warrant. This allows seasoned issuers to quickly access the public securities markets from time to time to take advantage of favorable market conditions.29 Affected funds currently can make shelf offerings under rule 415(a)(1)(x) if they meet the eligibility criteria for Form S–3, even though affected funds register their securities offerings on Form N–2.30 Our rules for operating companies, however, are more flexible and efficient than for affected funds. In particular, seasoned operating companies can use a short-form registration statement on Form S–3. Certain seasoned operating companies also can rely on Securities Act rule 430B to omit certain information from the ‘‘base’’ prospectus when the registration statement becomes effective and later provide that information in a subsequent Exchange Act report incorporated by reference, a prospectus supplement, or a post-effective amendment.31 The ability to ‘‘forward incorporate’’ information in Exchange Act reports filed after the registration statement becomes effective allows operating companies to efficiently update their prospectuses and access capital markets without the expense and delay of filing post-effective amendments in most cases. Affected funds, on the other hand, currently have limited ability to incorporate information by reference into their registration statements and cannot forward incorporate information from subsequently-filed Exchange Act reports.32 When an affected fund sells securities, including as part of a takedown ‘‘off the shelf,’’ its registration statement must include all required information.33 In particular, the affected fund’s registration statement must include current financial information, including any annual update required by section 10(a)(3) of the Securities Act.34 Affected funds provide any
section 10(a)(3) update to the
registration statement by filing a posteffective amendment, which involves the expense and potential delay associated with the fund’s preparation of the amendment and also provides our staff with time to review the amendment for compliance with the applicable disclosure and accounting requirements and to provide comments where appropriate.35 Affected funds also cannot currently rely on rule 430B, which allows certain issuers to omit information from a prospectus, or the process that operating companies follow to file prospectus supplements.36 In addition, affected funds cannot currently file automatic shelf registration statements because only WKSIs can file these registration statements. These differences can result in additional expense or delay for affected funds relative to operating companies and can affect the timing of an affected fund’s capital raising.37
Amendments to the Registration
Process for Affected Funds The amendments we are adopting are designed to streamline the registration process for affected funds in parity with operating companies. Specifically, and as discussed in more detail below, the amendments will permit affected funds to:

File a short-form registration
statement on Form N–2 that will

38See, e.g., ACC Comment Letter; ICI Comment Letter; Comment Letter of Securities Industry and Financial Markets Association (June 5, 2019) (‘‘SIFMA Comment Letter’’). 39See ICI Comment Letter. 40Throughout this release, we refer to General Instruction A.2 as the ‘‘short-form registration instruction’’ and refer to funds relying on this instruction as filing a ‘‘short-form registration statement’’ on amended Form N–2. Some of the required amendments and the conditions in our current rules are available only to issuers that meet the eligibility and transaction requirements of Form S–3 and therefore are eligible to file a short-form registration statement on that form. The short-form registration instruction in Form N–2 is designed to facilitate these amendments, as directed in the BDC Act and the Registered CEF Act. 41See amended rule 415(a)(1)(x) (conforming amendments for affected funds); see also supra
section II.B.3.c.
42See General Instruction I.B of Form S–3 (identifying transactions that can be registered on the form); see also General Instruction A.2.c of amended Form N–2. Form S–3, and therefore the short-form registration instruction, also is available to a majority-owned subsidiary that is a closed-end management investment company eligible to register a securities offering on Form N–2 if it meets certain conditions. See Proposing Release, supra footnote 10, at n.29 (describing the conditions necessary for majority-owned subsidiaries of closed-end management companies to register a securities offering on Form N–2). 43See General Instructions A.2.a and A.2.c of amended Form N–2; General Instructions I.A (registrant requirements) and I.B (transaction requirements) of Form S–3. 44Under this amendment to Form N–2, the fund also must have timely filed all reports required to be filed under section 30 of the Investment Company Act during any portion of a month immediately preceding the filing of the registration statement. See new General Instruction A.2.b of amended Form N–2. 45See General Instruction I.A.3 of Form S–3. 46See General Instruction I.B of Form S–3. 47See, e.g., SIFMA Comment Letter; Comment Letter of Mutual Fund Directors Forum (June 12,
2019) (‘‘MFDF Comment Letter’’).
48See, e.g., ICI Comment Letter; ABA Comment Letter. 49See infra section II.C.2 (discussing comments on public float requirement for WKSI eligibility). 50Only one interval fund is currently exchangelisted. 51We intend for the short-form registration instruction to provide affected funds parity with operating companies so that affected funds can register the same transactions as operating companies register on Form S–3. To register a primary offering of equity securities on Form S–3, an issuer must meet the applicable eligibility and registrant requirements. For example, an issuer with the requisite public float may register a primary offering of securities to be offered for cash. See General Instruction I.B.1 of Form S–3. Alternatively, an issuer may register a primary offering if it has common equity securities listed on an exchange, limits the amount sold over a twelvemonth period to no more than one-third of the aggregate value of voting and non-voting common equity held by non-affiliates, and meets certain function like a Form S–3 registration statement. An affected fund that files this short-form registration statement can use it to register shelf offerings, including shelf registration statements that are filed by affected funds that qualify as WKSIs and become effective automatically, and can satisfy Form N– 2’s disclosure requirements by incorporating by reference information from the fund’s Exchange Act reports;

Rely on rule 430B to omit
information from their base prospectuses, and to use the process operating companies follow to file prospectus supplements; and
Include additional information in
periodic reports to update their registration statements. Commenters generally supported our general approach to streamlining the registration process for affected funds. Commenters stated that the proposed amendments would allow affected funds to raise capital more efficiently and cost-effectively and would provide affected funds with greater flexibility to manage the timing of their offerings in response to market opportunities.38 One commenter stated that affected funds will benefit from the proposed amendments because they no longer will have to file post-effective amendments to shelf registration statements to update their financial statements. Instead, that information will be in annual reports and incorporated by reference into their registration statements.39

Short-Form Registration on Form N–
2
We are adopting, as proposed, new General Instruction A.2 in Form N–2, which will allow affected funds to file a short-form registration statement on Form N–2 that will function like a registration statement filed on Form S–
3.40 If a fund files a registration
statement under this new instruction, the fund’s registration statement will incorporate certain past and future Exchange Act reports by reference, allowing the fund to use a short-form registration statement and avoid the need to make post-effective amendments in most cases. An affected fund may use the new instruction to register a shelf offering under rule 415(a)(1)(x), and we are adopting conforming amendments to that rule to make this clear.41 The new instruction, however, is not limited to offerings under rule 415(a)(1)(x). Rather, an affected fund may use the new instruction to register any of the securities offerings that operating companies are permitted to register on Form S–3.42 a. Eligibility To File a Short-Form Registration Statement As proposed, we are adopting amendments to permit an affected fund to file a short-form registration statement under the short-form registration instruction on Form N–2 if:

For either a BDC or a registered
CEF, the fund meets both the registrant requirements and the transaction requirements of Form S–3 (i.e., the fund could register the offering on Form S– 3 if it were an operating company); 43 and
for registered CEFs only, the fund
also has been registered under the Investment Company Act for at least 12 calendar months immediately preceding the filing of the registration statement and has timely filed all reports required to be filed under section 30 of the Investment Company Act during that time.44 An affected fund generally will meet the registrant requirements of Form S– 3 if it has timely filed all reports and other materials required under the Exchange Act during the prior year.45 An affected fund will generally meet the transaction requirements of Form S–3 for a primary offering if the fund’s public float is $75 million or more.46 Requiring affected funds to satisfy the requirements of Form S–3 in order to file a short-form registration statement provides parity between affected funds and operating companies, consistent with Congress’s mandates in the BDC Act and Registered CEF Act. Commenters generally supported the proposal to permit affected funds to file short-form registration statements.47 Several commenters, however, urged that we provide additional bases other than public float for an affected fund to be eligible to file a short-form registration statement (or to qualify as a WKSI).48 While the arguments advanced by commenters apply to our proposed short-form registration requirement, commenters focused primarily on our proposed public float threshold for WKSI status.49 Accordingly, we discuss these comments below in section II.C.2. For the reasons discussed in that
section, we are not changing the public
float requirement or adopting new requirements for affected funds to file a short-form registration statement. We are adopting the proposed $75 million public float requirement for an affected fund to file a short-form registration statement on Form N–2 to provide affected funds parity with operating companies. Certain affected funds, including most interval funds,50 do not list their securities on an exchange and thus do not have public float. As a result, these affected funds generally would not be able to satisfy the transaction requirement necessary to file a shortform registration statement.51 In

other requirements. See General Instruction I.B.6 of Form S–3. Interval funds that are not exchangelisted and without public float would not be qualified to register a primary offering of their shares on Form S–3. 52See Proposing Release, supra footnote 10, at text following n.37. 53 17 CFR 230.415(a)(1)(xi). 54See 17 CFR 230.486. 55See Proposing Release, supra footnote 10, at text accompanying nn.42–46. 56Because Form N–PORT will render reports on Form N–Q unnecessarily duplicative, once a registered fund begins filing reports on Form N– PORT, it will no longer be required to file reports on Form N–Q. See Investment Company Reporting Modernization, Investment Company Act Release No. 32936 (Dec. 8, 2017) [82 FR 58731 (Dec. 14, 2017)] (delaying the requirement for registered funds to submit reports on Form N–PORT through the EDGAR system until April 2019 for larger fund groups, and April 2020 for smaller fund groups). Form N–Q will be rescinded on May 1, 2020. See id. 57See Comment Letter of Teachers Insurance and Annuity Association of America (June 13, 2019) (‘‘TIAA Comment Letter’’). 58See section 803(c)(1) of the BDC Act (directing us to include an item or instruction that is similar to item 12 on Form S–3 to provide that a BDC that would otherwise meet the requirements of Form S– 3 shall incorporate by reference the reports and documents filed by the BDC under the Exchange Act into the registration statement of the BDC filed on Form N–2). We are amending General Instruction F.3 of current Form N–2 in its entirety and replacing it with a new General Instruction F.3. In these provisions and others that are substantively identical to parallel provisions in Form S–3, we have included conforming references to a fund’s SAI. 59See new General Instruction F.3.a.(1)–(2) of amended Form N–2; cf. Item 12(a)(1)–(2) of Form S–3. In addition, if sales of a class of capital stock are to be registered on Form N–2 and the same class is registered under section 12 of the Exchange Act, the affected fund must incorporate by reference the description of the class contained in the Exchange Act registration statement with respect to that class (including any amendment or reports filed for the purpose of updating such description). See new General Instruction F.3.a.(3) of amended Form N– 2; cf. Item 12(a)(3) of Form S–3. 60See new General Instruction F.3.b of amended Form N–2; cf. Item 12(b) of Form S–3. 61See new General Instruction F.3 of amended Form N–2. The amendments will permit a fund to use this incorporated information to provide the disclosure required by Items 3–12 and Items 16–24 of Form N–2. See new General Instruction F.3.c of amended Form N–2; cf. Item 12(d) of Form S–3. addition, as we noted in the Proposing Release, because interval funds make continuous offerings, they (as well as other continuously offered, non-listed affected funds) would not be able to file a short-form registration statement that omits information required to be in an issuer’s
prospectus when it is offering its securities.52 Interval funds also have their own offering provision, Securities Act rule 415(a)(1)(xi),53 and post-effective amendments to their registration statements are immediately effective upon filing or automatically effective 60 days after filing under rule 486 under the Securities Act, depending on the substance of the amendments.54 As a result, interval funds currently have a tailored registration process that, although different in certain respects from that of operating companies, may provide many of the same efficiencies, including the ability to raise capital as the opportunity arises. As discussed below in section II.D, we are adopting amendments to rule 486 to allow any affected fund that conducts continuous offerings under rule 415(a)(1)(ix), such as continuously-offered tender offer funds, to rely on rule 486. We believe these amendments will benefit such continuously-offered affected funds by allowing them to maintain effective registration statements in a more efficient, cost-effective manner, similar to the benefits that the rules we are adopting will provide to affected funds that file short-form registration statements. As proposed, in addition to satisfying the registrant requirements of Form S– 3, a registered CEF also must have timely filed all reports required under
section 30 of the Investment Company
Act for the preceding 12 months in order to register an offering under the short-form registration instruction. A registered CEF therefore must have timely filed during the prior year all required Exchange Act reports, such as annual and semi-annual reports to shareholders filed with the Commission on Form N–CSR, as well as reports required only under section 30 of the Act, such as reports on Forms N–CEN and N–PORT. As we stated in the Proposing Release, an issuer’s Exchange Act filings provide the basic source of information to the market and to potential purchasers, and investors in the secondary market use that information in making their investment decisions.55 Although all affected funds file reports under the Exchange Act, registered CEFs also file reports under the Investment Company Act. These Investment Company Act reports also provide important information to the market and investors, including information about an affected fund’s portfolio holdings that will be publicly reported on a quarterly basis on Form N–PORT. We believe that the market will analyze this portfolio holdings information in a similar manner to how it analyzes financial statements for operating companies to determine changes in prospects for growth and performance. Portfolio holdings disclosure on Form N–PORT, for example, provides important information that is comparable to information BDCs include in Exchange Act reports for purposes of providing a quarterly flow of key information to the market. Moreover, requiring registered CEFs to have timely filed their Investment Company Act reports also will provide parity among BDCs, registered CEFs, and operating companies. This is because once Form N–PORT fully replaces Form N–Q, registered CEFs will only file Exchange Act reports semi-annually on Form N– CSR, whereas BDCs and operating companies file Exchange Act reports on Forms 10–K, 10–Q and 8–K.56 As such, all issuers will be required to have filed their quarterly and other required reports in order to file a short-form registration statement. We received one comment on this particular aspect of the proposal. This commenter expressed support for this aspect of the proposal, stating that it provides parity between registered CEFs and operating companies.57 b. Information Incorporated by Reference As proposed, the same rules on incorporation by reference that apply to Form S–3 registration statements also will apply to a short-form registration statement filed on Form N–2.58 We did not receive comments on these amendments and are adopting them as proposed. Specifically, an affected fund relying on the short-form registration instruction will be required to:

Specifically incorporate by
reference into the prospectus and statement of additional information (‘‘SAI’’): (1) Its latest annual report filed pursuant to section 13(a) or section 15(d) of the Exchange Act that contains financial statements for the registrant’s latest fiscal year for which a Form N– CSR or Form 10–K was required to be filed; and (2) all other reports filed pursuant to section 13(a) or 15(d) of the Exchange Act since the end of the fiscal year covered by the annual report (backward incorporation by reference); 59 and
State that all documents
subsequently filed pursuant to section 13(a), 13(c), 14, or 15(d) of the Exchange Act prior to the termination of the offering shall be deemed to be incorporated by reference into the prospectus and SAI (forward incorporation by reference).60 We also are adopting, as proposed, an instruction to Form N–2 that will permit an affected fund filing a short-form registration statement on Form N–2 to satisfy the disclosure requirements for its prospectus or SAI by incorporating the information by reference from Exchange Act reports.61 This provision,

62The BDC Act directed us to extend this parallel item in Form S–3 (Item 12) to BDCs that meet Form S–3’s requirements. See supra footnote 58; Item 12(d) of Form S–3; see also section 509(a) of the Registered CEF Act. 63See section 803(b)(2)(P) of the BDC Act (directing us to revise Item 34 of Form N–2 to require a BDC to provide undertakings ‘‘that are no more restrictive than the undertakings that are required of a registrant under [Item 512 of Regulation S–K],’’ which sets forth the undertakings an operating company must include in its registration statement for certain offerings). Commenters suggested that the Item 34.1 undertaking to suspend an offering if a fund’s NAV declines more than 10% from its NAV on its registration statement effective date until the fund amends the prospectus should not apply to continuous or delayed shelf offerings conducted by affected funds pursuant to proposed General Instruction A.2 of Form N–2. See Comment Letter of Dechert LLP (June 10, 2019) (‘‘Dechert Comment Letter’’); IPA Comment Letter; see also Item 34.1 of current Form N–2. Commenters urged that the undertaking should not apply in these circumstances because the shelf offering could extend over 3–1/2 years, and the undertaking did not seem necessary because the fund would amend its prospectus by incorporating by reference the information from its Exchange Act reports. See Dechert Comment Letter; IPA comment Letter. We agree, and are amending Item 34.1 to clarify that this undertaking is not applicable in the circumstance described by commenters. See Item
34.1 of amended Form N–2.
64Form N–2 currently requires an affected fund registering an offering under rule 415 to undertake to file, during any period in which offers or sales are being made, a post-effective amendment to the registration statement under certain circumstances, including to provide any prospectus required by
section 10(a)(3) of the Securities Act. See Item
34.4.a of current Form N–2.
65See 17 CFR 229.512(a)(1)(iii)(B) (Item 512(a)(1)(iii)(B) of Regulation S–K). 66Specifically, our amendments add a new provision to the relevant undertaking stating that the requirement to undertake to file a post-effective amendment does not apply if the registration statement is filed under the short-form registration instruction and the information required to be included in a post-effective amendment is contained in Exchange Act reports that are incorporated by reference into the fund’s registration statement or is contained in a form of prospectus that is part of the registration statement. See Item 34.3.a of amended Form N–2; cf. Item 512(a) of Regulation S–K. We also are amending Item 34 to make conforming changes to mirror parallel undertakings in Item 512 of Regulation S–K. See, e.g., Item 34.3.a(2) of amended Form N–2; cf. Item 512(a)(1)(ii) of Regulation S–K; Item 34.3.d(1) of amended Form N–2; cf. Item 512(a)(5)(i) of Regulation S–K; Item 34.3.e(2)–(3) of amended Form N–2; cf. Item 512(a)(6)(ii)–(iii) of Regulation S–K; Item 34.5 of amended Form N–2; cf. Item 512(b) of Regulation S–K; and Item 34.6 of amended Form N–2; cf. Item 512(h) of Regulation S–K. Additionally, in response to comments, we are eliminating the undertaking in Item 34.3 of current Form N–2, which requires affected funds to undertake to supplement the prospectus or file a post-effective amendment to disclose certain information if the securities being registered are to be offered to existing shareholders, and if not taken, to be reoffered to the public. See Dechert Comment Letter; IPA Comment. The Commission recently eliminated a parallel undertaking from Regulation S–K because other requirements make the undertaking duplicative and unnecessary. See FAST Act Modernization and Simplification of Regulation S–K, Investment Company Act Release No. 33426 (Mar. 20, 2019) [84 FR 12674 (Apr. 2, 2019)] (‘‘FAST Act Modernization Adopting Release’’), at n.171. We are eliminating this undertaking from Form N–2 for the same reasons, and renumbering Item 34’s sub-items accordingly. 67Form N–14 currently permits a registered CEF—but not a BDC—to incorporate by reference certain information about the registrant and the company being acquired that is required by Items 5, 6 and 11–14 of Form N–14 from its prospectus, SAI, or Investment Company Act reports into the Form N–14 prospectus. See General Instruction G of current Form N–14. 68See Dechert Comment Letter; IPA Comment Letter. 69See General Instruction G of amended Form N–
14. We also are eliminating the instruction’s
reference to sub-paragraph (d) of Section 30, and will instead reference Section 30 (no sub-part specified). This change will have the effect of requiring a Form N–14 registrant that seeks to incorporate by reference to be current in filing all
Section 30 reports, including reports filed on Forms
N–PORT and N–CEN. Commenters also suggested that we further amend Form N–14 to provide that a seasoned affected fund that incorporates by reference information about the registrant into the prospectus need not deliver copies of the documents containing such information with the prospectus. See, e.g., Dechert Comment Letter. Because the delivery requirement applies to funds generally and not just affected funds, we believe that any changes to the requirement should be considered on a broader basis that is beyond the scope of this rulemaking. 70See Dechert Comment Letter; IPA Comment Letter. 71See General Instruction G of amended Form N–
14. The requirement to file with the registration
statement the documents that contain the information that is incorporated by reference is no longer necessary given the availability of such documents on EDGAR. We are similarly eliminating the requirement to file with the registration statement each document from which information is incorporated by reference into the SAI. 72As proposed, amended Form N–2 will become effective on August 1, 2020. The Commission also will need time to modify its systems to automatically reflect that automatic shelf registration statements are effective upon filing and process ‘‘pay-as-you-go’’ payments for affected funds that are WKSIs. See infra section II.J. Until such modifications are complete, which is anticipated to be September 2020, affected funds which is substantively identical to a parallel item in Form S–3, will give affected funds filing a short-form registration statement on Form N–2 the option to either provide required disclosure directly in the prospectus or SAI or to satisfy Form N–2’s disclosure requirements with information incorporated by reference.62 We did not receive any comments on these particular amendments to Form N–2. We also are adopting, as proposed, conforming changes to Form N–2’s undertakings.63 Form N–2 currently requires an undertaking that would prevent seasoned funds that file a shortform shelf registration statement from incorporating information by reference as proposed, because it requires funds to file post-effective amendments in certain circumstances without providing an exception that would allow the required information to be supplied via incorporation by reference.64 In contrast, operating companies registering an offering on Form S–3 are not required under the applicable undertaking to file post-effective amendments if the required information is included in an Exchange Act report incorporated by reference or a prospectus supplement that is part of the registration statement.65 To implement the statutory mandates and provide parity for affected funds, we are adopting amendments to Form N–2’s undertakings to provide the same approach for affected funds filing a short-form registration statement on that form that applies to operating companies that file on Form S–3.66 The Proposing Release requested comment on whether we should modify incorporation by reference provisions in other registration forms filed by affected funds to provide parity or consistency across registration statements. In particular, we asked if we should amend Form N–14 to provide that BDCs may incorporate by reference to the same extent as registered CEFs.67 Commenters supported this approach,68 which would provide for more consistent treatment between registered CEFs and BDCs. We are modifying Form N–14 to allow BDCs to incorporate by reference to the same extent as registered CEFs. As commenters observed, this change will provide consistent treatment for BDCs and registered CEFs. This change also will reduce the length of a BDC’s Form N–14
prospectus, which in some cases can exceed 1,000 pages, because BDCs cannot currently incorporate information by reference. To effectuate this change, we are amending the instruction in Form N–14 that governs incorporation by reference to specifically include BDCs and clarify that current reports include those filed pursuant to section 13(a) or 15(d) of the Exchange Act.69 Additionally, in response to comments,70 we are eliminating the requirement that registrants file with the Form N–14 registration statement the documents that contain information that is incorporated by reference into the prospectus or SAI.71 Such documents are filed on EDGAR and readily available to Commission staff.
c. Affected Funds’ Use of Rule
415(a)(1)(x) and Automatic Shelf Registration Statements 72 We are adopting, as proposed, two additional amendments to allow

should contact the staff of the Division of Investment Management’s Disclosure Review and Accounting Office if they are filing an automatic shelf registration statement. 73See rule 415(a)(1)(x) (amended to include securities registered pursuant to General Instruction A.2 of Form N–2). See also section 803(b)(2)(J) of the BDC Act (directing us to revise rule 415(a)(1)(x) to provide that a BDC that would otherwise meet the eligibility requirements of Form S–3 can register its securities under that provision). Our amendments also add a reference to a Form N–2 registration statement filed pursuant to General Instruction A.2 to rule 415(a)(2) to make clear that affected funds registering offerings pursuant to rule 415(a)(1)(ix), like other issuers relying on that provision, will not be subject to the limitation that they register an amount of securities that the issuer reasonably expected would be offered or sold within two years from the date that the registration statement became effective. Cf. Securities Offering Reform Adopting Release, supra footnote 5, at 44774–44775. 74See General Instruction B of amended Form N– 2; section 803(c)(2) of the BDC Act (directing that we amend Form N–2 to include an instruction that is similar to the instruction regarding automatic shelf registration offerings by WKSIs on Form S–3 to provide that a BDC that is a WKSI may file automatic shelf offerings on Form N–2). This instruction will provide that an affected fund that is a WKSI may use the form as an automatic shelf registration statement only for the transactions that are described in, and consistent with the requirements of, General Instruction I.D of Form S–
3. This provides parity with operating companies
because General Instruction I.D of Form S–3 specifies the transactions and requirements for an automatic shelf registration statement filed on Form S–3. Consistent with General Instruction I.D of Form S–3, General Instruction B specifies that the form could not be used as an automatic shelf registration statement for securities offerings under rule 415(a)(1)(vii) or (viii). 75See 17 CFR 230.430B(a) (Securities Act rule 430B(a)). 76See 17 CFR 230.462(e) and (f) (Securities Act rule 462(e) and (f)). 77See 17 CFR 230.457(r) and 17 CFR 230.456(b) (Securities Act rule 457(r) and rule 456(b)). 78As proposed, we are making conforming amendments to Securities Act rule 462(f) and to the registration fee table in Form N–2 to enhance consistency with Form S–3 and to allow affected funds that file as WKSIs to use the pay-as-you-go registration fee process. See section II.J for a discussion of applicable effective dates for pay-asyou-go registration fees. 79While we did not receive any comments specifically on the proposed general instruction to permit affected funds that qualify as WKSIs to file an automatic shelf registration statement, we did receive comments on the proposed WKSI standard for affected funds. Those comments are addressed in section II.C below. 80See section 803(b)(2)(K) of the BDC Act. 81These amendments will not apply to open-end funds or other registered investment companies. Accordingly, those investment companies would continue to file prospectuses pursuant to rule 497. See amended rule 424(f). We also are amending rule 424(f) to state that references to the term ‘‘form of prospectus’’ in the rule include the SAI. 82See 17 CFR 230.409 (Securities Act rule 409). 83 15 U.S.C. 77j(a). 84Omitted information also may be provided in a post-effective amendment or, where permitted, through Exchange Act filings that are incorporated by reference. 85An affected fund that seeks to file a rule 424(b)(1) or 424(b)(4) prospectus supplement to provide pricing information omitted pursuant to rule 430A must be able to satisfy the conditions of rule 430A, which include the requirement to furnish the ‘‘undertakings required by Item 512(i) of Regulation S–K.’’ See rule 430A(a)(2) under the Securities Act. To facilitate an affected fund’s ability to rely on the rule, we are amending rule 430A to require affected funds to provide the parallel undertaking required by Item 34.4 of amended Form N–2. 86See amended Securities Act rule 497(l). 87See Proposing Release, supra footnote 10, at text preceding n.72. affected funds to use the shelf registration system in parity with operating companies. First, we are amending rule 415(a)(1)(x) to clarify that affected funds may use that rule by adding references to a registration statement filed under the short-form registration instruction.73 Second, we are adopting a new general instruction to permit affected funds that qualify as WKSIs to file an automatic shelf registration statement.74 A WKSI can register
unspecified amounts of different types or classes of securities on an automatic shelf registration statement.75 An automatic shelf registration statement and any amendments to the registration statement will be effective immediately upon filing.76 Automatic shelf registration provides WKSIs with significant flexibility to take advantage of market windows, structure terms of securities on a real-time basis to accommodate investor demand, and determine or change the plan of distribution in response to changing market conditions. WKSIs using an automatic shelf registration statement further benefit by being able to pay filing fees at any time in advance of a shelf takedown or on a ‘‘pay-as-you-go’’ basis at the time of each takedown off the shelf registration statement in an amount calculated for that takedown.77 Our amendments will extend these same benefits to affected funds that qualify as WKSIs, as directed by the BDC Act and the Registered CEF Act.78 We did not receive any comments on these particular amendments.79 d. Omitting Information From a Base Prospectus and Prospectus Supplements The BDC Act directed us to include a process for a BDC to file a prospectus in the same manner as under rule 424(b).80 Consistent with this directive and with the Registered CEF Act, we are amending, as proposed, rule 424(f) to allow affected funds to file a prospectus under rule 424.81 As discussed in the Proposing Release, affected funds registering shelf offerings under Securities Act rule 415 generally can omit required information from the base prospectus that is unknown or not reasonably available to the fund when the registration statement becomes effective.82 WKSIs and certain issuers eligible to use Form S–3 for primary offerings are permitted under rule 430B to omit certain additional information. A base prospectus that omits statutorilyrequired information is not a final prospectus under section 10(a) of the Securities Act.83 Filing a prospectus supplement pursuant to rule 424 is one way to provide information required for a prospectus to satisfy the requirements of section 10(a).84 Our rules, however, provide different processes for operating companies and investment companies to file prospectuses. Operating companies currently follow rule 424 to file prospectus supplements, whereas investment companies follow rule 497. Although these rules provide similar processes, they have certain key differences. For example, rule 424(b) is designed to work together with rule 415(a)(1)(x), and provides additional time for an issuer to file a prospectus. Rule 497 does not contain provisions specifically related to offerings under rule 415(a)(1)(x) and requires the fund to file a prospectus with the Commission before using it. Rule 424 also requires an issuer to file a prospectus when the issuer makes changes from or additions to a previously-filed prospectus that are substantive, whereas rule 497 requires funds to file every prospectus that varies from any
previously-filed prospectus. Under the amendment to rule 424(f), an affected fund will be able to file any type of prospectus enumerated in rule 424(b) to update, or to include information omitted from, a prospectus or in connection with a shelf takedown.85 We also are amending rule 497 to provide that rule 424 would be the exclusive rule for affected funds to file a prospectus supplement other than an advertisement that is deemed to be a prospectus under 17 CFR 230.482 (rule 482).86 This will avoid any confusion that might result if affected funds were permitted to file prospectuses under both rule 424 and rule 497, while also continuing to require affected funds to file rule 482 advertisements as they and other investment companies do today. We also are adopting, as proposed, an amendment to permit affected funds to use rule 430B in parity with operating companies.87 We received no comments on this aspect of the proposal. Thus an affected fund may omit certain information from its prospectus in two circumstances:

A WKSI filing an automatic shelf
registration statement may omit the plan

88See amended rule 430B (allowing affected funds eligible to register a primary offering under the short-form registration instruction to rely on rule 430B). We also are amending the undertakings in Form N–2 to require affected funds relying on rule 430B to make the same undertakings required of operating companies that rely on the rule. See Item 34.3.d(1) of amended Form N–2; cf. Item 512(a)(5)(i) of Regulation S–K. See also supra footnotes 63–66 and accompanying text. Rules 430B and 424 and 17 CFR 230.158 (rule 158) specify when information contained in a prospectus supplement will be deemed part of and included in the registration statement and circumstances that will trigger a new effective date of the registration statement for purposes of section 11(a) of the Securities Act. These rules apply to affected funds just as they apply to operating companies. 89See Proposing Release, supra footnote 10, at n.73 and accompanying text (discussing proposed Instruction 6.i to Item 24 of Form N–2). 90See Dechert Comment Letter; IPA Comment Letter. 91Securities Offering Reform Adopting Release, supra footnote 5, at 44727. 92See infra section II.F. 93See supra footnote 28. 94See paragraph (1)(i)(A) of the WKSI definition in rule 405. See also supra footnote 19. See also Proposing Release, supra footnote 10, at n.77 (identifying alternative bases for an issuer to qualify as a WKSI, including that an issuer may qualify if it has issued, for cash, within the last three years, at least $1 billion in aggregate principal amount of non-convertible securities, other than common equity, in primary offerings registered under the Securities Act). 95See paragraphs (1)(i) and (vi) of the definition of ineligible issuer in Securities Act rule 405. 96See amended paragraph (1)(v) of rule 405. 97See amended paragraph (1)(i) of the WKSI definition in rule 405. In addition, we are adopting, as proposed, amendments to the definition of WKSI to make conforming references to a registration statement filed under new General Instruction A.2 of amended Form N–2. See paragraphs (1)(i) introductory text and (1)(i)(B)(2) of the definition of WKSI in amended rule 405; new General Instruction A.2 of amended Form N–2. We also are making a conforming amendment, as proposed, to paragraph (2) of the definition of WKSI to add a reference to Form N–CSR, the form on which registered CEFs file their shareholder reports with the Commission. See amendment to paragraph (2) of the definition of WKSI in amended rule 405. We did not receive any comments on our proposal to make these conforming amendments to the WKSI definition in rule 405. 98See, e.g., ICI Comment Letter; ACC Comment Letter; SIFMA Comment Letter; MFDF Comment Letter. 99See section 803(b)(2)(A)(i) of the BDC Act and
section 509(a) of the Registered CEF Act.
100See Securities Offering Reform Adopting Release, supra footnote 5, at n.49 and accompanying text. In establishing the WKSI category of issuers for operating companies, the Commission stated that issuers that meet the $700 million public float threshold or the alternative $1 billion registered offering of non-convertible securities threshold have a wide following by market participants, the media, and institutional investors. See id. at section II.A. 101See, e.g., id. at n.50 (stating that the determination of public float is based on a public trading market, such as an exchange or certain overthe-counter markets). See also Shelf Registration, Securities Act Release No. 6499, at 5 (Nov. 17, of distribution and information as to whether the offering is a primary one or an offering on behalf of selling security holders.

If an issuer is eligible to file a
registration statement on Form S–3 to register a primary offering pursuant to General Instruction I.B.1 of Form S–3, and is registering the resale of securities on behalf of selling security holders, it may omit the identities of selling security holders and the amount of securities to be registered on their behalf, subject to certain conditions.88 e. Additional Information in Periodic Reports As discussed above, the amendments we are adopting will permit certain affected funds to forward incorporate information from their Exchange Act reports. These funds may wish to include information in their periodic reports that is not required to be included in these reports in order to update their registration statements. We therefore proposed to include a new instruction to Form N–2 that would allow a fund to include additional information so as long as the fund included a statement in the report identifying information that it included for this purpose to provide context for investors.89 After considering comments we received, we are not adopting this proposed instruction. The commenters that addressed this proposed new instruction to Form N–2 recommended against requiring this identifying statement in periodic reports on the grounds that it unnecessarily emphasized information included to update the fund’s registration statement and could potentially distract investors from other information that may be more material to their investment decisions.90 These commenters also stated that requiring funds to identify this information would not be consistent with an integrated disclosure regime in which the information is incorporated by reference. We have determined not to adopt the identification requirement. After considering comments, we are persuaded that requiring an affected fund to highlight information just because it updates the fund’s registration statement could unnecessarily emphasize it.
C. Well-Known Seasoned Issuer Status
We are adopting, as proposed, amendments that will allow certain affected funds to qualify as WKSIs. Issuers that qualify as WKSIs are permitted to receive the greatest degree of benefits from the modifications to the communications and registration rules that the Commission adopted in 2005.91 A WKSI, for example, can file a registration statement or amendment that becomes effective automatically in a broader variety of contexts than a nonWKSI. In addition, subject to certain conditions, a WKSI may communicate at any time, including through a free writing prospectus, without violating the ‘‘gun-jumping’’ provisions of the Securities Act.92 To qualify as a WKSI, the issuer must meet the registrant requirements of Form S–3, i.e., it must be ‘‘seasoned’’ 93 and generally must have at least $700 million in public float.94 An issuer is not eligible for WKSI status if, among other bases: (1) It is not current and timely in its Exchange Act reports, or (2) it is the subject of a judicial or administrative decree or order arising out of a governmental action involving violations of the anti-fraud provisions of the Federal securities laws (the ‘‘antifraud prong’’ of the ineligible issuer definition).95

WKSI Definition
As proposed, we are amending rule 405 to delete the exclusion of affected funds from the definition of WKSI.96 In addition, we are adopting, as proposed, an amendment to the WKSI definition to include a reference to the registrant requirements of the proposed short-form registration instruction on Form N–2.97 We received no comments on our proposal to make these particular amendments to rule 405. Commenters generally supported permitting affected funds to qualify as WKSIs.98
WKSI Eligibility
The BDC Act directed us to amend Securities Act rule 405 to allow a BDC to qualify as a WKSI, and the Registered CEF Act directed us to allow a registered CEF covered by the Act to use the securities offering rules that are available to operating companies.99 Consistent with these directives, and to provide parity in the offering rules for affected funds and operating companies, we are adopting, as proposed, amendments to allow affected funds to qualify as WKSIs if they satisfy the same $700 million public float requirement that applies to operating companies. Our securities offering rules provide WKSIs with certain registration and communication flexibilities because, among other reasons, they have a demonstrated market following (i.e., they are ‘‘well-known’’).100 The Commission has used public float as an approximate measure of an issuer’s market following and the extent to which the market absorbs information about the issuer that is ultimately reflected in the price of the issuer’s securities.101 The $700 million public

1983) [48 FR 52889] (‘‘Forms S–3 and F–3 recognize
the applicability of the efficient market theory to those companies which provide a steady stream of high quality corporate information to the marketplace and whose corporate information is broadly disseminated. Information about these companies is constantly digested and synthesized by financial analysts, who act as essential conduits in the continuous flow of information to investors, and is broadly disseminated on a timely basis by the financial press and other participants in the marketplace.’’); see also Covered Investment Fund Research Reports, Investment Company Act Release No. 33311 (Nov. 30, 2018) [83 FR 64180 (Dec. 13, 2018)] (‘‘Covered Investment Fund Research Reports Adopting Release’’). 102See Securities Offering Reform Adopting Release, supra footnote 5, at text accompanying n.40. 103See ICI Comment Letter (suggesting that we permit affected funds to qualify as WKSIs solely based on the other proposed requirements for WKSI status, such as meeting other registrant and transaction requirements of Form S–3); see also Comment Letter of Invesco Ltd. (June 10, 2019) (‘‘Invesco Comment Letter’’) (same). See also TIAA Comment Letter (recommending that we eliminate the public float requirement and adopt a standard for WKSI qualification for registered CEFs based on whether certain information about the fund is available to the public, such as information about the fund’s holdings, total return performance, and daily NAV). 104See ABA Comment Letter. See also TIAA Comment Letter (recommending that we adopt a $480 million public float requirement for registered CEFs in order to permit approximately 30% of registered CEFs to qualify as WKSIs, which would be consistent with the percentage of operating companies that were permitted to qualify as WKSIs under the Commission’s 2005 securities offering reforms). 105See TIAA Comment Letter (recommending that we reduce the public float threshold to $480 million as an alternative to its recommendation that we eliminate the public float requirement for affected funds). See supra footnote 103. 106See, e.g., ICI Comment Letter; see also ABA Comment Letter (stating that, unlike operating companies, affected funds ‘‘generally describe their operations in terms of a stated investment objective and investment strategies that tend to remain constant over time’’). The ABA Comment Letter further asserted that the proposed $700 million public float requirement would be burdensome for affected funds relative to operating companies because, unlike operating companies, affected funds have a relatively fixed asset base (and therefore a relatively fixed public float) that would be unlikely to increase over time to a level that would satisfy the public float requirement. 107See, e.g., ABA Comment Letter (stating that the ‘‘operating limitations, oversight requirements and investor protection provisions’’ that apply to affected funds under the Investment Company Act ‘‘more than compensate for Affected Funds’ lower level
of research analyst coverage relative to large operating companies’’); ICI Comment Letter (stating that affected funds ‘‘are subject to important requirements under the Investment Company Act, including valuing their investments under boardapproved valuation procedures and ongoing board oversight’’); TIAA Comment Letter (stating that market following is less relevant to affected funds because, among other reasons, they are subject to ‘‘the valuation framework of the 1940 Act’’). 108See, e.g., ABA Comment Letter; Dechert Comment Letter; ICI Comment Letter. 109Similar to the comments discussed above recommending that we eliminate or reduce the $700 million public float requirement, these commenters stated, among other things, that unlisted affected funds are subject to the Investment Company Act’s investor protection, board oversight, and disclosure requirements, and that unlisted affected funds are structurally and operationally less complex than operating companies. See supra footnotes 106–107 and accompanying text. 110See Dechert Comment Letter; ABA Comment Letter. 111See, e.g., Dechert Comment Letter. See section 509(a) of the Registered CEF Act. float requirement is meant to encompass issuers that are presumptively the most widely followed in the marketplace and whose disclosures and other communications therefore are subject to market scrutiny by investors, the financial press, analysts, and others.102 Although the comments we received generally supported permitting affected funds to qualify as WKSIs, commenters also suggested specific modifications to the proposed amendments to permit certain additional affected funds to qualify. Several commenters recommended that we eliminate the public float requirement for affected funds.103 Other commenters recommended that we adopt a substantially lower public float threshold for affected funds, among other reasons, to make WKSI status available to a greater percentage of affected funds that have listed securities.104 One such commenter offered a specific suggestion: That we reduce the public float threshold for affected funds from $700 million to $480 million.105 This commenter stated that the $700 million public float requirement adopted in 2005 for operating companies permitted approximately 30% of operating companies to qualify as WKSIs, and stated that we should seek to achieve a similar 30% ‘‘target’’ by adopting a $480 million public float requirement for affected funds. As the basis for the recommended elimination of or modification to the $700 million public float requirement for affected funds, these commenters stated that while affected funds may not have the same level of market following as operating companies with the requisite public float, market following is a less relevant standard for affected funds than it is for operating companies. These commenters suggested that certain distinguishing characteristics of affected funds compensate for their relative lack of market following and
corresponding market scrutiny. For example, commenters stated that affected funds, as pass-through investment vehicles, have a less complex business than traditional operating companies, and thus require less market scrutiny.106 Commenters also stated that market scrutiny is less relevant for affected funds because, unlike operating companies, affected funds must satisfy the investor protection requirements of the Investment Company Act and related Commission rules, including requirements relating to financial transparency, valuation of portfolio securities, transactions with affiliates, and board oversight, among others.107 Similarly, on the basis that public float is not a suitable criterion for determining WKSI status for affected funds, commenters also urged that we permit unlisted affected funds (which do not have public float) to qualify for WKSI status on the basis of their aggregate NAVs.108 In addition to the reasons provided by commenters, discussed above, for eliminating or modifying the public float requirement,109 these commenters stated that the intermediaries and distribution platforms through which unlisted affected funds are sold perform extensive due diligence on unlisted affected funds, resulting in these funds being subject to scrutiny ‘‘equal’’ to the market scrutiny indicated by a large public float.110 Commenters also stated that technological advancements have made unlisted affected funds’ financial disclosures directly accessible to investors, and that, particularly in light of the extensive disclosure funds provide, investors are less dependent on market analysts for financial information.111 After considering these comments, we are adopting, as proposed, WKSI requirements for affected funds that are in parity with the requirements for operating companies. We are not eliminating or modifying the $700 million public float requirement for affected funds, or permitting affected funds to qualify as WKSIs based on their aggregate NAVs. Our amendments will implement the BDC Act and Registered CEF Act, and are designed to provide parity in the offering rules for affected funds and operating companies. As discussed above, commenters stated that there are certain distinctions between affected funds and operating companies that suggest that the $700 million public float requirement is not an appropriate criterion for determining WKSI status for affected funds. For example, commenters noted that affected funds generally have less complex businesses than operating companies, are subject to the requirements of the Investment Company Act, and provide extensive financial information to the market. We agree with commenters that the WKSI framework, which the Commission designed specifically for operating

112See Revisions to the Eligibility Requirements for Primary Securities Offerings on Forms S–3 and F–3, Securities Act Release No. 8878 (Dec. 19, 2007) [72 FR 73534 (Dec. 27, 2007)], at text accompanying n.25; See also Securities Offering Reform Adopting Release, supra footnote 5, at text accompanying n.52 (‘‘High levels of analyst coverage, institutional ownership, and trading volume are useful indicators of the scrutiny that an issuer receives from the market, although no one statistic can fully capture the extent to which an issuer is followed by the market.’’). 113As discussed above, the Registered CEF Act, as enacted, requires us to allow only interval funds and listed registered CEFs to use the securities offering rules available to operating companies See supra section II.A. To provide parity of treatment for similarly situated affected funds, we are exercising our discretion to extend certain of these rules to unlisted registered CEFs that are not interval funds. We do not believe, however, that it would be consistent with the Registered CEF Act to provide these unlisted registered CEFs with new criteria for qualifying as WKSIs. Indeed, legislative language that preceded the passage of the Registered CEF Act would have applied to all registered closed-end investment companies, but the legislation enacted as the Registered CEF Act was subsequently narrowed in scope to apply only to listed closed-end funds and interval funds. Compare the Financial CHOICE Act of 2017, H.R. 10, 115th Cong. section 499A(a) (June 8, 2017) (directing us to revise rules to the extent necessary to allow a closed-end company, as defined in
section 5(a)(2) of the Investment Company Act, that
is registered as an investment company under the Act to use the securities offering and proxy rules that are available to other issuers that are required to file reports under section 13(a) or section 15(d) of the Exchange Act) with section 509(a) of Registered CEF Act. See also 163 Cong. Rec. H4791, H4792 (2017) (daily ed. June 8, 2017) (statement of Rep. Ellison) (stating that the prior bill would ‘‘allow even illiquid, nontraded funds to claim multiple exemptions,’’ making it ‘‘harder for the . . . Commission . . . to police these products for investors’’). 114For example, both unlisted REITS and unlisted affected funds sell their shares through intermediaries and both types of entities’ financial disclosures have been made directly accessible to investors through advances in technology. 115As discussed at infra section III.A.1, affected funds represent approximately 5.1% of all registered investment companies by number of funds and approximately 2% by assets. In addition, as discussed at infra section III.D, we believe that providing affected funds with specific WKSIeligibility criteria would not provide affected funds parity with similarly-situated operating companies that do not have public float or do not meet the $700 million public float requirement and thus cannot qualify as WKSIs under the rules for operating companies. 116See, e.g., Invesco Comment Letter (stating that the percentage of listed BDCs and registered CEFs that would meet the $700 million public float requirement, as set forth in the proposing release, were lower percentages than the Acts were designed to permit (citing Proposing Release, supra footnote 10, at section IV.A.1.); ABA Comment Letter (same); Dechert Comment Letter (stating that a goal of the BDC Act was to improve the flow of funds to middle-market companies, which would be furthered by permitting unlisted funds to qualify as WKSIs based on their aggregate NAVs). 117See TIAA Comment Letter. 118See Securities Offering Reform Adopting Release, supra footnote 5, at text following n.48. 119See, e.g., ICI Comment Letter (stating that the Registered CEF Act effectively requires the Commission to proceed without a public float standard to enable interval funds to qualify as seasoned funds and WKSI funds); Dechert Comment Letter (stating that adoption of a public float requirement for affected funds effectively would frustrate the intent of the Registered CEF Act). 120See section 509(a) of the Registered CEF Act. companies, is not well-tailored to the specific characteristics of affected funds. However, these rules are designed to provide WKSI status to issuers with a demonstrated market following, and the Commission has for many years used public float, based on a public trading market, as an approximate measure of a stock’s market following and, consequently, the degree of efficiency with which the market absorbs information and reflects it in the price of a security.112 Moreover, the offering rules for operating
companies, which Congress specifically directed the Commission to extend to certain affected funds, are not premised on the characteristics of specific types of issuers, such as whether an issuer’s business is less complex than other issuers’ businesses or whether an issuer is subject to different regulatory requirements. Further, the market following for closed-end funds is significantly less robust than is the case for operating companies. As a result, in our view, it would not be appropriate to select a public float figure that is below the figure used to determine WKSI status for operating companies. We also are not persuaded by commenters that allowing an affected fund, including an unlisted affected fund, to qualify on the basis of its aggregate NAV would be consistent with the requirements for an issuer to qualify as a WKSI, which Congress directed us to extend to affected funds.113 In addition, permitting unlisted affected funds to qualify as WKSIs based on their aggregate NAVs would result in disparate treatment between unlisted affected funds and similarly situated operating companies under these rules. For example, unlisted real estate investment trusts (‘‘unlisted REITs’’) do not have a public float and therefore generally cannot qualify as WKSIs under the rules for operating companies. Unlisted REITs, however, have many of the characteristics that commenters cited in support of permitting unlisted affected funds to use their aggregate NAVs to qualify as WKSIs.114 Nonetheless, unlisted REITs and other unlisted operating companies may not qualify as WKSIs unless they have the requisite public float or satisfy one of the alternative bases (which we also are adopting for affected funds). Moreover, many of the distinctions between affected funds and operating companies that commenters raised are based on the characteristics of registered funds and BDCs generally, and are not unique to affected funds. We believe that the particular characteristics of registered funds, including affected funds, may be appropriate for the Commission to examine as part of a more comprehensive consideration of whether the securities offering rules for funds should be modified rather than in this rulemaking related to affected funds specifically.115 We do not agree with the commenters who stated that changing or eliminating the WKSI requirements for affected funds would be consistent with the intent of the Acts. We do not believe, as commenters suggested, that the BDC Act and Registered CEF Act were designed to result in a higher percentage of affected funds qualifying for WKSI status.116 Rather, as discussed above, the Acts directed us to extend to affected funds the benefits of our securities offering rules that are available to operating companies. We believe that designing specific WKSI requirements for affected funds to permit a particular percentage of those funds to qualify as WKSIs would not provide parity of treatment. Moreover, the $700 million public
float requirement for operating companies was not designed to result in a certain percentage of operating companies qualifying as WKSIs, as suggested by the commenter who recommended that the public float requirement for affected funds be lowered to $480 million.117 In describing the $700 million public float threshold for operating companies, the Commission observed that the threshold would make the WKSI provisions available to approximately 30% of listed issuers, but this was describing the effect of the provision and not its intent.118 We also do not agree with commenters that the Registered CEF Act, by referring to interval funds, requires us to permit affected funds to qualify as WKSIs based on criteria other than the criteria that apply to operating companies.119 The Registered CEF Act directed us to allow interval funds (in addition to listed CEFs) to use the securities offering rules that are available to other issuers required to file reports under section 13 or 15(d) of the Exchange Act.120 As discussed throughout this release and summarized in Tables 1 and 2 above, the rules that we are amending in this release are available to all affected funds, including interval funds, that satisfy the relevant conditions of those rules. In addition, many of the rules we are amending are not conditioned on an issuer’s public

121See infra section II.D (discussing the Commission’s request for comment on broadening rule 486(b) in the Proposing Release and comments received in response to this request, as well as the amendments we are adopting to rule 486). 122See amended paragraph (1)(i) of the ineligible issuer definition in rule 405. 123See amended paragraph (1)(ix) of the ineligible issuer definition in rule 405. 124See Proposing Release, supra footnote 10, at text following n.84. 125See ACC Comment Letter; CBD Comment Letter. 126 Id. 127See ACC Comment Letter; CBD Comment Letter; 128See paragraph (2) of the ineligible issuer definition in rule 405 (providing that the Commission may grant waivers of ineligible issuer status upon a good-cause showing that it is not necessary under the circumstances for the issuer to be considered an ineligible issuer). 129Filings under rule 486(a) are generally effective on the sixtieth day after filing, but a registrant may designate a later date for Continued float, such as the amendments to permit affected funds to use the ‘‘access equals delivery’’ prospectus delivery framework available to operating companies. We are adopting certain targeted amendments to permit certain noninterval affected funds to rely on rule 486 under the Securities Act. Unlike the WKSI requirements, rule 486 is specifically designed to apply to funds. These amendments to rule 486 will permit certain registered CEFs and BDCs that conduct continuous offerings— regardless of whether they qualify as WKSIs—to file post-effective amendments and certain registration statements that become either effective immediately upon filing under rule 486(b) or automatically effective after 60 days under rule 486(a).121 Similar to the benefits the final rule will provide to affected funds that qualify as WKSIs or that are eligible to file short-form registration statements, these amendments will facilitate certain unlisted affected funds’ ability to raise capital without delay by allowing the funds to more efficiently maintain effective registration statements while they engage in continuous offerings. The final rule, therefore, will provide certain listed affected funds with the flexibility to use a short-form registration statement and to file registration statements and amendments that become effective automatically. Additionally, unlisted affected funds generally will have the flexibility to make filings that become effective either immediately upon filing or automatically after 60 days. Thus the final rule will provide additional flexibilities to both listed and unlisted affected funds.
3. Ineligible Issuer Definition
We are adopting, as proposed, amendments to the definition of ineligible issuer in rule 405. Although all of the provisions in the ineligible issuer definition would apply to affected funds, our amendments are designed to tailor certain of these provisions for affected funds specifically. First, we are amending the definition of ‘‘ineligible issuer’’ to provide that a registered CEF would be ineligible if it has failed to file all reports and materials required to be filed under section 30 of the Investment Company Act during the preceding 12 months. This provision is consistent with the proposed short-form registration instruction and would mirror the current Exchange Act reporting provision in the ineligible issuer definition.122 We did not receive any comments on this particular proposed amendment. Second, we are adopting, as proposed, an amendment to the definition of ineligible issuer to give effect to the definition’s anti-fraud prong in the context of affected funds. Specifically, we are adopting a parallel anti-fraud prong for affected funds, which provides that an affected fund is an ineligible issuer if within the past three years its investment adviser, including any sub-adviser, was the subject of any judicial or administrative decree or order arising out of a governmental action that determines the investment adviser aided or abetted or caused the affected fund to have violated the antifraud provisions of the Federal securities laws.123 We believe this amendment is appropriate because investment companies typically are externally managed by an investment adviser, which is primarily responsible for the day-to-day management of the fund and the preparation of the fund’s disclosures.124 We received several comments requesting that we clarify or modify certain aspects of the proposed amendments. Commenters suggested that we clarify that a violation of section 206(4) of the Advisers Act, or the rules adopted under section 206(4) (except for 17 CFR 275.206(4)–8 (rule 206(4)–8)), by an affected fund’s investment adviser or sub-adviser would not give rise to WKSI ineligibility for the affected fund.125 These commenters also recommended that we modify the proposed anti-fraud provision so that an affected fund would not be an ineligible issuer if the investment adviser (or sub-adviser) that was the subject of a judicial or administrative decree or order as described in the proposed rule no longer advises the affected fund at the time the affected fund seeks WKSI status.126 Under the anti-fraud prong for affected funds, an affected fund is ineligible for WKSI status if the affected fund’s adviser or sub-adviser is determined to have aided or abetted or caused a violation by the fund of the anti-fraud provisions of the Federal securities laws. As such, only the antifraud provisions of the securities laws that apply to the affected fund itself can give rise to WKSI ineligibility. There could not be a violation of section 206(4) or the rules
adopted thereunder by an affected fund, because the fund is not itself an adviser. We also do not believe it would be appropriate, as commenters suggested, to modify the proposed amendments to permit an affected fund whose adviser or sub-adviser was determined to have aided or abetted or caused a violation by the fund of the anti-fraud provisions of the securities laws to preserve its WKSI eligibility by terminating the adviser or sub-adviser.127 An operating company currently will be an ineligible issuer under the anti-fraud prong even if the operating company terminates all of the employees who aided or abetted the underlying violation of the Federal securities laws, and our amendments will provide comparable treatment if an affected fund were to terminate its adviser. The affected fund also may have the same board of directors that was in place when the affected fund violated the anti-fraud provisions. The specific facts and circumstances relating to a particular issuer’s WKSI status under the ineligible issuer definition may, however, be considered through the Commission’s process under rule 405 for granting waivers of ineligible issuer status.128 For these reasons, we are adopting the amendments to the ineligible issuer definition as proposed. D. Automatic or Immediate Effectiveness for Filings by Affected Funds Conducting Certain Continuous Offerings Based on comments that we received, we are expanding the scope of rule 486 to permit any registered CEF or BDC that conducts continuous offerings under rule 415(a)(1)(ix) (e.g., a continuously-offered tender offer fund) to rely on the rule. Rule 486 under the Securities Act currently permits interval funds to file post-effective amendments and certain registration statements that are either immediately effective upon filing under rule 486(b) or automatically effective 60 days after filing under rule 486(a).129

effectiveness (which must not be later than eighty days after filing). In addition, the Commission, having due regard to the public interest and the protection of investors, may declare an amendment or registration statement effective under rule 486(a) on an earlier date. See rule 486(a). 130See, e.g., Nuveen California Select Tax-Free Income Portfolio, SEC Staff No-Action Letter (Nov. 21, 2017); PIMCO Dynamic Income Fund, SEC Staff No-Action Letter (Dec. 12, 2017); Eagle Point Credit Company, Inc., SEC Staff No-Action Letter (Feb. 14, 2018); PIMCO Corporate & Income Opportunity Fund and PIMCO Income Opportunity Fund, SEC Staff No-Action Letter (Sep. 13, 2018); and DNP Select Income Fund, Inc., SEC Staff No-Action Letter (Oct. 4, 2018). 131See Proposing Release, supra footnote 10, at
section II.I.
132See ABA Comment Letter and ICI Comment Letter. 133See ICI Comment Letter. 134See ABA Comment Letter and ICI Comment Letter. 135See ABA Comment Letter. 136We also are making a technical amendment to rule 486(b)(1)(iv) to provide a more accurate cross reference to Item 9.1.c of Form N–2. Moreover, we are amending Form N–2 to recognize the broader scope of affected funds that may rely on rule 486. See General Instruction E.4 of amended Form N– 2 and cover page of amended Form N–2. 137See supra sections II.B.3.b and II.B.3.c. Although affected funds that file short-form registration statements or qualify as WKSIs will be able to use forward incorporation by reference and automatically effective filings to make a broader range of updates to their registration statements on an immediate basis than those specified in rule 486(b), the majority of post-effective amendments that affected funds currently file are solely for one or more purposes described in rule 486(b). Moreover, interval funds, and affected funds that make continuous offerings under rule 415(a)(1)(ix), will be able to make other, material amendments that are automatically effective 60 days after filing. 138Rule 415(a)(1)(ix), (x), and (xi) are the provisions affected funds primarily use to conduct delayed or continuous offerings of their securities. Rule 415(a)(1)(ix) allows nontraded affected funds to engage in continuous offerings but does not allow delayed (or ‘‘shelf’’) offerings. Rule 415(a)(1)(x) allows affected funds that are eligible to file shortform registration statements on Form N–2 to engage in delayed or continuous offerings. Rule 415(a)(1)(xi) allows interval funds to engage in delayed or continuous offerings. 139For example, rule 415 limits the amount of securities that can be registered in a continuous offering under rule 415(a)(1)(ix) and generally requires an issuer relying on rule 415(a)(1)(ix) to file a new registration statement every three years. See rule 415(a)(2), (5), and (6). 140See rule 486(b)(2) (requiring certain written representations that a post-effective amendment filed under rule 486(b) is filed solely for one or more of the permissible purposes covered by the provision); rule 486(e) (requiring a fund to have filed a post-effective amendment or registration statement relating to its common stock that became effective within two years prior to the filing made under rule 486(a) or (b)). 141See rule 486(c). 142See amended rule 486(a), (b)(1)(vi), and (g). As discussed in the Proposing Release, our staff has previously stated that it would not recommend that the Commission take enforcement action under certain provisions of the Securities Act if, on a case-by-case basis, specific listed registered CEFs that conduct offerings under rule 415(a)(1)(x) use rule 486(b) to file certain posteffective amendments that are immediately effective upon filing.130 The Proposing Release noted that staff in the Division of Investment Management were reviewing these
noaction letters to determine if they should be withdrawn in connection with any final rules. The Commission also requested comment on whether it should make rule 486(b) available to all or a broader group of registered CEFs and BDCs.131 In response to this request, several commenters asked that we allow certain non-interval funds that conduct delayed or continuous offerings under rule 415 to rely on rule 486, in whole or in part.132 For example, one commenter suggested that the existing no-action letters be retained or codified. This commenter stated that withdrawing the no-action letters would be disruptive to relevant non-WKSI funds and their ability to update their registration statements and receive automatic effectiveness.133 Additionally, two commenters recommended that we permit affected funds that are continuously-offered unlisted funds to rely on rule 486 in its entirety, including rule 486(a) and rule 486(b). The commenters suggested that, like interval funds, these unlisted funds are continuously offered and would benefit if their filings could become immediately effective or automatically effective 60 days after filing.134 One of these commenters stated that, for example, allowing continuously-offered unlisted affected funds to rely on rule 486 would benefit investors in these funds by allowing the funds to avoid the time and expense of an annual staff review of registration statements where no changes are made beyond immaterial updates and updates to audited financial information.135 In response to these comments, we are amending rule 486 to allow any registered CEF or BDC that conducts a continuous offering under rule 415(a)(1)(ix) to rely on rule 486.136 We believe this rule amendment will allow these continuously-offered affected funds to maintain effective registration statements in a more efficient, costeffective manner. For example, under rule 486(a), these funds will be able to make material changes to their registration statements on an automatically effective basis 60 days after filing. In addition, under rule 486(b), continuously-offered unlisted affected funds will be able, for example, to update their financial statements under section 10(a)(3) or make nonmaterial changes to their registration statements on an immediately effective basis. The rule amendment will allow these funds to more efficiently maintain effective registration statements while they engage in continuous offerings. This is similar to the benefits the final rule will provide to affected funds that file short-form registration statements or qualify as WKSIs, as those funds also will be able to make certain updates to their registration statements more efficiently (i.e., through forward incorporation by reference or automatically effective registration statements and post-effective amendments).137 We believe it is appropriate for any affected fund that conducts delayed or continuous offerings under rule 415(a)(1)(ix), (x), or (xi) to have a mechanism
for bringing its financial statements up to date under
section 10(a)(3) without delay.138
Together, the amendments we are adopting in this release and current rule 486 will achieve this objective. Continuously-offered unlisted affected funds relying on rule 486 will continue to be subject to applicable provisions in rule 415.139 Moreover, these funds will need to comply with relevant conditions in rule 486.140 If it appears to the Commission that a posteffective amendment or registration statement filed under rule 486(a) may be incomplete or inaccurate in any material respect, the Commission may suspend the effective date of that filing. Further, if it appears to the Commission that the fund has not complied with the conditions in rule 486(b), the Commission may suspend the fund’s ability to rely on rule 486(b).141 In addition to allowing an affected fund to rely on rule 486 if the fund makes continuous offerings under rule 415(a)(1)(ix), we are also amending the scope of registration statements that rule 486 covers. Currently, rule 486 is available for post-effective amendments and for registration statements filed for purposes of registering additional shares of common stock for which a Form N– 2 registration statement is effective. This generally reflects the scope of amendments and registration statement filings interval funds make after their initial registration statements are effective. However, unlike interval funds, the affected funds that will newly be eligible to rely on rule 486 generally are required to file new registration statements every three years under rule 415(a)(5) and (6). We are amending rule 486 to allow these registration statements to be immediately or automatically effective under the rule, depending on the substance of the disclosure.142 Specifically, a registration

143See ICI Comment Letter.
144See rule 415(a)(5) and (6); General Instructions A.2 and F.3 of amended Form N–2. 145See rule 486(b)(1)(i) and (v). 146Under these circumstances, a non-WKSI fund potentially could combine its ability to forward incorporate by reference and its ability to rely on rule 486(b) to achieve a WKSI-like status, with registration statements that would always be immediately effective upon filing. This could occur if, for example, a fund made material changes to its registration statement by forward incorporating information into its registration statement and then, to satisfy the requirement to file a new registration statement every three years, it filed a new registration statement under rule 486(b). In contrast, when an affected fund that may rely on rule 486 makes a material change to its registration statement, the relevant filing is not effective immediately. See rule 486(a). 147See supra footnote 130. 148 15 U.S.C. 77j(a). 149 15 U.S.C. 77e(b)(2). 150 17 CFR 230.172 (Securities Act rule 172); see also Securities Offering Reform Adopting Release, supra footnote 5, at nn.560–562 and accompanying text. 151See Securities Act rule 172. In the event that the issuer fails to file such a prospectus in a timely manner, the issuer must file the prospectus as soon as practicable thereafter. Securities Act rule 172(c)(3); see also Securities Offering Reform Adopting Release, supra footnote 5, at n.568 and preceding text (describing this ‘‘cure’’ provision). 152See, e.g., Securities Offering Reform Adopting Release, supra footnote 5, at text following n.567. 153 17 CFR 230.173 (Securities Act rule 173). See also Proposing Release, supra footnote 10, at n.109. Rule 173(d) provides that a purchaser who receives a notification may request a copy of the final prospectus. We proposed a change to Item 34.6 of Form N–2, under which funds currently undertake to provide an SAI upon request, to require an affected fund to also undertake to provide a prospectus upon request. We received no comments regarding this aspect of the proposal and are making the change as proposed. See Item 34.7 of amended Form N–2. 154See Securities Act rule 172(d)(1)–(2); Securities Act rule 173(f)(2)–(3). 155Section 803(b)(2)(L) of the BDC Act; see also
section 509(a) of Registered CEF Act (requiring
parity of securities offering rules with operating companies for listed registered CEFs and interval funds). statement a fund files to comply with rule 415(a)(5) and (6) could be immediately effective upon filing if it is filed for no purpose other than to comply with those provisions of rule 415 or for other purposes listed in rule 486(b), such as making non-material changes or updating the fund’s financial statements under section 10(a)(3). If the registration statement does not qualify under rule 486(b) because, for example, it includes material changes to the fund’s disclosure, the registration statement could be automatically effective 60 days after filing under rule 486(a). As a result of the amendments, affected funds that make continuous offerings under rule 415(a)(1)(ix) will be able to rely on rule 486 for registration statements filed to comply with rule 415(a)(5) and (6), regardless of whether they choose to register additional shares at the time these provisions requires them to file new registration statements. This will promote consistent treatment of these funds’ filings under the rule. Although one commenter suggested that we retain or codify the staff noaction letters discussed above to allow affected funds that conduct delayed or continuous offerings under rule 415(a)(1)(x) to file post-effective amendments that are immediately effective under rule 486(b), we believe the final rule makes such relief unnecessary.143 For example, while these funds will need to file new registration statements every three years under rule 415, during the interim period they will be able to update their registration statements through the forward incorporation by reference provisions applicable to short-form registration statement filers.144 The forward incorporation by reference provisions allow these funds to avoid filing the types of post-effective amendments that rule 486(b) covers, as well as other types of post-effective amendments (e.g., those making material changes to the fund’s disclosure). Thus, we do not believe that affected funds that make delayed or continuous offerings under rule 415(a)(1)(x) will need to file the types of post-effective amendments rule 486(b) covers. Moreover, while the commenter only referred to post-effective amendments, rule 486(b) also covers new registration statements under certain circumstances. For instance, when an eligible fund has an effective registration statement and wants to register additional shares without making material amendments to its existing disclosure, rule 486(b) allows that new registration statement to be immediately effective.145 If we were to permit a fund that makes delayed or continuous offerings under rule 415(a)(1)(x) to rely on rule 486(b) in its entirety, then the new registration statement the fund must file every three years could effectively become an automatic shelf registration statement, even though the fund does not qualify as a WKSI (e.g., it does not have $700 million
in public float).146 As a result of these considerations, the no-action letters stating that the staff would not recommend an enforcement action if specific listed, registered CEFs conducted offerings under rule 415(a)(1)(x) using rule 486(b) will be withdrawn effective August 1, 2021 (one year from the effective date of the final rule).147 Importantly, as recognized above, the final amendments provide a mechanism for these funds to efficiently update their registration statements. E. Final Prospectus Delivery Reforms We are adopting, as proposed, rule amendments that will allow an affected fund to satisfy its final prospectus delivery obligations by filing its final prospectus with the Commission. The Securities Act requires registrants to deliver to each investor in a registered offering a prospectus meeting the requirements of section 10(a) (known as a ‘‘final prospectus’’).148
Section 5(b)(2) makes it unlawful to
deliver a security for the purpose of sale or for delivery after sale unless accompanied or preceded by a final prospectus. After the effectiveness of a registration statement, a written communication that offers a security for sale, or confirms the sale of a security, may be provided to investors if a final prospectus is sent or given previously or at the same time. Otherwise, such a communication may not be provided unless it is otherwise permitted under Commission rules or meets the requirements of section 10(a).149 Rule 172 allows issuers, brokers, and dealers to satisfy final prospectus delivery obligations if a final prospectus is or will be on file with the Commission within the time required by the rules and other conditions are satisfied.150 For example, rule 172 provides that a final prospectus will be deemed to precede or accompany a security for sale for purposes of section 5(b)(2) as long as the final prospectus is filed with the Commission or it will be filed as part of the registration statement.151 Rule 172 applies only to final prospectuses and not to other documents.152 Rule 173 requires the delivery of a copy of the final prospectus or, in lieu of a final prospectus, a notice to purchasers stating that a sale of securities was made pursuant to a registration statement or in a transaction in which a final prospectus would have been required to have been delivered in the absence of rule 172.153 Rules 172 and 173 do not apply to offerings of affected funds.154 The BDC Act directs us to remove the exclusion for BDC offerings.155 To implement the BDC Act, and to provide parity for registered CEFs consistent with the Registered CEF Act, we proposed to amend rules 172 and 173 to remove the exclusion for offerings of all affected funds. Commenters supported this approach, stating that the proposed amendments would reduce prospectus printing and delivery costs and provide parity for affected funds, consistent with

156See, e.g., SIFMA Comment Letter; ICI Comment Letter; Invesco Comment Letter; TIAA Comment Letter. 157See amended Securities Act rule 172(d); amended Securities Act rule 173(f). 158See, Proposing Release, supra footnote 10 at
section II.E.1; see also Securities Act rule 134;
Securities Act rule 168; Securities Act rule 156; Securities Act rule 163; Securities Act rule 163A; Securities Act rule 164; Securities Act rule 168; Securities Act rule 169; and Securities Act rule 433. 159Unless otherwise noted, offering communications generally refer to written communications. Rule 405 provides that ‘‘[e]xcept as otherwise specifically provided or the context otherwise requires, a written communication is any communication that is written, printed, a radio or television broadcast, or a graphic communication as defined in [rule 405].’’ 160See Securities Offering Reform Adopting Release, supra footnote 5, at 44731. But see section 5(d) of the Securities Act [15 U.S.C. 77e(d)], which permits an emerging growth company, or any person authorized to act on its behalf, to engage in oral or written communications with potential investors that are qualified institutional buyers, as defined in 17 CFR 230.144A (Securities Act rule 144A), or institutions that are accredited investors, as defined in 17 CFR 230.501(a) (Securities Act rule 501(a)), either prior to or after the filing of a registration statement, to determine their interest in a contemplated registered offering. These communications are often referred to as ‘‘testing the waters.’’ 17 CFR 230.163B (Securities Act rule 163B), recently adopted by the Commission, extends this accommodation to all issuers. Solicitations of Interest Prior to a Registered Public Offering, Securities Act Release No. 10699 (Sept. 25, 2019) [84 FR 53011 (Oct. 4, 2019)] (‘‘Rule 163B Adopting Release’’). 161See section 5(c) of the Securities Act [15 U.S.C. 77e(c)]. 162This is because after the filing of the registration statement but before its effectiveness, offers made in writing (including electronically), by radio, or by television are limited to a ‘‘statutory prospectus’’ that conforms to the information requirements section 10 of the Securities Act. See sections 5(b)(1) and 10 of the Securities Act [15 U.S.C. 77e(b)(1) and 77(j)]. 163See section 2(a)(10) and section 5(b)(1) of the Securities Act [15 U.S.C. 77b(a)(10) and 77e(b)(1)]. 164See, e.g., SIFMA Comment Letter; Comment Letter of Sidley Austin LLP (June 10, 2019); ICI Comment Letter; ACC Comment Letter; CBD Comment Letter; MFDF Comment Letter; TIAA Comment Letter. 165See, e.g., SIFMA Comment Letter; ICI Comment Letter. 166See, e.g., SIFMA Comment Letter. 167See amended rules 134(g), 163(b)(3), 163A(b)(4), 164(f), 168(d)(3), and 169(d)(4) (removing references to BDCs and limiting the rules’ exclusion of registered investment companies from the safe harbor to exclude registered funds other than registered CEFs). See also amended rule 168 (adding to paragraphs (b)(1) and (2) references to the Investment Company Act to parallel current references to the Exchange Act to provide that forward-looking information and factual business information may be included in materials filed under the Investment Company Act); amended rule 433 (adding to
paragraphs (a)(1)(i) and (iv) references to registration statements filed on Form N–2 under adopted General Instruction A.2 to parallel current references to Form S–3; adding to paragraph (c)(1)(ii) a reference to reports filed under section 30 of the Investment Company Act as reports with which a free-writing prospectus may not conflict). See also amended rule 156(d); infra footnote 172. 168See Proposing Release, supra footnote 10, at n.122 (discussing rule 134). 169See id. at n.123 (discussing rule 163A). 170See id. at n.124 (discussing rule 168). 171Rule 169 is also a safe harbor from the definition of ‘‘prospectus’’ in section 2(a)(10) of the Securities Act. 172See amended rule 156(d); section 803(b)(2)(G) of the BDC Act; section 509(a) of Registered CEF Act. the BDC Act and the Registered CEF Act.156 We are adopting the amendments to rules 172 and 173 as proposed.157 F. Communications Reforms

Offering Communications
We are adopting amendments to the communications rules, as proposed, to extend to affected funds the rules that currently provide operating companies and other parties (such as underwriters) increased flexibility in their communications.158 The amendments permit these communications notwithstanding the ‘‘gun-jumping provisions’’ in the Securities Act, which restrict the types of offering communications that issuers or other parties subject to the Act’s provisions may use in connection with a registered public offering.159 The gun-jumping provisions were designed to make the statutorily mandated prospectus the primary means for investors to obtain information regarding a registered securities offering.160 Accordingly, the statute provides that unless otherwise permitted:

Before an issuer files a registration
statement, all offers, in whatever form, are prohibited; 161
After the issuer files a registration
statement but before it has become effective, the only written offers that are permitted are those made using a preliminary prospectus that meets the requirements of section 10 of the Securities Act, which must be filed with the Commission; 162 and
Even after the registration statement
is declared effective, offering participants still may make written offers only through a statutory prospectus, except that they may use additional written offering materials if a final prospectus that meets the requirements of Securities Act section 10(a) is sent or given prior to or with those materials.163 Since the adoption of the Securities Act, the Commission has recognized that certain communications before, during, and after the filing of a registration statement do not raise the investor protection concerns that the gun jumping provisions aim to address. For this reason, the Commission has adopted several rules to provide clarity to issuers on the types of communications that are permissible and how to communicate with investors without violating the gun jumping provisions. We proposed to extend those rules to affected funds in the Proposing Release. Commenters generally supported the proposed amendments to the communications rules.164 Two commenters stated that the amendments would allow increased flexibility in communications and provide parity with operating companies.165 One commenter added that the amendments would make it easier to execute offerings by affected funds and would decrease costs, leading to lower offering costs and potentially enhance capital formation while not negatively impacting investor protections.166 The Commission continues to believe that investors and the market will benefit from access to greater communications under conditions that preserve investor protections. To implement the BDC Act, and to provide parity for registered CEFs consistent with the Registered CEF Act, we are extending, as proposed, the communications rules currently available to operating companies to affected funds by removing the exclusions for affected funds and making other conforming changes.167 Specifically, the amended rules will:
Permit affected funds to use rule
134 to publish factual information about the issuer or the offering, including ‘‘tombstone ads.’’ 168
Permit affected funds to rely on rule
163A, which provides issuers a brightline time period, ending 30 days prior to filing a registration statement, during which they may communicate without risk of violating the gun-jumping provisions.169
Permit affected funds that are
reporting companies to rely on rule 168 to publish or disseminate regularly released factual business information and forward-looking information at any time, including around the time of a registered offering.170 The amendments to rule 169 will also permit affected funds’ continued publication or dissemination of regularly released factual business information that is intended for use by persons other than in their capacity as investors or potential investors.171 We also are adopting amendments to rule 156 to state that nothing in that rule may be construed to prevent an affected fund from qualifying for an exemption under rule 168 or 169.172 The contents of any rule 168 or 169 communication remain subject to the anti-fraud provisions of the Federal securities laws.

173See Proposing Release, supra footnote 10, at n.127 (discussing rules 164 and 433). 174See id. at n.128 (discussing how communications rules apply to WKSIs). 175See id. at section II.E.1. 176 17 CFR 230.482 (Securities Act rule 482); see also 17 CFR 230.497(i) (Securities Act rule 497). 177See Proposing Release, supra footnote 10, at
section II.E.1.
178See id. at text following n.128; see also sections 803(e)(2) of the BDC Act (prohibiting the Commission from interpreting the amendments directed by the BDC Act in a manner that would prevent BDCs from distributing sales material pursuant to rule 482 under the Securities Act); and 509(c)(1) of the Registered CEF Act (prohibiting the Commission from interpreting the amendments directed by the Registered CEF Act to impair or limit in any way a registered closed-end company from using rule 482 communications, under the Investment Company Act, to distribute sales material). 179See Dechert Comment Letter; IPA Comment Letter; see also sections 27A(b)(2)(B) and 27A(g) of the Securities Act [15 U.S.C. 77z–2(b)(2)(B) and 15 U.S.C. 77z–2(g)] and sections 21E(b)(2)(B) and 21E(g) of the Exchange Act [15 U.S.C. 78u– 5(b)(2)(B) and 15 U.S.C. 78u–5(g)]. 180See 17 CFR 230.138(a)(2)(i) (Securities Act rule 138(a)(2)(i)). 181See supra section II.B.3.a (Form N–Q will be rescinded on May 1, 2020). 182See Proposing Release, supra footnote 10, at
section II.E.2.
183See Fair Access to Investment Research Act of 2017, Public Law 115–66, 131 Stat. 1196 (2017); see also Covered Investment Fund Research Reports Adopting Release, supra footnote 101. 184 17 CFR 230.139b; see also Covered Investment Fund Research Reports Adopting Release, supra footnote 101, at 64183 (providing that under rule 139b, the term ‘‘covered investment fund’’ includes, among other things, registered investment companies and BDCs). 185See Covered Investment Fund Research Reports Adopting Release, supra footnote 101 at sections II.A.1 and II.E.2; see also section 2(f)(3) of the FAIR Act. 186See Covered Investment Fund Research Reports Adopting Release, supra footnote 101, at nn.144–145 and accompanying paragraph. 187 Id. 188 Id.

Permit affected funds to rely on
rules 164 and 433 to use a ‘‘free writing prospectus.’’ 173
Permit affected funds that are
WKSIs to engage at any time in oral and written communications, including use at any time of a free writing prospectus (before or after a registration statement is filed), subject to the same conditions applicable to other WKSIs.174 As we discussed in the Proposing Release, investment company communications currently are subject to rule 482.175 Rule 482 communications can only be used by a fund that is selling or is proposing to sell its securities pursuant to a filed registration statement, and are prospectuses subject to prospectus liability under section 12 of the Securities Act.176 The amendments to the communications rules provide affected funds with incremental flexibility in their communications, including additional flexibility to communicate before filing a registration statement, and some additional flexibility in using communications that are not subject to prospectus liability under section 12 of the Securities Act.177 Moreover, as we discussed in the Proposing Release, both the BDC Act and Registered CEF Act direct the Commission to continue to make available Securities Act rule 482 communications, or ‘‘ads,’’ notwithstanding the amendments to the communications rules.178 Affected funds therefore can now take advantage of additional flexibility under the communications rules as amended or continue to rely on rule 482 and other rules currently applicable to investment company communications. In addition to comments on the proposed amendments to the communications rules, two commenters urged us to adopt rules that would extend the safe harbors for liability in private actions for certain forward looking statements under section 27A of the Securities Act and section 21E of the Exchange Act to affected funds.179 Those commenters did not specify what the conditions or requirements of such a rule might be, and the public has not had the opportunity to comment on whether or how to extend safe harbors for forward-looking statements to affected funds. For these reasons, we believe commenters’ request requires more extensive consideration beyond the scope of this rulemaking.

Broker-Dealer Research Reports
We are adopting the amendments to Securities Act rule 138 as proposed. Rule 138 permits a broker-dealer participating in the registered offering of an eligible issuer’s common stock and similar securities to publish or distribute research reports about that issuer’s fixed income securities, and vice versa, if it publishes or distributes that research in the regular course of its business. Although rule 138 does not currently exclude affected funds from coverage, it does include references to Form S–3 but not Form N–2. We therefore proposed to amend the rule’s references to shelf registration statements filed on Form S– 3 to include a parallel reference to a registration statement filed on Form N– 2 under the proposed short-form registration instruction. Rule 138 also currently provides that an issuer covered in a research report published in reliance on the rule must be required to file reports, and must have filed all periodic reports required during the preceding 12 months (or such shorter time that the issuer was required to file such reports), on Forms 10–K and 10– Q.180 Because registered CEFs do not file the periodic reports currently specified in rule 138, we proposed to include parallel references to the reports that registered CEFs are required to file, i.e., reports on Forms N–CSR, N–Q, N– CEN, and N–PORT.181 We did not receive any comments on these amendments and are adopting them as proposed. We are not adopting changes to 17 CFR 230.139 (rule 139).182 That rule provides a safe harbor for a brokerdealer’s publication or distribution of research reports where the broker-dealer is participating in the registered offering of the issuer’s securities and, unlike rule 138, permits the research report to cover any class of the issuer’s securities. As we stated in the Proposing Release, in 2018 the Commission adopted new 17 CFR 230.139b (Securities Act rule 139b) to implement the Fair Access to Investment Research Act of 2017 (the ‘‘FAIR Act’’).183 The FAIR Act directed that the Commission extend rule 139 to cover broker-dealers’ publication or distribution of ‘‘covered investment fund research reports.’’ These include research reports about affected funds.184 Rule 139b includes specific provisions mandated by Congress for covered investment fund research reports. For example, rule 139b excludes from the rule’s safe harbor research reports published or distributed by the covered investment fund itself, any affiliate of the covered investment fund, or any broker-dealer that is an investment adviser (or an affiliated person of an investment adviser) for the covered investment fund.185 The Commission did not propose changes to rule 139 because it believed that rule 139b satisfies the directives of the BDC Act and Registered CEF Act by extending rule 139’s safe harbor to research reports on BDCs and registered CEFs and is consistent with Congress’s core objective regarding research reports covering these funds.186 The Commission observed that,
if it were to amend rule 139 to cover research reports on BDCs, or on affected funds generally, exactly the same conduct would be subject to different standards based on the rule a brokerdealer chose to use.187 The Commission believed that it would be more appropriate to provide a consistent approach for affected fund research reports under rule 139b.188 One commenter suggested that we amend rule 139 and repeal rule 139b, in order to provide the same requirements for broker-dealer research reports on

189See ABA Comment Letter.
190See Proposing Release, supra footnote 10, at text accompanying n.147. 191See section 803(b)(2)(M) of the BDC Act. 192See Proposing Release, supra footnote 10, at n.148. 193Section 803(b)(2)(N) of the BDC Act (directing us to amend Item 13(b)(1) of Schedule 14A to include as an issuer to which Item 13(b)(1) applies a BDC that would otherwise meet the requirements of Note E of the Schedule); section 509(a) of the Registered CEF Act (requiring us to provide certain registered CEFs with the same flexibility under the proxy rules, subject to appropriate conditions, as is available to other issuers required to file reports under section 13 or section 15(d) of the Exchange Act). 194 Item 13 applies to proxy statements seeking security holder approval to authorize, issue, modify, or exchange securities as described in Items 11 or 12 of Schedule 14A. 195The proposed definition in Note E of Schedule 14A of an affected fund that ‘‘meets the requirements of General Instruction A.2 of Form N– 2’’ included certain conditions relating to the transaction requirements in General Instruction I.B or I.C of Form S–3, consistent with the conditions in the definition in Note E of an operating company that ‘‘meets the requirements of Form S–3.’’ We are adopting the definition in Note E as proposed to provide parity between affected funds and operating companies although, as discussed in the Proposing Release, we believe these conditions are less likely to be relevant to affected funds. See Proposing Release, supra footnote 10, at n.152. 196Rule 100 of Regulation FD generally requires an issuer to make either simultaneous or prompt public disclosure of any material nonpublic information regarding the issuer or its securities that the issuer or a person acting on its behalf has selectively disclosed to certain parties. See 17 CFR
243.100 (requiring simultaneous public disclosure
in the case of an intentional selective disclosure or prompt public disclosure in the case of a nonintentional selective disclosure). 197See section 803(b)(2)(O) of the BDC Act; 17 CFR 243.103(a) (rule 103(a) of Regulation FD). 198 In general, issuers today—including interval funds—are required under the Securities Act to pay a registration fee to the Commission at the time of filing a registration statement. See sections 6(b)(1) (requiring applicants to pay a fee to the Commission at the time of filing a registration statement) and (c) (providing that a registration statement shall not be deemed to have taken place without payment of a registration fee) of the Securities Act [15 U.S.C. 77f(b)(1)]. This means that they pay registration fees at the time they register the offering of securities, regardless of when (or if) they sell them. WKSIs using automatic shelf registration statements have additional flexibility to pay filing fees at or prior to the time of a securities offering. See supra footnote 78; see also Securities Offering Reform Adopting Release, supra footnote 5, at 44780. This arrangement is commonly known as ‘‘pay-as-yougo.’’ Id. As a result, these filers may defer payment until a future takedown of shares off a shelf registration statement. Affected funds that become WKSIs as a result of our final rule will also gain that flexibility, but other affected funds will not. See supra section II.C. 199The final rule applies to interval funds the same treatment provided by rule 24f–2 to open-end funds and UITs. See amended rule 23c–3(e) (providing that an interval fund would be deemed to have registered an indefinite amount of securities under section 24(f) upon the effective date of its registration statement); see also amended rule 24f– 2 (providing for interval funds to pay their registration fees on the same annual net basis as mutual funds, other open-end funds, and UITs). See
section 4(e) of the Exchange Act [15 U.S.C. 78d–
4(e)]; section 28 of the Securities Act [15 U.S.C. 77z–3)]. affected funds and operating companies.189 The commenter raised concerns regarding differences between these two rules’ requirements, such as rule 139b’s ‘‘affiliate exclusion.’’ That provision makes rule 139b’s safe harbor inapplicable to research reports by a broker-dealer that is an investment adviser (or an affiliated person of an investment adviser) to the covered investment fund. We acknowledged the differences between rule 139b and rule 139 in the Proposing Release. Indeed, the different requirements in rule 139b—which were mandated by Congress in the FAIR Act—are why we did not propose amendments to rule 139. We continue to believe that rule 139b already satisfies the directives of the BDC Act and Registered CEF Act by extending rule 139’s safe harbor to research reports on BDCs and registered CEFs and is consistent with Congress’s core objective regarding research reports covering these funds. If we were to amend rule 139 and rescind rule 139b as urged by this commenter, this would not give effect to Congress’s more specific directives in the FAIR Act. Moreover, rule 139b, as directed by the FAIR Act, provides a consistent framework for research reports on ‘‘covered investment funds,’’ which are not limited to the affected funds covered in this rulemaking. Maintaining rule 139b therefore provides a consistent approach for all ‘‘covered investment fund research reports.’’ G. Other Rule Amendments

Rule 418 Supplemental Information
As proposed, we are adopting amendments to rule 418 to exempt affected funds that are eligible to file a short-form registration statement on Form N–2 from the requirement to furnish certain supplemental information to the Commission or staff on request under paragraph (a)(3) of the rule. As discussed in the Proposing Release, operating companies that are eligible to use Form S–3 are already exempt from having to furnish certain information under rule 418(a)(3).190 Commenters did not address the amendments to rule 418, which we proposed to implement the BDC Act and to provide parity for registered CEFs consistent with the Registered CEF Act.191 Consistent with the proposal, affected funds that are eligible to file a short-form registration statement on Form N–2 will not be required to furnish, on request, recent engineering, management, or similar reports or memoranda relating to broad aspects of the business, operations, or products of the registrant under amended rule 418(a)(3).192
Amendments to Incorporation by
Reference Into Proxy Statements We are adopting amendments to
Schedule 14A under the Exchange Act
as proposed, consistent with the BDC Act and the Registered CEF Act.193 We did not receive comments on the proposed amendments to Schedule 14A. The amendments will allow affected funds that meet the requirements of the short-form registration instruction in Form N–2, as further described in Note E to Schedule 14A, to incorporate certain information by reference to previously-filed documents for proxy statements containing specific proposals under Item 13 of Schedule 14A.194 The amendments allow eligible funds to incorporate by reference certain required information for relevant proxy proposals to the same extent that operating companies meeting the requirements of Form S–3 (as defined in Note E to Schedule 14A) may use incorporation by reference under the same circumstances.195
Rule 103 of Regulation FD
We are adopting amendments to rule 103(a) of Regulation FD, as proposed, to provide that an affected fund’s failure to make a public disclosure required solely by rule 100 of Regulation FD will not affect the fund’s eligibility under the short-form registration instruction of Form N–2.196 We did not receive comments on the proposed amendments to rule 103(a). The final amendments to rule 103(a) will enhance parity between affected funds and operating companies, consistent with the BDC Act and the Registered CEF Act, as rule 103(a) already provides that an operating company’s failure to make a public disclosure required solely by rule 100 of Regulation FD will not affect its eligibility to use Form S–3.197 H. New Registration Fee Payment Method for Interval Funds and Issuers of Certain Exchange-Traded Products We are adopting a modernized approach to registration fee payment that will require interval funds to pay securities registration fees using the same method that mutual funds and ETFs use today.198 Specifically, for interval funds, the final rule will provide that such funds register an indefinite amount of securities upon their registration statements’ effectiveness.199 Like mutual funds and ETFs, interval funds will be required to

200See section 24(f)(2) of the Investment Company Act [15 U.S.C. 80a–24(f)(2)]. Specifically, mutual funds and ETFs currently are required to pay fees on a net basis, based upon the sales price for securities sold during the fiscal year and reduced based on the price of shares redeemed or repurchased that year. 201 17 CFR 274.24. 202Proposing Release, supra footnote 10, at
section II.G (discussing how and why interval funds
are currently not permitted to pay registration fees on an annual net basis). 203 ICI Comment Letter; Invesco Comment Letter. No commenter expressed opposition to the proposed provision. 204ABA Comment Letter; ICI Comment Letter. 205 ICI Comment Letter. 206ABA Comment Letter. 207 GraniteShares Comment Letter; Invesco Comment Letter; ProShares Comment Letter; Comment Letter of State Street Global Advisors (June 21, 2019) (‘‘SSGA Comment Letter’’); USCF Comment Letter; WGC Comment Letter; Comment Letter of Morgan, Lewis & Bockius LLP (Jan. 15, 2020). 208 Invesco Comment Letter (stating that the provision would assist ETPs); ProShares Comment Letter (same); SSGA Comment Letter (same); GraniteShares Comment Letter (stating that the provision would assist ETPs, and would eliminate a competitive difference between ETPs and mutual funds); USCF Comment Letter (stating that the provision would provide ETPs with cost savings and efficiencies that would benefit investors); WGC Comment Letter (same). One commenter noted that the securities of these ETPs are issued and redeemed in large blocks called ‘‘creation units’’ through either in-kind transactions with brokerage firms and institutional investors or on a cash basis when the ETPs invest in futures contracts and other investments that cannot be transferred in-kind. GraniteShares Comment Letter. 209USCF Comment Letter; SSGA Comment Letter; WGC Comment Letter. 210We believe that the scope of this definition properly limits the availability of this treatment to offerings of securities that share substantially similar attributes with those issued by ETFs, such as being listed on a national securities exchange and routine purchases and redemptions of the securities in ‘‘creation units’’ at NAV. The reference to ‘‘ratable share’’ in the definition encompasses repurchases or redemptions of securities that occur at NAV on an in-kind basis or cash basis. 211We are amending a number of Securities Act registration statement forms (Forms S–1, S–3, F–1 and F–3) to provide that an issuer may elect to register an indeterminate amount of exchangetraded vehicle securities on these registration statement forms. 212Rule 424(i) also includes certain disclosure requirements modeled after Form 24F–2. 213For example, regulatory parity could mitigate any competitive disparities between affected funds and other issuers. It also could help investors in affected funds by providing them investor protections that are currently provided to investors in similarly-situated issuers. See, e.g., infra discussion in paragraphs accompanying footnotes 284–289. pay registration fees based on their net issuance of shares, no later than 90 days after the funds’ fiscal year ends.200 These issuers will be required to file information about the computation of this registration fee and other information on Form 24F–2 under the Investment Company Act when paying the fee.201 In response to comments that we received, we also are extending similar
treatment to certain ETPs that are not registered under the Investment Company Act. We proposed to amend rules 23c–3 and 24f–2 so that interval funds would pay registration fees on this same annual net basis.202 The commenters who addressed this aspect of the proposal supported it.203 Two commenters suggested expanding the scope of this aspect of our proposal to include additional types of issuers.204 One commenter recommended extending the scope of the provision to ‘‘all other funds’’ to confer the same benefits to those additional funds, such as eliminating the need to predict the number of shares the fund expects to sell.205 Another commenter suggested extending the scope to ‘‘tender offer funds’’—those that make repurchase offers but that are not, like interval funds, required to periodically repurchase shares or to have a fundamental policy regarding its repurchase offers that can be changed only by a shareholder vote.206 We are adopting this provision as proposed. Of the categories of investment companies contemplated by commenters, only interval funds routinely repurchase shares at NAV and are required to periodically offer to repurchase their shares, making these funds more like mutual funds and ETFs, which are required to use this method. In response to a request for comment in the Proposing Release, a number of commenters also recommended that certain ETPs that are not registered under the Investment Company Act be permitted to register offerings of an indefinite number of securities and pay registration fees in a manner equivalent to that under rule 24f–2.207 These commenters stated that these ETPs operate in a manner substantially similar to that of ETFs and would similarly benefit from paying registration fees on an annual net basis and from registering offerings of an indefinite number of securities.208 Some of these commenters also noted that the attributes cited in the Proposing Release for extending the ability to pay registration fees on an annual net basis to interval funds (routine repurchases of shares at NAV and avoiding the possibility that an interval fund would inadvertently sell more shares than it had registered) would also apply to these ETPs.209 After considering these comments, we have determined to adopt amendments to enable certain ETPs that are not registered under the Investment Company Act to elect to register an offering of an indeterminate number of securities and to pay registration fees for such an offering in a manner equivalent to that for mutual funds and ETFs (i.e., in arrears on an annual net basis). In view of the concerns raised by commenters as well as the similarities between these ETPs and ETFs, we agree that it is appropriate to extend the availability of this treatment to these ETPs under the Securities Act. Accordingly, issuers that offer exchange-traded vehicle securities, as the term will now be defined in amended rule 405,210 will be eligible under new Securities Act rule 456(d) to elect to
register an offering of an indeterminate amount of exchangetraded vehicle securities and pay registration fees for such an offering on an annual net basis no later than 90 days after the end of the fiscal year when making this election. We are also adopting Securities Act rule 457(u), which sets forth the calculation method for paying registration fees in this manner and is consistent with the fee calculation provisions of Form 24F–
2.211 Finally, we are adopting rule 424(i)
pursuant to which issuers that elect to register an offering of an indeterminate amount of securities pursuant to rule 456(d) will be required to file a prospectus supplement when paying registration fees on an annual net basis.212
I. Disclosure and Reporting Parity
Proposals
We are adopting amendments to our rules and forms, substantially as proposed, intended to tailor the disclosure and regulatory framework for affected funds in light of our amendments to the offering rules. Many of these amendments are not required by the BDC Act or the Registered CEF Act, but we believe are consistent with the respective Acts’ requirements to increase regulatory parity of affected funds with otherwise similarly-situated issuers.213 As discussed in detail below, these amendments include structured data requirements; new annual reporting requirements; amendments to provide all affected funds additional flexibility to incorporate information by reference; and enhancements to the disclosures that registered CEFs make to investors when the funds are not updating their registration statements.

Structured Data Requirements
We are adopting, substantially as proposed, certain new structured data reporting requirements for registered CEFs and BDCs. In particular, and as discussed in detail below, we are requiring:

214Compare 17 CFR 229.601(b)(101)(i) (amended Item 601(b)(101)(i) of Regulation S–K) (excluding registered investment companies from rule 601’s tagging requirements) with current Item 601(b)(101)(i) of Regulation S–K (excluding all registrants that prepare financial statements in accordance with 17 CFR 210.6–01 through 210.6– 10 (Article 6 of Regulation S–X); see also amended rule 405(b)(3)(i) of Regulation S–T (requiring a BDC to tag its financial statements). We also are making conforming amendments to Items 601(b)(101)(ii)(A) and (iii) of Regulation S–K to clarify the exclusion of registered investment companies from rule 601’s tagging requirements. 215Proposing Release, supra footnote 10, at
section II.H.1.a.
216 Id. We also observed that having this information in a structured data format would enhance our staff’s ability to review and analyze BDCs’ financial statements. 217 Id. (summarizing the structured data reporting requirements for operating companies and registered investment companies). 218Calcbench Comment Letter; Comment Letter of IRIS Business Services Ltd. (June 10, 2019) (‘‘IRIS Comment Letter’’); Comment Letter of XBRL US (June 10, 2019) (‘‘XBRL US Comment Letter’’). 219Calcbench Comment Letter; XBRL US Comment Letter. 220 XBRL US Comment Letter. 221Calcbench Comment Letter. 222 IRIS Comment Letter; XBRL US Comment Letter. 223 IRIS Comment Letter. 224 IRIS Comment Letter. The commenter also stated that it is appropriate to subject BDCs to the same format as operating companies—compared to requiring BDCs to report on Forms N–PORT and N– CEN—because the format of their financial statements is similar to that of operating companies. Id. Another commenter observed that the same applications used to prepare XBRL for operating companies could be leveraged for BDCs, increasing economies of scale. XBRL US Comment Letter. 225 IRIS Comment Letter; XBRL US Comment Letter. Based on our staff’s review of BDCs’ disclosures and assessment of the XBRL taxonomies’ development since they were first adopted in 2009, the Commission stated its belief that relevant XBRL taxonomies were sufficiently well developed for financial statement reporting by BDCs. Proposing Release, supra footnote 10, at
section II.H.1.a. One commenter observed that BDC
financial statement line items were already captured in the US GAAP Taxonomy and that a new custom schema would be an unnecessary cost for the Commission and the marketplace. XBRL US Comment Letter. Another commenter stated, however, that it would expect a greater use of nonstandard reporting elements than for average operating companies. IRIS Comment Letter. We continue to believe that the relevant XBRL taxonomies are sufficiently well developed for use by BDCs, even if BDCs use non-standard elements more than the average operating company. 226See supra footnote 214. 227See new General Instruction I.1 of amended Form N–2; new rule 405(b)(3)(ii) of amended Regulation S–T. We also are making certain conforming revisions to proposed General Instruction H (Interactive Data Files), which we renumbered as General Instruction I of amended Form N–2. In addition, and as a result, we renumbered General Instruction I of current Form N–2 (Registration of Additional Securities) as General Instruction J of amended Form N–2. 228See 17 CFR 232.406 [rule 406 of Regulation S– T]; FAST Act Modernization Adopting Release, supra footnote 66, at 12674. 229Proposing Release, supra footnote 10, at
section II.H.1.b. The Commission noted that this
requirement would enhance investors’ ability to better identify, count, sort, aggregate, compare, and analyze registrants and disclosures to the extent these data points otherwise would be formatted only in HTML. 230 IRIS Comment Letter; XBRL US Comment Letter. 231 IRIS Comment Letter; XBRL US Comment Letter; see also supra footnotes 222–224 and accompanying text. 232 XBRL US Comment Letter (stating that multiple data standards would cause confusion in the marketplace and unnecessary costs throughout the reporting supply chain and that a custom

BDCs, like operating companies, to
submit financial statement information using Inline XBRL format;
registered CEFs and BDCs to
include structured cover page information in their registration statements on Form N–2 using Inline XBRL format;
certain information required in an
affected fund’s prospectus to be tagged using Inline XBRL format; and
filings on Form 24F–2 to be
submitted in eXtensible Markup Language (‘‘XML’’) format. a. Inline XBRL Requirements for Financial Statements and Notes to Financial Statements We are adopting, as proposed, an amendment to 17 CFR 229.601 (Item 601 of Regulation S–K) to subject BDCs to the Inline XBRL financial statement tagging requirements that apply to operating companies, by removing the exclusion for BDCs from the Inline XBRL financial statement tagging requirements.214 We continue to believe that reporting in a structured data format makes financial information easier for investors to analyze and helps automate regulatory filings and business information processing.215 We also believe that BDC investors and other market participants would benefit from the availability of relevant information in a structured data format.216 These requirements will reduce the current disparity between the accessibility of financial information BDCs provide to the market and the accessibility of substantially similar financial information that operating companies provide to the market.217 The commenters who addressed this proposed requirement supported it.218 Some of these commenters stated that structured financial statement data would be more useful to investors than information in only a HyperText Markup Language (‘‘HTML’’) or plain text format.219 One of these commenters stated that more structured financial statement reporting would improve the clarity and transparency of reported information by using consistent, agreedupon definitions, and would yield information that is less expensive to process and more timely than unstructured data.220 Another commenter stated that eliminating the delay for data users to obtain information once it is public makes capital markets more efficient.221 Two commenters supported the use of the Inline XBRL format specifically.222 One of these commenters noted that, because Inline XBRL is both machinereadable and human-readable, it will help investors in BDCs quickly access structured data just as investors in operating companies can.223 This commenter also highlighted potential benefits of the format for issuers, stating that data in Inline XBRL format is easier to review than, for example, the same data in separate XBRL and HTML formats.224 Some commenters also stated that the currently available XBRL taxonomies will be sufficient for BDCs.225 After considering public comments received, and because we continue to believe that investors will benefit from the availability of relevant information in a structured data format, we are adopting this requirement as proposed.226 b. New Check Boxes and Structured Data Format for Form N–2 Cover Page Information We are adopting, as proposed, a requirement that all affected funds tag all of the data points that appear on the cover page of Form N–2, except the Calculation of Registration Fee table, using Inline XBRL format.227 These cover page data points will include, for example, the company name, the Act or Acts to
which the registration statement relates, and check boxes relating to the effectiveness of the registration statement. We currently require operating companies to tag all of the data points on the cover page of Form 10–K, Form 10–Q, Form 8–K, Form 20– F, and Form 40–F using Inline XBRL format.228 The Commission generally proposed to extend this requirement to mandatory tagging of the data points on the cover page of Form N–2 because it believed it would allow investors, other market participants, and other data users to automate their use of this information.229 The commenters who addressed the proposed requirement supported it.230 As above, two commenters supported the proposed Inline XBRL format, stating that it would provide benefits for investors, regulators, and issuers.231 One commenter specifically supported requiring the Inline XBRL format over allowing reporting entities to choose from more than one data standard or developing a custom schema for the required information.232 After

schema would require the development of new tools to create and to extract and analyze the data). 233See Proposing Release, supra footnote 10, at
section II.H.1.b.
234See XBRL US Comment Letter.
235See Filing Fee Disclosure and Payment Methods Modernization, Investment Company Act Release No. 33676 (Oct. 24, 2019) [84 FR 71580 (Dec. 27, 2019)]. 236See cover page of amended Form N–2. For purposes of 17 CFR 230.401(g) (Securities Act rule 401(g)), an affected fund that checks a box on Form N–2 to indicate that it is relying on the short-form registration instruction or that it is a WKSI filing an automatic shelf registration statement will be deemed to have filed the relevant registration statement or post-effective amendment properly under the applicable provisions of Form N–2 unless the Commission objects in the manner set forth in rule 401(g). See 17 CFR 230.401(g). 237Proposing Release, supra footnote 10, at
section II.G.1.b. (discussing proposed check box
requirements on Form N–2 cover page). In a conforming change, we are also including a check box that is substantively identical to a parallel check box on Form S–3 for emerging growth companies that have elected not to use an extended transition period for complying with new or revised accounting standards. See cover page of amended Form N–2. 238Commenters recommended that the Commission clarify that the check box indicating that the only securities being registered are being offered pursuant to dividend or interest reinvestment plans is not intended to affect the ability of affected funds to rely on ‘‘Guide 5. Dividend Reinvestment Plans’’ to Form N–2. See Dechert Comment Letter; IPA Comment Letter. The new check box will not affect that ability. 239See supra footnote 227. 240See new General Instruction I.2 of amended Form N–2. 241See new General Instruction I.3 of amended Form N–2. 242See new General Instructions I.2 and I.3 of amended Form N–2; see also Items 3.1, 4.3, 8.2.b, 8.2.d, 8.3.a, 8.3.b, 8.5.b, 8.5.c, 8.5.e, 10.1.a–d, 10.2.a–c, 10.2.e, 10.3, and 10.5 of amended Form N–2. This information largely parallels similar information contained in the Form N–1A risk/ return summary. See Item 2 (Risk/Return Summary:
Investment Objectives/Goals), Item 3 (Risk/Return Summary: Fee Table), and Item 4 (Risk/Return Summary: Investments, Risks and Performance) of Form N–1A. 243See generally Proposing Release, supra footnote 10, at section II.H.1.b. 244 IRIS Comment Letter; XBRL US Comment Letter. 245 Id. One commenter also supported the proposed scope of the new requirement—all affected funds—stating that if some issuers are excluded, it would result in higher costs for preparer and users of data. XBRL US Comment Letter. One commenter offered support for the proposed Inline XBRL format, stating that it would provide benefits to investors, regulators, and issuers. IRIS Comment Letter; see also supra footnotes 222–224 and accompanying text. 246 XBRL US Comment Letter. considering public comments received, and because we continue to believe that it would allow investors, other market participants, and other data users to automate their use of this information, we are adopting this requirement as proposed. The Commission did not propose to require affected funds to tag the table on the form’s cover page that includes information about calculation of the fund’s registration fee under the Securities Act.233 One commenter recommended that the Commission require tagging of such registration fee information, stating that these are valuable data elements and that extending the requirement to fee information would not increase the burden of tagging on issuers.234 The Commission recently proposed such amendments to Form N–2 as part of a larger proposal to modernize the filing fee disclosure and payment methods for most of the Commission’s fee-bearing forms, statements, and related rules.235 As a result, we believe that the filing fee disclosure and payment modernization rulemaking is a more appropriate vehicle for considering whether the fee calculation information on Form N–2 should be tagged. In addition, we are amending Form N–2 to add new check boxes to its cover
page, as proposed.236 We proposed
several new check boxes to allow investors, Commission staff, and others to more readily identify types of issuers and securities.237 We continue to believe that this check box information will allow investors, Commission staff, and others to more readily identify types of issuers and securities, and so are adopting this provision as proposed.238 These check boxes will be among the data points required to be tagged using Inline XBRL format.239
c. Tagging of Prospectus Disclosure
Items
We are adopting, as proposed, a requirement that all affected funds tag certain information that is required to be included in an affected fund’s prospectus using Inline XBRL format. All affected funds will be required to submit certain information in registration statements or post-effective amendments filed on Form N–2 and certain forms of prospectuses filed pursuant to rule 424 under the Securities Act to the Commission using Inline XBRL.240 A seasoned fund filing a short-form registration statement on Form N–2 also will be required to tag information appearing in Exchange Act reports—such as those on Form N–CSR, 10–K, 10–Q, or 8–K—if that information is required to be tagged in the fund’s prospectus.241 We will require affected funds to tag the following prospectus disclosure items using Inline XBRL format: Fee
Table; Senior Securities Table;
Investment Objectives and Policies; Risk Factors; Share Price Data; and Capital Stock, Long-Term Debt, and Other Securities.242 We continue to believe that these items are of greatest utility for investors and other data users that seek structured data to analyze and compare funds, as they provide important information about a fund’s key features, costs, and risks.243 We believe tagging the Fee Table, which provides detailed information about the fund’s costs, could facilitate analysis of fund costs and allow investors and other data users to compare the costs of a particular affected fund to the costs of other funds or other investment products, such as mutual funds. The Senior Securities
Table requires registrants to include
information about each class of senior securities, including bank loans. Tagging this information will facilitate analyses of outstanding senior securities that may bear on the likelihood, frequency, and size of distributions from the fund to its investors. Tagging Investment Objectives and Policies, which provides information about the fund’s principal portfolio emphasis, will help an investor determine the degree to which a fund’s objectives and policies align with the investor’s preferences. Risk Factors describes risks associated with an investment in the fund. Tagging Risk Factors will facilitate the aggregation, analysis, and comparison by investors and other data users of information about a fund’s risks alongside the fund’s features and benefits. Tagging Share Price Information is important because the presence of a premium or discount may bear on the likelihood, frequency, and size of distributions from the fund to its investors, which we believe may be of particular importance to many affected fund investors. Tagging Capital Stock, Long-Term Debt, and Other Securities better informs common shareholders how their rights, expenses, and risks are affected when the fund issues other types or classes of securities. We also continue to believe that these items are best suited to being tagged in a structured format. The commenters who addressed the proposed requirement supported it.244 These commenters stated that the tagged data would be useful, including both numeric and narrative information.245 In addition, one commenter asserted that the Commission should require tagging all financial data that is required to be reported.246 We believe that this rule is appropriately focused on the key items that are most suitable for tagging and of greatest utility for investors. Because we continue to believe that structuring these data elements will allow investors, other market participants, and other data users to automate their use of this information,

247See new General Instructions I.2 and I.3 of amended Form N–2; new rule 405(b)(3)(iii) of amended Regulation S–T. We also are making conforming amendments to rule 601(b)(101)(i)(C) of Regulation S–K, rule 11 of Regulation S–T, and adding a new general instruction to Form N–CSR to implement the specified prospectus disclosure tagging requirements for affected funds. 248Taxonomies are available at https:// www.sec.gov/structureddata/dera_taxonomies. 249See rule 405(c)(1) of Regulation S–T. 250See Inline XBRL Filing of Tagged Data, Investment Company Act Release No. 33139 (June 28, 2018) (‘‘Inline XBRL Adopting Release’’). 251The term ‘‘Interactive Data File’’ is defined to mean ‘‘the machine-readable computer code that presents information in [XBRL] electronic format pursuant to [rule 405 of Regulation S–T] and as specified by the EDGAR Filer Manual.’’ See rule 11 of Regulation S–T. The EDGAR Filer Manual sets forth the technical formatting requirements for the presentation and submission of electronic filings through the EDGAR system. 252New General Instruction I.2 of amended Form N–2; cf. General Instruction C.3.(g)(i)(B) of Form N– 1A. 253New General Instruction I.2 of amended Form N–2; cf. General Instruction C.3.(g)(ii) of Form N– 1A. 254New General Instruction I.3 of amended Form N–2. 255Proposing Release, supra footnote 10, at
section II.H.1.c.
256See General Instruction A.3 to amended Form 24F–2 (requiring reports on Form 24F–2 to be submitted in electronic format pursuant to the EDGAR Filer Manual and Appendices). We are expanding the group of issuers subject to filing on Form 24F–2 to include interval funds. See supra
section II.H. We also are making a technical
correction in Form 24F–2 to refer to the applicable paragraph of 17 CFR 232.101 (rule 101 of Regulation S–T). See General Instruction A.3 to amended Form 24F–2 (correcting ‘‘rule 101(a)(1)(i)’’ to ‘‘rule 101(a)(1)(iv)’’). In addition, we are amending Form 24F–2 to add a free text response field, and a requirement to provide the EDGAR series/class (contract) ID for each separately reported series/class (contract) to facilitate implementation of the new structured data format. See amended Form 24F–2. 257Proposing Release, supra footnote 10, at
section II.H.1.d.
258 IRIS Comment Letter; XBRL US Comment Letter. 259 IRIS Comment Letter. 260 IRIS Comment Letter. Additionally, two commenters recommended that the Commission require that reports on Forms N–CEN and N–PORT, which require reporting of information in a structured data format using a custom XML schema, be in XBRL or Inline XBRL format. See XBRL US Comment Letter; IRIS Comment Letter. The Commission considered requiring reporting in XBRL format in connection with its adoption of Forms N–CEN and N–PORT and determined that the relatively simple characteristics reported on those forms is more suited to XML than XBRL. See Investment Company Reporting Modernization, Investment Company Act Release No. 32314 (Oct. 13, 2016) [81 FR 81870, 81906–07 (Nov. 17, 2016)] (‘‘Investment Company Reporting Modernization Adopting Release’’). 261 XBRL US Comment Letter (stating that a custom XML schema will result in added costs for reporting entities and data consumers relative to XBRL). This commenter also suggested requiring the use of validation rules and linking custom extensions to improve data quality for reported financial information. XBRL US Comment Letter. While we encourage the use of appropriate tools to improve data quality, we believe that consideration of a requirement to use validation rules or use custom extension linking would best be taken up on a separate, holistic basis, for BDCs and operating companies alike, rather than in the context of this final rule. 262See Investment Company Reporting Modernization Adopting Release, supra footnote 260, at nn.449–50 and accompanying text. 263See id. 264See new General Instruction F.3.b of amended Form N–2. we are adopting this requirement as proposed.247 As with other new Commission XBRL taxonomies, staff will post for public review and feedback a draft Inline XBRL taxonomy for affected funds’ tagged prospectus disclosures.248 When available, affected funds will be required to use the most recent version of the Inline XBRL taxonomy for tagged prospectus disclosures, as specified by the EDGAR Filer Manual.249 As the Commission proposed, and as required of mutual funds and ETFs under the recently adopted Inline XBRL regime,250 we will require affected funds to submit ‘‘Interactive Data Files’’ (i.e., machine-readable computer code that presents information in XBRL format) 251 as follows:

For any registration statements and
post-effective amendments, Interactive Data Files must be filed either concurrently with the filing or in a subsequent amendment that is filed on or before the date that the registration statement or post-effective amendment that contains the related information becomes effective; 252
for any form of prospectus filed
pursuant to rule 424, Interactive Data Files must be submitted concurrently with the filing; 253 and
for any Exchange Act reports that a
seasoned fund filing a short-form registration statement on Form N–2 will have to tag, as discussed above, Interactive Data files must be submitted concurrently with the filing.254 We proposed this approach to facilitate timely availability and promote the comparability and utility of important information in a structured data format for investors, other market participants, and other data users, which we believed would yield substantial benefits.255 We did not receive comments on this aspect of the proposal. We continue to believe that this approach will yield the substantial benefits discussed above and therefore are adopting it as proposed. d. Structured Data Format for Form 24F–2 We will require submission of filings on Form 24F–2 in a structured XML format.256 We proposed this use of a structured data format, believing that it would make it easier for issuers to accurately prepare and submit the information required by Form 24F–2 and would make the submitted information more useful to Commission staff.257 The commenters who addressed the proposed requirement to structure Form 24F–2 supported it,258 with one commenter observing that the structured registration fee information could be useful in validating the submission.259 Commenters were mixed on the proposed custom XML format, with one commenter supporting the proposed XML format,260 and another recommending that the Commission use an XBRL format instead.261 Because Form 24F–2 is primarily used by Commission staff to validate registration fees paid by issuers and not for financial reporting purposes, we continue to believe that a custom XML schema will be an appropriate format for the required information. For example, while XBRL allows issuers to capture the rich complexity of financial information presented in accordance with GAAP, we believe that XML is more appropriate for the relatively simple characteristics of the fund’s fee information in reports on Form 24F–
2.262 In addition we continue to believe
that the XML format will improve the quality of information disclosed by providing a built-in validation framework of the data in the reports.263 We therefore will require reports on Form 24F–2 to be filed in a structured XML format, as proposed.

Periodic Reporting Requirements
We are also adopting new annual report requirements, as proposed. As we discussed in the Proposing Release, we expect several of the reforms we are adopting in this release, such as those relating to automatically effective shelf registration, forward incorporation by reference, and final prospectus delivery, will elevate the importance of periodic reporting relative to prospectus disclosure for affected funds. A seasoned fund filing a short-form registration statement on Form N–2 will be required to forward incorporate all periodic Exchange Act reports into its registration statement.264 This should result in periodic reports becoming a more salient, convenient, and comprehensive source of updated information about a particular seasoned fund, relative to that fund’s registration statement. As a result, these funds’ annual reports may take on greater prominence, with investors looking to the annual reports for key

265 In 2005, the Commission observed that recent enhancements to Exchange Act reporting enabled us to rely on those reports to a greater degree in adopting our rules to reform the securities offering process. Securities Offering Reform Adopting Release, supra footnote 5, at 44726. As the Commission did then, we believe that enhanced periodic reporting is an important corollary to reform of the offering process under the Securities Act. See id. 266Compare Securities Act rule 172 with 17 CFR 270.30e-1 (Investment Company Act rule 30e-1); see also supra section II.C. 267 In general, these requirements are expressed as a cross-reference to the specified registration statement requirements in Form N–2. See new Instructions 4.h.(1)–4.h.(3) to Item 24 of amended Form N–2 (referencing Items 4.3, 3.1, and 8.5 of amended Form N–2, respectively). 268Proposing Release, supra footnote 10, at
section II.H.2.
269See infra sections II.I.2.a–II.I.2.d. See new Instruction 4.g to Item 24 of amended Form N–2 (MDFP); deletion of Instruction 1 to Item 4 of current Form N–2 (BDC financial highlights); and new Instruction 4.h.(4) to Item 24.4.h(4) of amended Form N–2 (material unresolved staff comments). 270We are also, as proposed, amending Form N– 2 to apply certain of its requirements for annual reports to BDCs. See new Instruction 10 to Item 24 of amended Form N–2. 271See new Instructions 4.h.(1) (senior securities
table), 4.h.(2) (fee and expense table), and 4.h.(3)
(share price data) to Item 24 of amended Form N– 2. 272See Item 3.1 of amended Form N–2; see also new Instruction 4.h.(2) to Item 24 of amended Form N–2. 273See Enhanced Disclosure and New Prospectus Delivery Option for Registered Open-End Management Investment Companies, Investment Company Release No. 28064 (Nov. 21, 2007) [72 FR 67790, 67794 (Nov. 30, 2007)]. 274See id.; Enhanced Disclosure and New Prospectus Delivery Option for Registered OpenEnd Management Investment Companies, Investment Company Act Release No. 28584 (Jan. 13, 2009) [74 FR 4546, 4553 (Jan. 26, 2009)]; Request for Comment on Fund Retail Investor Experience and Disclosure, Investment Company Act Release No. 33113 (June 5, 2018) [83 FR 26891, 26901 (June 11, 2018)] (‘‘Investor Experience Request for Comment’’). 275See Item 8.5 of amended Form N–2; see also new Instruction 4.h.(3) to Item 24 of amended Form N–2 (share price data). 276See Item 4.3 of amended Form N–2; see also new Instruction 4.h.(1) to Item 24 of amended Form N–2. 277See Instruction 1 to Item 4.3 (applying Instruction 8 to Item 4.1 to Item 4.3) and Instruction 8 to Item 4.1 (requiring the information to be audited) of amended Form N–2. 278 ICI Comment Letter; Invesco Comment Letter. Two other commenters stated that they did ‘‘not object’’ to the proposed requirements. Dechert Comment Letter; IPA Comment Letter. Several commenters opposed related potential modifications addressed in the requests for comment within the Proposing Release that we are not adopting. Dechert Comment Letter (opposing expansion of proposed requirement to semi-annual reports; opposing expansion of requirement to ‘‘portfolio companies’’ table); IPA Comment Letter (same). One commenter recommended that the Commission continue to consider ways to enhance the fund retail investor experience, including the content of the annual report. ICI Comment Letter. The Commission staff is continuing to consider comment letters received in response to the Investor Experience Request for Comment. See supra footnote 274. 279Proposing Release, supra footnote 10, at
section II.H.2.a.
280One commenter recommended that we add an instruction to Form N–2 to ‘‘clarify’’ that the schedules required by 17 CFR 210.12–12 (rule 12– 12 of Regulation S–X) satisfy the Portfolio Companies table requirement in Item 8.6.a of Form N–2. See Dechert Comment Letter. We are not making this change because the two provisions do not require the same information. Disclosure satisfying the requirements of rule 12–12 of Regulation S–X would not always satisfy the requirements of Item 8.6.a. For example, Item 8.6.a of Form N–2 requires certain information about each portfolio company, such as the percentage of each class owned by the issuer, the issuer’s relationship with the portfolio company, and the address of the portfolio company. Regulation S–X requires no such disclosures. information.265 Registered CEFs’ shareholder reports may also take on greater prominence for investors because, under the final rule, affected funds will not be required to deliver final prospectuses but will still be required to deliver shareholder reports at least semi-annually.266 Accordingly, as proposed, we are requiring seasoned funds that register using the proposed short-form registration instruction to include key information in their annual reports regarding fees and expenses, premiums and discounts, and outstanding senior securities that the funds currently disclose in their prospectuses.267 Because the annual report will be incorporated by reference into the fund’s prospectus, requiring disclosure in both the prospectus and annual report should not require duplicative disclosure. Moreover, specifying identical disclosure requirements in both places may facilitate forward incorporation by reference, by making clear that the same required disclosure will satisfy both requirements. We continue to believe that investors should have no less current information than they do today about these items when the fund is offering its shares.268 Finally, we are requiring, as proposed, registered CEFs to provide management’s discussion of fund performance (or ‘‘MDFP’’) in their annual reports to shareholders, BDCs to provide financial highlights in their registration statements and annual reports, and affected funds filing a short-form registration statement on Form N–2 to disclose material unresolved staff comments.269 These provisions are intended to modernize and harmonize our periodic report disclosure requirements for affected funds with those applicable to operating companies and mutual funds and ETFs.270 a. Fee and Expense Table, Share Price Data, and Senior Securities Table We are adopting a requirement, as proposed, that funds filing a short-form registration statement on Form N–2 include key information in their annual reports that they disclose in their prospectuses in light of the importance of this information and the increased prominence of shareholder reports under our final rule. Specifically, we will require that these funds include the following information in
their annual reports: 271

Fee and Expense Table: Form N–2
requires registrants to include information about the costs and expenses that the investor will bear directly or indirectly, using specified captions and a specified tabular format.272 This table is designed to help investors understand the costs of investing in an affected fund and to compare those costs with the costs of other affected funds.273 The Commission has previously noted the importance of costs to an investment decision and, in the case of registered open-end funds, has specified the location of the fee table to enhance the prominence of the cost information.274
Share Price Data: Form N–2
requires registrants to include information about the share price of the registrant’s stock as well as information about any premium or discount that the share price reflects, compared to the registrant’s NAV.275 The presence of a premium or discount may bear on the likelihood, frequency, and size of distributions from the fund to its investors, which we believe may be of particular importance to many affected fund investors.
Senior Securities Table: Form N–2
requires registrants to include information about each of its classes of senior securities, including bank loans.276 As with a premium or discount, any outstanding senior securities may bear on the likelihood, frequency, and size of distributions from the fund to its investors. A registrant must disclose information about its senior securities for the most recent ten years, the last five years of which must be audited.277 The commenters that addressed these proposed requirements related to the Fee and Expense Table, Share Price Data, and Senior Securities Table supported them.278 Because we continue to believe in the importance of this information and the increased prominence of shareholder reports under our final rule,279 we are adopting this aspect of the proposal as proposed.280 With respect to the Senior Securities
Table, two commenters requested that
we revise the instruction to Form N–2

281 Dechert Comment Letter (‘‘[W]e believe that the SEC should revise the instructions to Item 4.3 of Form N–2 to state that an Affected Fund need only audit the information in the senior securities
table for the same periods as contained in the
audited balance sheet included in the fund’s annual report.’’); IPA Comment Letter. 282See Instruction 1 to Item 4.3 of Form N–2 (applying Instruction 3 to Item 4.1 to the Senior Securities Table). 283New Instruction 4.g to Item 24 of amended Form N–2. 284 Item 27(b)(7) of Form N–1A. This requirement applies to registered open-end management investment companies other than money market funds. 285Shareholder Reports and Quarterly Portfolio Disclosure of Registered Management Investment Companies, Investment Company Act Release No. 26372 (Feb. 27, 2004) [69 FR 11243, 11254 (Mar. 9, 2004)] (‘‘Quarterly Portfolio Disclosure Adopting Release’’); see also Proposing Release, supra footnote 10, at section II.H.2.b (summarizing the history and purpose of the requirement). 286 Disclosure and Analysis of Mutual Fund Performance Information; Portfolio Manager Disclosure, Investment Company Act Release No. 17294 (Jan. 8, 1990) [55 FR 1460, 1462 (Jan. 16, 1990)]. 287Proposing Release, supra footnote 10, at
section II.H.2.b.
288ABA Comment Letter; ICI Comment Letter; Invesco Comment Letter; TIAA Comment Letter. One commenter stated that MDFP information can assist investors with understanding fund performance and market conditions over the reporting period from the fund manager’s perspective. ICI Comment Letter. In the Proposing Release, we asked whether, instead of requiring MDFP information for registered CEFs, we should require such funds to disclose MD&A information like BDCs and operating companies. Proposing Release, supra footnote 10, at section II.H.2.b. A few commenters expressly opposed this change to the proposed requirement compared with the MDFP requirement in Form N–1A. ABA Comment Letter; ICI Comment Letter; Invesco Comment Letter; TIAA Comment Letter. 289Proposing Release, supra footnote 10, at
section II.H.2.b.
290New Instruction 4.g to Item 24 of amended Form N–2. 291To effectuate this change, we are removing and reserving Instruction 1 to Item 4, and adding new Instruction 10 to Item 24 of amended Form N–
2. Currently, only registered CEFs are required to
include financial highlights in their registration statements, and annual reports to shareholders. See Instruction 1 to Item 4.1 (limiting the applicability of Item 4.1 in the case of BDCs), and Instruction 4.b (requiring the financial highlights required by Item
4.1 to be included in the annual report) to Item 24
of current Form N 2.
292 General Instruction 1 to Item 4.1 of current Form N–2. 293Registration Form for Closed-End Management Investment Companies, Investment Company Act Release No. 19115 (Nov. 20, 1992) [57 FR 56826, 56829 (Dec. 1, 1992)]. 294Registration Form for Closed-End Management Investment Companies, Investment Company Act Release No. 17091 (July 28, 1989) [54 FR 32993, 32997 (Aug. 11, 1989)]. 295See Proposing Release, supra footnote 10, at
section II.H.2.c.
296See Instruction 1 to Item 4.1 of amended Form N–2 (removed and reserved); new Instruction 10 to Item 24 of amended Form N–2. In addition, we are adopting, as proposed, a conforming change to the financial highlights requirements to eliminate the current requirement that registered CEFs specify the average commission rate paid. See Item 4.1 of amended Form N–2 (removing Instructions 18–19 from Item 4.1). Although this information is currently required for registered CEFs, the Commission previously eliminated a similar requirement from Item 13(a) of Form N–1A for open-end funds registered on Form N–1A. Item 4.1.l of Form N–2; Instructions 18–19 to Item 4.1 of Form N–2; Item 13(a) of Form N–1A; See Registration Form Used by Open-End Management Investment Companies, Investment Company Act Release No. 23064 (Mar. 13, 1998) [63 FR 13916, 13936 (Mar. 23, 1998)]. The Commission reached this determination after receiving and considering public comment arguing that these rates are technical information that typical investors are unable to understand. Id. We continue to believe that the same considerations supporting elimination of this requirement from Form N–1A also apply to registered CEFs. as it relates to affected funds to reduce the audit requirement from the last fiveyears (in the registration statement) to the same periods as contained in the audited balance sheet presented in the annual report.281 However, such a change would alter the periods presented for the Senior Securities
Table, which match the periods
presented in the Financial Highlights.282 Given the importance of asset coverage and the comparability of information contained in both the Financial Highlights and the Senior Securities
Table, we do not believe such a change
is appropriate. Additionally, because the annual report will be incorporated by reference into the fund’s prospectus, filing the audited senior securities table in the annual report will not result in duplicative disclosure. For this reason, we have determined not to amend the requirements in the manner suggested by the commenters. b. Management’s Discussion of Fund Performance We are also adopting, as proposed, an amendment to Form N–2 that will extend the MDFP disclosure requirements to all registered CEFs.283 Currently, mutual funds and ETFs are required to include MDFP in their annual reports to shareholders.284 MDFP disclosure aids investors in assessing a fund’s performance over the prior year and complements other backward looking information required in the annual report, such as financial statements.285 This required disclosure is grounded conceptually in the disclosure requirement for operating companies (as well as BDCs) to include a narrative discussion of the financial statements of the company— ‘‘management discussion and analysis’’ or ‘‘MD&A’’—and to provide an opportunity to look at a company ‘‘through the eyes of management.’’ 286 We proposed to amend Form N–2 to extend the MDFP disclosure requirements to all registered CEFs.287 Specifically, we proposed to require that registered CEFs:

Discuss the factors that materially
affected their performance during the most recently completed fiscal year, including the relevant market conditions and the investment strategies and techniques used by the fund;
Provide a line graph comparing the
initial and subsequent account values at the end of each of the most recently completed ten fiscal years of the fund and a table of the fund’s total returns for the 1-, 5-, and 10-year periods as of the last day of the fund’s most recent fiscal year; and
Discuss the effect of any policy or
practice of maintaining a specified level of distributions to shareholders on the fund’s investment strategies and per share NAV during the last fiscal year, as well as the extent to which the registrant’s distribution policy resulted in distributions of capital. Commenters that addressed this aspect of the proposal supported it.288 Because we continue to believe that investors in these funds—like investors in mutual funds, ETFs, BDCs, and operating companies—would benefit from annual report disclosure that aids them in assessing the fund’s performance over the prior year and that complements other information in the report,289 we are adopting this requirement as proposed.290
c. Financial Highlights
We are amending Form N–2, as proposed, to require that a BDC, like other affected funds, include financial highlights disclosure summarizing its financial statements in its registration statement and annual report.291 Today, BDCs include their full financial statements in their prospectus, and we currently permit BDCs to omit financial highlights disclosure summarizing these financial statements.292 We understand, however, that it is generally market practice for BDCs to include financial highlights disclosure. This information is arranged to allow investors to trace the operating performance of a fund on a per share basis from the fund’s beginning NAV to its ending NAV so that investors may understand the sources of changes.293 It summarizes the financial statements.294 Commenters did not address this aspect of the proposal. Because we continue to believe that investors will benefit from required disclosure summarizing a BDC’s financial statements,295 we are adopting this change as proposed.296

297See new Instruction 4.h.(4) to Item 24 of amended Form N–2. Specifically, such funds will be required to disclose the substance of any unresolved written staff comments that the fund believes are material and that were received not less than 180 days before the end of the fiscal period to which the annual report relates. Id. 298See generally Proposing Release, supra footnote 10, at section II.H.2.d. 299 ICI Comment Letter; Invesco Comment Letter. One commenter opposed extending the proposed requirement to additional categories of issuers, including mutual funds and ETFs. ICI Comment Letter. 300 ICI Comment Letter. 301 ICI Comment Letter; Invesco Comment Letter. 302 ICI Comment Letter. 303 Invesco Comment Letter. 304Adopting this requirement does not prevent the Commission from also publishing staff comments or issuer responses, which may supplement this required disclosure. For example, publishing staff comments and issuer responses, which the staff currently disseminates using the EDGAR system, may also inform investors and the market about comments that are promptly resolved. See Press Release No. 2004–89; SEC Staff to Publicly Release Comment Letters and Responses (June 24, 2004) available at https://www.sec.gov/ news/press/2004-89.htm. 305Proposing Release, supra footnote 10, at
section II.H.2.d.
306New Instruction 4.h.(4) to Item 24 of amended Form N–2. 307See Proposing Release, supra footnote 10, at
section II.H.3.a. See also Securities Offering Reform
Adopting Release, supra footnote 5, at 44726 (describing the availability of ongoing information about a public issuer and its securities, including current information on Form 8–K, as an important component of the offering reforms the Commission adopted for operating companies) and 44730 (declining to make the benefits of being a reporting issuer, seasoned issuer, or WKSI available to voluntary filers and stating that ‘‘such issuers should be required to register under the Exchange Act, and thus become subject to all of the results of registration for all purposes, if they wish to avail themselves of’’ these benefits). 308BDCs will continue to be required to report on Form 8–K, as they do today. 309See ABA Comment Letter; ICI Comment Letter; and Invesco Comment Letter. d. Unresolved Staff Comments We are also adopting, as proposed, a requirement that affected funds filing a short-form registration statement disclose outstanding staff comments that remain unresolved for a substantial period of time and that the fund believes are material.297 As part of the Commission’s 2005 securities offering reforms for operating companies, the Commission adopted a similar provision for operating companies, recognizing that the new rules could eliminate some incentives issuers may have to timely resolve any staff comments on their Exchange Act reports.298 The Commission observed, in connection with this proposed requirement, that this rulemaking similarly may eliminate some incentives for certain affected funds to timely resolve staff comments. Two commenters recommended that the Commission not adopt this proposed requirement.299 One commenter stated that the proposed requirement would be inconsistent with Commission efforts to simplify disclosure and focus on key information important to investors.300 We believe, however, that, because the requirement only relates to comments that the issuer believes are material and because they will relate to information about which the issuer and the Commission staff disagree, the disclosure of the comments is likely to be information that is important to investors. This commenter also stated that the requirement would be at odds with recent statements about the nonbinding nature of staff guidance. However, the provision will not make the substance of statements by staff in their comments binding upon the public or the Commission. Rather, the Commission, by rule, will require affected funds to inform investors about their disagreements with the staff in connection with the staff’s review of disclosures. Two commenters expressed concern that differing views about whether a particular comment is ‘‘material’’ or ‘‘unresolved’’ could result in inconsistent disclosure among different funds in similar circumstances.301 We recognize that analysis of whether a particular written comment must be disclosed may involve some subjective judgment regarding specific facts and circumstances. Many disclosure requirements inherently involve
some subjective judgment and can result in some variance in the disclosure provided by different funds. These commenters also suggested some alternatives to the proposed requirement. For example, one commenter suggested that the Commission, rather than require disclosure of material unresolved staff comments, issue a stop order to prevent an offering from going forward if necessary.302 We believe that it is more appropriate to preserve an intermediate approach for the Commission, in appropriate circumstances, to allow an offering to proceed while informing investors and others about material disagreements between the issuer and the Commission’s staff, so that investors can make an informed judgment about the disagreement. Another commenter recommended, as an alternative, that the Commission publish its staff’s comments and issuer responses.303 We believe, however, that investors and other interested persons are more likely to see and read disclosure of material, unresolved staff comments if they appear in a fund’s annual report than comments and responses published separately.304 In addition, this requirement parallels the current requirement for operating companies that use the offering rules.305 These commenters, however, provide no basis for distinguishing affected funds from those operating companies that are already subject to the requirement. After considering comments received, and because we continue to believe that these disclosure requirements will provide an incentive for affected funds to timely resolve staff comments and that investors may value information about areas of disagreement that the issuer believes are material, we are adopting the requirement as proposed.306
3. Current Reporting Requirements for
Affected Funds
As discussed in the Proposing Release, operating companies and BDCs are required to promptly report certain events on Form 8–K, while registered CEFs generally are not required to report on Form 8–K. The Commission proposed to require registered CEFs to report information on Form 8–K to enhance parity with operating companies and BDCs, to improve information for investors and the market, and to recognize the role of Form 8–K reporting in the 2005 offering reform amendments.307 It also proposed to amend Form 8–K to: (1) Add two new reporting items for affected funds on material changes to investment objectives or policies and material write-downs of significant investments, and (2) adapt the existing reporting requirements and instructions to affected funds. As discussed in more detail below, in response to comments, we are not adopting the proposed Form 8–K amendments.308 However, we will continue to consider current reporting more generally as part of our ongoing review of the effectiveness of investment company disclosure. a. Form 8–K Reporting for Registered CEFs The Commission proposed to require registered CEFs that are reporting companies under section 13(a) or
section 15(d) of the Exchange Act to
report current information on Form 8– K. Commenters generally opposed a Form 8–K reporting requirement for registered CEFs.309 Commenters suggested that registered CEFs should not be subject to Form 8–K reporting requirements because the commenters believe that: (1) Existing registered CEF

310See ABA Comment Letter; ICI Comment Letter; and Invesco Comment Letter. 311See ABA Comment Letter (stating that the cost and administrative burden of Form 8–K reporting would outweigh the benefits discussed in the Proposing Release of establishing a uniform and centralized current reporting regime for registered CEFs); ICI Comment Letter (suggesting that registered CEFs already have a greater regulatory filing burden than operating companies because they report on Forms N–CEN, N–PORT, and N–PX); and Invesco Comment Letter. 312See ICI Comment Letter (suggesting there are reasons for registered CEFs to be subject to a different disclosure regime than operating companies, including that registered CEFs are highly regulated under the Investment Company Act). 313See ABA Comment Letter and ICI Comment Letter. But see White Comment Letter (stating that there should always be a current document where an investor can see a fund’s strategy, risks, performance, and costs each year and suggesting that investors should receive notices of any material changes on a more timely basis); Proposing Release, supra footnote 10, at n.323 (citing a similar comment letter the Commission received in response to the Investor Experience Request for Comment). 314See ABA Comment Letter; ICI Comment Letter; and Invesco Comment Letter. As discussed in the Proposing Release, listed registered CEFs may disclose certain information on Form 8–K to comply with exchange requirements for listed company disclosure, although there are other mechanisms they may use to disclose the information (e.g., press releases). See Proposing Release, supra footnote 10, at section II.H.3.a. Two commenters pointed to these requirements in support of their argument that existing disclosure is adequate. ABA Comment Letter and Invesco Comment Letter. 315See ABA Comment Letter (stating that Form 8–K is largely duplicative of information that listed registered CEFs disclose in press releases in accordance with exchange rules and that continuously-offered registered CEFs disclose in prospectus supplements or post-effective amendments under SEC rules). 316See Invesco Comment Letter and White Comment Letter. 317See Invesco Comment Letter. 318See ICI Comment Letter. 319See ABA Comment Letter. 320See White Comment Letter. 321See Proposing Release, supra footnote 10, at text following n.260; ABA Comment Letter (suggesting that, as a general matter, registered CEFs tend to have a simpler and more transparent business than operating companies (e.g., many listed registered CEFs publish their NAVs on a daily or weekly basis)); ICI Comment Letter (stating that, for example, disclosure about departures of fund officers on Form 8–K would not be meaningful for registered CEFs because fund officers generally are not actively involved in the day-to-day management of a fund’s portfolio). 322 In addition to the proposed amendments to Form 8–K, we also are not adopting the associated proposed amendments to 17 CFR
240.13a–11 and 240.15d–11 (Exchange Act rule 13a–11 and rule 15d–11) because the proposed amendments to those rules were only necessary to carry out the proposal to require registered CEFs to report on Form 8–K. 323See Investor Experience Request for Comment, supra footnote 274. See also supra footnote 313. 324Although registered CEFs are only required to file Form 8–K reports under Item 5.04 (Temporary Suspension of Trading Under Registrant’s Employee Benefit Plans), as applicable, other Form 8–K reports they file on a voluntary basis will be ‘‘filed pursuant to Section 13(a) or 15(d) of the Exchange Act’’ for purposes of the incorporation by reference instructions in Form N–2 that apply to funds that are eligible to file short-form registration statements. See General Instruction F.3 of amended Form N–2; Exchange Act rule 13a–11(b)(1) and rule 15d–11(b)(1). Information a registered CEF furnishes on a Form 8–K report will not be incorporated by reference into the fund’s registration statement under this instruction. This is consistent with the incorporation by reference regime for operating companies on Form S–3, where information voluntarily filed on Form 8–K (e.g., under Item 8.01 (Other Events)) is incorporated by reference into the company’s registration statement while furnished Form 8–K reports are not incorporated by reference. See also supra footnote 314 (discussing exchange rules requiring listed registered CEFs to timely disclose certain information to the public). 325See new General Instruction A.2 of amended Form N–2; General Instruction I.A.3 of Form S–3. disclosure is sufficient; 310 (2) Form 8– K reporting would be costly for registered CEFs; 311 (3) parity with operating companies and BDCs is unnecessary in the context of Form 8– K reporting; 312 and (4) investors, analysts, and regulators have not previously indicated that registered CEF disclosure is inadequate.313 With respect to existing disclosure practices, commenters stated that registered CEFs already provide material updates through other required or voluntary mechanisms (e.g., prospectus supplements, press releases, shareholder reports, voluntary Form 8– K filings, and website disclosure) that result in adequate and timely disclosure of information to investors.314 One commenter suggested that registered CEFs would be unlikely to provide meaningful new information under Form 8–K beyond what they already disclose under other regulatory requirements.315 Two commenters expressed concern that Form 8–K reporting may not timely inform investors about important fund events.316 One of these commenters suggested that fund investors are more likely to receive timely information through a registered CEF’s typical practice of issuing a press release about an important event, posting the press release to its website, and including information about the event in its next shareholder report.317 Although they opposed a new Form 8–K reporting requirement, a few commenters suggested
alternative approaches if we were to require registered CEFs to report on Form 8–K. One commenter suggested that, if the Commission requires registered CEFs to report on Form 8–K, we should require them to report only a subset of Form 8– K items.318 Another commenter suggested that, rather than require registered CEFs to report on Form 8–K, we could require listed registered CEFs to file press releases containing material information on Form 8–K, similar to how continuously-offered registered CEFs file prospectus supplements on EDGAR.319 Additionally, one commenter suggested that we require registered CEFs to more directly notify investors about material fund changes and stated that Form 8–K filings would not provide appropriate notice to a fund’s investors.320 As we recognized in the Proposing Release and as noted by commenters, there are differences between the types of events that are important to registered CEFs and the types of events that are important to operating companies.321 Moreover, for those Form 8–K events that would be relevant to registered CEFs, we recognize that these funds currently may disclose substantially similar information through other mechanisms, such as prospectus supplements, post-effective amendments, and press releases. We also are sensitive to commenters’ concerns about the burdens to registered CEFs associated with a new Form 8–K reporting requirement, particularly for those registered CEFs that will not qualify as WKSIs or be eligible to file short-form registration statements under the amendments we are adopting. As a result of these considerations, we are persuaded that a new Form 8–K reporting requirement for registered CEFs may not substantially improve the flow of important current information to investors and the market and, as a result, would not justify the additional burdens associated with Form 8–K reporting. Therefore, we are not adopting the proposed Form 8–K reporting requirements for registered CEFs.322 However, we will continue to consider whether more current reporting requirements that are tailored to registered CEFs, or to registered investment companies more generally, may be appropriate in connection with our continuing review of investment company disclosure effectiveness.323 Although registered CEFs generally will not be required to file reports on Form 8–K, a registered CEF that is eligible to file a short-form registration statement may voluntarily file information on Form 8–K to forward incorporate that information into its registration statement or for other purposes (e.g., to publicly disseminate information under exchange rules, as applicable).324 These voluntary Form 8– K filings will not affect a registered CEF’s ability to qualify as a seasoned fund. This is because the requirements to be current and timely with respect to the fund’s Exchange Act and Investment Company Act reports only apply to materials a fund is required to file.325

326See Proposing Release, supra footnote 10, at
section II.H.3.b. Since we are not adopting the
proposed items to Form 8–K, we also are not amending the safe harbor in Exchange Act rules 13a–11 and 15d–11 to include those items. See Proposing Release, supra footnote 10, at n.289. 327See ABA Comment Letter (suggesting that neither of the proposed items would provide additional important information); ACC Comment Letter (opposing the proposed material write-down item for BDCs in particular); CBD Comment Letter. 328See Investor Experience Request for Comment, supra footnote 274. 329See General Instruction F of amended Form N–2. 330See General Instruction F.3 of amended Form N–2 (requiring the material incorporated by reference to be provided with the prospectus and/ or the SAI to each person to whom the prospectus and/or the SAI is sent or given, unless the person holds securities of the fund and otherwise has received a copy of the material); see also Proposing Release, supra footnote 10, at text accompanying nn.309–311. 331We also are amending Form N–2’s current disclosure requirements for incorporation by reference, by replacing these current instructions with a new General Instruction F.4, which largely mirrors the disclosure requirements in Item 12(c) of Form S–3. The new instruction streamlines—but does not substantively change (other than the website disclosure provision discussed below)—the disclosure requirements for incorporation by reference in current Form N–2. 332New General Instruction F.4.a of amended Form N–2; cf. General Instruction VII.F of Form S– 1; General Instruction F.4.b.(5) of amended Form N–2; cf. Item 12(c)(1)(v) of Form S–1. We are amending current General Instruction F.3 in its entirety, and moving its requirement directing a fund to state in the prospectus and SAI that it will furnish, without charge, a copy of the incorporated materials on request, to new General Instruction F.4.b of amended Form N–2. We also are conforming certain incorporation by reference provisions in Form N–2 to mirror parallel provisions in Form N–1A. See new General Instruction F.2.a–c of amended Form N–2; cf. General Instruction D.1.(a)–(c) of Form N–1A. 333See Proposing Release, supra footnote 10, at nn.313–317 and accompanying text. 334See SIFMA Comment Letter. 335See amended Investment Company Act rule 8b–16. 336Current rule 8b–16(b) (requiring disclosure in the annual report of information that repeats or updates certain key prospectus disclosures, specifically: (1) Information about the fund’s dividend reinvestment plan; (2) material changes in the fund’s investment objectives or policies that have not been approved by shareholders; (3) any change concerning the fund’s control provisions that has not been approved by shareholders; (4) material changes in the principal risk factors associated with an investment in the fund; and (5) any portfolio manager changes). Except for information about the fund’s dividend reinvestment plan (which requires a complete description of the plan), the fund must only disclose changes that have occurred
during the year covered by the annual report. 337See Proposing Release, supra footnote 10, at n.323 and accompanying text. See also Investor Experience Request for Comment, supra footnote 274, in which we sought input from individual investors on how to enhance fund disclosures. 338See Proposing Release, supra footnote 10, at 136. 339 Id. 340See Peres Comment Letter (noting that ‘‘[i]f there is a change to an objective, strategy or risk in the past year, they describe the change in the annual report. However, there is no complete description of a fund’s current objectives, strategies and risks. To learn this information, an investor would need to look at the fund’s most recent registration statement (which could be from decades ago) and review each annual report since that time.’’). The Proposing Release requested comment on whether we should adopt different disclosure requirements for funds that rely on rule 8b–16, including whether we should require such funds to summarize in their annual reports certain key information that would be required in a current Continued b. Other Proposed Amendments to Form 8–K We are similarly not adopting the other proposed amendments to Form 8– K, including the two proposed reporting items regarding material changes to investment objectives or policies and material write-downs.326 Although the two proposed reporting items also would have applied to BDCs, we are not adopting these current reporting requirements for any affected funds. Commenters generally opposed these proposed reporting items and argued that existing disclosure is adequate.327 We will continue to consider the adequacy of affected fund disclosure, including the availability and timeliness of information about material changes in investment objectives or policies and material write-downs of significant investments, as part of our ongoing review of the effectiveness of investment company disclosure.328 Rather than establish new current reporting requirements for affected funds on a piecemeal basis in this release, we believe it is more appropriate to consider current reporting in connection with a broader, systematic review of investment company disclosure.
4. Online Availability of Information
Incorporated by Reference We are adopting, as proposed, amendments to Form N–2’s General Instruction for Incorporation by Reference.329 All registered CEFs and BDCs currently can backward incorporate their financial information from previously-filed Exchange Act reports into the prospectus or SAI. However, Form N–2 currently requires that a fund provide to new purchasers a copy of all previously-filed materials that the fund incorporated by reference into the prospectus and/or SAI.330 Under the amendments, and as proposed, we are removing the requirement that a fund deliver to new investors information that it has incorporated by reference into the prospectus or SAI.331 These amendments will allow the fund to make its prospectus, SAI, and the incorporated materials readily available and accessible on a website identified in the fund’s prospectus and SAI.332 Affected funds will also be required to provide incorporated materials upon request free of charge. We believe this approach will improve the online accessibility of the prospectus and SAI and any documents that are incorporated by reference for investors that wish to review such information online, and will facilitate the efficient use of incorporation by reference by affected funds.333 The only commenter who addressed this approach supported it,334 and we are adopting it as proposed.
5. Amendments to Certain Registered
CEFs’ Annual Report Disclosure We are adopting, largely as proposed, amendments to rule 8b–16(b) that are designed to allow investors in registered CEFs that rely on the rule to more easily identify and understand key information about their investments.335 Although rule 8b–16(a) generally requires registered investment companies to update their registration statements annually, rule 8b–16(b) currently allows registered CEFs to forgo an annual update provided that they disclose in their annual reports certain key changes that have occurred during the prior year.336 Disclosures that describe a specific change to a fund strategy or risk may not have sufficient context to allow investors to understand the effect of such change, potentially leaving shareholders to have to look at a series of documents—from the fund’s prospectus, which could be several years old, plus each subsequent annual report—to understand certain key information about the fund, such as its current investment strategy or principal risk factors.337 Accordingly, we proposed to require funds that rely on rule 8b–16(b) to describe any changes in enough detail to allow investors to understand each change and how it may affect the fund.338 For example, as stated in the Proposing Release, to the extent a fund’s principal investment objectives, investment policies or principal risks have changed, the fund should describe its objectives, policies or risks before and after the change.339 The one commenter to address this aspect of the proposal stated that a closed-end fund’s annual report should include a full description of the fund’s current objectives, strategies and risks, as many closed-end funds do not maintain a current registration statement, which would otherwise include this information.340 One

prospectus. See Proposing Release, supra footnote 10, at section II.H.5. 341See ABA Comment Letter (‘‘[M]any Affected Funds were organized many years ago, and since the relevant information may be spread among the prospectus used for the Affected Fund’s most recent public offering (which may have taken place years or even decades ago), proxy statements and reports to shareholders spanning many years, it can be a burdensome undertaking to piece such information together.’’); see also Dale White Comment Letter (‘‘There should always be a current document where an investor can see a fund’s strategy, risks, performance, and costs each year.’’). 342See paragraph (e) of amended Investment Company Act rule 8b–16. 343 Id. 344See amended rule 8b–16(b)(2), (4). 345See Updated Disclosure Requirements and Summary Prospectus for Variable Annuity and Variable Life Insurance Contracts, Investment Company Act Release No. 33814 (March 11, 2020) (‘‘Variable Contract Summary Prospectus Adopting Release’’). 346See supra section II.G. 347See ICI Comment Letter. 348To facilitate the transition to calculating fees on Form 24F–2, an interval fund’s fee calculation should exclude excess shares that were registered under the fund’s last registration statement on Form N–2 that remain unsold prior to the effectiveness of rule 24f–2 as applied to interval funds. 349See supra section II.H.2.b. 350See ICI Comment Letter (citing Inline XBRL Adopting Release, supra footnote 250, which requires open-end funds to comply with the Inline XBRL requirements on September 17, 2020 (24 months post-effective date) for ‘‘large fund groups’’ and September 17, 2021 (36 months post-effective date) for ‘‘small fund groups’’). 351 Id.; see also Variable Contract Summary Prospectus Adopting Release, supra footnote 345 (requiring variable contracts to comply with the Inline XBRL requirements on January 1, 2023 (30 months post-effective date)). commenter described difficulties faced by investors in determining an affected fund’s current investment objectives and policies, with another requesting a single location where such key information could be found.341 As proposed, we are requiring funds that rely on rule 8b–16(b) to describe certain key changes in enough detail to allow investors to understand each change and how it may affect the fund.342 We believe that in giving context for a change to one or more of the required disclosures, it is particularly effective for a fund to describe current information regarding related disclosures, as this approach may facilitate a more complete understanding of how a change to one aspect of the fund impacts the fund more broadly. Such disclosures must be prefaced with a legend clarifying that the disclosures provide only a summary of certain changes that have occurred in the past year, which may not reflect all of the changes that have occurred since the investor purchased the fund.343 In response to comments and in a change from the proposal, we also are
requiring any affected fund that relies on rule 8b–16(b) to describe the fund’s current investment objectives, investment policies, and principal risks in its annual report.344 These key disclosures must be provided, even if there were no changes in the past year. This will ensure that investors can access in a single location current information about key aspects of the fund in which they invest. We believe that funds could increase the effectiveness of this disclosure by presenting it concisely, in accordance with ‘‘plain English’’ principles for organization, wording, and design. We similarly encourage funds to tailor their disclosures to how the fund operates rather than rely on generic, standard disclosures about the fund’s investment policies and risks. Finally, we encourage funds to describe principal risks in order of importance, with most significant risks appearing first (i.e., not listing risks in alphabetical order). J. Effective and Compliance Dates Effective Dates. The final rule will become effective on August 1, 2020. While we proposed that the rule would become effective 60 days from publication in the Federal Register, we are establishing a fixed date so that the amendments to certain rules and forms adopted pursuant to the Variable Contract Summary Prospectus Adopting Release will be effective prior to the amendments to the same rules and forms adopted herein.345 The August 1, 2020 effective date will apply to all aspects of the final rule, except for the following:

Rules 23c–3, 24f–2, and Form 24F–
2. The amendments to rules 23c–3, 24f–
2, and Form 24F–2 346 will become effective August 1, 2021 (one year after other aspects of the final rule take effect, as proposed). One commenter suggested making the amendments to rules 23c–3 and 24f–2 immediately effective for new interval funds so they can pay registration fees based on the net issuance of shares sold during their initial fiscal year, and allow existing funds to use the new payment method as soon as possible thereafter.347 While we agree that interval funds should be able to calculate fees on Form 24F–2 as soon as possible, as proposed, the amendments to rules 23c–3 and 24f–2 will become effective one year after the final rule’s effective date to provide sufficient time to modify the Commission’s systems to accept such filings from interval funds.348
Rules 456 and 457 and Forms S–1,
S–3, F–1 and F–3: The amendments to rules 456 and 457 and Forms S–1, S–3, F–1 and F–3 under the Securities Act will become effective August 1, 2021. Compliance Dates. We are adopting compliance dates for certain new requirements to provide a transition period after the effective date of the final rule.
MDFP. As proposed, an annual
report filed by a registered CEF one year or more after the effective date of the final rule will be required to include the MDFP disclosures.349 We received no comments on this proposed compliance period. Affected funds must comply with this requirement by August 1, 2021.
Structured Data Requirements
(Financial Statement, Cover Page, and Prospectus Information). We proposed that all affected funds subject to the Inline XBRL structured data reporting requirements for financial statement, registration statement cover page, and prospectus information that are eligible to file a short-form registration statement would be required to comply with those provisions 18 months after the effective date, and all other affected funds to comply 24 months after the effective date. The one commenter who addressed this aspect of the release recommended that any new Inline XBRL requirements have a compliance date later than that required for openend funds.350 We are extending the compliance period by an additional six months to align more closely with the Inline XBRL compliance periods for other fund registrants.351 Accordingly, affected funds that are eligible to file a short-form registration statement will be required to comply with those provisions 24 months after the effective date, or August 1, 2022. All other affected funds subject to these requirements must comply 30 months after the effective date, or February 1,
2023. Affected funds will be permitted
to file in Inline XBRL prior to the compliance date once EDGAR has been modified to accept submissions in Inline XBRL for all forms subject to the amendments, which is anticipated to be March 2021. Notice of EDGAR system readiness to accept filings in Inline XBRL will be provided in a manner similar to notices of taxonomy updates and EDGAR Filer Manual updates.
Structured Data Requirements
(Form 24F–2). As proposed, all filers on Form 24F–2 (including existing Form 24F–2 filers, such as open-end funds and unit investment trusts, as well as interval funds) will be required to file reports on the form in an XML structured data format 18 months after the effective date, or February 1,

352See supra section II.H.1.d.
353See ICI Comment Letter.
354See supra section I for summary of final rule. 355The estimated number of BDCs includes BDCs that have not registered a securities offering on Form N–2. Certain of our amendments, such as the requirement to tag certain Form N–2 prospectus disclosure items in Inline XBRL, will only apply to affected funds that have filed a registration statement on Form N–2. As a result, our quantitative estimates of the costs and paperwork burdens of these amendments with respect to BDCs may be over-estimates in certain respects. 356The data (as of June 30, 2019) on prices and shares outstanding, which are used to calculate the public float, is taken from the Center for Research of Securities Prices (‘‘CRSP’’) database. CRSP data on shares outstanding includes all publicly held shares. 357The estimated number of registered CEFs includes registered CEFs that have not registered a securities offering under the Securities Act. Certain of our amendments, such as the structured data requirements, will apply somewhat differently to these registered CEFs and may impose fewer burdens on them. For example, a registration statement that is filed under only the Investment Company Act is not required to include financial highlights information under Item 4 of Form N–2, while registered CEFs that file a registration statement under the Securities Act must disclose financial highlights information and tag that information in Inline XBRL. See General Instructions G and H of amended Form N–2. Thus, our quantitative estimates of the costs and paperwork burdens of certain of the amendments with respect to registered CEFs may be overestimates in certain respects. 358The average of net assets of registered interval funds is $520 million. 359This includes the listed interval fund, which had public float of approximately $73 million as of Continued
2022.352 The one commenter who
addressed the proposed 18-month transition period supported it.353
III. Economic Analysis
We are adopting amendments to our rules designed to carry out the requirements of section 803 of the BDC Act and section 509 of the Registered CEF Act and tailor the disclosure and regulatory framework for affected funds in light of the amendments to the offering rules applicable to them. Currently, affected funds face regulatory impediments to capital formation as they are not able to use the flexible and less costly offering process that operating companies use when conducting registered securities offerings. This may hinder affected funds’ ability to raise capital, take advantage of favorable market conditions as operating companies do, and enjoy lower cost of capital and lower offering costs. Additionally, because of existing rules, affected funds generally are unable to communicate about an offering before a registration statement is filed, and their post-filing communications are subject to prospectus liability under section 12 of the Securities Act (or must be accompanied or preceded by the statutory prospectus). The final rule will provide incremental flexibility to funds in their communications, which may increase the flow of information to investors. As discussed in detail above, the final rule will affect numerous distinct aspects of how our securities offering and communications rules apply to affected funds.354 A. Introduction and Baseline We are sensitive to the economic effects that may result from the final rule, including the benefits, costs, and the effects on efficiency, competition, and capital formation. Section 3(f) of the Exchange Act, section 2(b) of the Securities Act, and section 2(c) of the Investment Company Act state that when engaging in rulemaking that requires us to consider or determine whether an action is necessary or appropriate in (or, with respect to the Investment Company Act, consistent with) the public interest, we must consider, in addition to the protection of investors, whether the action will promote efficiency, competition, and capital formation. Additionally, section 23(a)(2) of the Exchange Act requires us, when making rules or regulations under the Exchange Act, to consider, among other matters, the impact that any such rule or regulation would have on competition and states that the Commission shall not adopt any such rule or regulation which would impose a burden on competition that is not necessary or appropriate in furtherance of the Exchange Act. We have considered the potential costs and benefits that would result from the final rule, as well as the potential effects on efficiency, competition, and capital formation. Many of the potential economic effects of the final rule would stem from the statutory mandates, while others would stem from the discretion we are exercising. We discuss the potential economic effects of the amendments to implement the statutory mandates in sections III.B and III.C. We considered certain alternatives to our approach to implementing the statutory mandates, as
discussed in section III.D. We are also adopting certain other amendments to tailor affected funds’ disclosure and regulatory framework. We discuss the potential economic effects of these discretionary amendments, as well as reasonable alternatives to these provisions, in section III.E. Where possible, we have attempted to quantify the costs, benefits, and effects on efficiency, competition, and capital formation expected to result from the final rule. In some cases, however, we are unable to quantify the economic effects because we lack the information necessary to provide a reasonable and reliable estimate. The baseline we use to analyze the potential effects of the final rule is the current set of legal requirements and market practices. The final rule likely will have a significant impact on the security offering requirements and disclosure practices of affected funds. The overall magnitude of the benefits and the costs associated with the final rule will depend on many factors, including the number of affected funds that rely on the final rule. We recognize that some affected funds would not satisfy the conditions in certain of the amendments (e.g., those limited to WKSIs or funds that file a short-form registration statement on Form N–2), and other affected funds may satisfy the conditions but choose not to rely on the final rule. The discussion below describes our understanding of the markets and issuers that will be affected by the final rule.

Number of Affected Funds
The final rule will affect BDCs and registered CEFs. As of June 30, 2019, there were 791 affected funds, including 105 BDCs and 686 registered CEFs. To estimate the number of BDCs, we use data from Form 10–K and Form 10–Q filings as of June 30, 2019, the latest data available.355 We identify 51 listed BDCs and 54 unlisted BDCs. The average net assets of the listed BDCs is approximately $820 million, and the average of their total assets is $1.5 billion. Based on trading data as of June 30, 2019, 44 of the listed BDCs have public float greater than $75 million (i.e., one of the transaction requirement thresholds for primary offerings under the short-form registration instruction) and 15 of those BDCs have public float greater than $700 million (i.e., the WKSI public float threshold).356 We use data from Morningstar and SEC filings to estimate the number of registered CEFs.357 We identify 497 registered CEFs that were listed on an exchange as of June 30, 2019, including 1 interval fund. There were 189 unlisted registered CEFs as of June 30, 2019, including 60 interval funds. The average net assets of the listed registered CEFs is approximately $551 million, while the average net assets of the unlisted registered CEFs is approximately $382 million.358 Based on trading data as of June 30, 2019, 455 of the listed registered CEFs have public float greater than $75 million, and 85 of those funds have public float greater than $700 million.359 Information about the types

June 30, 2019. Data on prices and shares outstanding, which is used to calculate the public float, is taken from CRSP. 360 Data on registered offerings (initial public offerings, equity offerings by seasoned issuers, convertible debt offerings, and public debt offerings) for BDCs and listed registered CEFs is taken from Securities Data Corporation’s New Issues database (Thomson Financial). Data on Regulation D offerings was collected from all Form D filings (new filings and amendments) on EDGAR. Data on registered offerings for unlisted registered CEFs was collected from Form N–2 and Form N– CSR filings on EDGAR. 361See supra section II.C. 362See supra section II.B.1. 363See supra section II.F. 364See supra section II.E. 365This estimate is based on recent Form N–2 filings of the 49 listed BDCs. BDCs generally do not rely on existing Form N–2 backward incorporation by reference provisions because the form requires affected funds to provide to new purchasers a copy of all previously-filed materials that the fund incorporated by reference into the prospectus and/ or SAI. 366See supra footnote 314. of offerings conducted by different categories of affected funds for the period of July 1, 2014—June 30, 2019 is reflected in the below table.360
TABLE 3
Types of offerings Offering statistics Listed BDCs Unlisted BDCs Listed registered CEFs Unlisted registered CEFs
Registered offerings ........ Number of offerings ........................ 113 ..................... 24 ....................... 26 ....................... 137
Total amount raised ........................ $12.2 bil ............. $1.7 bil ............... $5.2 bil ............... $20.3 bil Average (median) offering amount $107.9 mil ($60.0 mil). $7.8 mil ($7.2 mil). $201.3 mil ($103.8 mil). $176.3 mil ($31.0 mil)
Regulation D offerings .... Number of offerings ........................ 21 ....................... 67 ....................... 1 ......................... 165
Total amount raised ........................ $12.3 bil ............. $9.1 bil ............... $15.1 mil ............ $7.5 bil Average (median) offering amount $584.7 mil ($100 mil). $135.0 mil ($50.0 mil). $15.1 mil ($15.1 mil). $45.6 mil ($6.1 mil) As of September 2019, there were 7,995 mutual funds, 2,076 ETFs, and 4,758 UITs. Thus, together with the 791 affected funds, there is a total of 15,620 funds, affected and non-affected. This means that affected funds represent about 5.1% of the total number of funds. As of September 2019, mutual funds had approximately $20,156 billion in assets, ETFs had approximately $4,024 billion in assets, UITs had approximately $76 billion in assets, and affected funds had approximately $459 billion in assets. Thus, affected funds represent about 1.8% of total investment company assets. We use data from Morningstar and SEC filings to estimate the number of affected ETPs. We identify 68 such ETPs as of December 31, 2019.
2. Current Securities Offering
Requirements for Affected Funds The securities offering process for affected funds at present differs from that for operating companies. Affected funds register their securities offerings on Form N–2, while operating companies use other forms (e.g., Form S–1 or Form S–3). As discussed in more detail above in sections II.B, II.C, and II.F, registered investment companies and BDCs are excluded from certain offering and communications rules available to operating companies. Affected funds currently are expressly excluded from the WKSI definition. As a result, even if they would otherwise meet the WKSI definition, they are unable to, for example, file an automatic shelf registration statement or communicate about an offering before filing a registration statement.361 Affected funds currently can conduct shelf offerings under rule 415(a)(1)(x) if they meet the applicable eligibility criteria for Form S–3, even though affected funds register their securities offerings on Form N–2. Affected funds conducting shelf offerings, however, currently experience certain burdens not faced by operating companies.362 For example, affected funds conducting shelf offerings currently must file posteffective amendments to make certain updates to their registration statements, while operating companies conducting shelf offerings may update their registration statements through forward incorporation by reference. As a result, affected funds can incur additional expense or delay for shelf offerings, which can affect the timing of their capital-raising. Similarly, different rules apply to affected fund communications as opposed to operating company communications.363 These differences can impose additional costs or constraints on affected funds or others because, for example, underwriters may be more familiar with the operating company rules. Further, affected funds currently are required to deliver a final prospectus to investors.364 Final prospectuses can be lengthy, particularly for BDCs because they generally do not take advantage of backward incorporation by reference currently permitted for certain financial and related information. For example, the median page length of prospectuses filed by listed BDCs is approximately 234 pages.365
3. Current Disclosure Obligations of
Affected Funds
Affected funds differ in their periodic and current reporting obligations. Like operating companies, BDCs file annual reports with audited financials on Form 10–K, quarterly reports with unaudited financials on Form 10–Q, and current reports on Form 8–K. Registered CEFs file annual reports to shareholders with audited financials and semi-annual reports to shareholders with unaudited financials on Form N–CSR. Listed registered CEFs are also subject to exchange rules that require listed issuers to provide the market current information in response to certain events (e.g., dividends announcements through a press release or report on Form 8–K).366 B. Potential Benefits Resulting From the Proposed Implementation of the Statutory Mandates As discussed, the amendments to implement the statutory mandates are designed to provide securities offering parity between affected funds and operating companies and streamline the registration process for BDCs and registered CEFs, consistent with the BDC Act and the Registered CEF Act. We believe that the final rule will achieve this goal and consequently result in significant benefits in a number of areas, including by improving access to the public capital markets and possibly lowering the cost of capital by, among other things, modifying our rules related to affected funds’ ability to qualify as WKSIs, to use the full shelf registration process, and to engage in

367See also infra section III.E (discussing benefits associated with our discretionary rule amendments). 368See supra section II.C. 369See supra section III.A.1. 370See, e.g., Jonathan B. Berk and Richard Stanton, Managerial Ability, Compensation, and the Closed-End Fund Discount, Journal of Finance, Vol. 62, 529–556 (2007); Jeffrey Pontiff, Costly Arbitrage:
Evidence from Closed-End Funds, Quarterly Journal of Economics, Vol. 111, 1135–1151 (1996); Charles M. C. Lee, Andrei Shleifer, and Richard H. Thaler, Investor Sentiment and the Closed-End Fund Puzzle, Journal of Finance Vol. 46, 76–110 (1991). 371See supra footnote 37 (discussing restrictions on affected funds’ ability to sell their shares at a price below NAV). 372See also infra section III.D (discussing considerations related to an alternative of modifying the public float standards in the WKSI definition by changing the required level of public float or providing alternative eligibility criteria). 373See, e.g., 17 CFR 270.17a–8 (Investment Company Act rule 17a–8). 374See supra section II.B. certain communications during a registered offering.367 Additionally, as discussed below, we believe that the final rule will provide benefits to investors as well, including by increasing the flow of valuable information that could be available to investors to inform their investment decisions. Finally, we believe that the final rule will provide cost-saving options to affected fund issuers and underwriters.

Improved Access to Capital and
Lower Cost of Capital
We anticipate that the final rule will facilitate capital formation and possibly lower the cost of capital by improving access to the public capital markets for affected funds. The rule is designed to reduce regulatory impediments to capital formation and provide more flexibility to these funds to conduct registered securities offerings. The amount of flexibility accorded by the final rule will depend on the characteristics of the affected fund, consistent with our rules’ treatment of similarly-situated operating companies. For example, and as explained below, certain affected funds like large listed BDCs and large listed registered CEFs are expected to benefit more from the final rule than unlisted BDCs and unlisted registered CEFs, including unlisted interval funds. The final rule will provide the most flexibility under the communications rules and the automatic shelf registration system to eligible WKSIs. Other affected funds, such as seasoned affected funds, also will benefit, albeit to a lesser degree, from the other revisions to the offering process and our communications rules. a. Benefits From WKSI Status The largest increase in capital formation and reduction in cost of capital that the final rule could generate will come from allowing affected funds to obtain WKSI status. Affected funds that qualify as WKSIs will enjoy additional flexibility compared to affected funds that are non-WKSIs.368 There are 100 affected funds (15 listed BDCs and 85 listed registered CEFs) that meet the $700 million dollar public float criterion as of June 30, 2019.369 A shelf registration statement and any subsequent amendments filed by a WKSI are automatically effective upon filing. This flexibility will allow affected funds that qualify as WKSIs to promptly tap favorable conditions in the public market, to structure terms of securities on a real-time basis to accommodate investor demand, and to determine or change the plan of distribution in response to changing market conditions. For example, because affected funds typically trade at a discount to their NAV,370 affected funds that are WKSIs will be able to act more quickly to raise capital when their shares are trading at a premium,371 thus increasing the amount of capital raised and enhancing capital formation. Additionally, WKSIs are not required to pay any registration fees at the time of filing a registration statement. They are only required to pay the registration filing fee at the time securities are taken down and sold off the shelf registration statement. This will provide additional flexibility to qualifying affected funds in that they need only incur such filing fees if and when they decide to proceed with an offering. The final rule may also lower the cost of capital because it will provide significant flexibility to affected funds that are WKSIs and their underwriters in marketing securities. The final communications rules will allow these funds to communicate at any time regarding an offering.
Requiring an affected fund to have at least $700 million in public float to qualify as a WKSI will avoid providing affected funds with an advantage in the competition for capital over certain operating companies. For example, a lower public float threshold for affected funds would provide them with a competitive advantage over operating companies that may have similar characteristics to affected funds, such as listed REITs, but have public float below $700 million. In a similar vein, the use of alternative eligibility criteria for affected funds to qualify as WKSIs would put them at competitive advantage compared to similar operating companies without public float, such as unlisted REITs. Moreover, reducing the $700 million threshold or providing alternative eligibility criteria for affected funds to qualify as WKSIs would likely lead to potential higher incidences of disclosure and fund practices that may not comply with applicable law due to reduced staff review.372 Given the important benefits that WKSI status provides, and the fact that currently only few affected funds would qualify as WKSIs, it is possible that advisers to some affected funds may try, through various means, including raising additional capital and mergers and acquisitions, to increase their funds’ public float to the WKSI threshold. Thus, the possible effects of the rule may include increased fund size and consolidation of affected funds. Such developments may increase efficiency by allowing the larger resulting funds to benefit from improved access and lower cost of capital. We also recognize that consolidation may be driven by other factors as well, in combination with the effects of the rule, and typically would be subject to certain approvals by a fund’s board of directors or shareholders.373 Potential consolidation and increases in fund size could also reduce costs to investors by, for example, allowing an affected fund to realize greater efficiencies and reduce its total operating expenses over time. However, consolidation also could inhibit competition and negatively affect the number of investment opportunities available to investors if it leads to a reduction of the number of strategies funds employ. It is possible that new funds will enter the market thereby increasing competition and investment opportunities. Potential consolidation of affected funds could make it more difficult for new or smaller funds to compete since funds with larger amounts of assets may have better access to certain investment opportunities or may be able to offer lower costs to investors. Smaller funds, however, may have better access to investment opportunities in smaller companies because these investments may be too small to be economically viable for larger funds. At present, we are not able to estimate the effects of these competitive dynamics. b. Benefits From Shelf Registration Other provisions of the final rule could also enhance capital formation and lower the cost of offerings
for affected funds that qualify as seasoned funds and file a short-form registration statement on Form N–2.374 For example,

375The short-form registration instruction refers to the eligibility criteria in Form S–3, with additional references to reporting requirements under the Investment Company Act. 376See supra section III.A.1. 377See infra section IV.B.1. For purposes of the PRA, we estimate that the hour burden of preparing and filing a post-effective amendment is 125 hours. Reducing the number of post-effective amendments by 128 filings would decrease the aggregate annual burden of Form N–2 by 16,000 hours (125 hours × 128 post-effective amendments = 16,000 hours). We estimate that the monetized internal burden is $33,625 per post-effective amendment and the external burden is $11,114 per post-effective amendment. See infra section IV.B.1. The total annual cost is calculated by adding the monetized internal burden ($33,625 × 128 post-effective amendments = $4,304,000) to the cost of outside professionals ($11,114 × 128 post-effective amendments = $1,422,592). Although we have increased the expected reduction in the number of post-effective amendments discussed in the Proposing Release from 112 to 128 filings, the estimated annual aggregate cost reduction has decreased from $7,943,376 to $5,726,592 to better recognize how we have monetized internal burdens for purposes of the PRA. See Proposing Release, supra footnote 10, at n.359 and accompanying text; infra section IV.B.1. 378This analysis assumes that a BDC would file a prospectus supplement for each Form 10–Q filing (3 filings per year), Form 10–K filing (1 filing per year), and Form 8–K filing (estimated to be 10 filings per year), for a total of 14 periodic and current reports per year. See Proposing Release, supra footnote 10, at n.415 and accompanying text (discussing the estimated number of Form 8–K filings per BDC per year). 379See supra sections II.B.3.e and II.I.2.a. 380See supra section II.G.2. 381See supra section II.G.1. 382See supra section II.B.3.d. 383See supra section II.D. 384Because a fund is not required to report the extent to which it relies on Commission guidance, we lack information to estimate the percentage of funds that solely or predominantly rely on electronic delivery under existing Commission the final rule generally allows these funds to more efficiently use the shelf registration process if, like operating companies, they meet the eligibility requirements of Form S–3.375 As of June 30, 2019, there were 499 affected funds that met the $75 million dollar public float criterion for primary offerings under Form S–3 (which criterion is incorporated into the short-form registration instruction of Form N–2).376 Affected funds that qualify will bear fewer costs associated with updating the information in their registration statements because information in the fund’s Exchange Act reports will be incorporated by reference into the fund’s registration statement. For example, for PRA purposes, we estimate that eligible affected funds will file approximately 128 fewer post-effective
amendments annually as a result of the amendments, resulting in an annual aggregate cost reduction of approximately $5,726,592 for these funds.377 Additionally, we understand that currently BDCs often file prospectus supplements close-in-time to filing their current and periodic Exchange Act reports to make sure the BDC’s prospectus disclosure provides the same information as that disclosed in its Exchange Act reports. Under the final rule, eligible BDCs will no longer file these prospectus supplements since their Exchange Act reports will be incorporated by reference into their registration statements. As a result, an eligible BDC may, on average, file approximately 14 fewer prospectus supplements on an annual basis under the rule.378 We anticipate that eligible registered CEFs also will be able to make fewer prospectus supplement filings under the final rule, although they likely will not experience as large of a reduction in filings since, among other things, they file periodic reports on a semi-annual basis (rather than quarterly) and generally are not required to report on Form 8–K. While we believe that affected funds will likely file fewer prospectus supplements under the final amendments, we are unable to estimate any reduction in the number of prospectus supplements that affected funds will file under the final rule, and any associated cost savings for affected funds, due to certain counterbalancing factors. For example, if the final rule causes affected funds to increase their capital-raising activities, they may need to update their prospectuses more often and may file more prospectus supplements as a result. However, if affected funds begin to use their Exchange Act reports to update their prospectuses, as permitted under the final amendments, they may file fewer prospectus supplements.379 On average, we believe that affected funds will likely file fewer prospectus supplements under the final amendments since they will be able to update their prospectus more efficiently by forward incorporating their Exchange Act reports, although an affected fund that greatly increases its capital-raising activities may not experience the same reduction in filing burdens. In general, we believe affected funds that qualify for the short-form registration instruction will experience cost savings associated with making fewer filings and will be able to use a more efficient process to update their prospectus disclosure. This will decrease the costs of eligible funds’ registered offerings and will also allow them to act more quickly to take advantage of favorable market conditions (e.g., when trading at a premium). Certain seasoned funds registering shelf offerings also will be able to omit certain information from their prospectuses and use the same process as operating companies to provide omitted information by filing a prospectus supplement, which will generally make the shelf registration process less costly for these funds as compared to the
baseline. The final rule also may provide incremental cost savings to affected funds that are eligible to file a shortform registration statement in certain other respects. For example, the final rule will reduce the costs of these funds seeking shareholder approval for proposals to authorize, issue, modify, or exchange securities by allowing them to incorporate by reference certain materials rather than delivering these materials to security holders with the proxy statement.380 We do not anticipate that these cost savings will be substantial, however, as we understand that affected funds do not often make these types of proposals to security holders. Affected funds that are eligible to file a short-form registration statement also could experience modest cost savings from the amendment to rule 418 since they will no longer be required by that rule to furnish certain information to the Commission or its staff promptly on request.381
c. Other Benefits for Affected Funds
The final rule will generate other benefits for affected funds generally, regardless of whether they are WKSIs or seasoned funds. For example, the amendment to require affected funds to follow the same process that operating companies follow to file prospectuses under rule 424 will require that affected funds file prospectus supplements when changes from or additions to a previously filed prospectus are substantive, whereas currently they are required to file every prospectus that varies from any previously filed prospectus under rule 497.382 Rule 424 also is designed to work together with rule 415(a)(1)(x), and provides additional time for an issuer to file a prospectus. This change could modestly reduce filing burdens and should facilitate eligible funds using the shelf registration process efficiently and in parity with operating companies. Also, the final rule allows an affected fund to satisfy its obligation to deliver a final prospectus by filing it with the Commission and complying with certain other requirements, thus decreasing the cost of the offering.383 For example, the final rule will permit affected funds to save on printing and mailing costs for delivering the final prospectus in paper.384

guidance. See, e.g., Use of Electronic Media for Delivery Purposes, Investment Company Act Release No. 21399 (Oct. 6, 1995) [60 FR 53458 (Oct. 13, 1995)]. Affected funds that rely to a greater extent on electronic delivery of final prospectuses under existing Commission guidance may realize smaller net cost savings under the rule. 385See ACC Comment Letter; CBD Comment Letter; SIFMA Comment Letter. 386See Invesco Comment Letter. 387See ICI Comment Letter; Invesco Comment Letter. 388For example, in 2017 non-fund issuers raised approximately $1.3 trillion in 1,846 registered debt offerings and $184 billion in 976 registered equity offerings. See Capital Raising in the U.S.: An Analysis of the Market for Unregistered Securities Offerings, 2009–2017, Division of Economic and Risk Analysis White Paper (Aug. 1, 2018), available at https://www.sec.gov/dera/staff-papers/whitepapers/dera_white_paper_regulation_d_082018. 389See SIFMA Comment Letter. 390See, e.g., Alan Berger and Gregory Udell, The Economics of Small Business Finance: The Roles of Private Equity and Debt Markets in the Financial Growth Cycle, Journal of Banking and Finance, Vol. 22, 613–673 (1998); Meghana Ayyagari, Asli Demirgu¨ c¸-Kunt, and Vojislav Maksimovic, How Important are Financing Constraints? The Role of Finance in the Business Environment, World Bank Mimeo (2005); Crowdfunding, Securities Act Release No. 9974 (Oct. 30, 2015) [80 FR 71388 (Nov. 16, 2015)]. 391See, e.g., Torsten Beck, Asli Demirgu¨ c¸-Kunt, and Ross Levine, SMEs, Growth, and Poverty: CrossCountry Evidence, Journal of Economic Growth, Vol. 10, 197–227 (2005); Ryan Decker, John Haltiwanger, Ron Jarmin, and Javier Miranda, The Role of Entrepreneurship in U.S. Job Creation and Economic Dynamism, Journal of Economic Perspectives, July, 3–24 (2014). 392See SIFMA Comment Letter; ACC Comment Letter; CBD Comment Letter. 393See ICI Comment Letter. 394See supra section II.F. 395But see supra footnote 144 (explaining that affected funds currently are permitted to engage in certain pre-filing test-the-waters communications under Securities Act rule 163B). In general, commenters stated that the rule will generate benefits for affected funds. Several commenters stated that the proposed rule would lead to a more efficient capital-raising process.385 One commenter suggested that the proposed rule could also help encourage product development that would expand the universe of registered CEFs, but did not elaborate on the specific aspects of the rulemaking that would encourage product development.386 d. Benefits for Other Parties The lower costs of registered offerings resulting from the final rule should benefit investors in affected funds because funds bear offering expenses. Lowering offering expenses may, all else equal, reduce the size of the discount or increase the size of the premium at which shares of the affected funds trade. Two commenters expressed similar views, arguing that the proposed rule would provide cost
savings to funds’ shareholders.387 In addition, the final rule could reduce the cost to underwriters of participating in registered offerings of affected funds, and these potential cost savings could be passed on to the affected funds. Based on the sheer volume and number of transactions,388 underwriters may have more expertise and established procedures for operating companies’ registered offerings, which are subject to the rules we are extending to affected funds. In contrast, underwriters probably have less, or more concentrated, expertise regarding the current requirements for offerings by affected funds. Standardization in the registered offering space, by making the offerings of affected funds more similar to those of operating companies, could make it easier for underwriters to execute such offerings and may decrease their compliance costs. If underwriters pass some of the cost savings on to affected funds and their investors, this could result in cheaper registered offerings for affected funds, thus encouraging them to raise more capital, which would lead to enhanced capital formation. Lastly, standardization may encourage a broader set of underwriters to participate in this market, potentially decreasing costs for affected funds and investors in these funds. One commenter agreed that the proposed rule would make it easier for underwriters to execute offerings by affected funds, which could lead to decreased costs.389 The final rule could level the securities offering playing field between affected funds and operating companies and streamline the registration process for affected funds, consequently making them potentially more competitive in the market for capital raising. The final rule may also make certain affected funds more competitive compared to affected funds that either cannot or choose not to rely on these amendments. Thus, the final rule will likely enhance competition in the public capital markets. The increased competition for capital in turn could lead to potentially better allocation of capital. The final rule may also benefit companies in which affected funds invest. Small and mid-size companies, because of their size, type of assets, risk profile, and the general lack of information about their activities and financial condition, typically find it more difficult to raise funds from traditional sources of capital such as bank loans and registered offerings.390 This difficulty in sourcing more traditional financing constrains their ability to invest in profitable projects and grow. To the extent that the final rule improves capital-raising opportunities for affected funds that invest in these companies, this may result in investments in a greater number of small to mid-size U.S. companies, thus alleviating financial constraints of such companies and contributing to economic growth generally.391 Commenters generally agreed that the proposed rule would facilitate capital formation, especially for small to mid-size
businesses.392 One commenter stated that the proposed rule could potentially stimulate economic growth.393
2. Facilitated Communication With
Investors
The final rule will provide incremental flexibility to funds in their communications, which may increase the flow of information to investors.394 Currently, affected funds generally are unable to communicate about an offering before a registration statement is filed, and their post-filing communications are subject to prospectus liability under section 12 of the Securities Act (or must be accompanied or preceded by the statutory prospectus).395 This standardization in the communications processes of affected funds, by making them similar to those of operating companies, will make it easier for underwriters to execute offerings by affected funds and thus may decrease their compliance costs, which in turn may lead to lower offering costs and potentially enhance capital formation. Additionally, under the final rule, affected funds that qualify as WKSIs can engage in the widest range of communications, including free writing prospectus communications about an offering with any party before a registration statement is filed. More generally, affected funds will be able to engage in certain other pre-filing communications, use free writing prospectuses after a registration statement is filed, and use certain communications that are not subject to prospectus liability. The changes in the communications rules for affected funds may increase the amount of valuable information that could be provided to investors before they make investment decisions, particularly with respect to WKSIs. We believe that more information could be provided on a timelier basis because the amendments will eliminate regulatory barriers to the dissemination of that information, and the markets may provide incentives for issuers, underwriters, and brokerdealers to produce additional

396See ACC Comment Letter; ICI Comment Letter; Invesco Comment Letter. 397See also infra section III.E (discussing compliance and other costs associated with the proposed discretionary amendments). 398See supra section II.F.1; infra section IV.B.4 (estimating the annual paperwork burden for free writing prospectuses under rules 163 and 433 for purposes of the PRA). 399But see infra Table 14 footnote 1 (discussing that only 10 WKSIs relied on rule 163 for the Commission’s 2017 fiscal year). 400For purposes of the PRA, we estimate that, on average, affected funds that are eligible to be WKSIs (estimated as 100 funds) would file two free writing prospectuses under the proposed amendments to rule 163 each year. We estimate the total incremental burden would be approximately 0.125 hours and $150 for the service of outside professionals. See infra section IV.B.4. We monetize the internal burden of preparing and filing a free writing prospectus by multiplying the burden hours by an estimated wage rate of $400 per hour (0.125 × $400 = $50). The estimated wage figure is based on analysis in previous rulemakings. The total annual cost is calculated by adding the monetized internal burden ($50) to the cost of outside professionals ($150). 401See supra section II.B.3.d. 402See supra section II.D. 403The Commission has estimated the cost per rule 173 notice to be $0.05 for operating companies. See Securities Offering Reform Adopting Release, supra footnote 5, at 44795. We assume the same cost will apply to rule 173 notices provided to affected fund investors. 404For the purpose of the PRA, we estimate that there will be 43,546 notices per year per affected fund with an effective Securities Act registration statement (estimated as 382 affected funds). The annual cost of providing rule 173 notification is calculated as the number of affected funds (382) × the number of notices per year (43,546) × the cost per notice ($0.05). See infra section IV.B.5. information. We also believe that the increased flexibility of affected funds in their communications with investors under the free writing prospectus rules will maintain appropriate investor protection, consistent with the protections that apply to affected funds’ communications under rule 482. For example, the rules that allow affected funds to use free writing prospectuses are designed to assure that written issuer-provided or issuer-used information is publicly available. Additionally, the free writing prospectus will be a section 10(b) prospectus under the Securities Act and, as such, will be subject to liability under section 12(a)(2) as well as the anti-fraud provisions of the Federal securities laws. Increased information flow can help promote efficient capital markets because the market may be able to value securities more accurately. For example, the final rule will permit broker-dealers to disseminate research about an affected fund if certain conditions are met. While broker-dealers currently may
disseminate such research under rule 482, the amendments to rule 138 will likely reduce certain costs to brokerdealers associated with rule 482 (e.g., filing costs and concerns associated with prospectus liability). This could allow more valuable information about affected funds to reach potential investors. Another benefit of increasing the information flow is that investors may become better informed in making portfolio allocation decisions in accordance with their particular riskreturn profiles. In addition, the final rule may benefit broker-dealers who provide research reports on affected funds by reducing their potential liability exposure associated with such reports, relative to the baseline, which may encourage them to provide additional research and enhance information flow. Commenters generally agreed that the proposed rule would provide more flexibility for affected funds to communicate and would increase information flow.396
C. Potential Costs Resulting From the
Proposed Implementation of the Statutory Mandates

Compliance Costs
The amendments we are adopting to implement the statutory mandates could increase affected funds’ compliance costs in certain respects.397 We also are cognizant of the fact that such an increase could be passed on to funds’ investors. A potential cost of the final rule is that affected funds could incur increased filing or recordkeeping costs associated with issuer free writing prospectuses,398 although affected funds currently face many of the same filing and recordkeeping costs under rule 482. For example, the ability of affected funds that qualify as WKSIs to use free writing prospectuses may increase the level of these funds’ current communications (including certain communications prior to filing a registration statement that are presently prohibited), thus increasing the funds’ filing and recordkeeping costs.399 We estimate that affected funds that are WKSIs would have additional annual filing and recordkeeping costs of $200 per affected fund for free writing prospectuses used before the fund files a registration statement.400 To the extent affected funds use free writing prospectuses for communications that currently occur under rule 482, the costs associated with free writing prospectuses could increase, and the costs associated with rule 482 advertisements could decrease. We are unable to predict, however, whether affected funds will be more likely to use free writing prospectuses than rule 482 communications or to engage in more communications with investors in practice as a result of the amendments. Affected funds could also incur costs associated with adjusting their internal procedures for filing prospectus supplements.401 Such costs could stem from the need to augment funds’ information technology systems or train funds’ employees, although, as recognized above, affected funds likely will be able to file fewer prospectus supplements under the final rule. Parties that will be required to provide notices under rule 173,402 including underwriters and dealers in certain circumstances, may incur additional costs due to the requirement to notify affected fund investors that they have purchased shares in a registered offering. In addition, these same parties may incur costs to establish procedures for receiving and complying with requests for final prospectuses. We believe that providing the notice to investors will not impose a significant incremental cost because the notice can consist of a pre-printed message that is automatically delivered with or as part of the confirmation required by 17 CFR 240.10b–10 (Exchange Act rule 10b–10). Accordingly, we estimate that the cost of complying with rule 173 will be approximately $0.05 per notice.403 We estimate the annual cost of providing the notification will be approximately $831,729.404 For the parties that are required to provide such notices, these additional costs of complying with rule 173 will be mitigated to a certain degree by the elimination of the requirement to supply a final
prospectus to each investor.
Other Costs
Under the final rule, affected funds that qualify as WKSIs will be able to file shelf registration statements and posteffective amendments that become automatically effective. To the extent that investors previously benefited from the Commission staff’s review of these filings before they become effective, allowing these filings of affected funds that are WKSIs to become automatically effective may eliminate such reviews and, as a result, possibly increase the costs to investors. Allowing affected funds that file short-form registration statements on Form N–2 to forward incorporate by reference could have a similar potential impact on investors. However, issuers will still face liability under the Federal securities laws for registration statement disclosures (e.g., sections 12 and 17 of the Securities Act and section 10(b) of the Exchange Act

405Certain of our discretionary amendments may also ameliorate these costs. See infra section III.E.3 (discussing the benefits and costs of the requirement to disclose material unresolved staff comments) and section III.E.2 (discussing the benefits and costs of the structured data requirements). 406See supra footnote 29. 407See supra section II.I.2.a. 408See Securities Offering Reform Adopting Release, supra footnote 5, at 44796. 409The average institutional holding is estimated to be approximately 30% for BDCs and 21% for registered CEFs. See Covered Investment Fund Research Reports Adopting Release, supra footnote 101, at 64199. The institutional ownership of U.S. public equities was approximately 67% as of 2010. See Marshall E. Blume and Donald B. Keim, Institutional Investors and Stock Market Liquidity:
Trends and Relationships, Working Paper, The Wharton School, University of Pennsylvania (Aug. 21, 2012). 410See Securities Offering Reform Adopting Release, supra footnote 5, at 44782. 411See supra section II.C. 412See, e.g., ICI Comment Letter; ABA Comment Letter; Dechert Comment Letter; CBD Comment Letter; TIAA Comment Letter. and 17 CFR 240.10b-10 (rule 10b-5 under the Exchange Act)), which may ameliorate the potential costs associated with reduced staff review.405 More generally, allowing forward incorporation by reference under the short-form registration instruction could increase the analytical burden and search costs for potential investors. Currently, affected funds provide required information in the prospectus that is delivered to investors, and forward incorporation by reference is not allowed. Under the amendments, instead of having all the information available in one location, investors may need to separately access on a website or request the incorporated materials. As a result, costs to investors for assembling and assimilating necessary information could increase, with a potentially stronger effect for retail investors (e.g., because they generally may not have the technical capabilities or monetary resources to efficiently search through several information sources). We do not have data to assess if, and to what extent, this revision will burden investors. However, an affected fund making a shelf offering under rule 415(a)(1)(x) is required to file a new registration statement every three years, which provides investors with a periodic update of consolidated information.406 The final rule will require that affected funds provide in their annual reports certain information currently disclosed in their prospectuses to make the information more readily available in one document for investors.407 Further, Securities Act Forms S–3 and F–3 have long permitted incorporation by reference from the issuer’s Exchange Act reports, and investors have not indicated they are unduly burdened when investing in offerings registered on these Forms.408 Studies have shown, however, that the majority of investors in operating companies are institutional investors, whereas the majority of investors in the securities of affected funds are retail investors, who may face relatively higher costs associated with searching for information distributed across multiple documents.409 In addition, the requirement to backward and forward incorporate by reference certain information into a short-form registration statement could increase an affected fund’s liability with respect to information that has not previously been incorporated into its registration statement because this information will now be part of the registration statement. This could increase costs for relevant funds, including potential legal costs (e.g., those associated with additional review of materials that would be incorporated by reference into the fund’s registration statement, or counsel
and other costs in connection with potential legal actions). These potential cost increases could be passed on to investors of affected funds. The final rule will allow an affected fund to not deliver final prospectuses directly to investors if the fund files the final prospectus with the Commission and certain other conditions are satisfied. We acknowledge, however, that while this procedure has become commonplace in many aspects of our capital markets, there may be some investors who would prefer to receive the prospectus directly. While an investor could request a copy of the final prospectus under rule 173, there will be burdens on an investor to make such a request (e.g., loss of time while making the request and a delay in receiving the prospectus). Thus, investors without home internet access, depending on their ability and preference to access fund information electronically, might experience a reduction in their ability to access a fund’s final prospectus. To the extent that a reduction in this information by such investors decreases how informed they are about affected funds, it could potentially decrease their ability to efficiently allocate capital across affected funds and other investments. However, an investor’s purchase commitment and the resulting contract of sale of securities to the investor in the offering generally occur before the final prospectus is required to be delivered under the Securities Act, and this is commonplace in other parts of our capital markets. Moreover, for sales occurring in the secondary market, as a result of our existing rules, investors in securities of reporting issuers generally are not delivered a final prospectus.410 D. Alternatives to Adopted Approach To Implementing Statutory Mandates We considered certain alternative approaches to implementing the directives in the BDC Act and Registered CEF Act to allow affected funds to use the securities offering rules that are available to operating companies. Although the BDC Act identifies certain required amendments to our rules and forms, we could have, for example, made additional modifications to the relevant provisions for affected funds or further revised the current registration and offering framework affected funds use. For example, as discussed above, we considered modifying the public float standards in the WKSI definition or the short-form registration instruction by changing the required level of public float or providing alternative eligibility criteria, such as the aggregate NAV of a certain size for funds whose shares are not traded on an exchange.411 Several commenters supported changing the public float standards in the WKSI definition for affected funds.412 These alternatives could have allowed more affected funds to qualify as WKSIs or to file short-form registration statements, with the associated benefits (e.g., lower costs of registered offerings) and costs (e.g., potential higher incidence of disclosure and fund practices that may
not comply with applicable law due to reduced staff review) discussed above. For example, most interval funds do not list their securities on an exchange and do not have ‘‘public float,’’ and these alternatives therefore could have permitted these interval funds, as well as other unlisted affected funds, to qualify as WKSIs or file short-form registration statements. However, modifying the eligibility criteria in the WKSI definition or the short-form registration instruction could give affected funds that do not have the requisite public float under the current WKSI definition or Form S–3 eligibility requirements an advantage over certain operating companies that do not have public float or do not meet the $700 million public float requirement. In addition, certain of the benefits that flow from WKSI status or the ability to use a short-form registration statement may be less relevant to unlisted affected funds that engage in continuous

413See supra paragraph accompanying footnotes 50–51. 414As previously recognized, unlisted registered CEFs would not be eligible for certain of the amendments. See supra section II.A. 415See ABA Comment Letter. 416See infra sections III.E.1 and III.E.5. 417See supra section II.I.3. 418See supra section II.G.3. 419The estimates are based on data collected for interval funds that were active as of June 30, 2018. We used their Form N–2 filings and Form N–CSR filings to identify current registration fees, proceeds from shares issued, and cost of shares repurchased. offerings.413 Further, interval funds already have a tailored registration process that provides similar efficiencies. For example, certain of an interval fund’s post-effective amendments are immediately effective upon filing (e.g., filings solely to update the fund’s financial statements or to make non-material changes), while other post-effective amendments (e.g., filings to make material changes) are automatically effective 60 days after filing unless the fund designates a later date for effectiveness. In addition, we are extending this process to allow other continuously-offered unlisted affected funds to file immediately-effective posteffective amendments under the same circumstances as interval funds. Specifically, we are amending rule 486 to allow certain unlisted continuouslyoffered affected funds to maintain effective registration statements in a more efficient and cost-effective manner. We believe that amended rule 486 will provide these funds with benefits that are similar to the benefits we are providing to affected funds that qualify to file short-form registration statements or as WKSIs. Interval funds and other continuously-offered unlisted affected funds, however, will not experience the same efficiencies as affected funds that qualify to file shortform registration statements or as WKSIs when they make material changes to their registration statements. This is because these filings by interval funds and other continuously-offered unlisted affected will be subject to staff review and will not be immediately effective upon filing. Under the BDC Act and the Registered CEF Act, we could have extended the final rule only to BDCs, listed registered CEFs, and interval funds. Under this approach, unlisted registered CEFs would not have been able to take advantage of certain benefits of the amendments that would otherwise be available to unlisted BDCs, such as the cost savings associated with the final prospectus delivery reforms.414 This alternative also could have saved unlisted registered CEFs certain compliance costs stemming from the proposed rulemaking, such as the requirement to tag certain prospectus information using Inline XBRL. However, excluding unlisted registered CEFs from the final rule could create unnecessary competitive disparities between unlisted registered CEFs and unlisted BDCs and would not provide investors in unlisted registered CEFs with the benefits of
the new investor protections we are adopting. E. Discussion of Discretionary Choices We discuss below the discretionary amendments that we are adopting, in light of the changes to implement the BDC Act and Registered CEF Act and the associated benefits and costs of those choices. We have tried to quantify the impact of each of the amendments, but in many cases, reliable, empirical evidence about the effects is not readily available to the Commission. With respect to the proposed discretionary amendments, one commenter stated that the proposal would impose regulatory and compliance costs on unlisted affected funds, while at the same time providing unlisted interval funds with only small benefits and providing no benefits to other unlisted affected funds (e.g., tender offer funds).415 We believe interval funds and other continuouslyoffered unlisted affected funds will directly benefit from two of our discretionary amendments.416 While the final rule also imposes certain costs on these funds, we believe those costs are warranted, as discussed in detail below. Moreover, we are not at this time adopting the proposed new reporting requirements on Form 8–K that would have imposed costs on unlisted affected funds.417

New Registration Fee Payment
Method for Interval Funds and Issuers of Certain Exchange-Traded Products We are adopting a modernized approach to registration fee payment for interval funds that will require them to pay securities registration fees using the same method that mutual funds and ETFs use today. In response to comments, we also are allowing certain ETPs that are not registered under the Investment Company Act to use a similar method to pay registration fees. With respect to interval funds, the final rule requires these funds to pay their registration fees on a net basis once a year, rather than having to pay registration fees when the fund files its registration statement.418 We believe this approach will make the registration fee payment process for interval funds more efficient. For example, it will avoid the possibility that an interval fund will inadvertently sell more shares than it has registered and will not require the issuer to periodically register new shares. We believe the final rule could also benefit interval funds by reducing their initial registration fees. In the table below, we have attempted to quantify the potential initial cost-savings for interval funds under the modernized approach to registration fee payment over a 3-year period.419
TABLE 4
Current average registration fee (paid upon filing) 1 Estimated average registration fee that will be paid under the amendments (paid at the end of the fiscal year) 2 Year 1 .............................................................................................................................................. $31,501 $8,376 Year 2 .............................................................................................................................................. .................................... 7,015 Year 3 .............................................................................................................................................. .................................... 22,445 Notes:
1.The current average registration fee paid in year 1 is the average of the actual fees reported by the interval funds in the Calculation of Registration Fee table in Form N–2 in the year of registration with the Commission. For purposes of this analysis, we assume that interval funds did not register additional securities in years 2 or 3. If they did, the average registration fees under the current framework would be higher than $31,501.

420As discussed below, interval funds and other funds that file on Form 24F–2 will be required to file the form in a structured XML format under the amendments. 421For PRA purposes, we estimate an annual burden per respondent of filing Form 24F–2 of two hours. See infra section IV.B.6. At an estimated wage rate of $70 per hour, the annual dollar cost for filing Form 24F–2 is $140 (2 hours × $70 per hour). This estimate does not account for burdens associated with filing Form 24F–2 in a structured XML format, which are discussed infra in section III.E.2. 422See supra section II.I.1.c. 423See supra section II.I.1.a. 424See Calcbench Comment Letter. 425See supra section III.C.2 (discussing these costs). 426See supra section II.I.1.b. 427See FAST Act Modernization Adopting Release, supra footnote 66. 2.For each of the interval funds, the fees in years 1, 2, and 3 are estimated as [(dollar proceeds from shares issued + dollar cost of shares repurchased) / $1,000,000] × $129.80. The $129.80 is the fee rate (per million dollars) that funds pay to register shares for fiscal year 2020. Then we calculate the average fees per year. Under the current regime, an interval fund would pay on average $31,501 at the time of filing, and then issue and repurchase securities over time. Under the regime we are adopting, the interval fund will pay its registration fees on a net basis once a year. Since the final rule allows interval funds to shift more of the fee payments to the future, it will decrease their cost of offering securities. An interval fund will, however, be required to annually file Form 24F–2.420 We estimate the annual burden of filing Form 24F–2 for interval funds will be $140 per fund.421 We believe the final rule will provide similar benefits to certain ETPs that are not registered under the Investment Company Act by allowing these ETPs to elect to register an indeterminate number of securities and to pay registration fees in arrears on an annual net basis. Since now ETPs pay registration fees in advance whether or not they sell any securities and may not factor in redemptions in reducing the amount of the registration fees owed, this change will allow them to reduce their registration fees and shift their payment obligations into future periods. The amendments will also avoid the possibility that such an ETP will inadvertently sell more shares than it has registered and will not require the issuer to periodically register new shares. Moreover, the amendments will allow ETPs that are not registered under the Investment Company Act to use a similar registration fee payment method as ETFs that are registered under the Investment Company Act. As an alternative, we considered allowing a wider range of affected funds, such as registered CEFs that are tender offer funds, to rely on rule 24f–
2. This approach would have extended
the benefits of rule 24f–2 to additional affected funds. However, as discussed above, interval funds have structural similarities to mutual funds and ETFs that other affected funds do not. In particular, interval funds routinely repurchase shares at NAV and are required to periodically offer to repurchase their shares, and therefore are more likely to realize the operational benefits of computing registration fees on a net annual basis than are funds that are not required to periodically offer to repurchase their shares at NAV.
2. Structured Data Requirements
The final rule includes new structured data reporting requirements for affected funds. Specifically, all affected funds will be required to tag in Inline XBRL format certain Form N–2 prospectus disclosure items. All affected funds also will be required to tag the information on the cover page of Form N–2 using Inline XBRL. Finally, BDCs will be required to tag financial statement information using Inline XBRL. Under the final rule, affected funds will be required to tag the following Form N–2 prospectus disclosure items using Inline XBRL: Fee Table; Senior Securities Table; Investment Objectives and Policies; Risk Factors; Share Price Data; and Capital Stock, Long-Term Debt, and Other Securities.422 These items provide important information about an affected fund’s key features, costs, and risks and may be particularly useful to investors to inform their investment decisions. With respect to the requirement that BDCs tag financial statement information, unlike operating companies and registered investment companies, BDCs currently are not required to report any structured data.423 This requirement will extend to BDCs a requirement that currently applies to operating companies. Requiring BDCs to tag financial statement information using Inline XBRL, and all affected funds to tag in Inline XBRL format certain important prospectus disclosure items, will provide important benefits to investors seeking to access information about affected funds, both directly and through information intermediaries such as data aggregators and financial analysts. Providing a standardized, interactive, computer-based framework for reporting could further facilitate more efficient investor comparisons of important information across affected funds by making it easier to aggregate and analyze information through automated means, which could increase competition for investor capital. The Inline XBRL tagging requirements may also potentially increase the efficiency of capital formation to the extent that making disclosures available in a structured format reduces some of the information barriers facing prospective investors and makes it easier for affected funds to attract investors. One commenter expressed similar views.424 Smaller affected funds in particular may benefit more from enhanced exposure to investors. To the extent that reporting the disclosures in a structured format increases the availability, or reduces the cost of collecting and analyzing, key information about affected funds, smaller affected funds may benefit from improved coverage by information intermediaries. Further, requiring affected funds to tag certain prospectus disclosures using Inline XBRL would facilitate monitoring of these disclosures by investors and information intermediaries, potentially increasing transparency and mitigating the potential informational costs stemming from other aspects of the proposal such as automatic shelf registration statements for WKSIs and short-form registration
statements for eligible funds, which may result in required disclosures being distributed across multiple regulatory filings and could thereby affect investor protection.425 The cover page tagging requirement includes new check boxes that will help identify whether a registration statement is, for example, an automatic shelf registration statement or a short-form registration statement.426 We already require registrants to tag all of the information on the cover page of Form 10–K, Form 10–Q, Form 8–K, Form 20– F, and Form 40–F using Inline XBRL.427 The requirement to tag the Form N–2 cover page in Inline XBRL is expected to benefit investors by enabling investors and information intermediaries to automate their use of the cover page information, including company name, the Act or Acts to which the registration statement relates, and check boxes relating to the effectiveness of the registration statement. This will enhance the ability of investors and information intermediaries to identify, count, sort, and analyze registrants and disclosures

428See, e.g., Michael Cohn, AICPA sees 45% drop in XBRL costs for small companies, Accounting Today (Aug. 15, 2018), available at https:// www.accountingtoday.com/news/aicpa-sees-45- drop-in-xbrl-costs-for-small-reporting-companies (stating that, according to an updated survey by AICPA and XBRL US, the cost of formatting financial statements in XBRL for smaller reporting companies has declined 45% since 2014 and that 68.6% of the companies paid $5,500 or less on an annual basis (as compared to 29.9% of companies in the 2014 survey) for fully outsourced creation and filing solutions for their XBRL filings, while 11.8% of the companies surveyed paid annual costs between $5,500 to as much as $8,000 for their fullservice outsourced solutions). 429For BDCs, for the purposes of the PRA, we estimated the average annual compliance costs in the 3 years following the adoption of the rule to be 33,028 burden hours of in-house Inline XBRL preparation (31,095 burden hours for tagging financial statement information, 1,828 burden hours for certain prospectus disclosure items, and 105 burden hours for Form N–2 cover page information using Inline XBRL) and $3,712,565 in outside services ($3,555,931 for tagging financial statement information, $156,634 for certain prospectus disclosure items, and $0 for Form N–2 cover page information using Inline XBRL). See infra section IV.B.2. We monetize the burden of in-house Inline XBRL preparation by multiplying the burden hours by an estimated wage rate of $400 per hour (33,028 × $400 = $13,211,200). The estimated wage figure is based on analysis in previous rulemakings. The average cost per BDC is calculated by adding the monetized internal burden ($13,211,200) to the cost of outside services ($3,712,565) and dividing by the number of BDCs (105). See also supra footnote 355. 430For registered CEFs, for the purposes of the PRA, we estimated the average annual compliance costs in the 3 years following the adoption of the rule to be 12,628 burden hours of in-house Inline XBRL preparation (686 burden hours for Form N– 2 cover page information using Inline XBRL and 11,942 burden hours for certain prospectus disclosure items) and $1,023,345 in outside services ($0 for Form N–2 cover page information using Inline XBRL and $1,023,345 for certain prospectus disclosure items). See infra section IV.B.2. We monetize the burden of in-house Inline XBRL preparation by multiplying the burden hours by an estimated wage rate of $400 per hour (12,628 × $400 = $5,051,200). The estimated wage figure is based on analysis in previous rulemakings. The average cost per registered CEF is calculated by adding the monetized internal burden ($5,051,200) to the cost of outside services ($1,023,345) and dividing by the number of registered CEFs (686). 431See American Institute of CPAs, XBRL Costs for Small Companies Have Declined 45%, According to AICPA Study (Aug. 18, 2018), available at https://www.aicpa.org/press/
pressreleases/2018/xbrl-costs-have-declinedaccording-to-aicpa-study.html; CFA Institute, The Cost of Structured Data: Myth vs. Reality (2017), available at https://www.cfainstitute.org/-/media/ documents/survey/the-cost-of-structured-datamyth-vs-reality-august-2017.ashx. 432See XBRL US Comment Letter. 433See European Securities and Markets Authority, Feedback Statement on the Consultation Paper on the Regulatory Technical Standard on the European Single Electronic Format (ESEF) (Dec. 21, 2016), available at https://www.esma.europa.eu/ sites/default/files/library/2016-1668_esma_ feedback_statement_on_the_rts_on_esef_0.pdf. to the extent these data points otherwise would be formatted, for example, in HTML. The check boxes, which are required to be tagged in Inline XBRL format, will allow investors and information intermediaries to distinguish between different categories of registration statements in much the same way they are currently able to do for operating companies. The availability of information in Inline XBRL could enable investors and information intermediaries to capture and analyze cover page information more quickly and at a lower cost, as well as to search and analyze the information dynamically. It could also facilitate comparison of information across filers and reporting periods. Affected funds will incur some costs to tag and review the required information in Inline XBRL. Some filers may perform the tagging in-house while others may retain outside service providers. We expect filers will incur costs for the fees of the outside service providers. Various XBRL preparation solutions have been developed and used by operating companies and open-end fund filers, and some evidence suggests that, for operating companies, XBRL tagging costs have decreased over time.428 While this evidence is specific to XBRL tagging costs rather than Inline XBRL tagging costs, because Inline XBRL allows filers to embed XBRL data directly into an HTML document, we expect Inline XBRL costs to be even lower than XBRL costs since Inline XBRL eliminates the need to tag a copy of the information in a separate XBRL exhibit. Costs of Inline XBRL preparation may depend on the familiarity of the filer and/or its service provider with Inline XBRL. Filers that currently report information in Inline XBRL for other investment products they offer, such as open-end funds, filing affected fund information in Inline XBRL under the amendments will likely incur lower costs of compliance than filers adopting Inline XBRL for the first time. Those registrants affected by the requirement that have not had experience structuring disclosures in other contexts will likely incur initial costs to acquire the necessary expertise and/or software as well as ongoing costs of tagging required information in Inline XBRL, and any fixed costs of complying with the Inline XBRL requirement may have a relatively greater impact on smaller filers. On an ongoing basis, registrants are expected
to expend time to tag and review the tagged information in Inline XBRL using their in-house staff. Some registrants may also incur an initial cost to license filing preparation software with Inline XBRL capabilities from a software vendor, and some may also incur an ongoing licensing cost. Other registrants may incur an initial cost to modify their existing filing preparation software to accommodate Inline XBRL preparation. Some registrants will incur the costs of filing agent services to rely on a filing agent to prepare their Inline XBRL filings. Initial costs involving investments in expertise and modifications to disclosure preparation solutions, or switching to a different software vendor or outside service provider, may result in a higher compliance cost during the first year of using Inline XBRL than in subsequent years. The costs of compliance with the Inline XBRL requirements are likely to vary across registrants. On average we estimate that the compliance cost to BDCs of tagging financial statement information, certain prospectus disclosure items, and Form N–2 cover
page information using Inline XBRL will
be approximately $161,179 per BDC per year in the 3 years following the adoption of the rule.429 We estimate that the compliance cost to registered CEFs of tagging in Inline XBRL format certain prospectus disclosure items and tagging Form N–2 cover page information will be approximately $8,855 per registered CEF per year in the 3 years following the adoption of the rule.430 We note that some recent surveys based on operating companies suggest that these current PRA-based burden estimates may be overstated with respect to affected funds, and particularly smaller affected funds.431 One commenter cited a study by the European Securities and Markets Authority estimating the cost of preparing Inline XBRL in-house to be on average around 8,200 euros for the first filing and 2,400 euros for each subsequent filing.432 In case of outsourcing, the study estimates the costs to be on average around 13,000 euros for the first filing and 4,600 euros for each subsequent filing. However, we do not believe that these figures the commenter cited are salient to the structured data requirements we are adopting. For example, although not cited by the commenter, the same study mentions that in the United States, because of the detailed tagging and extended taxonomy, the average costs for outsourcing the preparation of the financial statements in XBRL is higher, between 9,000 euros and 19,000 euros.433 As an alternative, we could have allowed but not required affected funds to present cover page, financial statement, and certain prospectus disclosure information in Inline XBRL. Compared to the final rule, a fully voluntary Inline XBRL program would

434Some studies have shown that investors use XBRL files often, even preferring them to non-XBRL files when both are available. See Yu Cong, Hui Du, and Miklos A. Vasarhelyi, Are XBRL Files Being Accessed? Evidence from the SEC EDGAR Log File Dataset, Journal of Information Systems, Vol. 32–3, 23–29 (2018). 435See XBRL US Comment Letter. 436 In contrast, the information provided in Form 24F–2 is less complex and is generally only used by fund issuers and Commission staff for purposes of calculating certain registered investment companies’ registration fees, so we have proposed to require Form 24F–2 information in a structured XML format rather than Inline XBRL. 437See XBRL US Comment Letter. 438See supra section II.I.1.d. 439We assume that the burden of tagging Form 24F–2 in a structured XML format would be 2 hours for each filing. See infra section IV.B.6. At an estimated wage rate of $271 per hour, the dollar cost for filing Form 24F–2 in a structured XML format is $542 (2 hours × $271 per hour) per fund. 440See supra section II.I.2.a and section II.I.2.d. 441See supra section II.I.2.c. 442See supra section II.I.2.b. 443See supra section II.I.5. lower costs for those filers that do not find Inline XBRL to be cost efficient. We also could have required Inline XBRL tagging only for a subset of affected funds—for example, affected funds that file short-form registration statements on Form N–2 or WKSIs. We also could have permitted more than one structured data format or left the precise format unspecified. However, a voluntary program or the use of multiple structured data formats would also reduce potential data quality benefits compared to mandatory Inline XBRL, as would a program that captures only a subset of affected funds. If the information were not submitted by all affected funds in a standardized, structured, machine-readable format, investors who seek to instantly analyze, aggregate, and compare the data would have to incur the costs of paying a thirdparty service provider to manually rekey the data, review the data for data quality problems during the duplication process, and disseminate the data to the investors.434 Alternatively, investors unwilling to pay a third-party service provider would have to incur the time to do that process themselves. In either scenario, the data would not be usable in as timely a manner as if it were made machine-readable in a standardized format. In addition, under a voluntary program, data that is not submitted in Inline XBRL would not be validated, thus decreasing the overall data quality of the data submitted. Unlike the machine-readable Inline XBRL format, data submitted in unstructured formats (e.g., HTML, ASCII) is not machinereadable at the element level and thereby cannot be validated by EDGAR in any way. Thus, data submitted in the HTML format by affected funds that opted not to use Inline XBRL and XBRL data submitted by other affected funds could be different due to the level of pre-submission
validation activities. Poor data quality reduces any data user’s ability to meaningfully analyze, aggregate, and compare data. One commenter supported the use of Inline XBRL compared to unstructured formats, arguing that Inline XBRL data is significantly less expensive to process and more timely than unstructured data.435 As another alternative, we could have required the disclosures to be filed in a different structured format, such as the XBRL or XML format. Compared to the Inline XBRL requirement that we are adopting, using the XBRL format would entail duplicative entry, which can adversely affect the quality and usability of the structured data as well as the efficiency and cost of preparation and review of the structured data. Compared to the requirement to use Inline XBRL, the alternative of requiring affected funds to use XML could result in lower costs. However, compared to the amendments, XML would provide less flexibility in tagging complex information as well as less extensive data quality validation capabilities. Given the complexity of the information required to be tagged and its importance to investors, we believe the benefits of using Inline XBRL outweigh the higher costs compared to XML.436 One commenter supported using Inline XBRL compared to XML, arguing that financial information is more efficiently reported in Inline XBRL.437 As another alternative, we could have expanded the scope of prospectus disclosure information required to be tagged in Inline XBRL under the final rule. Compared to the final rule, this alternative would improve the timeliness and usability of the required disclosure information, but would potentially impose additional costs on affected funds. To the extent that the other required prospectus disclosures of affected funds contain information that is more specific to individual funds without sufficient comparability or aggregation utility, the benefits of having those additional required disclosures in a structured format may be lower than the more limited subset of disclosures that we are requiring affected funds to file in Inline XBRL. As another alternative, we could have narrowed the scope of prospectus disclosure information required to be tagged in Inline XBRL under the rule. Compared to the final rule, this alternative could decrease the timeliness and usability of the information required to be disclosed, but could also potentially reduce costs for registrants. Overall, the prospectus disclosures that affected funds will be required to tag in Inline XBRL largely parallel the information that mutual funds and ETFs are required to disclose. We also believe these disclosures represent the information that will be most useful for investors that seek to use structured data to assist with investment decisions regarding affected funds. We also are requiring issuers that file Form 24F–2 (including mutual funds and ETFs, as well as interval funds) to submit the form in a structured XML format.438 We believe
using a structured data format will make it easier for issuers to accurately prepare and submit the information Form 24F–2 requires and will make the submitted information more useful to Commission staff. Automated validation processes could help issuers compute registration fees accurately before submitting the filing, which could reduce administrative burdens associated with correcting inaccurate filings. A structured filing format could also facilitate pre-population of previouslyfiled information. We estimate the cost of tagging Form 24F–2 in a structured XML format to be $542 per fund.439
3. Periodic Reporting Requirements
We are adopting certain new annual report requirements for affected funds that file a short-form registration statement on Form N–2. These funds must include in their annual reports certain information that they currently disclose in their prospectus—a table of fees and expenses, share price information, and a table of senior securities—and a discussion of material unresolved staff comments.440 In addition, all BDCs will be required to include financial highlights in their registration statements and annual reports.441 We also are requiring all registered CEFs to provide management’s discussion of fund performance in their annual reports.442 Finally, registered CEFs that rely on rule 8b–16(b) under the Investment Company Act to avoid annually updating their registration statements will be required to describe in their annual reports the fund’s current investment objectives and policies, and principal risks, and to provide more expansive disclosure about certain key changes that occurred during the relevant year in enough detail to allow investors to understand each change and how it may affect the fund.443 We believe these requirements will promote

444See ICI Comment Letter; Invesco Comment Letter. 445For the purpose of the PRA, we estimate that the proposed amendments to require registered CEFs to provide MDFP in their annual reports will result in an additional 16 burden hours for registered CEFs. See infra section IV.B.3. We monetize the internal burden by multiplying the burden hours by an estimated wage rate of $400 per hour (16 × $400 = $6,400). 446See infra footnote 561. investor protection by making important information more readily accessible to investors. With respect to affected funds filing short-form registration statements on Form N–2, the annual report requirements will compile certain information that is already available in a fund’s registration statement. This could be beneficial to some investors in these funds since information will be readily available in one document instead of investors needing to compile it from several sources. As previously discussed, given the ability of affected funds to use forward incorporation by reference under the short-form registration instruction, these funds’ annual reports may become a more convenient and comprehensive source of information about a particular seasoned fund, relative to that fund’s registration statement. At the same time, the annual report requirements may increase the compliance costs for seasoned funds because new information items will have to be added to the annual report. However, because the annual report will be incorporated by reference into the fund’s prospectus, requiring disclosure in both the prospectus and annual report should not require duplicative disclosure. Moreover, specifying identical disclosure requirements in both places may facilitate forward incorporation by reference, by making clear that the same required disclosure will satisfy both requirements. Alternatively, we could have required affected funds to include in their annual reports more or less information from their registration statements. While requiring less information would reduce costs to affected funds by reducing the amount of required annual report disclosure, it could also make it more difficult for investors to find important fund information. Requiring affected funds to include more prospectus information in their annual reports could increase the length and complexity of annual reports and make them less useful to investors overall. This alternative would also increase affected funds’ compliance costs. The requirement to disclose material unresolved staff comments in the annual report is designed to mitigate the concern that other aspects of the amendments may reduce certain affected funds’ incentives to resolve staff comments in a timely manner. We believe disclosure of material unresolved staff comments will likely provide important information to investors. This requirement may, however, impose certain compliance costs to the extent a seasoned fund does not timely resolve staff comments and hence will be required to provide
such disclosure. We do not believe these disclosure costs will be significant because the information will be readily available to the affected fund. We recognize, however, there could be some costs to affected funds associated with compliance and legal review to the extent an affected fund wants to provide additional information in its annual report disclosure beyond that provided in the fund’s written response to the staff’s comment (which would typically already be publicly available on EDGAR). We also recognize, as some commenters suggested, that determining whether a particular comment is ‘‘material’’ or ‘‘unresolved’’ involves some subjective judgment, which may contribute to compliance and legal costs.444 With respect to the requirement that BDCs provide financial highlights information, we believe investors will benefit from disclosure summarizing a BDC’s financial statements. We believe the costs associated with this requirement should be minimal since we understand that it is general market practice for BDCs to include this information in their registration statements. We believe the requirement for registered CEFs to include MDFP disclosure in their annual shareholder reports will be beneficial to investors by helping them assess a fund’s performance over the prior year and complementing other information in the report, which may make the annual report disclosure more understandable as a whole. This requirement will also promote parity between different types of funds, as open-end funds and BDCs are already required to provide similar disclosure in their annual reports. This requirement will likely increase compliance burdens for registered CEFs, to the extent they do not voluntarily provide MDFP disclosure already. We believe that a majority of registered CEFs already provide MDFP-like disclosure in their annual shareholder reports. We estimate the annual cost of providing MDFP disclosure to be $6,400 per registered CEF,445 although this cost will likely be lower for affected funds that already provide MDFP-like disclosure. We considered adopting additional MDFP requirements, such as requirements to: (1) Disclose the impact of particular investments (including large positions and/or significant investments) or investment types that contributed to or detracted from performance; (2) explain a fund’s performance in relation to its index; (3) explain how the use of leverage affected fund performance; (4) explain the reason for and effect of any large cash or temporary defensive positions on fund performance; (5) explain the effect of any tax strategies, or the effects of taxes, on fund performance; (6) explain the effect of non-recurring or non-cash income on fund performance; (7) include general discussion of purchases and sales of fund shares and the effects of any share repurchases or tender offers on fund performance; and/or (8) disclose whether the fund has high portfolio turnover and the effect of portfolio turnover on fund
performance. We also considered changing the average annual total return table to provide additional or more useful information to investors, such as requiring total return based on per-share NAV, in addition to total return based on current market price. Although one or more of these changes could result in additional, potentially helpful information for investors, we also considered the administrative costs that additional disclosure requirements would impose and have determined not to adopt them at this time. Under the amendments to rule 8b–16, registered CEFs relying on paragraph (b) of the rule must describe in their annual reports the fund’s current investment objectives and policies, and principal risks, and certain key changes that occurred during the relevant year in enough detail to allow investors to understand each change and how it may affect the fund. We estimate that approximately 521 registered CEFs relied on rule 8b-16 as of December 31, 2019 and will therefore provide the new disclosure.446 These registered CEFs also will be required to preface disclosure of these key changes with a legend clarifying that the disclosures provide only a summary of certain changes that have occurred in the past year, and that the summary may not reflect all of the changes that have occurred. We believe these new disclosure requirements will allow investors in funds relying on rule 8b– 16(b) to more easily identify and understand key information about their

447See supra section II.I.4. 448For example, results from 2011 investor testing sponsored by the Commission suggest that an investor looking for a fund’s annual report is most likely to seek it out on the fund’s website. See Investor Testing of Selected Mutual Fund Annual Reports (Feb. 9, 2012), available at https:// www.sec.gov/comments/s7-08-15/s70815-3.pdf. Additionally, a 2018 report by the Investment Company Institute suggests that over 90% of U.S. households owning mutual funds used the internet extensively. See ICI Research Perspective, Ownership of Mutual Funds, Shareholder Sentiment, and Use of the internet, 2019 (Oct. 2019), available at https://www.ici.org/pdf/per25- 08.pdf. 449See supra paragraph accompanying footnote 410 (recognizing the effects of allowing affected funds to not deliver final prospectuses directly to investors if they meet certain requirements). 450See, e.g., supra footnote 365 and accompanying text. 451See supra section II.D. 452For the purpose of the PRA, we estimate an average burden to comply with the website posting requirements of 2 hours per fund. See infra section IV.B.1. The expected compliance cost associated with the proposed website posting requirements is calculated by multiplying the 2-hour burden by the estimated hourly wage based on published rates for webmasters ($248). 453See supra footnote 153. 454See supra section II.I.4. 455See Variable Contract Summary Prospectus Adopting Release, supra footnote 345, at n.1233 and accompanying text. 456We requested data regarding how often investors may request copies of prospectuses or incorporated materials, how many materials affected funds would incorporate by reference into their prospectuses or SAIs, and how lengthy those materials would be. Commenters did not provide any data in response. 457See supra section II.B.3.b. investments by providing such information in one place. Because these funds are already required to disclose in their annual reports the enumerated changes to specified Form N–2 disclosure items—and therefore already must have and maintain, among other things, updated information about the investment objectives, policies and principal risks that we are requiring them to disclose in full—the new requirement will likely add only a small incremental compliance burden.
4. Discretionary Amendments to
Incorporation by Reference Requirements The final rule will modernize Form N–2’s requirements for backward incorporation by reference for all affected funds.447 Specifically, we are requiring that an affected fund make information that is incorporated by reference into its prospectus or SAI, as well as the corresponding prospectus and SAI, readily available and accessible on a website maintained by or for the fund and identified in the fund’s prospectus or SAI. We believe this new requirement will improve the information’s online accessibility for investors. In particular, this new requirement will make the incorporated information, prospectus, and SAI more accessible to retail investors online because we believe they may be more inclined to look at a fund’s website for information than to search the EDGAR system.448 We recognize that investors without home internet access, depending on their ability and preference to access fund information electronically, might experience a reduction in their ability to access information that is incorporated by reference into its prospectus or SAI. However, affected funds will also be required to provide incorporated materials upon request free of charge, in recognition that some investors may prefer to review these materials in paper.449 This amendment also will facilitate the efficient use of incorporation by reference by affected funds. For example, if an investor requested a copy of the affected fund’s prospectus in accordance with rule 173, the fund would in some cases need to deliver a much longer document if we did not amend Form N–2’s backward incorporation by reference provisions.450 We do not, however, expect that the backward incorporation by reference amendment will substantially reduce the amount of information affected funds deliver to investors by mail or electronically. This is because we expect that most affected funds will rely on rules 172 and 173 to satisfy their prospectus delivery obligations. An issuer that uses these rules will satisfy its final prospectus delivery obligations by filing the prospectus with the Commission rather than delivering the prospectus and any incorporated material to investors.451 We do not believe the requirement to make a fund’s prospectus, SAI, and incorporated materials available on a website will generate significant compliance costs for affected funds because many funds currently post their annual and semi-annual reports and other fund information on their websites. We estimate the annual cost to comply with the website posting requirements to be $496 per fund.452 Affected funds may also incur printing and mailing costs under the final rule if some investors request paper copies of the prospectus 453 or of the information that has been incorporated by reference into the prospectus or SAI but not delivered with the prospectus or SAI.454 In another release, the Commission estimated that the annual printing and mailing cost associated with providing copies of
prospectuses and other documents upon request would be approximately $500 per registrant.455 We are similarly adopting a requirement to send prospectuses and related information in this release, and we have no reason to assume significant differences in the average lengths of the associated materials or the frequency of investor requests under the amendments we are adopting. We estimate that the printing and mailing costs associated with the new requirements will be approximately $750 per fund in recognition that the requirement to deliver information that has been incorporated by reference may result in greater overall costs since affected funds that are eligible to file short-form registration statements under the final rule will be able to use incorporation by reference more frequently.456 We anticipate, however, that investors may be less likely to request copies of materials that have been incorporated by reference into an affected fund’s prospectus or SAI, so we believe this requirement will only incrementally increase costs. Alternatively, we could have retained Form N–2’s current backward incorporation by reference requirements and continued to require funds to deliver incorporated materials to new investors. Because current General Instruction F of Form N–2 does not require affected funds to make incorporated materials available online, funds would not have to incur costs associated with website posting. However, because affected funds that choose to rely on rules 172 and 173 will be deemed to have delivered their disclosures upon filing with the Commission instead of giving them to investors, the current backward incorporation delivery requirement will not result in delivery of incorporated materials to a fund’s investors, thus making less accessible the disclosure materials that might affect their investment decision. We are also modifying Form N–14 to decrease the disclosure burden of the form and reduce the length of Form N– 14 prospectuses in certain circumstances.457 The amendments will allow BDCs to incorporate by reference to the same extent as registered CEFs. This will provide for more consistent treatment between registered CEFs and BDCs. We also are eliminating the requirement that registrants file with the Form N–14 registration statement the documents containing the information that is incorporated by reference into the prospectus or SAI, thus decreasing

458See Dechert Comment Letter; IPA Comment Letter. 459See supra section II.D. 460See ABA Comment Letter. 461 44 U.S.C. 3501 et seq. 462We are also adopting new requirements for funds that file on Form 24F–2 to submit the form in XML format. We account for the burdens associated with this requirement in infra section IV.B.6. compliance costs. Commenters generally supported these changes.458
5. Automatic or Immediate Effectiveness
of Filings by Affected Funds Conducting Certain Continuous Offerings In response to comments, the final rule will allow any registered CEF or BDC that conducts continuous offerings under rule 415(a)(1)(ix) to file posteffective amendments and certain registration statements that become effective immediately upon filing or automatically 60 days after filing.459 We believe this rule amendment will allow these unlisted continuously-offered affected funds to maintain effective registration statements in a more efficient, cost-effective manner, similar to the benefits the final rule provides to affected funds that file short-form registration statements or qualify as WKSIs. Under the amendments, continuously-offered unlisted affected funds, which generally will not qualify as WKSIs or be eligible to file short-form registration statements because they do not have public float, will be able to more efficiently update their financial statements under section 10(a)(3) of the Securities Act to maintain effective registration statements while they engage in continuous offerings. One commenter stated that allowing continuously-offered unlisted affected funds to rely on rule 486 would benefit investors in these funds by allowing the funds to avoid the time and expense of an annual staff review of registration statements where no changes are made beyond immaterial updates and updates to audited financial information.460 As an alternative, we could have continued to limit rule 486 to interval funds. Such an alternative would have made it less efficient for certain continuously-offered unlisted affected funds to update their financial statements or make other changes to their registration statements relative to the processes available to all other funds that conduct continuous or delayed offerings under the Commission’s rules.
IV. Paperwork Reduction Act Analysis
A. Background
Certain provisions of the final amendments contain ‘‘collection of information’’ requirements within the meaning of the Paperwork Reduction Act of 1995 (PRA).461 We are submitting the final amendments to the Office of Management and Budget (OMB) for review in accordance with 44 U.S.C. 3507(d) and 5 CFR 1320.11. The hours and costs associated with preparing disclosure, filing forms, and retaining records constitute reporting and cost burdens imposed by the collections of information. 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 control number. The titles for the collection of information are summarized in Table 5 below.
TABLE 5—COLLECTIONS OF
INFORMATION
Title OMB control
No.
Form N–2 .............................. 3235–0026 Investment Company Interactive Data 1 ...................... 3235–0642 Rule 30e–1 ........................... 3235–0025 Form 10–K ............................ 3235–0063 Family of rules under section 8(b) of the Investment Company Act of 1940 2 ..... 3235–0176 Rule 163 ............................... 3235–0619 Rule 433 ............................... 3235–0617 Rule 173 ............................... 3235–0618 Form 24F–2 .......................... 3235–0456 Form S–1 .............................. 3235–0065 Form S–3 .............................. 3235- 0073 Form N-14 ............................ 3235–0336 Form F–1 .............................. 3235–0258 Form F–3 .............................. 3235–0256 Notes:
1. Recently, we issued a release that, among
other things, retitled this collection of information (previously, ‘‘Mutual Fund Interactive Data’’) ‘‘Investment Company Interactive Data.’’ See Variable Contract Summary Prospectus Adopting Release, supra footnote
345. 2.The paperwork burdens for the rules
under section 8(b) of the Investment Company Act are imposed through the forms and reports that are subject to the requirements in these rules and are reflected in the PRA burdens of those documents. To avoid a PRA inventory reflecting duplicative burdens and for administrative convenience, we assign a onehour burden to these rules. The rules, forms, and regulations listed above were adopted under the Securities Act, the Exchange Act, or the Investment Company Act. They set forth the disclosure requirements for registration statements, prospectuses, periodic reports, and certified shareholder reports that are prepared by registrants to help investors make informed investment and voting decisions. They also permit additional communications by registrants during a registered offering. The final amendments will allow affected funds to use the securities offering rules that are already available to operating companies. In addition, the final rule includes amendments to our rules and forms intended to tailor the disclosure and regulatory framework to affected funds. The Investment Company Interactive Data collection of information references current requirements for certain registered investment companies to submit to the Commission information included in their registration statements, or information included in or amended by any posteffective amendments to such registration statements, in response to certain form items in interactive data format. It also references the requirement for funds to submit an Interactive Data File to the Commission for any form of prospectus filed pursuant to rule 497(c) or (e) that includes information in response to certain form items. The final amendment will include several new structured data requirements, including requirements for: (1) BDCs to submit financial statement information using Inline XBRL format; (2) affected funds to include structured cover page information in their registration statements on Form N–2 using Inline XBRL format; and (3) affected funds to tag certain prospectus information using Inline XBRL format.462 Although the interactive data filing requirements are included in the Form N–2 instructions, we are separately reflecting the hour and cost burdens for these requirements in the burden estimate for Investment Company Interactive Data and not in the estimate for Form N–2. The information collection requirements related to registration statements and Exchange Act reports are mandatory. In addition, there is no mandatory retention period for the information disclosed, and the information gathered will be made publicly available. The information collection requirements related to the communications and prospectus delivery rules we are adopting apply only to affected funds and other offering participants choosing to rely on them. There will be a mandatory record retention period with respect to the communications and prospectus delivery information collections. Under rule 433, issuers and
offering participants must retain all free writing prospectuses that have been used, for three years following the date of the initial bona fide offering of the securities in question that were not filed with the Commission. Moreover, free writing prospectuses that are made by or on behalf of an affected fund, and free

463See supra footnotes 355 and 357.
464See supra section II.I.1.b; see also amended cover page of Form N–2. 465See supra section II.I.2.c; see also Instruction 1 to Item 4 of amended Form N–2. 466See supra footnote 63 and accompanying paragraph; see also Items 34.3–7 of amended Form N–2. 467See supra section II.I.4; see also General Instruction F.4.a of amended Form N–2. 468See supra section II.B.3.e; see also General Instruction F.3.b of amended Form N–2. writing prospectuses that are broadly disseminated by another offering participant, will have to be filed and will be publicly available on EDGAR, whereas free writing prospectuses prepared by or on behalf of, or used or referred to, by offering participants other than the issuer will not have to be filed. B. Summary of the Amendments and Impact on Information Collections We are amending several rules and forms to modify the registration, communications, and offering processes for affected funds under the Securities Act and Investment Company Act. The amendments are designed to carry out the requirements of section 803 of the BDC Act and section 509 of the Registered CEF Act. The amendments generally will allow affected funds to use the securities offering rules that are already available to operating companies. The amendments principally affect five aspects of the application of our securities offering rules to affected funds. First, the amendments will streamline the registration process under the Securities Act for affected funds to allow them to sell securities more quickly and efficiently under a shelf registration process tailored to affected funds. Second, the amendments will allow affected funds to qualify as WKSIs under rule 405 under the Securities Act. Third, the amendments will allow affected funds to satisfy final prospectus delivery requirements using the same method as operating companies. Fourth, the amendments will allow affected funds to use communications rules currently available to operating companies, such as the use of the safe harbors for disseminating certain factual business information, forward-looking information, a ‘‘free writing prospectus,’’ and broker-dealer research reports. Finally, the amendments will tailor affected funds’ disclosure and regulatory framework in light of the amendments to the offering rules applicable to them. These amendments include new structured data requirements, new disclosure requirements for annual reports, and a requirement for interval funds to pay securities registration fees using the same method that mutual funds and ETFs use today. We anticipate that several provisions of the amendments will increase the burdens and costs for affected funds that will be subject to the amendments. We have estimated the average number of hours an affected fund will spend to prepare and file the information collections and the average hourly rate for the services of outside professionals. In deriving our estimates, we recognize that the burdens will likely vary among individual
affected funds based on a number of factors, including their size and the nature of their investment activities.463 In addition, some affected funds may experience costs in excess of our estimates, and some may experience less than the estimated average costs. In addition to these amendments relating to affected funds, we are amending several rules and forms to enable certain ETPs that are not registered under the Investment Company Act to elect to register offerings of an indeterminate amount of exchange-traded vehicle securities and pay registration fees for these offerings on an annual net basis. We have estimated the average number of additional hours that such ETPs will spend when filing registration statements for these offerings to prepare and file the information collections and the average hourly rate for the services of outside professionals. We anticipate that the amendments will result in a decrease in the number of registration statements filed by these issuers and that, overall, these amendments will reduce the burdens and costs for these issuers.

Amendments to Form N–2
Registration Statement
Form N–2 is the form used by an affected fund to register offerings under the Securities Act and, as applicable, to register as an investment company under the Investment Company Act. The amendments to Form N–2 will increase the existing disclosure burdens of the form by requiring:

Affected funds to use new check
boxes on the cover page to provide information about the fund, the purpose of the filing, and the type of offering, including whether the form is being used for automatic shelf registration; 464
BDCs to include financial highlights
disclosure in their registration statements, as registered CEFs are currently required to do; 465
Affected funds to provide new
undertakings to be furnished in registration statements being filed pursuant to rule 415; 466 and
Affected funds to make certain
documents available online if they incorporate them by reference, including the prospectus, SAI, and any Exchange Act reports filed under
section 13 or section 15(d) of the
Exchange Act that are incorporated by reference into the fund’s prospectus or SAI.467 At the same time, the amendments to Form N–2 will decrease existing burdens for the form by:
Permitting eligible affected funds to
forward incorporate by reference Exchange Act reports, which will reduce the need for such funds to file a post-effective amendment or a prospectus supplement to update information in the registration statement.468
TABLE 6—CURRENTLY APPROVED FORM N–2 PRA ESTIMATES 1
Internal burden Wage rate 2 Cost of internal burden Annual external cost burden Burden per Initial Registration Statement Total burden per registration statement ...................... 517.6 hours × $269 (blended rate of $365 for compliance attorney and $172 for intermediate accountant). $139,234 .......... $32,241 Number of annual initial registration statements ......... × 136 ................................................... × 136 ................ × 136

TABLE 6—CURRENTLY APPROVED FORM N–2 PRA ESTIMATES 1—Continued
Internal burden Wage rate 2 Cost of internal burden Annual external cost burden Total annual burden ............................................. 70,394 hours ................................................... $18,935,824 ..... $4,384,776 Burden per Post-Effective Amendment Total burden per post-effective amendment ............... 125 hours × $269 (blended rate of $365 for compliance attorney and $172 for intermediate accountant). $33,625 ............ $11,114 Number of annual post-effective amendments ........... × 30 ................................................... × 30 .................. × 30 Total annual burden ............................................. 3,751 hours ................................................... $1,008,750 ....... $333,420 Total Burden Total initial registration statement burden ................... 70,394 hours ................................................... $18,935,824 ..... $4,384,776 Total post-effective amendment burden ...................... 3,751 hours ................................................... $1,008,750 ....... $333,420 Total annual burden ............................................. 74,145 hours ................................................... 19,944,574 ....... 4,718,196 Notes:
1.These estimates were previously submitted to OMB in connection with a revision of the then-currently-approved collection in 2020. 2. Derived from SIFMA’s Management & Professional Earnings in the Securities Industry 2013 (modified to account for an 1,800-hour work year; multiplied by 5.35 to account for bonuses, firm size, employee benefits and overheard, and adjusted for inflation).
TABLE 7—PROPOSED FORM N–2 PRA ESTIMATES 1
Internal burden Wage rate 2 Cost of internal burden Annual external cost burden Burden for Initial Registration Statement Preparing and filing initial registration statement.
171.67 hours × $401 (attorney) ........................................... $68,838.33 ....... $31,941
171.67 hours × $210 (paralegal) ......................................... $36,050 ............
171.67 hours × $449 (assistant general counsel) ............... $77,078.33 .......
Total burden per registration statement ..... 515 hours .................................................................... $181,966.67 ..... $31,941 Number of annual initial registration statements. × 138 .................................................................... × 138 ................ × 138 Total annual burden ............................ 71,070 hours .................................................................... $25,111,399.08 $4,407,858 Burden for Post–Effective Amendment Preparing and filing post-effective amendments.
35.67 hours × $401 (attorney) ........................................... $14,302.33 ....... $10,814
35.67 hours × $210 (paralegal) ......................................... $7,490 ..............
35.67 hours × $449 (assistant general counsel) ............... $16,014.33 .......
Total burden per post-effective amendment. 107 hours .................................................................... $37,806.67 ....... $10,814 Number of annual post-effective amendments. × 190 .................................................................... × 190 ................ × 190 Total annual burden ............................ 20,330 hours .................................................................... $7,183,266.70 .. $2,054,660 Additional Burden for Affected Funds Proposed new check box requirements ..... 0.1667 × $352 (compliance attorney) ....................... $58.67 .............. $0
0.1667 × $319 (senior programmer) ......................... $53.17 ..............
0.1667 × $239 (webmaster) ...................................... $39.83 ..............
Proposed online availability requirement ... 0.67 hours × $352 (compliance attorney) ....................... $234.67.
0.67 hours × $319 (senior programmer) ......................... $212.67 ............ $0
0.67 hours × $239 (webmaster) ...................................... $159.33 ............
Total additional burden per affected fund .. 2.5 hours .................................................................... $758.33 ............ $0 Number of affected funds ........................... × 807 .................................................................... × 807 ................ × 807 Total annual burden ............................ 2,018 hours .................................................................... $611,975 .......... $0 Additional Burden for BDCS Financial highlights requirement ................ 0.5 hours × $352 (compliance attorney) ....................... $176 ................. $0
0.5 hours × $319 (senior programmer) ......................... $159.50 ............

TABLE 7—PROPOSED FORM N–2 PRA ESTIMATES 1—Continued
Internal burden Wage rate 2 Cost of internal burden Annual external cost burden
0.5 hours × $239 (webmaster) ...................................... $119.50 ............
Total additional burden per BDC ............... 1.5 hours .................................................................... $455 ................. $0 Number of BDCs ........................................ × 103 .................................................................... × 103 ................ × 103 Total annual burden ............................ 155 hours .................................................................... $46,865 ............ $0 Total Burden Total initial registration statement burden .. 71,070 hours .................................................................... $25,111,399.08 $4,407,858 Total post-effective amendment burden .... 20,330 hours .................................................................... $7,183,266.70 .. $2,054,660 Total additional burden for affected funds 2,018 hours .................................................................... $611,975 .......... $0 Total additional burden for BDCs ............... 155 hours .................................................................... $46,865 ............ $0 Total annual burden ............................ 93,573 hours .................................................................... $32,953,505.78 $6,462,518 Notes:
1.See Proposing Release, supra footnote 10, at section IV.B.1. 2.See supra Table 6, at footnote 2.
TABLE 8—FINAL FORM N–2 PRA ESTIMATES
Internal burden Wage rate 1 Cost of internal burden Annual external cost burden Burden for Initial Registration Statement Total burden per registration statement ..... 517.6 hours × $269 (blended rate of $365 for compliance attorney and $172 for intermediate accountant). $139,234 .......... $32,241 Number of annual initial registration statements. × 14023 × 140 23 ............ × 140 23 Total annual burden ............................ 72,464 hours $19,492,760 ..... $4,513,740 Burden for Post-Effective Amendment Total burden per post-effective amendment. 125 hours × $269 (blended rate of $365 for compliance attorney and $172 for intermediate accountant). $33,625 ............ $11,114 Number of annual post-effective amendments. × 1582, 4 × 158 24 ............ × 158 24 Total annual burden ............................ 19,750 hours $5,312,750 ....... $1,756,012 Additional Burden for Affected Funds New check box requirements ..................... 0.1667 hours × $365 (compliance attorney) 2 ..................... $60.85 .............. $0
0.1667 hours × $331 (senior programmer) 2 ....................... $55.18 ..............
0.1667 hours × $248 (webmaster) 2 .................................... $41.34 ..............
Online availability requirement ................... 2 hours × $248 (webmaster) 24 .................................. $496 ................. $0 Total additional burden per affected fund .. 2.5 hours $653.37 ............ $0 Number of affected funds ........................... × 791 × 791 ................ × 791 Total annual burden ............................ 1,978 hours $516,815.67 ..... $0 Additional Burden for BDCS Financial highlights requirement ................ 0.5 hours × $365 (compliance attorney) 2 ..................... $182.50 ............ $0
0.5 hours × $331 (senior programmer) 2 ....................... $165.50.
0.5 hours × $248 (webmaster) 2 .................................... $124.
Total additional burden per BDC ............... 1.5 hours $472 ................. $0 Number of BDCs ........................................ × 105 × 105 ................ × 105 Total annual burden ............................ 158 hours 49,560 .............. $0 Total Burden Total initial registration statement burden .. 72,464 hours $19,492,760 ..... $4,513,740 Total post-effective amendment burden .... 19,750 hours .... .................................................................... 5,312,750 ......... 1,756,012
Total additional burden for affected funds 1,978 hours .... .................................................................... 516,815.67 ....... 0

469See Proposing Release, supra footnote 10, at
section IV.B.1.
470See 17 CFR part 229 [OMB Control No. 3235– 0071] (Regulation S–K specifies the requirements for exhibits to registration statements and reports); 17 CFR part 232 [OMB Control No. 3235–0424] (Regulation S–T specifies the requirements that govern the electronic submission of documents). Specifically, we are amending rule 601 of Regulation S–K, and rules 11 and 405 of Regulation S–T. The additional collection of information burden that will result from the amendments to rule 601 of Regulation S–K, rules 11 and 405 of Regulation S–T, and Forms N–2 and N–CSR to require structured data reporting for affected funds are included in our burden estimates for the ‘‘Investment Company Interactive Data’’ collection of information, and do not impose any separate burden aside from that described in our discussion of the burden estimates for this collection of information. 471We also are amending Form 24F–2 to require submission of this filing in a structured XML format. We discuss the PRA burdens of this and other amendments to the form below. See infra
section IV.B.6. 472See supra section II.I.1.a; see also amended
rule 601(b)(101) of Regulation S–K; amended rule 405(b)(3)(i) of Regulation of S–T. 473See supra section II.I.1.b; see also General Instruction I.1 of amended Form N–2; amended rule 405(b)(3)(ii) of Regulation S–T. 474See supra section II.I.1.c; see also General Instruction I.2–3 of amended Form N–2; amended rule 405(b)(3)(iii) of Regulation S–T. The amendments will require the following prospectus disclosure items be tagged using Inline XBRL: Fee
Table; Senior Securities Table; Investment
Objectives and Policies; Risk Factors; Share Price Data; and Capital Stock, Long-Term Debt, and Other Securities. A seasoned fund filing a short-form registration statement on Form N–2 also will be required to tag any information that is incorporated by reference from an Exchange Act report, such as those on Form N–CSR, 10–K, 10–Q, or 8–K, in response to a disclosure item of the registration statement that is required to be tagged. See supra footnote 241 and accompanying text.
TABLE 8—FINAL FORM N–2 PRA ESTIMATES—Continued
Internal burden Wage rate 1 Cost of internal burden Annual external cost burden
Total additional burden for BDCs ............... 158 hours .... .................................................................... 49,560 .............. 0
Total annual burden ............................ 94,350 hours $25,371,885.70 $6,269,752 Notes:
1.See supra Table 6, at footnote 2. In a change from the Proposing Release, we have revised the wage rate categories for existing Form N–2 burdens, consistent with the currently-approved Form N–2 PRA burden estimates. 2.Estimate revised to reflect updated industry data. 3.We considered whether deeming interval funds to have registered an indefinite number of shares under the amendments to rules 23c–3 and 24f–2 will result in fewer registration statement filings since these funds will no longer need to file registration statements to register additional shares. Based on staff analysis of interval fund filings between January 1, 2017 and December 31, 2019, interval funds very rarely filed registrations statements on Form N–2 solely to register additional shares (i.e., the filing typically also updated the fund’s financial statements or included other changes). On average, interval funds filed seven Form N–2 registration statements each year during this period that, among other things, registered additional shares. As a result, for purposes of this PRA estimate, we are not reducing the estimated number of Form N–2 filings to account for the change in how interval funds register additional shares. 4.Estimate revised to reflect the average number of post-effective amendments filed between January 1, 2017 and December 31, 2019 (286 post-effective amendments), minus an estimated reduction of 128 post-effective amendments resulting from the ability of affected funds that are eligible to file short-form registration statements to forward incorporate by reference information into their registration statements. The estimated reduction in the number of post-effective amendment filings has been increased from 112 to 128 filings to account for an increase in the percentage of affected funds that will be eligible to file short-form registration statements (based on updated industry data) and to account for post-effective amendments under rule 486(b) filed by funds that have received relevant staff no-action letters (an average of approximately 29 filings per year over the three-year period). See supra Section II.D (discussing relevant staff no-action letters); Proposing Release, supra footnote 10, at n.447 (discussing the initial estimated reduction in the number of post-effective amendments of 112).
Table 6 above summarizes the current
PRA estimates associated with the requirements of Form N–2. Table 7 summarized the proposed PRA estimates included in the Proposing Release.469 Table 8 summarizes the final PRA estimates associated with Form N– 2 as amended. We did not receive public comment on our proposed PRA estimates, but we are revising our estimates as a result of updated industry data. Specifically, we are revising the estimated wage rates, the estimated number of affected funds, and the estimated number of annual initial registration statement and post-effective amendment filings to reflect updated industry data. As summarized in Table 8 above, we estimate that the total hour burdens and time costs associated with Form N–2 will be an aggregate annual burden of 94,350 hours at an aggregate annual cost of internal burden of $25,371,886. We estimate an aggregate annual external time cost of $6,269,752.
2. Structured Data Reporting
Requirements
We are amending Form N–2, as well as Regulation S–K and Regulation S– T,470 to require certain new structured data reporting requirements for registered CEFs and BDCs.471 Specifically, the amendments will require:

BDCs to submit financial statement
information using Inline XBRL format, as is currently required of operating companies.472 The respondents for this collection of information are an estimated 105 BDCs.
Affected funds to include
structured cover page information in their registration statements on Form N– 2 using Inline XBRL, including the tagging of the new check boxes to the cover page of Form N–2.473 The respondents for this collection of information are an estimated 791 affected funds. As demonstrated in
Table 9 below, we do not believe the
cover page tagging requirement will result in significant additional burdens for affected funds.
Affected funds to tag certain Form
N–2 disclosure items using Inline XBRL.474 The respondents for this collection of information are an estimated 791 affected funds. The purposes of these information collections are to make financial information easier for investors to analyze and to help automate regulatory filings and business information processing, and to reduce the current disparity between operating companies and BDCs with respect to the accessibility of information they provide to the market. These collections of information are mandatory for the relevant respondents, discussed for each collection below. Confidential information will not be disclosed pursuant to these new reporting requirements.

475See supra section II.I.2.
476See supra section II.I.2.a; see also new Instructions 4.h.(1) (senior securities table), 4.h.(2) (fee and expense table), 4.h.(3) (share price data), and 4.h.(4) (unresolved staff comments) to Item 24 of amended Form N–2. 477See supra section II.I.2.b; see also new Instruction 4.g to Item 24 of amended Form N–2. 478See supra section II.I.2.c; see also Instruction 1 to Item 4 of amended Form N–2; new Instruction 10 to Item 24 of amended Form N–2. As discussed above, BDCs also will be required to include financial highlights in their registration statements on Form N–2. See supra section IV.B.1. 479See supra section II.I.5; see also amended rule 8b-16.
TABLE 9—PROPOSED AND FINAL STRUCTURED DATA REPORTING PRA ANALYSIS
Initial hours Annual hours 1 Initial cost burden Annual cost burden PROPOSED ESTIMATES2 BDC Financial Statement Information—Per BDC Response (I) ............ 81 65.81 hours ............ $9,262.50 $7,525.78 Number of BDC Responses Per Year .................................................... ........................ × 463.5 2 ................. ........................ × 463.5 2 Total Annual Burden ........................................................................ ........................ 30,503 hours .......... ........................ $3,488,199.03 Affected Funds Cover Page Information on Form N 2—Per Affected Fund Response (II). 0 1 hour .................... $0 $0 Number of Affected Fund Responses Per Year ..................................... ........................ × 807 ...................... ........................ × 807 Total Annual Burden ........................................................................ ........................ 807 hours ............... ........................ $0 Affected Funds Form N–2 Disclosure Items—Per Affected Fund Response (III).
15.25 12.8 hours .............. $1,350.00 $1,096.88
Number of Affected Fund Responses Per Year ..................................... ........................ × 1097.5 ................. ........................ × 1097.5 Total Annual Burden ........................................................................ ........................ 14,048.26 hours ..... ........................ $1,203,825.80 Combined Total Annual Burden ...................................................... ........................ 45,358.26 hours ..... ........................ $4,692,024.83 FINAL ESTIMATES BDC Financial Statement Information—Per BDC Response (I) ............ 81 hours 65.81 ...................... $9,262.50 $7,525.78 Number of BDC Responses Per Year .................................................... ........................ × 472.5 ................... ........................ × 472.5 Total Annual Burden ........................................................................ ........................ 31,095 hours .......... ........................ $3,555,931 Affected Funds Cover Page Information on Form N–2—Per Affected Fund Response (II). ........................ 1 hour .................... ........................ $0 Number of Affected Fund Responses Per Year ..................................... ........................ × 791 ...................... ........................ × 791 Total Annual Burden ........................................................................ ........................ 791 hours ............... ........................ $0 Affected Funds Form N–2 Disclosure Items (III) .................................... 15.25 12.8 hours .............. $1,350.00 $1,097 Number of Affected Fund Responses Per Year ..................................... ........................ × 1,076 ................... ........................ × 1,076 Total Annual Burden ........................................................................ ........................ 13,773 hours .......... ........................ $1,180,372 Combined Total Annual Burden ...................................................... ........................ 45,659 hours .......... ........................ $4,736,303 Notes:
1. Includes initial and ongoing burden estimates annualized over a three-year period. Here, as discussed in the Proposing Release, supra footnote 10, at section V.B.2, we assumed that the one-time cost would result in a 50% incremental increase in the internal burdens and external
costs of the BDC financial information and Form N–2 disclosure requirements (items I and III in the chart above) during the first year, and would subsequently decline in the second and third years by 75% from the immediately-preceding year. 2.The proposed estimates are discussed in additional detail in the Proposing Release, supra footnote 10, at section V.B.2.
Table 9 summarizes the proposed
PRA estimates included in the Proposing Release and the final PRA estimates for the structured data reporting requirements. We did not receive public comment on our proposed PRA estimates, but we are revising our estimates as a result of updated industry data. Specifically, we are revising the estimated number of BDCs and affected funds to reflect updated industry data. As summarized in Table 9, we estimate that the total hour burdens and time costs associated with the structured data reporting requirements will be an aggregate annual burden of 45,659 hours. We estimate an aggregate annual external time cost of $4,736,303.
3. New Annual Reporting Requirements
Under Rule 30e-1 and Exchange Act Periodic Reporting Requirements for BDCs Several of the amendments, such as the amendments that would allow certain affected funds to use an automatic shelf registration statement or to forward incorporate by reference Exchange Act reports, may raise the importance of an affected fund’s Exchange Act reports to investors.475 In light of this, we are adopting new disclosure requirements for affected funds’ annual reports. Specifically, we are amending:

Form N–2 to require affected funds
using the short-form registration statement to disclose in their annual reports a fee and expense table, share price data, a senior securities table, and unresolved staff comments regarding the fund’s periodic or current reports or registration statement; 476
Form N–2 to require registered
CEFs to provide MDFP in their annual reports; 477
Form N–2 to require BDCs to
include financial highlights in their annual reports on Form 10–K; 478 and
Rule 8b-16 to require a registered
CEF that relies on paragraph (b) of that rule to describe in its annual reports its current investment objectives and policies, and principal risks, and certain key changes that occurred during the relevant year in enough detail to allow investors to understand each change and how it may affect the fund.479 The collection of information burdens under these amendments correspond to information collections under rule 30e– 1 for registered CEFs and Form 10–K for BDCs. Rule 30e–1 generally requires registered investment companies to transmit to their shareholders, at least semi-annually, reports containing the information that is required to be included in such reports by the fund’s registration statement form under the Investment Company Act. BDCs, like operating companies, are required to file annual reports on Form 10–K pursuant to section 13 or 15(d) of the Exchange Act. The burden estimates were calculated by multiplying the estimated number of responses by the estimated average amount of time it would take an affected

480We recognize that the costs of retaining outside professionals may vary depending on the nature of the professional services but, for purposes of this PRA analysis for rule 30e–1 and Form 10– K, we estimate that such costs would be an average of $400 per hour. This estimate is based on consultations with several registrants, law firms, and persons who regularly assist registrants in preparing and filing reports with the Commission. fund to prepare and review disclosure required under the amendments. For purposes of the PRA, the burden is allocated between internal burden hours and outside professional costs. For these purposes, we estimate that 75% of the burden of preparing annual reports under rule 30e–1 and on Form 10–K is undertaken by the fund internally, while 25% of this burden is undertaken by outside professionals, such as outside counsel and independent auditors, retained by the fund at an average cost of $400 per hour.480
TABLE 10—RULE 30E–1 INCREMENTAL BURDEN ESTIMATES
Number of estimated affected responses Burden hour increase per current affected response Increase in burden hours for current affected responses Increase in company hours for current affected responses Increase in professional hours for current affected responses Increase in professional costs for current affected responses (A) (B) (C) = (A) × (B) (D) = (C) × 0.75 (E) = (C) × 0.25 (F) = (E) × $400 PROPOSED ESTIMATES1 MDFP requirement ................................... 704 16 11,264 8,448 2,816 $1,126,400 Requirements to disclose fee and expense table, share price data, a senior securities table, and unresolved staff comments ............................................. 457 3 1,371 1,028 343 137,200 Amendments to rule 8b–16(b) ................. 704 4 2,816 2,112 704 281,600 Total estimated burdens ................... 11,588 hours 2 $1,545,200 FINAL ESTIMATES MDFP requirement ................................... 3 686 16 10,976 8,232 2,744 1,097,600 Requirements to disclose fee and expense table, share price data, a senior securities table, and unresolved staff comments ............................................. 3 455 3 1,365 1,024 341 136,400 Amendments to rule 8b–16(b) ................. 34 521 5 5 2,605 1,954 651 260,400 Total estimated burdens ................... 11,210 hours 1,494,400 Notes:
1.See Proposing Release, supra footnote 10, at section V.B.3. 2.The Proposing Release reflected an estimate of $1,545,100. Since we are rounding internal burden and external cost estimates to the nearest whole number in this section, this table reflects an estimated annual cost burden of $1,545,200. 3. Revised to reflect updated industry data. 4. Revised to recognize that not all registered CEFs rely on rule 8b–16(b). 5. Revised to reflect a change from the proposed requirements.
Table 10 summarizes the proposed
incremental PRA burden estimates and the final incremental PRA burden estimates associated with the new annual report requirements for registered CEFs. We did not receive comments on our proposed estimates, but we have revised them as a result of updated industry data and changes to the proposed amendments. Specifically, we are revising the estimated number of registered CEFs that will be subject to the new annual report requirements to reflect updated industry data and the estimated burden hours associated with the amendments to rule 8b–16(b). As summarized in Table 10 above, the revised additional burdens associated with the new annual report requirements for registered CEFs for purposes of the rule 30e–1 collection of information is 11,210 hours for internal time and external costs of $1,494,400.

TABLE 11—FORM 10–K INCREMENTAL BURDEN ESTIMATES
Number of estimated affected responses Burden hour increase per current affected response Increase in burden hours for current affected responses Increase in company hours for current affected responses Increase in professional hours for current affected responses Increase in professional costs for current affected responses (A) (B) (C) = (A) × (B) (D) = (C) × 0.75 (E) = (C) × 0.25 (F) = (E) × $400 PROPOSED ESTIMATES1 Requirements to disclose fee and expense table, share price data, a senior securities table, and unresolved staff comments ............................................. 43 3 129 97 32 $12,800 Financial highlights requirement .............. 103 1.5 155 116 39 15,600 Total estimated burdens ................... 213 hours 28,400 FINAL ESTIMATES Requirements to disclose fee and expense table, share price data, a senior securities table, and unresolved staff comments ............................................. 2 44 3 132 99 33 13,200 Financial highlights requirement .............. 2 105 1.5 158 119 40 16,000 Total estimated burdens ................... 218 hours 29,200 Notes:
1.See Proposing Release, supra footnote 10, at section V.B.3. 2. Revised to reflect updated industry data.
Table 11 summarizes the proposed
incremental PRA burden estimates and the final incremental PRA burden estimates associated with the new annual report requirements for BDCs. We did not receive comments on our proposed estimates, but we have revised them as a result of updated industry data. Specifically, we are revising the estimated number of BDCs that will be subject to the new annual report requirements to reflect updated industry data. As summarized in Table 11 above, the revised additional burdens associated with the new annual report requirements for BDCs for purposes of the Form 10–K collection of information is 218 hours for internal time and external costs of $29,200.
TABLE 12—REQUESTED PAPERWORK BURDEN UNDER THE AMENDMENTS TO ANNUAL REPORT DISCLOSURE
Rule or form
Current annual responses Current burden hours Current cost burden Number of affected responses Increase in company hours Increase in professional costs Annual responses Burden hours Cost burden (A) (B) (C) (D) (E) (F) (G) = (A) (H) = (B) + (E) (I) = (C) + (F) Current Burden 1 Program Change Requested Change in Burden 30e–1 .. 23,784 1,028,658 $147,750,391 Varies (see
Table 10) 2.
11,210 $1,494,400 23,784 1,039,868 $149,244,791 10–K .... 8,137 14,198,780 $1,895,224,719 Varies (see
Table 11) 2.
218 $29,200 8,137 14,198,998 1,895,253,919 Notes:
1.The rule 30e–1 estimates are based on the last time the rule’s information collections were approved, pursuant to a submission for a PRA extension in 2019. The Form 10–K estimates are based on the last time the form’s information collections were approved, pursuant to a submission for a PRA extension in 2019. 2.As reflected in Table 10 and Table 11, the number of registered CEFs and the number of BDCs that will need to comply with the new annual report disclosure requirements will vary depending on the type of new disclosure, although all registered CEFs (686) and all BDCs (105) will be required to provide some additional annual report disclosure. As summarized above in Table 12, the revised aggregate estimates, including the new amendments, for rule 30e–1 are 1,039,868 hours and $149,244,791 in external costs. The revised aggregate estimates for Form 10–K, including the new amendments, are 14,198,998 hours and $1,895,253,919 in external costs.
4. Securities Offering Communications
Rule 163 permits WKSIs to make unrestricted oral and written offers before filing a registration statement, but any written offer will be considered a free writing prospectus and will generally have to be filed upon filing a registration statement or amendment covering the securities. Rule 433 governs the use of free writing prospectuses by WKSIs and non-WKSI issuers after the filing of a registration statement. A free writing prospectus used by or on behalf of an affected fund, or free writing prospectuses that are broadly disseminated by another offering participant, are required to be filed with the Commission. We have adopted amendments to rules 163 and 433 that will permit affected funds to

481We estimate that 25% of the burden of preparing and filing a free writing prospectus pursuant to rule 163 or rule 433 is undertaken by the issuer internally and that 75% of the burden is undertaken by outside professionals retained by the issuer. 482We recognize the costs of retaining outside professionals may vary depending on the nature of the professional services, but for purposes of this PRA analysis, we estimate that such costs would be an average of $400 per hour. This estimate is based on consultations with several registrants, law firms, and other persons who regularly assist registrants in preparing and filing reports with the Commission. rely on these rules to use a free writing prospectus. We did not receive public comment on our proposed estimates, but we have revised them as a result of updated industry data. Specifically, we are revising the estimated number of firms that will be subject to the rule to reflect updated industry data. The burden estimates were calculated by multiplying the estimated number of responses by the estimated average amount of time it would take a registrant to prepare and review disclosure required under the proposed amendments. For purposes of the PRA, the burden is to be allocated between internal burden hours and outside professional costs. Table 13 below sets forth the percentage estimates we typically use for the burden allocation for each rule.481 We also estimate that the average cost of retaining outside professional to be $400 per hour.482
TABLE 13—STANDARD ESTIMATED BURDEN ALLOCATION FOR SECURITIES ACT RULES 163 AND 433
Internal Outside professionals ESTIMATED BURDEN ALLOCATION Rule 163 .................................................................................................................................................................. 25% 75% Rule 433 .................................................................................................................................................................. 25% 75% The table below illustrates the incremental change to the total annual compliance burden of affected rules, in hours and costs, as a result of the proposed amendments.
TABLE 14—CALCULATION OF THE INCREMENTAL CHANGE IN BURDEN ESTIMATES OF CURRENT RESPONSES RESULTING
FROM THE AMENDMENTS
Number of estimated affected responses Burden hour increase per current affected response Increase in burden hours for current affected responses Increase in company hours for current affected responses Increase in professional hours for current affected responses Increase in professional costs for current affect responses (A) 12 (B) 3 (C) = (A) × (B) (D) = (C) × 0.25 or 0.75 (E) = (C) × 0.75 or 0.25 (F) = (E) × $400 Incremental Change in Burden Estimates 163 ............................... 2 0.25 0.50 0.125 0.375 $150 433 ............................... 4,271 1.28 5,467 1,367 4,100 $1,640,000 Notes:
1.For a number of reasons, many issuers that are currently eligible to be WKSIs do not make use of free writing prospectuses in reliance on rule 163. At the time the Commission adopted rule 163, it estimated that 53 free writing prospectuses would be filed under rule 163 per year. However, during the Commission’s 2017 fiscal year, only 10 free writing prospectuses in reliance on rule 163 were filed with the Commission. We estimate that 100 affected funds would be eligible to be WKSIs. See supra section III.A.1. If current practices regarding the use of free writing prospectuses under rule 163 continue with respect to affected funds, we do not believe that these affected funds would significantly increase the number of free writing prospectuses under rule 163. Accordingly, we estimate that, on average, affected funds that are eligible to be WKSIs would file 2 free writing prospectuses under the amendments to rule 163 each year. 2.The most recent data that we have available shows that each operating company files an average of approximately 5.4 free writing prospectuses per year in reliance on rule 433. We estimate that there will be 791 affected funds filing approximately 4,271 free writing prospectuses. See supra section III.A.1. 3.The burden hour estimates for rules 163 and 433 are based on the last time the rules’ information collections were approved, pursuant to a submission for a PRA extension in 2017. The conditions under rule 433 to use a free writing prospectus, require a free writing prospectus to contain more information and contribute to the greater burden hour than for a rule 163 free writing prospectus. The following table summarizes the requested paperwork burden, including the estimated total reporting burdens and costs, under the proposed amendments.

483See supra footnote 153.
484See supra section II.D.
485This estimate is based on the last time rule 173’s information collections were approved, in 2017.
TABLE 15—REQUESTED PAPERWORK BURDEN UNDER THE AMENDMENTS TO SECURITIES ACT RULES 163 AND 433
Current annual responses Current burden hours Current cost burden Number of affected responses Increase in company hours Increase in professional costs Annual responses Burden hours Cost burden (A) (B) (C) (D) (E) (F) (G) = (A) (H) = (B) + (E) (I) = (C) + (F) Current Burden Program Change Requested Change in Burden 163 ................................ 10 1 $720 2 0.125 $150 12 1.125 $870 433 ................................ 15,700 5,024 $6,028,800 4,271 1,367 $1,640,000 19,971 6,391 $7,668,800 As summarized above in Table 15, the revised aggregate estimates, including the new amendments, for rule 163 are
1.125 hours, and $870 in external costs.
The revised aggregate estimates for rule 433, including the new amendments, are 6,391 hours and $7,669,017 in external costs.
5. Prospectus Delivery Requirements
Rule 173 requires the delivery of a copy of a final prospectus, or in lieu of a final prospectus, a notice to purchasers stating that a sale of securities was made based on a registration statement or in a transaction in which a final prospectus would have been required to have been delivered in the absence of rule 172.483 We have adopted amendments to rule 173 to remove the exclusion for offerings of affected funds.484 We did not receive public comment on our proposed PRA estimates for rule
173. We have revised our estimates
regarding the number of funds likely to rely on rule 173, and to reflect updated industry data.485 Specifically, based on a review of Form N–2 filings made with the Commission, we are revising downward the proposed estimate of the number of affected funds expected to rely on rule 173 as a result of the amendments, and thus incur burdens associated with the rule. The burden estimates were calculated by multiplying the estimated number of registrants likely to rely on rule 173 by the number of responses per registrant by the estimated time it would take compile the necessary information and data, prepare and review disclosure, file documents and retain records for issuers that choose to rely on rule 173. We assume, similar to operating companies that rely on rule 173, that each affected fund will incur 100% of the burden. The table below illustrates the incremental change to the total annual burden for affected funds as a result of the amendments.
TABLE 16—RULE 173 (CALCULATION OF THE INCREMENTAL CHANGE IN BURDEN ESTIMATES OF CURRENT RESPONSES
RESULTING FROM THE AMENDMENTS) Number of estimated affected responses Burden hour per current affected response Burden hours for current affected responses Increase in professional hours for current affected responses Increase in professional costs for current affect responses (A) 1 (B) 2 (C) = (A) × (B) 173 ................................................................... 16,634,572 0.0167 277,797 0 $0 Notes:

In the Proposing Release we estimated that all 807 affected funds would rely on rule 173. See supra footnote 10 at section V.B.5. However,
because only a fund with an effective Securities Act registration statement may rely on rule 173, we are revising our estimates. Based on our staff’s review of Form N–2 Securities Act registration statements filed annually between 2017 and 2019, we estimate 382 annual filings, each by a different affected fund. We estimate that each such fund will provide 43,546 responses annually, for a total of 16,634,572 annual responses per year (382 funds × 43,546 responses annually = 16,634,572). 2.The estimated burden hour per response of 0.0167 hours derives from the most recently-approved rule 173 PRA submission (2017). The following table summarizes the total PRA burden, including the estimated total reporting burdens and costs, for rule 173 as a result of the amendments. As reflected below, the revised aggregate hourly burden associated with rule 173 as a result of the amendments is 4,159,688 internal burden hours, with no external costs.
TABLE 17—RULE 173 (REQUESTED PAPERWORK BURDEN UNDER THE AMENDMENTS)
Current annual responses Current burden hours Current cost burden Number of affected responses Increase in company hours Increase in professional costs Annual responses Burden hours Cost burden (A) (B) (C) (D) (E) (F) (A) + (D) (B) + (E) (C) + (F) Current Burden Program Change Requested Change in Burden 173 ......... 232,448,548 3,881,891 $0 + 16,634,572 + 277,797 $0 249,083,120 4,159,688 $0

486See Proposing Release, supra footnote 10, at
section IV.B.7.
487The paperwork burdens for 17 CFR 230.400 through 230.498A (Regulation C) are imposed through the forms, schedules and reports that are subject to the requirements in these regulations and are reflected in the analysis of those documents. To avoid a PRA inventory reflecting duplicative burdens and for administrative convenience, we assign a one-hour burden to Regulation C.
6. Form 24F–2
Rule 24f–2 requires any open-end management company, unit investment trust, or face-amount certificate company deemed to have registered an indefinite amount of securities to file a Form 24F–2 not later than 90 days after the end of any fiscal year in which it has publicly offered such securities. Form 24F–2 is the annual notice of securities sold by these funds that accompanies the payment of registration fees with respect to the securities sold during the fiscal year, net of securities redeemed or repurchased during the year. We are amending rules 23c–3 and 24f–2 so that interval funds will pay registration fees on the same annual basis using Form 24F–2. We are also adopting a requirement that funds submit reports on Form 24F–2 in an XML structured data format.
TABLE 18—FORM 24F–2 PRA ESTIMATES
Internal burden Wage rate 1 Cost of internal burden Annual external cost burden Currently Approved Estimates 2 Clerical work to file Form 24F-2 ..................... 2 hours × $66 (compliance clerk) ................................... $132 $0 Number of annual responses ......................... × 7,284 ......................................................................... × 7,284 × 7,284 Total annual burden ................................ 14,568 hours ......................................................................... *$961,488 $0 Proposed Estimates 3 Clerical work to file Form 24F–2 .................... 2 hours × $67 (compliance clerk) ................................... $134 $0 Submission in a structured data format .......... 2 hours × $261 (programmer) ......................................... $522 $0 Total annual burden per response ................. 4 hours ......................................................................... $656 $0 Number of annual responses ......................... × 6,177 ......................................................................... × 6,177 × 6,177 Total annual burden ................................ 24,708 hours ......................................................................... $4,052,112 $0 Final Estimates Clerical work to file Form 24F–2 .................... 2 hours × $70 (compliance clerk) 4 ................................. $140 $0 Submission in a structured data format .......... 2 hours × $271 (programmer) 4 ...................................... $542 $0 Total annual burden per response ................. 4 hours ......................................................................... $682 $0 Number of annual responses ......................... × 6,7944 ......................................................................... 4 × 6,794 4 × 6,794 Total annual burden ................................ 27,176 hours ......................................................................... $4,633,508 $0 Notes:
1.See supra Table 6, at footnote 2. 2.This estimate was previously submitted to OMB in connection with the renewal of approval for the collection of information required by Form 24F-2 in 2018. 3.Proposing Release, supra footnote 10, at section IV.B.7. 4.Estimate revised to reflect updated data. Based on a review of Form 24F–2 filings for the period 2017–2019, the staff estimates that 6,741 filings will be made annually, and that 53 interval funds (representing the 3-year average of interval funds registered with the Commission) will file Form 24F–2 as a result of the final amendments (6,741 + 53 = 6,794).
Table 18 above summarizes the
current PRA estimates, the proposed PRA estimates, and the final PRA estimates associated with the requirement to file reports on Form 24F–2.486 We did not receive public comment on our proposed estimates, but we have revised them as a result of updated industry data. Specifically, we are revising the estimated wage rates and estimated number of funds that will be subject to the requirements of Form 24F–2 to reflect updated industry data. As summarized in Table 18 above, the revised aggregate estimates for Form 24F–2, including the new amendments, are 27,176 hours, with no external costs.
7. Amendments Permitting the
Registration of Offerings of an Indeterminate Number of ExchangeTraded Vehicle Securities and the Payment of Registration Fees for Such Offerings on an Annual Net Basis The amendments to certain Securities Act rules and to Forms S–1, S–3, F–1 and F–3 will allow issuers of exchangetraded vehicle securities to elect to register offerings of an indeterminate number of such securities and pay registration fees for these offerings on an annual net basis. We estimate that the amendments will increase the paperwork burden for registration statements on Form S–1 and Form S–3 for such offerings due to the requirement to calculate and pay registration fees on an annual net basis within 90 days after the end of the fiscal year.487 However, because these issuers will have the ability to elect to register offerings of an indeterminate number of such securities, we also estimate that the amendments will result in a decrease in the number of registration statements on these forms filed by these issuers and that, overall, the amendments will reduce the paperwork burdens associated with Form S–1 and Form S–3. The amendments to Forms F–1 and F–3 are not expected to affect the burdens associated with those forms, in that we do not anticipate that any issuers at this time will use Form F–1 or Form F–3 to register offerings of

488While we believe that the number of such registration statements to register an indeterminate number of exchange-traded vehicle securities will be higher immediately following the effectiveness of these amendments, we estimate that the number of registration statements for such offerings after this initial period will average a total of approximately 10 registration statements each year. traded vehicle securities and pay registration fees for these offerings on an annual net basis. Based on a review of registration statements filed by ETPs for the period 2017–2019, the staff estimates that, after the effectiveness of these amendments, an average of five registration statements on each of Form S–1 and Form S–3 will be filed each year for offerings of an indeterminate number of exchangetraded vehicle securities with the payment of registration fees on an annual net basis.488 We estimate that the incremental increase in burden for these registration statements will be two hours, consistent with the estimated burden for Form 24F–2. We would expect there to be only a minimal initial burden of establishing a system for calculating fee payments in this manner, in that these issuers already track the issuances and redemptions of their securities on an ongoing basis. When paying registration fees, these issuers will file prospectus supplements under rule 424 and provide disclosures modeled after Form 24F–2. We estimate that, in filing these prospectus supplements in connection with registration statements on Form S–1 or Form S–3, 25% of the burden of preparation is carried by the issuer internally and that 75% of the burden of preparation is carried by outside professionals retained by the issuer at an average cost of $400 per hour.
TABLE 19—INCREMENTAL PAPERWORK BURDEN UNDER THE AMENDMENTS FOR REGISTRATION STATEMENTS
Current burden Estimated increase in burden for affected responses Annual reponses Burden hours Costs Estimated number of affected responses Burden hour change per affected response Change in burden hours for affected responses Change in company hours for affected responses Change in professional hours for affected responses Change in professional costs (A) (B) (C) = (A) × (B) (D) = (C) × 0.25 (E) = (C) × 0.75 S–1 .............................. 901 147,208 $180,319,975 5 2 10 2.5 7.5 $3,000 S–3 .............................. 1,657 193,626 236,198,036 5 2 10 2.5 7.5 3,000 In addition, we estimate that seven fewer Forms S–1 and ten fewer Forms S–3 will be filed by these issuers each year as a result of the ability to register offerings of an indeterminate number of exchange-traded vehicle securities, which could result in lower costs for these issuers through a reduction in the number of registration statements filed by these issuers.
TABLE 20—ESTIMATED DECREASE IN BURDEN AS A RESULT OF THE DECREASE IN THE NUMBER OF ANNUAL RESPONSES
Current burden Estimated decrease in burden as a result of the decrease in the number of annual responses Annual reponses Burden hours Costs Estimated decrease in the number of annual responses Estimated decrease in burden hours Estimated decrease in costs S–1 ............................................... 901 147,208 $180,319,975 7 1,144 $1,400,932 S–3 ............................................... 1,657 193,626 236,198,036 10 1,169 1,425,456 The following table illustrates the total annual compliance burden, in hours and in costs, of the affected collections of information resulting from the amendments to these forms.
TABLE 21—CURRENT AND REVISED BURDENS UNDER THE AMENDMENTS TO SECURITIES ACT REGISTRATION STATEMENTS
Current burden Revised burden Burden hours Costs Burden hours Costs (A) (B) (C) (D) S–1 ....................................................................................................... 147,208 $180,319,975 146,067 $178,922,043 S–3 ....................................................................................................... 193,626 236,198,036 192,460 234,775,580 F–1 ....................................................................................................... 26,692 32,275,375 26,692 32,275,375 F–3 ....................................................................................................... 4,441 5,703,600 4,441 5,703,600

489See supra section II.B.3.b.
8. Amendments to Form N–14
Form N–14 is the form used by an affected fund for the registration of securities issued in business combination transactions. The amendments to Form N–14 will decrease the existing disclosure burden of the form by allowing BDCs to incorporate by reference to the same extent as is currently permitted for registered CEFs and eliminating the requirement for affected funds to file with the Form N–14 registration statement the documents that contain the information that is incorporated by reference into the prospectus or SAI.489
TABLE 22—CURRENTLY APPROVED FORM N–14 PRA ESTIMATES 1
Internal burden Wage rate 2 Cost of internal burden Annual external cost burden Burden per Initial Filing 310 hours × $401 (attorney) ............................................... $124,310 $27,500 Preparing and filing initial filing ....................... 248 hours × $209 (senior accountant) ................................ $51,832 62 hours × $210 (paralegal) ............................................. $13,020 Total burden per initial filing ........................... 620 hours ......................................................................... $189,162 $27,500 Number of annual initial filings ....................... × 156 ......................................................................... × 156 × 156 Total annual burden ................................ 96,720 hours ......................................................................... $29,509,272 $4,290,000 Burden per Amendment
150 hours × $401 (attorney) ............................................... $60,150 ....................
Preparing and filing amendments ................... 120 hours × $209 (senior accountant) ................................ $25,080 $16,000
30 hours × $210 (paralegal) ............................................. $6,300 ....................
Total burden per amendment ......................... 300 hours ......................................................................... $91,530 $16,000 Number of annual amendments ..................... × 97 ......................................................................... × 97 × 97 Total annual burden ................................ 29,100 hours ......................................................................... $8,878,410 $1,552,000 Total Burden Total initial filing burden .................................. 96,720 hours ......................................................................... $29,509,272 $4,290,000 Total amendment burden ............................... 29,100 hours ......................................................................... $8,878,410 $1,552,000 Total annual burden ................................ 125,820 hours ......................................................................... $38,387,682 $5,842,000 Notes:
1.These estimates were previously submitted to OMB in connection with the renewal of approval for the collection of information required by Form N-2 in 2019. 2.See supra Table 6, at footnote 2.
TABLE 23—FINAL FORM N–14 PRA ESTIMATES
Internal burden Wage rate 2 Cost of internal burden Annual external cost burden Burden per Initial Filing Current burden for preparing and filing initial filing. 310 hours 248 hours 62 hours × × ×
2 $415 (attorney) .............................................
2 $216 (senior accountant) .............................
2 $218 (paralegal) ...........................................
$128,650
$53,568
$13,516
$27,500
Burden reduction from incorporation by reference amendments. 3 (10 hours) × 2 $218 (paralegal) ........................................... $(2,180) $(0) Total burden per initial filing ........................... 610 hours .... ......................................................................... $193,554 $27,500 Number of annual initial filings ....................... × 2 156 .... ......................................................................... × 2 156 × 2 156 Total annual burden ................................ 96,160 hours .... ......................................................................... $29,181,672 $4,290,000 Burden per Amendment Current burden for preparing and filing amendments. 150 hours 120 hours 30 hours × × ×
2 $415 (attorney) .............................................
2 $216 (senior accountant) .............................
2 $218 (paralegal) ...........................................
$62,250
$25,920
$6,540
$16,000
Burden reduction from incorporation by reference amendments. 3 (10 hours) × 2 $218 (paralegal) ........................................... $(2,180) $(0) Total burden per amendment ......................... 290 hours .... ......................................................................... $92,530 $16,000 Number of annual amendments ..................... 2 × 97 .... ......................................................................... 2 × 97 2 × 97 Total annual burden ................................ 29,100 hours .... ......................................................................... $8,674,710 $1,552,000

490See 5 U.S.C. 603.
491See Proposing Release, supra footnote 10, at
section VI.
492As discussed above, we apply the final rule to all registered CEFs (and BDCs), with certain conditions and exceptions. 493See e.g., ABA Comment Letter; Invesco Comment Letter; White Comment Letter; XBRL US Comment Letter. 494See e.g., ABA Comment Letter. 495See e.g., Invesco Comment Letter. 496See e.g., White Comment Letter.
TABLE 23—FINAL FORM N–14 PRA ESTIMATES—Continued
Internal burden Wage rate 2 Cost of internal burden Annual external cost burden Total Burden Total initial filing burden .................................. 96,160 hours .... ......................................................................... $29,181,672 $4,290,000 Total amendment burden ............................... 29,100 hours .... ......................................................................... 8,674,710 $1,552,000 Total annual burden ................................ 125,260 hours .... ......................................................................... $37,856,382 $5,842,000 Notes:
1.See supra Table 6, at footnote 2. 2.Estimate revised to reflect updated industry data. 3.Estimate revised to reflect modifications from the proposal.
Table 22 above summarizes the
current PRA estimates associated with the requirements of Form N–14. Table 23 summarizes the final PRA amendments associated with Form N– 14 as amended. We are revising our estimates as a result of updated industry data and modifications from the proposal. Specifically, we are deducting 10 hours of internal burden per filing to reflect the burden reduction associated with the incorporation by reference amendments affecting filings on Form N–14. In addition, we are revising the estimated wage rates to reflect updated industry data. As summarized in Table 23 above, we estimate that the total hour burdens and time costs associated with Form N–14 will be an aggregate burden of 125,260 hours at an aggregate annual cost of internal burden of $37,856,382. We estimate an aggregate annual external time cost of $5,842,000.
V. Final Regulatory Flexibility Analysis
The Commission has prepared the following Final Regulatory Flexibility Analysis (‘‘FRFA’’) in accordance with
section 4(a) of the Regulatory Flexibility
Act (‘‘RFA’’),490 regarding the final rule modifications to the registration, communications, and offering processes for affected funds under the Securities Act and the rules and forms under the Exchange Act and Investment Company Act, that will allow affected funds to use the securities offering rules that are already available to operating companies. An Initial Regulatory Flexibility Analysis (‘‘IRFA’’) was prepared in accordance with the RFA and is included in the Proposing Release.491 A. Need and Objectives of the Final Rule The BDC Act directs us to allow a BDC to use the securities offering rules that are available to other issuers required to file reports under section 13(a) or section 15(d) of the Exchange Act and specifically enumerates the required revisions. Similarly, the Registered CEF Act directs us to allow any listed registered CEF or interval fund to use the securities offering rules that are available to other issuers that are required to file reports under section 13(a) or section 15(d) of the Exchange Act, subject to appropriate conditions.492 Pursuant to both Acts, the final rule will modify the registration, communications, and offering processes for affected funds to allow them to use the securities offering rules that are available to other issuers required to file reports under section 13(a) or section 15(d) of the Exchange Act. We are also adopting amendments to our rules and forms, to tailor the disclosure and regulatory framework for affected funds, in light of the amendments to the offering rules applicable to them. The reasons for, and objectives of, the final rule are further discussed in more detail in Section II above. The costs and burdens of these requirements on smaller affected funds are discussed below as well as above in our Economic Analysis and Paperwork Reduction Act Analysis, which discusses the costs and burdens of the final rule on all affected funds. B. Significant Issues Raised by Public Comments In the Proposing Release, we requested comment on every aspect of the IRFA, including the number of small entities that would be affected by the proposed rule and form amendments, the existence or nature of the potential impact of the proposals on small entities discussed in the analysis, and how to quantify the impact of the proposed amendments. We also requested comment on the proposed compliance burdens and the effect these burdens would have on smaller entities. Although we did not receive comments specifically addressing the IRFA, several commenters stated in their comment letters the impact they believed certain aspects of the proposed amendments would have on small affected funds.493 Specifically, one commenter stated that the proposed rules would disadvantage smaller affected funds relative to larger affected funds that have obtained WKSI status, because smaller funds that would benefit from the ability to use automatic effective registration statements to quickly come to market during periods when
their shares trade at a premium, may miss the opportunity to raise capital that the proposed rules were designed to facilitate. The commenter stated that this disparity was unnecessary because shareholders of smaller funds would not likely be disadvantaged by a lower level of market commentary about those funds as compared to larger funds given the investor protections afforded to those shareholders by the Investment Company Act.494 Similarly, another commenter stated that the Commission should reconsider the public float requirement in order to encourage new CEF issuances and give smaller CEFs the opportunity to grow through the issuance of additional shares, because the offering size of most of the recent offerings by public CEFs have been relatively small, making them ineligible for treatment as a ‘‘seasoned fund’’ or WKSI.495 The second commenter stated that forward incorporation by reference, which is allowed when an affected fund has met the requirements to use a shortform registration statement, should be made available to smaller affected funds.496 However, as discussed below, commenters defined smaller funds as those funds that did not meet the WKSI

497See e.g., XBRL US Comment Letter. 498 Id. at 13. 499 Id. at 10. 500 Id. at 13. 501See supra sections II.D and II.I.3. 502 17 CFR 270.0–10(a) (Investment Company Act rule 0–10(a)). 503These estimates, reflecting the net assets of registered CEFs and of BDCs, are based on staff review of Forms N–CEN and N–Q filed with the Commission as of June 2019 and are based on the definition of small entity under Investment Company Act rule 0–10. Such funds will not necessarily be able to meet the transaction requirement to qualify to file a short-form registration statement on Form N–2 (i.e., generally those affected funds with a public float of $75 million) or to be a WKSI (i.e., generally those affected funds with a public float of $700 million). See supra section II.B.3 and II.C. Based on data as of June 2019 from Morningstar Direct, Forms 10–K and 10–Q that are filed with the Commission by BDCs, and closed-end fund data reported on Forms N–CSR, N–Q, and N–PORT filed with the Commission, we estimate, of the 16 BDCs that are small entities, 3 were traded on an exchange with market capitalization below the $75 million public float threshold for qualifying to file a short-form registration statement on Form N–2, and 5 small BDCs traded on the over-the-counter (OTC) market with market capitalization below this same $75 million threshold. Likewise, of the 33 registered CEFs that qualified as small entities, 4 traded on an exchange with market capitalizations below this same $75 million threshold; while 3 were traded on the OTC market with market capitalizations below $75 million. 504See 17 CFR 240.0–10(c)(1) (Exchange Act rule 0–10(c)(1)). Alternatively, if a broker-dealer is ‘‘not required to file such statements, a broker or dealer that had total capital (net worth plus subordinated liabilities) of less than $500,000 on the last business day of the preceding fiscal year (or in the time that it has been in business, if shorter).’’ See id. 505See Exchange Act rule 0–10(c)(2). 506This estimate is derived from an analysis of data for the period ending June 30, 2019 obtained from Financial and Operational Combined Uniform Single (FOCUS) Reports that broker-dealers generally are required to file with the Commission and/or SROs pursuant to Exchange Act rule 17a-5. 507See supra section II.F.2. 508See 17 CFR 230.157. 509Based on data as of February 2020 from Morningstar Direct and Form S–1 and Form S–3 registration statements filed with the Commission within the past three years. As discussed above, we do not anticipate that any issuers at this time will use Form F–1 to register offerings of an indeterminate number of exchange-traded vehicle securities and pay registration fees for these offerings on an annual net basis. See supra section IV.B.7. Consequently, our figures do not reflect F– 1 filers as a ‘‘small business’’ or ‘‘small organization.’’ 510See also supra section IV (discussing the skills necessary to perform the recordkeeping, reporting, and compliance
requirements of the final rule, including those to be performed internally by a fund, and those to be performed externally by professionals). The PRA provides for the hours, costs, and skill level associated with preparing disclosures, filing forms, and retaining records in compliance with our adopted rules. These skills would apply for compliance with the adopted rules by all funds, large and small, and Commission staff further estimates that small funds will incur approximately the same initial and ongoing costs as large funds. 511See supra section II.B.3. public float threshold of $700 million or more for purposes of using an automatic registration statement, or did not meet the seasoned public float threshold of $75 million or more for purposes of forward incorporation by reference. Another commenter voiced support for the XBRL format proposed for certain filings by affected funds and recommended expanded use of the format for other disclosures.497 The commenter noted that a study it conducted along with the AICPA in 2014 and again in 2017 evaluating the annual cost of XBRL preparation for small reporting companies had decreased from $10,000 in 2014 to $5,500 in 2017.498 In citing to the Council of Institutional Investors (CII) July 19, 2018 comment letter in response to the SEC Draft Strategic Plan 2018–2022, the commenter stated that inline XBRL is an improvement to EDGAR functionality and makes disclosure documents more valuable and cost-effective for a broad range of users including market analysts and data vendors that conduct research on smaller companies.499 In response to the Commission’s request for comment regarding whether the current burdens of preparing financial statements and notes in XBRL format have changed over time for small reporting companies, the commenter reiterated that the cost of XBRL preparation has declined 45% for small reporting companies.500 After considering the comments we received on the proposed rule and form amendments, we are adopting the amendments, substantially as proposed, with two modifications intended to reduce the operational challenges commenters identified. Specifically, we are expanding the scope of rule 486 to any registered CEF or BDC conducting continuous offerings under rule 415(a)(1)(ix), and we are not adopting our proposed amendments to Form 8– K.501 However, we do not believe there would be any meaningful reporting, recordkeeping, or other compliance costs associated with these modifications that would impact small entities.
C. Small Entities Subject to the Rule
An investment company is a small entity if, together with other investment companies in the same group of related investment companies, it has net assets of $50 million or less as of the end of its most recent fiscal year.502 Commission staff estimates that, as of June 2019, 16 BDCs and 33 registered CEFs are small entities.503 A broker-dealer is a small entity if it has total capital (net worth plus subordinated liabilities) of less than $500,000 on the date in the prior fiscal year as of which its audited financial statements were prepared pursuant to 17 CFR 240.17a-5(d) (Exchange Act rule 17a–5),504 and it is not affiliated with any person (other than a natural person) that is not a small business or small organization.505 Commission staff estimates that, as of June 30, 2019, there are approximately 942 broker-dealers that may be considered small entities.506 To the extent a small broker-dealer participates in a securities offering or prepares research reports, it may be affected by the final rule. Generally, we believe larger broker-dealers engage in these activities, and we did not receive comments on whether or how the proposed amendments to rule 138 affect small broker-dealers.507 The final rule will also affect ETPs, permitting them to register offerings of an indeterminate number of exchangetraded vehicle securities and pay registration fees for such offerings on an annual net basis. For purposes of the RFA, 17 CFR 230.157 (Securities Act rule 157) defines an issuer, other than an investment company, to be a ‘‘small business’’ or ‘‘small organization’’ if it had total assets of $5 million or less on the last day of its most recent fiscal year and is engaged or proposing to engage in an offering of securities not exceeding $5 million.508 Exchange Act rule 0–10(a) defines an issuer, other than an investment company, to be a ‘‘small business’’ or ‘‘small organization’’ if it had total assets of $5 million or less on the last day of its most recent fiscal year. Commission staff estimates that, as of February 2020, there are approximately 7 ETPs that are issuers, other than an investment company, that may be considered small entities.509 D. Projected Reporting, Recordkeeping, and Other Compliance Requirements The final rule will create, amend, or eliminate current requirements for affected funds and broker-dealers, including those that are small entities discussed in section V.C above.510

Registration Process and Final
Prospectus Delivery
The amendments to the registration process for affected funds will create a short-form registration statement on Form N–2 that will function like a registration statement filed on Form S–
3.511 An affected fund eligible to file the
short-form registration statement can use it to register shelf offerings, including shelf registration statements (filed by a WKSI) that become effective

512 Id.
513 Id.
514See supra section II.B.3.d.
515See supra section II.B.3.e.
516See supra section II.C.
517 Id.
518 Id.
519See supra section II.B.3.a; see also supra footnote 51 and accompanying and preceding text. 520See supra sections II.B.3.a and III.B.1. 521See supra sections II.B.3 and III.B.1. 522See supra section III.B.1. 523See supra sections IV.B.5 and II.E. 524Affected funds using the new approach to prospectus delivery will be required to provide a notice to purchasers stating that a sale of securities was made pursuant to a registration statement or in a transaction in which a final prospectus would have been required to have been delivered in the absence of Securities Act rule 172. See supra footnote 153 and accompanying text. 525See supra sections II.F, III.B.2, III.C.1, and IV.B.4. The amendments to Securities Act rules 163 and 433, regarding the use of a free writing prospectus, create new recordkeeping, filing, and compliance requirements that are addressed further below. 526See supra sections II.F, III.B.2, III.C.1, and IV.B.4. These include, for example, amendments to rule 163A of the Securities Act, which provides a bright-line rule permitting communications more than 30 days before filing a registration statement, and amendments to rule 169 of the Securities Act, which provides affected funds the ability to engage in regular factual business communications. 527See supra section V.D.1. 528See amended rule 433(d) and (g). Paragraph (d) of the rule provides for the various conditions and exclusions applicable to the general requirement of 433(d)(1) that an issuer or offering participant file its free writing prospectus. Paragraph (g) requires that if a free writing prospectus is not filed pursuant to paragraph (d) or (f) of rule 433, issuers and offering participants must retain all free writing prospectuses that have been used, for three years following the initial bona fide offering of the securities in question. 529See note to paragraph (h) of Securities Act rule
482. Rule 482 requires that advertisements used in
reliance on rule 482 are required to be filed in accordance with the requirements of rule 497, unless they are filed with FINRA. See supra footnote 528 and sections III.C and IV.B.4.; see also Securities Act rule 497(a) and (i). automatically.512 Such a fund also can satisfy Form N–2’s disclosure requirement by incorporating by reference information from the fund’s Exchange Act reports. 513 In addition, the final rule will allow certain affected funds eligible to register a primary offering under the adopted short-form registration instruction to rely on rule 430B to omit information from their base prospectuses, and to permit affected funds to use the process operating companies follow to file prospectus supplements.514 Affected funds that choose to forward incorporate information by reference into their registration statements will also be able to include additional information in their periodic reports that is not required to be included in these reports in order to update their registration statements.515 The amendments to the WKSI definition in rule 405 will also permit affected funds to qualify for enhanced offering and communication benefits under our rules.516 In order for an issuer to qualify as a WKSI, the issuer must meet the registrant requirements of Form S–3, i.e., it must be ‘‘seasoned,’’ and generally must have at least $700 million in public float.517 Qualifying as a WKSI will allow such funds to file a registration statement or amendment that becomes effective automatically in a broader variety of contexts than nonWKSIs, and to communicate at any time, including through a free writing prospectus, without violating the ‘‘gunjumping’’ provisions of the Securities Act.518 Smaller affected funds will not be able to avail themselves of the aspects of the adopted rule amendments streamlining the registration process for affected funds or that make available the WKSI designation to affected funds. The adopted short-form registration instruction is designed to provide affected funds parity with operating companies by permitting them to use the instruction to register the same transactions that an operating company can register on Form S–3.519 In order to qualify to use the short-form registration statement under Form N–2, General Instruction A.2 of Form N–2 generally requires an affected fund to meet the public float requirement of $75 million under the transaction requirements for Form S–3.520 Likewise, the WKSI provision of rule 405 contains a public float requirement of $700 million, as discussed above. Smaller funds will not generally meet the public float thresholds to file a short-form registration statement or qualify as a WKSI and therefore will not generally be subject to either of these amendments.521 However, smaller affected funds may be affected by these amendments in other ways. For example, smaller affected funds may be more likely to merge to obtain WKSI status, and could experience competitive disadvantages compared
to larger funds that qualify as WKSIs or that file short-form registration statements on Form N–2.522 The final rule will also apply the delivery method for operating company final prospectuses to offerings of affected funds. As a result, an affected fund, broker, or dealer will be allowed to satisfy the final prospectus delivery obligations if a final prospectus is or will be on file with the Commission within the time required by the rules and other conditions are satisfied.523 These requirements will apply to all affected funds, as well as all brokers or dealers.524
2. Communications Rules
For offerings of smaller affected funds, we are not adopting any new restrictions on communications. As discussed above, the amendments to Securities Act rules 134, 138, 156, 163, 163A, 164, 168, 169, and 433 will make available the use of certain types of communications that were previously not available to affected funds.525 Except as otherwise discussed below, we believe that there are no significant reporting, recordkeeping, or other compliance requirements associated with these amendments. As such, except as otherwise discussed below, we believe that there are no attendant costs and administrative burdens for small affected funds associated with these amendments. In addition, the communications rules themselves do not create any new restrictions for smaller affected funds. Instead, smaller affected funds now may be able to take advantage of new communications options not previously afforded to them.526 We also note that rule 163, and the new amendments, apply only to WKSIs. Consequently, these amendments to rule 163 will not produce any benefit, or create any burden, for small affected funds because they would not qualify as WKSIs, as discussed above.527 To the extent that an affected fund uses a free writing prospectus under the adopted rules, any affected fund—large or small—will incur the burden of the requirement to file a free writing prospectus, or retain a record of the free writing prospectus for three years if it was not filed with the Commission.528 However, we believe that the burden here will be negligible. Affected funds currently use rule 482 of the Securities Act to engage in communications similar to those that will be permitted under the amendments to rule 433, and these funds are required to file their rule 482 communication with either the Commission or, alternatively, with the Financial Industry Regulatory Authority (‘‘FINRA’’).529 The burden associated with the filing requirements that the amendments to rule 433 will entail will therefore not be meaningfully different than the burden associated with the filing requirement for rule 482 communications. Rule 433 also creates a recordkeeping requirement. We do not believe that this requirement will create any significant burden given that records of rule 482 communications must also be retained for a period that

530See 17 CFR 270.31a–2(a)(3) (Investment Company Act rule 31a-2(a)(3)) (requiring every registered investment company to preserve for no less than six years from the end of the fiscal year last used, any advertisement, pamphlet, circular form letter, or other sales literature addressed to or intended for distribution to prospective investors). Securities Act rule 433(g) requires an issuer and offering participants to retain all free writing prospectuses that have been used, and that have not been filed pursuant to paragraphs (d) or (f) of the rule, for three years following the initial bona fide offering of the securities in question. However, for a broker or dealer utilizing a free writing prospectus, rule 433 defers to the recordkeeping requirements under 17 CFR 240.17a–4 (Exchange Act rule 17a–4) (requiring sales literature to be retained for not less than three years). 531See amended Securities Act rule 138. 532See supra footnote 529 and FINRA rule 2210(c)(7)(F) (requiring a broker-dealer to file with FINRA an investment company prospectus published pursuant to Securities Act rule 482). 533See amended rule 433(b). Paragraph (b)(1) states that for WKSIs and seasoned issuers, both an issuer or offering participant may use a free writing prospectus, while paragraph (b)(2) states that for non-reporting and unseasoned issuers, any person participating in the offer or sale of the issuer’s securities may use a free writing prospectus. Although the term ‘‘offering participant’’ is not defined, paragraph (h)(3) of rule 433 gives some context to this term. 534See supra footnote 528. 535See supra footnote 529. 536See supra section III.C.1 and IV.B.4 (noting that we are unable to predict whether affected funds will engage in more communications with investors as a result of the final rule). To the extent affected funds or broker-dealers will use a free writing prospectus for communications that currently occur under rule 482, we would expect an increase in such filings of free writing prospectuses as well as an increase in the number of rule 138 research reports, and a decrease in the number of rule 482 ads filed with FINRA. See supra footnote 532 and accompanying text. 537See supra section II.H and III.E.1. 538See supra section II.H. 539 Id. 540 Id. 541 Id. 542 Id.; see also section III.E.1. 543See supra section II.I. Some of the amendments reflect our consideration of the availability of information to investors, as required by the Registered CEF Act. See section 509(a) of the Registered CEF Act. 544See supra sections II.I.1–II.I.5. 545See supra footnote 241 and accompanying text noting that a seasoned fund filing a short-form registration statement on Form N–2 also will be required to tag information appearing in Exchange Act reports, such as those on Forms N–CSR, 10–K, or 8–K, if that information is required to be tagged in the fund’s prospectus. will generally exceed that required under rule 433.530 In addition, the recordkeeping requirement will
apply only to affected funds (both large and small) that elect to use rule 433, as adopted. The final rule also will affect brokerdealers participating in a registered offering. Specifically, the amended rules will affect: (1) Broker-dealers’ publication and distribution of research reports on affected funds; and (2) broker-dealers’ use of free writing prospectuses on affected funds. The amendments to rule 138 will affect both large and small brokerdealers. These amendments will now permit broker-dealers to publish or distribute research reports with respect to a broader class of issuers and securities without this publication or distribution being an offer that otherwise could be a non-conforming prospectus in violation of section 5 of the Securities Act.531 Broker-dealers that once used rule 482 ads styled as research reports, and instead rely on rule 138, as adopted, to publish or distribute similar communications, will no longer be subject to any filing requirement for these communications. Consequently, we expect that the amendments to rule 138 will result in fewer rule 482 communications being filed with FINRA.532 This in turn will reduce filing-related administrative costs for broker-dealers publishing or distributing research reports on affected funds under the amendments to rule
138. However, large and smaller brokerdealers will not be affected differently
by the amendments to rule 138.
In addition, the free writing prospectus rule amendments will permit broker-dealers to engage in these communications on behalf of the affected fund issuer.533 This will require broker-dealers, both large and small, to file the free writing prospectuses that they use with the Commission, or maintain records of any free writing prospectuses used if it was not filed with the Commission.534 However, certain of these broker-dealers are already required to file communications made under rule 482.535 Broker-dealers that once used rule 482 ads and instead now choose to rely on adopted amended rule 433 to publish or distribute similar communications, will no longer be required to file these communications with FINRA. Consequently, the amendments to rule 433 could result in fewer rule 482 communications being filed with FINRA and a potential increase in filings of free writing prospectuses by affected funds with the Commission.536 However, those brokerdealers that have not previously used rule 482 to publish or distribute the types of communications that the amendments to rule 433 permit, will newly be subject to both the filing and recordkeeping requirements of rule 433.
3. New Registration Fee Payment
Method for Interval Funds Interval funds, like other affected funds, are not currently permitted to pay registration fees on this same annual ‘‘net’’ basis as mutual funds and ETFs, and pay the registration fee at the time of filing the registration statement.537 As discussed above, we believe that interval funds will benefit from the ability to pay their registration fees in the same manner as mutual funds and ETFs, and that this approach is appropriate in light of interval funds’ operations.538 In addition, in response to comments to the Proposing Release, we also are adopting amendments to enable ETPs to register an indeterminate number of securities and to pay registration fees in arrears on an annual net basis.539 As we discussed above, ETPs operate in a manner substantially similar to that of ETFs, and as commenters noted, share similar attributes with interval funds, which we highlighted in extending to interval funds the ability to pay registration fees on an annual net basis, including routine repurchases of shares at NAV and avoiding the possibility of inadvertently selling more shares than it had registered.540 As a result, the final rule will require interval funds and allow ETPs to pay securities registration fees using the same method that mutual funds and ETFs use.541 We believe this will benefit small interval funds and ETPs as well as larger interval funds and ETPs equally, and will make the registration fee payment process for all interval funds and ETPs more efficient as discussed above.542
4. Disclosure and Reporting
Requirements
We also are adopting amendments, substantially as proposed, to our rules and forms that are intended to tailor the disclosure and regulatory framework for affected funds in light of our amendments to the offering rules applicable to them.543 These amendments include: Structured data requirements; new periodic requirements; amendments to provide affected funds additional flexibility to incorporate information by reference; and enhancements to the disclosures that registered CEFs make to investors when the funds are not updating their registration statements.544 Structured Data Requirements The amendments will require BDCs, like operating companies, to submit financial statement information using Inline XBRL format; to require that affected funds include structured cover
page information in their registration
statements on Form N–2 using Inline XBRL format; to require that certain information required in an affected fund’s prospectus be tagged using Inline XBRL format; 545 and to require that

546See supra sections II.I.1 and III.E.1. 547See supra section III.E.2. But see supra footnote 428 (noting that since 2014, costs incurred utilizing XBRL have significantly reduced for smaller companies). 548 Id. 549See supra sections II.I.2.b, II.I.2.c, and II.I.2.d. 550See supra section III.E.3. 551See supra section II.I.2.b and II.I.2.c; see also supra section IV.B.3 (discussing the burden hours associated with complying with the adopted disclosure requirements for both small and large affected funds). 552 Id.; see also supra sections IV.B.1 and IV.B.3. 553See supra footnote 503. 554See supra sections II.I.4 and IV.E.5. 555 Id. 556See supra section III.E.4. 557 Id. 558 Id. 559See supra sections II.I.5 and III.E.3. 560 Id. 561See supra section III.E.3. Based on staff review of data derived from Morningstar Direct and Commission filings for the period ending June 30, 2019, approximately 521 registered CEFs currently rely on rule 8b–16(b). Of these, we estimate that 22 will be small issuers based on net assets of $50 million or less. 562See supra section III.E.3. 563 Id. 564See also supra sections III.E.3 and IV.B.3 (discussing the economic impact, and the estimated compliance costs and burdens, of the final rule described in section II.I). filings on Form 24F–2 be submitted in XML format.546 Large and small affected funds will both incur on a proportional basis, the costs associated with these adopted structured data requirements. Furthermore, as noted above, based on our experience implementing the XBRL format, we recognize that some registrants affected by the adopted requirement, particularly filers with no Inline XBRL experience, likely will incur initial costs to acquire the necessary expertise and/or software as well as ongoing costs of tagging required information in Inline XBRL, and the incremental effect of any fixed costs, including ongoing fixed costs, of complying with the Inline XBRL requirement may be greater for smaller filers.547 However, we believe that smaller affected funds in particular may benefit more from enhanced exposure to investors that could result from these adopted requirements.548 If reporting the disclosures in a structured format increases the availability of, or reduces the cost of collecting and analyzing, key information about affected funds, smaller affected funds may benefit from improved coverage by third-party information providers and data aggregators. Periodic Reporting Requirements The final rule also will require registered CEFs to provide the MDFP in their annual reports to shareholders, BDCs to provide financial highlights in their registration statements and annual reports, and affected funds filing a short-form registration statement on Form N–2 to disclose material unresolved staff comments.549 These requirements are intended to modernize and harmonize our periodic reporting disclosure requirements for affected funds with those applicable to operating companies and mutual funds and ETFs. The final
rule requirement for registered CEFs to include an MDFP
section in the annual report and for
BDCs to provide financial highlights in their registration statement and annual reports will apply to all applicable affected funds, large and small. We do not believe it would be appropriate to treat large and small entities differently for purposes of the MDFP requirement because such disclosures helps investors assess fund performance over the prior year and complements other information in the report, which may make the annual report disclosure more understandable as a whole.550 Such investor protection benefits are equally significant to investors in smaller affected funds as well as larger affected funds.551 For similar reasons, we believe that the informational benefit of BDCs’ inclusion of the financial highlights in their registration statements should apply equally to investors in large and small BDCs. We also believe the costs associated with this adopted requirement should be minimal for both large and small BDCs, since we understand that it is general market practice for BDCs to include this information in their registration statements.552 Finally, the final rule will require affected funds that file a short-form registration statement on Form N–2 to disclose material unresolved staff comments. Such a requirement will apply only to those entities that qualify for the short-form registration statement, which generally would not include smaller affected funds.553 Online Availability of Information Incorporated by Reference The final rule will modernize Form N–2’s requirements for backward incorporation by reference by all affected funds. Affected funds will no longer be required to deliver to new investors information that they have incorporated by reference.554 Instead, we are adopting new requirements that these funds make the incorporated materials and corresponding prospectus and SAI readily available and accessible on a website maintained by or for the fund and identified in the fund’s prospectus or SAI.555 We do not believe this requirement will generate significant compliance costs for affected funds because many funds currently post their annual and semi-annual reports and other fund information on their websites.556 Nor do we think it would be appropriate to treat large and small entities differently for these purposes. The adopted requirement will make the incorporated information, prospectus, and SAI more accessible to retail investors, who we believe may be more inclined to look at a fund’s website for information than to search the EDGAR system.557 The final rule also will increase the likelihood that fund investors view the information in their preferred format, and thereby increase their use of the information to make investment decisions.558 We believe that these investor protection benefits should be available equally for investors in smaller and larger affected funds. Enhancements to Certain Registered CEFs’ Annual Report Disclosure Finally, the amendments to rule 8b– 16(b) under the Investment Company Act will
require a fund relying on that rule to describe in its annual report the fund’s current investment objectives, policies, and principal risks.559 The amendments also will require a fund to describe in its annual report certain key changes that occurred during the relevant year in enough detail to allow investors to understand each change and how it may affect the fund, and to preface such disclosures with a legend.560 The amendments to rule 8b– 16(b) will only affect that portion of registered CEFs that rely on the rule.561 We do not think it would be appropriate to treat large and small entities differently for purposes of the amendments to rule 8b–16(b), as this new requirement will allow investors in funds relying on the rule to more easily identify and understand key information about their investments.562 We believe that this investor protection benefit should be available equally for investors in smaller and larger affected funds. In addition, the adopted new requirement will likely add only a small incremental compliance burden because funds relying on rule 8b–16(b) are already required to disclose the enumerated changes.563 The amendments described in section II.I above will apply to affected funds that are small entities as well as other affected funds unless noted otherwise.564

565See supra section II.D.
566 Id.
567 Id.; see also supra section III.E.5. 568See supra section III.E.5. 569Based on staff review of fund filings, as of August 2019, we estimate that approximately 65 continuously-offered unlisted affected funds (that are not interval funds) conduct continuous offerings under rule 415(a)(1)(ix), of which 14 are BDCs, and 51 are registered CEFs. 570See supra section II.A. 571See supra section II.C. 572See supra section III.D. 573 Id. 574See supra section III.E.1. 575See id. 576See supra section IV.B.2.
5. Automatic or Immediate Effectiveness
for Filings by Affected Funds Conducting Certain Continuous Offerings As we discussed above, the amendments we are adopting to rule 486 will permit any registered CEF or BDC that conducts continuous offerings under rule 415(a)(1)(ix), including unlisted continuously-offered affected funds such as tender offer funds, to rely on rule 486.565 Our amendment to rule 486 will allow such funds to file posteffective amendments and registration statements that become effective immediately upon filing or automatically effective 60 days after filing, depending on the substance of the disclosure changes.566 In doing so, we believe that such funds will be able to more efficiently update their financial statements under section 10(a)(3) of the Securities Act to maintain effective registration statements while they engage in continuous offerings.567 These amendments will benefit both large and small continuously-offered unlisted affected funds, and we believe that they provide benefits similar to the benefits the adopted rule offers affected funds that will file short-form registration statements or qualify as WKSIs.568 Because the amended rule applies only to those affected funds that conduct continuous offerings under rule 415(a)(1)(ix), we expect this subset of affected funds to be limited.569 In addition, although reliance on rule 486 is voluntary for continuously-offered affected funds who are newly permitted to rely on the rule, we expect many will rely on it due to the cost efficiencies sustained from a regime providing immediate or automatic effectiveness for post-effective amendments and certain registration statements. Notwithstanding this increased use, and because it will provide greater efficiencies, we do not believe the final rule will create any new meaningful reporting, recordkeeping, or other compliance costs in relation to how affected funds currently file post-effective amendments or registration statements. In addition, immediate or automatic effectiveness would permit smaller funds the ability to engage in offerings that meet investor demand, on a timely basis, for such offerings. E. Agency Action To Minimize Effect on Small Entities The RFA directs the Commission to consider significant alternatives that would accomplish our stated objective, while minimizing any significant economic impact on small entities. Although the BDC Act and Registered CEF Act required certain amendments to our rules and forms, we could have, for example, made additional modifications to the relevant provisions with respect to affected funds that are small entities. Alternatively, we also could have limited the scope to BDCs (as the BDC Act specified) and to interval funds and listed registered CEFs (as the Registered CEF Act specified), which would have excluded from the scope of the adopted rules certain small entities that are registered CEFs but that are not interval funds or listed registered CEFs.570 Where our final rules reflect an exercise of discretion,
we considered the following alternatives for small entities in relation to our amendments:

Exempting affected funds that are
small entities from the adopted disclosure, reporting, or recordkeeping requirements, to account for resources available to small entities;
Establishing different compliance or
reporting requirements or frequency to account for resources available to small entities;
Clarifying, consolidating, or
simplifying the compliance requirements under the amendments for small entities; and
Using performance rather than
design standards.

Alternatives to the Adopted
Approach to Implementing Statutory Mandates In accordance with the BDC Act and Registered CEF Act, to the final rule modifies the restrictions regarding offerings and communications permitted around the time of a Securities Act registered offering. The flexibility provided by our amendments will be greatest for larger and seasoned affected funds, but will also provide greater flexibility to all affected funds and broker-dealers, including small entities. We considered modifying the public float standards in the WKSI definition or the short-form registration instruction by reducing the required level of public float or providing alternative eligibility criteria, such as an aggregate NAV of a certain size for funds whose shares are not traded on an exchange or through the use of ‘‘performance’’ rather than ‘‘design’’ standards.571 These alternatives would have allowed more affected funds, potentially including small entities, to qualify as WKSIs or file short-form registration statements. However, we believe that modifying the eligibility criteria in the WKSI definition or the short-form registration instruction could weaken the investor protection benefits provided by those criteria. We also considered extending the adopted rule amendments only to BDCs, listed registered CEFs, and interval funds.572 However, excluding unlisted registered CEFs from the adopted rule amendments will create unnecessary competitive disparities between unlisted registered CEFs (which will potentially include smaller funds) and unlisted BDCs and will not provide investors in unlisted registered CEFs with the benefits of the new investor protections we are adopting.573
Alternative Approaches to
Discretionary Choices
New Registration Fee Payment Method for Interval Funds We considered, but are not adopting, provisions allowing a wider range of affected funds, such as registered CEFs that are tender offer funds, to rely on rule 24f–2.574 To the extent that this alternative would have brought in additional small affected funds, it could have extended the benefits of this fee payment method to additional small entities. However, we did not adopt this alternative approach because interval funds and ETPs have structural similarities to mutual funds and ETFs that other affected funds do not.575 Structured Data Requirements As an alternative, we could have adopted amendments requiring the Inline XBRL requirements only for a subset of affected funds—for example, affected funds that file short-form registration statements on Form N–2 or WKSIs.576 This would have lessened the burden associated with the structured data requirements on smaller affected funds. However, a structured data program that captures only a subset of affected funds would reduce potential data quality benefits compared to mandatory Inline XBRL requirements

577See id.
578See supra section III.E.3.
579See supra section V.D.4.
580See id.
581 5 U.S.C. 801 et seq. for all affected funds.577 This in turn would reduce data users’ ability to meaningfully analyze, aggregate, and compare data. However, we are adopting an extended compliance period for the new XBRL reporting requirements we adopted for affected funds that are not eligible to file a short-form registration statement. This extended compliance period—which will apply to affected funds that do not meet the transaction requirement to qualify to file a shortform registration statement on Form N– 2 (i.e., generally those affected funds with a public float of $75 million), and which encompasses the small entities subject to the adopted rule amendments discussed above—should enable small entities to defer the burden of additional cost associated with the adopted XBRL requirements and learn from affected funds that comply earlier. Periodic Reporting Requirements and Online Availability of Information Incorporated by Reference We also considered a partial or complete exemption from the adopted periodic reporting requirements, and for the adopted requirements to make information incorporated by reference available on a website, for small entities.578 With respect to the periodic reporting requirements, small entities that are not affected funds currently follow the same requirements that large entities do when filing periodic reports, and we believe that establishing different reporting requirements or frequency for small entities that are affected funds would not be consistent with the Commission’s goal of investor protection and industry oversight. For example, we could have adopted amendments to require smaller affected funds to include in their annual reports less information from their registration statements. While requiring less information would reduce costs to smaller affected funds by reducing the amount of required annual report disclosure, it could also make it more difficult for investors in these funds to find important fund information. Similarly, we believe that the investor protection benefits associated with the other adopted periodic reporting requirements that apply to large and small affected funds—for example, the MDFP requirement for registered CEFs and the inclusion of BDCs’ financial highlights in their registration statement—should apply equally to investors in large and small affected funds.579 We also believe that the investor protection benefits stemming from the adopted requirement to make materials incorporated by reference available on a website should be available equally for investors in smaller and larger affected funds, and therefore this adopted rule applies equally to large and small affected funds.580
VI. Other Matters
Pursuant to the Congressional Review Act,581 the Office of Information and Regulatory Affairs has designated this rule a ‘‘major rule,’’ as defined by 5 U.S.C. 804(2). If any of the provisions of these rules, or the application thereof to any person or circumstance, is held to be invalid, such invalidity shall not affect other provisions or application of such provisions to other persons or circumstances that can be given effect without the invalid provision or application.
VII. Statutory Authority
The amendments contained in this release are being adopted under the authority set forth in the Securities Act, particularly sections 6, 7, 8, 10, 19, and 28 thereof [15 U.S.C. 77a et seq.]; the Exchange Act, particularly sections 3, 4, 10, 12, 13, 14, 15, 17, 23, 35A, and 36 thereof [15 U.S.C. 78a et seq.]; the Investment Company Act, particularly sections 6, 8, 20, 23, 24, 30, 31, and 38 thereof [15 U.S.C. 80a et seq.]; the BDC Act, particularly section 803(b) thereof [Pub. L. 115–141, div. S, title VIII, 132 Stat. 348 (2018)]; and the Registered CEF Act, particularly section 509(a) thereof [Pub. L. 115–174, title V, 132 Stat. 1296 (2018)]. List of Subjects 17 CFR Part 229 Reporting and recordkeeping requirements, Securities. 17 CFR Part 230 Advertising, Confidential business information, Investment Companies, Reporting and recordkeeping requirements, Securities. 17 CFR Part 232 Administrative practice and procedure, Confidential business information, Reporting and recordkeeping requirements, Securities. 17 CFR Part 239 Reporting and recordkeeping requirements, Securities. 17 CFR Part 240 Brokers, Confidential business information, Fraud, Reporting and recordkeeping requirements, Securities. 17 CFR Part 243 Reporting and recordkeeping requirements, Securities. 17 CFR Part 249 Brokers, Reporting and recordkeeping requirements, Securities 17 CFR Part 270 Confidential business information, Fraud, Investment companies, Reporting and recordkeeping requirements, Securities. 17 CFR Part 274 Investment companies, Reporting and recordkeeping requirements, Securities. Text of Rule and Form Amendments For reasons set forth in the preamble, we are amending title 17, chapter II of the Code of Federal Regulations as follows:
PART 229—STANDARD
INSTRUCTIONS FOR FILING FORMS UNDER SECURITIES ACT OF 1933, SECURITIES EXCHANGE ACT OF 1934 AND ENERGY POLICY AND CONSERVATION ACT OF 1975— REGULATION S–K

1. The authority citation for part 229
  continues to read as follows:
  Authority: 15 U.S.C. 77e, 77f, 77g, 77h, 77j, 77k, 77s, 77z–2, 77z–3, 77aa(25), 77aa(26), 77ddd, 77eee, 77ggg, 77hhh, 77iii, 77jjj, 77nnn, 77sss, 78c, 78i, 78j, 78j–3, 78l, 78m, 78n, 78n–1, 78o, 78u–5, 78w, 78ll, 78 mm, 80a–8, 80a–9, 80a–20, 80a–29, 80a–30, 80a– 31(c), 80a–37, 80a–38(a), 80a–39, 80b–11 and 7201 et seq.; 18 U.S.C. 1350; sec. 953(b), Pub.
  L. 111–203, 124 Stat. 1904 (2010); and sec.
  102(c), Pub. L. 112–106, 126 Stat. 310 (2012).
1. Amend § 229.601 by revising
  paragraphs (b)(101)(i) introductory text, (b)(101)(i)(C), (b)(101)(ii)(A), and (b)(101)(iii) to read as follows:
  § 229.601 (Item 601) Exhibits.

(b) * * *
(101) * * *
(i) Required to be submitted. Required to be submitted to the Commission in the manner provided by § 232.405 of this chapter if the registrant is not registered under the Investment Company Act of 1940 (15 U.S.C. 80a–1 et seq.), except that an Interactive Data File:

(1) Only when the Form 8–K contains audited annual financial statements that are a revised version of financial statements that previously were filed with the Commission and that have been revised pursuant to applicable accounting standards to reflect the effects of certain subsequent events, including a discontinued operation, a change in reportable segments or a change in accounting principle. In such case, the Interactive Data File will be required only as to such revised financial statements regardless of whether the Form 8–K contains other financial statements; and (2) Except that a business development company as defined in
Section 2(a)(48) of the Investment
Company Act of 1940 (15 U.S.C. 80a– 2(a)(48)) also is required to submit an Interactive Data File to the extent required by § 232.405(b)(3)(iii) of this
chapter.
(ii) * * *
(A) Registrant is not registered under the Investment Company Act of 1940 (15 U.S.C. 80a–1 et seq.); and

(iii) Not permitted to be submitted. Not permitted to be submitted to the Commission if the registrant is registered under the Investment Company Act of 1940 (15 U.S.C. 80a–1 et seq.).

PART 230—GENERAL RULES and
REGULATIONS, SECURITIES ACT OF 1933

3. The authority citation for part 230
continues to read, in part, as follows:
Authority: 15 U.S.C. 77b, 77b note, 77c, 77d, 77f, 77g, 77h, 77j, 77r, 77s, 77z–3, 77sss, 78c, 78d, 78j, 78l, 78m, 78n, 78o, 78o–7 note, 78t, 78w, 78ll(d), 78mm, 80a–8, 80a–24, 80a– 28, 80a–29, 80a–30, and 80a–37, and Pub. L. 112–106, sec. 201(a), sec. 401, 126 Stat. 313 (2012), unless otherwise noted.

Sections 230.400 to 230.499 issued under secs. 6, 8, 10, 19, 48 Stat. 78, 79, 81, and 85, as amended (15 U.S.C. 77f, 77h, 77j, 77s). Sec. 230.457 also issued under secs. 6 and 7, 15 U.S.C. 77f and 77g.

1. Amend § 230.134 by revising
  paragraph (g) to read as follows:
  § 230.134 Communications not deemed a prospectus.

(g) This section does not apply to a communication relating to an investment company registered under the Investment Company Act of 1940 (15 U.S.C. 80a–1 et seq.), other than a registered closed-end investment company.

5. Amend § 230.138 by:
a. Removing Instruction to paragraph
(a)(1);
b. Adding paragraph (a)(1)(iii); and
c. Revising paragraph (a)(2)(i).
The addition and revision read as follows:
§ 230.138 Publications or distributions of research reports by brokers or dealers about securities other than those they are distributing. (a) * * * (1) * * * (iii) Note: If the issuer has filed a shelf registration statement under § 230.415(a)(1)(x) (Rule 415(a)(1)(x)) or pursuant to General Instruction I.D. of Form S–3, General Instruction I.C. of Form F–3 (§ 239.13 or § 239.33 of this
chapter), or pursuant to General
Instructions A.2 and B of Form N–2 (§§ 239.14 and 274.11a–1 of this
chapter) with respect to multiple classes
of securities, the conditions of paragraph (a)(1) of this section must be satisfied for the offering in which the broker or dealer is participating or will participate. (2) * * * (i)(A) Is required to file reports, and has filed all periodic reports required during the preceding 12 months (or such shorter time that the issuer was required to file such reports) on Forms 10–K (§ 249.310 of this chapter), 10–Q (§ 249.308a of this chapter), and 20–F (§ 249.220f of this chapter) pursuant to
Section 13 or Section 15(d) of the
Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); or (B)(1) Is a registered closed-end investment company; and (2) Is required to file reports, and has filed all periodic reports required during the preceding 12 months (or such shorter time that the issuer was required to file such reports) on Forms N–CSR (§§ 249.331 and 274.128 of this chapter), N–PORT (§ 274.150 of this chapter), and N–CEN (§§ 249.330 and 274.101 of this
chapter) pursuant to Section 30 of the
Investment Company Act; or

1. Amend § 230.156 by adding
  paragraph (d) to read as follows:
  § 230.156 Investment company sales literature.

(d) Nothing in this section may be construed to prevent a business development company or a registered closed-end investment company from qualifying for an exemption under § 230.168 or § 230.169.

7. Amend § 230.163 by:
a. In paragraph (b)(3)(i):
i. Removing ‘‘Rule 165 (§ 230.165) or
Rule 166 (§ 230.166)’’ and adding ‘‘§ 230.165 (Rule 165) or § 230.166 (Rule 166)’’ in its place; and
ii. Adding ‘‘or’’ after the semicolon at
the end of the paragraph;
b. Revising paragraph (b)(3)(ii); and
c. Removing paragraph (b)(3)(iii).
The revision reads as follows:
§ 230.163 Exemption from section 5(c) of the Act for certain communications by or on behalf of well-known seasoned issuers.

(b) * * *
(3) * * *
(ii) Communications by an issuer that is an investment company registered under the Investment Company Act of 1940 (15 U.S.C. 80a–1 et seq.), other than a registered closed-end investment company.

1. Amend § 230.163A by revising
  paragraph (b)(4) to read as follows:
  § 230.163A Exemption from section 5(c) of the Act for certain communications made by or on behalf of issuers more than 30 days before a registration statement is filed.

(b) * * *
(4) Communications made by an issuer that is an investment company registered under the Investment Company Act of 1940 (15 U.S.C. 80a–1 et seq.), other than a registered closedend investment company.

1. Amend § 230.164 by revising
  paragraph (f) to read as follows:
  § 230.164 Post-filing free writing prospectuses in connection with certain registered offerings.

(f) Excluded issuers. This section and Rule 433 are not available if the issuer is an investment company registered under the Investment Company Act of 1940 (15 U.S.C. 80a–1 et seq.), other than a registered closed-end investment company.

1. Amend § 230.168 by revising
  paragraphs (b)(1) introductory text, (b)(2) introductory text, and (d)(3) to read as follows:
  § 230.168 Exemption from sections 2(a)(10) and 5(c) of the Act for certain communications of regularly released factual business information and forwardlooking information.

(b) * * *
(1) Factual business information means some or all of the following

information that is released or disseminated under the conditions in paragraph (d) of this section, including, without limitation, such factual business information contained in reports or other materials filed with, furnished to, or submitted to the Commission pursuant to the Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) or the Investment Company Act of 1940 (15 U.S.C. 80a–1 et seq.):

(2) Forward-looking information means some or all of the following information that is released or disseminated under the conditions in paragraph (d) of this section, including, without limitation, such forwardlooking information contained in reports or other materials filed with, furnished to, or submitted to the Commission pursuant to the Securities Exchange Act of 1934 or pursuant to the Investment Company Act of 1940:

(d) * * *
(3) The issuer is not an investment company registered under the Investment Company Act of 1940 (15 U.S.C. 80a–1 et seq.), other than a registered closed-end investment company.

11. Amend § 230.169 by revising
paragraph (d)(4) to read as follows:
§ 230.169 Exemption from sections 2(a)(10) and 5(c) of the Act for certain communications of regularly released factual business information.

(d) * * *
(4) The issuer is not an investment company registered under the Investment Company Act of 1940 (15 U.S.C. 80a–1 et seq.), other than a registered closed-end investment company.

12. Amend § 230.172 by:
a. Revising paragraph (d)(1);
b. Removing paragraph (d)(2);
c. Redesignating paragraphs (d)(3) and
(4) as paragraphs (d)(2) and (3); and
d. In newly redesignated paragraph
(d)(2), removing ‘‘Rule 165(f)(1) (§ 230.165(f)(1)’’ and adding ‘‘§ 230.165(f)(1) (Rule 165(f)(1))’’ in its place. The revision reads as follows:
§ 230.172 Delivery of prospectuses.

(d) * * *
(1) Offering of any investment company registered under the Investment Company Act of 1940 (15 U.S.C. 80a–1 et seq.), other than a registered closed-end investment company;

1. Amend § 230.173 by:
a. Revising paragraph (f)(2);
b. Removing paragraph (f)(3);
c. Redesignating paragraphs (f)(4) and
(5) as paragraphs (f)(3) and (4); and
d. In newly redesignated paragraph
(f)(3), removing ‘‘Rule 165(f)(1) (§ 230.165(f)(1))’’ and adding ‘‘§ 230.165(f)(1) (Rule 165(f)(1))’’ in its place. The revision reads as follows:
§ 230.173 Notice of registration.

(f) * * *
(2) Offering of an investment company registered under the Investment Company Act of 1940 (15 U.S.C. 80a–1 et seq.), other than a registered closed-end investment company;

1. Amend § 230.405 by:
a. Revising the definition of
‘‘Automatic shelf registration statement’’;
b. Adding the definition for
‘‘Exchange-traded vehicle security’’ in alphabetical order;
c. In the definition of ‘‘Ineligible
issuer’’:
i. Revising paragraph (1)(i);
ii. In paragraph (1)(vii), removing the
word ‘‘or’’ at the end of the paragraph;
iii. In paragraph (1)(viii), removing the
period and adding in its place ‘‘; or’’; and
iv. Adding paragraph (1)(ix);
d. Adding the definition for
‘‘Registered closed-end investment company’’ in alphabetical order; and
e. In the definition ‘‘Well-known
seasoned issuer’’, revising paragraphs (1)(i) introductory text, (1)(i)(B)(2), (1)(v), and (2)(iii). The additions and revisions read as follows:
§ 230.405 Definitions of terms.

Automatic shelf registration statement. The term automatic shelf registration statement means a registration statement filed on Form S– 3, Form F–3, or Form N–2 (§ 239.13, § 239.33, or §§ 239.14 and 274.11a–1 of this chapter) by a well-known seasoned issuer pursuant to General Instruction I.D. of Form S–3, General Instruction I.C. of Form F–3, or General Instruction B of Form N–2.

Exchange-traded vehicle security. The term exchange-traded vehicle security means a security:
(1) Of an issuer:
(i) That is not a registered investment company under the Investment Company Act of 1940; and (ii) The assets of which consist primarily of commodities, currencies, or derivative instruments that reference commodities or currencies, or interests in the foregoing; (2) Offered or sold in a registered offering on a continuous basis pursuant to § 230.415 (Rule 415) by or on behalf of the issuer; (3) Of a class of securities that is listed for trading on a national securities exchange at or immediately after the time of effectiveness of the registration statement; and (4) Which is able to be purchased or redeemed, subject to conditions or limitations as described in the registration statement for the offering of such security, by the issuer for a ratable share of the issuer’s assets (or the cash equivalent thereof) at their net asset value each business day.

Ineligible issuer. (1) * * * (i) Any issuer that is required to file reports pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)) or section 30 of the Investment Company Act of 1940 (15 U.S.C. 80a–29) that has not filed all reports and other materials required to be filed during the preceding 12 months (or for such shorter period that the issuer was required to file such reports pursuant to sections 13 or 15(d) of the Securities Exchange Act of 1934 or
section 30 of the Investment Company
Act of 1940), other than reports on Form 8–K (§ 249.308 of this chapter) required solely pursuant to an item specified in General Instruction I.A.3(b) of Form S– 3 (§ 239.13 of this chapter) or General Instruction A.2.a of Form N–2 (§§ 239.14 and 274.11a-1 of this chapter) (or in the case of an asset-backed issuer, to the extent the depositor or any issuing entity previously established, directly or indirectly, by the depositor (as such terms are defined in § 229.1101 of this chapter (Item 1101 of Regulation AB) are or were at any time during the preceding 12 calendar months required to file reports pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934 with respect to a class of assetbacked securities involving the same asset class, such depositor and each such issuing entity must have filed all reports and other material required to be filed for such period (or such shorter period that each such entity was required to file such reports), other than reports on Form 8–K required solely pursuant to an item specified in General Instruction I.A.2 of Form SF–3);

(ix) In the case of an issuer that is a registered closed-end investment

company or a business development company, within the past three years any person or entity that at the time was an investment adviser to the issuer, including any sub-adviser, was made the subject of any judicial or administrative decree or order arising out of a governmental action that determines that the investment adviser aided, abetted or caused the issuer to have violated the anti-fraud provisions of the Federal securities laws.

Registered closed-end investment company. The term registered closedend investment company means a closed-end company, as defined in
section 5(a)(2) of the Investment
Company Act of 1940 (15 U.S.C. 80a– 5(a)(2)), that is registered under the Investment Company Act.

Well-known seasoned issuer. * * * (1)(i) Meets all the registrant requirements of General Instruction I.A. of Form S–3 or Form F–3 (§ 239.13 or § 239.33 of this chapter), or General Instructions A.2.a and A.2.b of Form N– 2 (§§ 239.14 and 274.11a–1 of this
chapter) and either:

(B) * * *
(2) Will register only non-convertible securities, other than common equity, and full and unconditional guarantees permitted pursuant to paragraph (1)(ii) of this definition unless, at the determination date, the issuer also is eligible to register a primary offering of its securities relying on General Instruction I.B.1. of Form S–3 or Form F–3 or is eligible to register a primary offering described in General Instruction I.B.1. of Form S–3 relying on General Instruction A.2 of Form N–2.

(v) Is not an investment company registered under the Investment Company Act of 1940 (15 U.S.C. 80a–1 et seq.), other than a registered closedend investment company. (2) * * * (iii) In the event that the issuer has not filed a shelf registration statement or amended a shelf registration statement for purposes of complying with section 10(a)(3) of the Act for sixteen months, the time of filing of the issuer’s most recent annual report on Form 10–K (§ 249.310 of this chapter), Form 20–F (§ 249.220f of this chapter), or Form N– CSR (§§ 249.331 and 274.128 of this
chapter) (or if such report has not been
filed by its due date, such due date).

1. Amend § 230.415 by revising
  paragraphs (a)(1)(x) and (xi), adding paragraph (a)(1)(xiii), and revising paragraph (a)(2) to read as follows:
  § 230.415 Delayed or continuous offering and sale of securities. (a) * * * (1) * * * (x) Securities registered (or qualified to be registered) on Form S–3 or Form F–3 (§ 239.13 or § 239.33 of this
  chapter), or on Form N–2 (§§ 239.14 and
  274.11a–1 of this chapter) pursuant to General Instruction A.2 of that form, which are to be offered and sold on an immediate, continuous or delayed basis by or on behalf of the registrant, a majority-owned subsidiary of the registrant or a person of which the registrant is a majority-owned subsidiary; or (xi) Shares of common stock which are to be offered and sold on a delayed or continuous basis by or on behalf of a registered closed-end investment company or business development company that makes periodic repurchase offers pursuant to § 270.23c– 3 of this chapter.

(xiii) Exchange-traded vehicle securities which are to be offered and sold on a continuous basis by or on behalf of the registrant in accordance with § 230.456(d) (Rule 456(d)). (2) Securities in paragraphs (a)(1)(viii) and (ix) of this section that are not registered on Form S–3 or Form F–3 (§ 239.13 or § 239.33 of this chapter), or on Form N–2 (§§ 239.14 and 274.11a–1 of this chapter) pursuant to General Instruction A.2 of that form, may only be registered in an amount which, at the time the registration statement becomes effective, is reasonably expected to be offered and sold within two years from the initial effective date of the registration.

1. Amend § 230.418 by revising
  paragraph (a)(3) introductory text to read as follows:
  § 230.418 Supplemental information.
  (a) * * *
  (3) Except in the case of a registrant eligible to use Form S–3 (§ 239.13 of this
  chapter), or Form N–2 (§§ 239.14 and
  274.11a–1 of this chapter) under General Instruction A.2 of that form, any engineering, management or similar reports or memoranda relating to broad aspects of the business, operations or products of the registrant, which have been prepared within the past twelve months for or by the registrant and any affiliate of the registrant or any principal underwriter, as defined in § 230.405 (Rule 405), of the securities being registered except for:

1. Amend § 230.424 by revising
  paragraph (f) and adding paragraph (i) to read as follows:
  § 230.424 Filing of prospectuses, number of copies.

(f) This section shall not apply with respect to prospectuses of an investment company registered under the Investment Company Act of 1940, other than a registered closed-end investment company. References to ‘‘form of prospectus’’ in paragraphs (a), (b), and (c) of this section shall be deemed also to refer to the form of Statement of Additional Information.

(i)(1) A form of prospectus filed pursuant to this section that operates to reflect the payment of filing fees for an offering of an indeterminate amount of exchange-traded vehicle securities pursuant to §§ 230.456(d) and 230.457(u) (Rule 456(d) and Rule 457(u)) shall be filed with the Commission within the time period set forth in Rule 456(d). The form of prospectus must be accompanied by the appropriate registration fee. (2) The form of prospectus must include the following information:
(i) The name and address of issuer; (ii) The name of the securities for which the prospectus is filed; (iii) The Securities Act file number(s) of the registration statement(s) associated with the offering; (iv) The last day of the fiscal year for the issuer for which the prospectus is filed; (v) The calculation of registration fee information calculated pursuant to Rule 457(u); and (vi) The total interest due pursuant to Rule 456(d)(5) and the total amount of registration fee due including any such interest, if the prospectus is being filed more than 90 days after the end of the issuer’s fiscal year.

18. Amend § 230.430A by revising
paragraph (a)(2) to read as follows:
§ 230.430A Prospectus in a registration statement at the time of effectiveness. (a) * * * (2) The registrant furnishes the undertakings required by § 229.512(i) of this chapter (Item 512(i) of Regulation S–K), or the undertakings required by Item 34.4 of Form N–2 (§§ 239.14 and 274.11a–1 of this chapter); and

1. Amend § 230.430B by revising
  paragraphs (b) introductory text, (f)(4)

introductory text, (f)(4)(ii), and (i) to read as follows:
§ 230.430B Prospectus in a registration statement after effective date.

(b) A form of prospectus filed as part of a registration statement for offerings pursuant to Rule 415(a)(1)(i) by an issuer eligible to use Form S–3 or Form F–3 (§ 239.13 or § 239.33 of this chapter) for primary offerings pursuant to General Instruction I.B.1 of such forms, or an issuer eligible to register such a primary offering under General Instruction A.2 of Form N–2 (§§ 239.14 and 274.11a–1 of this chapter), may omit the information specified in paragraph (a) of this section, and may also omit the identities of selling security holders and amounts of securities to be registered on their behalf if:

(f) * * *
(4) Except for an effective date resulting from the filing of a form of prospectus filed for purposes of including information required by
section 10(a)(3) of the Act or pursuant
to § 229.512(a)(1)(ii) of this chapter (Item 512(a)(1)(ii) of Regulation S–K) or Item 34.3.a(2) of Form N–2 (§§ 239.14 and 274.11a–1 of this chapter), the date a form of prospectus is deemed part of and included in the registration statement pursuant to this paragraph (f)(4) shall not be an effective date established pursuant to paragraph (f)(2) of this section as to:

(ii) Any person signing any report or document incorporated by reference into the registration statement, except for such a report or document incorporated by reference for purposes of including information required by
section 10(a)(3) of the Act or pursuant
to Item 512(a)(1)(ii) of Regulation S–K or Item 34.3.a(2) of Form N–2 (§§ 239.14 and 274.11a–1 of this chapter) (such person except for such reports being deemed not to be a person who signed the registration statement within the meaning of section 11(a) of the Act).

(i) Issuers relying on this section shall furnish the undertakings required by Item 512(a) of Regulation S–K or Item
34.3 of Form N–2 (§§ 239.14 and
274.11a–1 of this chapter) as applicable.

20. Amend § 230.433 by revising
paragraphs (b)(1)(i) and (iv) and (c)(1)(ii) to read as follows:
§ 230.433 Conditions to permissible postfiling free writing prospectuses.

(b) * * *
(1) * * *
(i) Offerings of securities registered on Form S–3 (§ 239.33 of this chapter) pursuant to General Instruction I.B.1, I.B.2, I.C., or I.D. thereof or on Form SF– 3 (§ 239.45 of this chapter) or on Form N–2 (§§ 239.14 and 274.11a–1 of this
chapter) pursuant to General Instruction
A.2 with respect to the same transactions;

(iv) Any other offering not excluded from reliance on this section and Rule 164 of securities of an issuer eligible to use Form S–3 or Form F–3 for primary offerings pursuant to General Instruction I.B.1 of such Forms or an issuer eligible to use General Instruction A.2 of Form N–2 to register a primary offering described in General Instruction I.B.1 of Form S–3.

(c) * * *
(1) * * *
(ii) Information contained in the issuer’s periodic and current reports filed or furnished to the Commission pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)) that are incorporated by reference into the registration statement and not superseded or modified, or pursuant to
section 30 of the Investment Company
Act of 1940 (15 U.S.C. 80a–29).

1. Effective August 1, 2021, amend
  § 230.456 by adding paragraph (d) to read as follows:
  § 230.456 Date of filing; timing of fee payment.

(d)(1) Notwithstanding paragraph (a) of this section, where a registration statement relates to an offering of exchange-traded vehicle securities, an issuer may elect to register an offering of an indeterminate amount of such securities if it meets the following conditions:
(i) The issuer must state in the ‘‘Calculation of Registration Fee’’ table that it is offering an indeterminate amount of such securities; and (ii) The issuer must, not later than 90 days after the end of any fiscal year during which it has publicly offered such securities, pay a registration fee to the Commission calculated in accordance with § 230.457(u) (Rule 457(u)) and file a prospectus in accordance with § 230.424(i) (Rule 424(i)). Instruction 1 to paragraph (d)(1)(ii):
To determine the date on which the registration fee must be paid, the first day of the 90-day period is the first calendar day of the fiscal year following the fiscal year for which the registration fee is to be paid. If the last day of the 90-day period falls on a Saturday, Sunday, or Federal holiday, the registration fee is due on the first business day thereafter. (2) If a registrant elects to register an offering of an indeterminate amount of exchange-traded vehicle securities pursuant to paragraph (d)(1) of this
section, the securities sold will be
considered registered, for purposes of
section 6(a) of the Act, if the registration
fee has been paid and a prospectus is filed pursuant to paragraph (d)(1) not later than the end of the 90-day period. (3) A registration statement filed relying on the registration fee payment provisions of paragraph (d)(1) of this
section will be considered filed as to the
securities identified in the registration statement for purposes of this section and section 5 of the Act when it is received by the Commission, if it complies with all other requirements under the Act, including this part. (4) For purposes of this section, if an issuer ceases operations, the date the issuer ceases operations will be deemed to be the end of its fiscal year. In the case of a liquidation, merger, or sale of all or substantially all of the assets (‘‘merger’’) of the issuer, the issuer will be deemed to have ceased operations for the purposes of this section on the date the merger is consummated; provided, however, that in the case of a merger of an issuer or a series of an issuer (‘‘Predecessor Issuer’’) with another issuer or a series of an issuer (‘‘Successor Issuer’’), the Predecessor Issuer will not be deemed to have ceased operations and the Successor Issuer will assume the obligations, fees, and redemption credits of the Predecessor Issuer incurred pursuant to this section if the Successor Issuer:
(i) Had no assets or liabilities, other than nominal assets or liabilities, and no operating history immediately prior to the merger; (ii) Acquired substantially all of the assets and assumed substantially all of the liabilities and obligations of the Predecessor Issuer; and (iii) The merger is not designed to result in the Predecessor Issuer merging with, or substantially all of its assets being acquired by, an issuer (or a series of an issuer) that would not meet the conditions of paragraph (d)(4)(i) of this
section.
(5) An issuer paying the fee required by paragraph (d)(1) of this section or any portion thereof more than 90 days after the end of the fiscal year of the issuer shall pay to the Commission interest on

unpaid amounts, calculated based on the interest rate in effect at the time of the interest payment by reference to the ‘‘current value of funds rate’’ on the Treasury Department’s Financial Management Service internet site at http://www.fms.treas.gov, or by calling (202) 874–6995, and using the following formula: I = (X) (Y) (Z/365), where: I = Amount of interest due; X = Amount of registration fee due; Y = Applicable interest rate, expressed as a fraction; Z = Number of days by which the registration fee payment is late. The payment of interest pursuant to this paragraph (d)(5) shall not preclude the Commission from bringing an action to enforce the requirements of this paragraph (d). (6) An immaterial or unintentional failure to comply with a requirement of this paragraph (d) will not result in a violation of section 6(a) of the Act (15 U.S.C. 77f(a)), so long as:
(i) A good faith and reasonable effort was made to comply with the requirement; and (ii) In the case of a late payment of a registration fee, the issuer pays the registration fee and any interest due thereon as soon as practicable after discovery of the failure to pay the registration fee.

22. Effective August 1, 2021, amend
§ 230.457 by adding paragraph (u) to read as follows:
§ 230.457 Computation of fee.

(u) Where an issuer elects to register an offering of an indeterminate amount of exchange-traded vehicle securities in accordance with § 230.456(d) (Rule 456(d)), the registration fee is to be calculated in the following manner:
(1) Determine the aggregate sale price of securities sold during the fiscal year. (2) Determine the sum of:
(i) The aggregate redemption or repurchase price of securities redeemed or repurchased during the fiscal year; and (ii) The aggregate redemption or repurchase price of securities redeemed or repurchased during any prior fiscal year ending no earlier than August 1, 2021, that were not used previously to reduce registration fees payable to the Commission. (3) Subtract the amount in paragraph (u)(2) of this section from the amount in paragraph (u)(1) of this section. If the resulting amount is positive, the amount is the net sales amount. If the resulting amount is negative, it is the amount of redemption credits available for use in future years to offset sales. (4) The registration fee is calculated by multiplying the net sales amount by the fee payment rate in effect on the date of the fee payment. If the issuer determines that it had net redemptions or repurchases for the fiscal year, no registration fee is due.

23. Amend § 230.462 by revising
paragraph (f) to read as follows:
§ 230.462 Immediate effectiveness of certain registration statements and posteffective amendments.

(f) A post-effective amendment filed pursuant to paragraph (e) of this section for purposes of adding a new issuer and its securities as permitted by § 230.413(b) (Rule 413(b)) that satisfies the requirements of Form S–3, Form F– 3, or General Instruction A.2 of Form N– 2 (§ 239.13, § 239.33, or §§ 239.14 and 274.11a–1 of this chapter), as applicable, including the signatures required by § 230.402(e) (Rule 402(e)), and contains a prospectus satisfying the requirements of § 230.430B (Rule 430B), shall become effective upon filing with the Commission.

24. Amend § 230.486 by:
a. Revising paragraphs (a), (b)
introductory text, and (b)(1)(iv);
b. Removing ‘‘and’’ at the end of
paragraph (b)(1)(v);
c. Redesignating paragraph (b)(1)(vi)
as paragraph (b)(1)(vii);
d. Adding new paragraph (b)(1)(vi);
e. Revising the introductory text to
paragraph (b)(2); and
f. Adding paragraph (g).
The revisions and additions read as follows:
§ 230.486 Effective date of post-effective amendments and registration statements filed by certain closed-end management investment companies. (a) Automatic effectiveness. Except as otherwise provided in this section, a post-effective amendment to a registration statement, or a registration statement described in paragraph (g) of this section, filed by a registered closedend management investment company or business development company which makes periodic repurchase offers under § 270.23c–3 of this chapter or which offers securities under § 230.415(a)(1)(ix), shall become effective on the sixtieth day after the filing thereof, or a later date designated by the registrant on the facing sheet of the amendment or registration statement, which date shall not be later than eighty days after the date on which the amendment or registration statement is filed, Provided, that the Commission, having due regard to the public interest and the protection of investors, may declare an amendment or registration statement filed under this paragraph (a) effective on an earlier date. (b) Immediate effectiveness. Except as otherwise provided in this section, a post-effective amendment to a registration statement, or a registration statement, filed by a registered closedend management investment company or business development company which makes periodic repurchase offers under § 270.23c–3 of this chapter or which offers securities under § 230.415(a)(1)(ix), shall become effective on the date on which it is filed with the Commission, or a later date designated by the registrant on the facing sheet of the amendment or registration statement, which date shall be not later than thirty days after the date on which the amendment or registration statement is filed, except that a post-effective amendment including a designation of a new effective date under paragraph (b)(1)(iii) of this section shall become effective on the new effective date designated therein, Provided, that the following conditions are met:
(1) * * *
(iv) Disclosing or updating the information required by Item 9.1.c of Form N–2 [17 CFR 239.14 and 274.11a– 1];

(vi) Complying with § 230.415(a)(5) and (6); and

(2) The registrant represents that the amendment is filed solely for one or more of the purposes specified in paragraph (b)(1) of this section and that no material event requiring disclosure in the prospectus, other than one listed in paragraph (b)(1) or one for which the Commission has approved a filing under paragraph (b)(1)(vii) of this section, has occurred since the latest of the following three dates:

(g) Registration statements. A registration statement can become effective under paragraph (a) of this
section if it is filed for the purpose of:
(1) Registering additional shares of common stock for which a registration statement filed on Form N–2 (§§ 239.14 and 274.11a–1 of this chapter) is effective; or (2) Complying with § 230.415(a)(5) and (6).

25. Amend § 230.497 by:
a. Remove from paragraphs (c) and (e)
the text ‘‘Form N–2 (§§ 239.14 and 274.11a–1 of this chapter),’’;
b. Removing the heading from
paragraph (k);
c. Adding paragraph (l); and
d. Removing the parenthetical
authority citation at the end of the
section.

The addition reads as follows:
§ 230.497 Filing of investment company prospectuses—number of copies.

(l) Except for an investment company advertisement deemed to be a section 10(b) prospectus pursuant to § 230.482, this section shall not apply with respect to prospectuses of a registered closedend investment company, or a business development company.
PART 232—REGULATION S–T—
GENERAL RULES AND REGULATIONS FOR ELECTRONIC FILINGS

26. The general authority citation for
part 232 continues to read as follows:
Authority: 15 U.S.C. 77c, 77f, 77g, 77h, 77j, 77s(a), 77z–3, 77sss(a), 78c(b), 78l, 78m, 78n, 78o(d), 78w(a), 78ll, 80a–6(c), 80a–8, 80a–29, 80a–30, 80a–37, 7201 et seq.; and 18 U.S.C. 1350, unless otherwise noted.

1. Amend § 232.11 by revising the
  section heading and the definition of
  ‘‘Related Official Filing’’ to read as follows:
  § 232.11 Definition of terms used in this
  part.

Related Official Filing. The term Related Official Filing means the ASCII or HTML format part of the official filing with which all or part of an Interactive Data File appears as an exhibit or, in the case of a filing on Form N–1A (§§ 239.15A and 274.11A of this chapter), Form N–2 (§§ 239.14 and 274.11a–1 of this chapter), Form N–3 (§§ 239.17a and 274.11b of this chapter), Form N–4 (§§ 239.17b and 274.11c of this chapter), Form N–6 (§§ 239.17c and 274.11d of this chapter), and Form N– CSR (§ 274.128 of this chapter), and, to the extent required by § 232.405 [Rule 405 of Regulation S–T] for a business development company as defined in
Section 2(a)(48) of the Investment
Company Act of 1940 (15 U.S.C. 80a– 2(a)(48)), Form 10–K (§ 249.310 of this
chapter), Form 10–Q (§ 249.308a of this
chapter), and Form 8–K (§ 249.308 of
this chapter), the ASCII or HTML format
part of an official filing that contains the
information to which an Interactive Data File corresponds.

1. Amend § 232.405 by:
a. Revising the introductory text and
paragraphs (a)(2), (a)(3)(i) introductory text, (a)(3)(ii), and (a)(4);
b. Adding a heading for paragraph (b);
c. Removing the heading and revising
the introductory text of paragraph (b)(1);
d. Adding paragraph (b)(3); and
e. Redesignating the note to § 232.405
as note 2 to § 232.405 and revising the last sentence of newly redesignated note 2 to § 232.405. The revisions and addition read as follows:
§ 232.405 Interactive Data File submissions. This section applies to electronic filers that submit Interactive Data Files.
Section 229.601(b)(101) of this chapter
(Item 601(b)(101) of Regulation S–K), paragraph (101) of Part II—Information Not Required to be Delivered to Offerees or Purchasers of Form F–10 (§ 239.40 of this chapter), paragraph 101 of the Instructions as to Exhibits of Form 20– F (§ 249.220f of this chapter), paragraph B.(15) of the General Instructions to Form 40–F (§ 249.240f of this chapter), paragraph C.(6) of the General Instructions to Form 6–K (§ 249.306 of this chapter), General Instruction C.3.(g) of Form N–1A (§§ 239.15A and 274.11A of this chapter), General Instruction I of Form N–2 (§§ 239.14 and 274.11a–1 of this chapter), General Instruction C.3.(h) of Form N–3 (§§ 239.17a and 274.11b of this chapter), General Instruction C.3.(h) of Form N–4 (§§ 239.17b and 274.11c of this chapter), General Instruction C.3.(h) of Form N–6 (§§ 239.17c and 274.11d of this chapter), and General Instruction C.4 of Form N–CSR (§ 274.128 of this
chapter) specify when electronic filers
are required or permitted to submit an Interactive Data File (§ 232.11), as further described in note 2 to this
section. This section imposes content,
format, and submission requirements for an Interactive Data File, but does not change the substantive content requirements for the financial and other disclosures in the Related Official Filing (§ 232.11). (a) * * * (2) Be submitted only by an electronic filer either required or permitted to submit an Interactive Data File as specified by § 229.601(b)(101) of this
chapter (Item 601(b)(101) of Regulation
S–K), paragraph (101) of Part II— Information Not Required to be Delivered to Offerees or Purchasers of Form F–10 (§ 239.40 of this chapter), paragraph 101 of the Instructions as to Exhibits of Form 20–F (§ 249.220f of this
chapter), paragraph B.(15) of the General
Instructions to Form 40–F (§ 249.240f of this chapter), paragraph C.(6) of the General Instructions to Form 6–K (§ 249.306 of this chapter), General Instruction C.3.(g) of Form N–1A (§§ 239.15A and 274.11A of this
chapter), General Instruction I of Form
N–2 (§§ 239.14 and 274.11a–1 of this
chapter), General Instruction C.3.(h) of
Form N–3 (§§ 239.17a and 274.11b of this chapter), General Instruction C.3.(h) of Form N–4 (§§ 239.17b and 274.11c of this chapter), General Instruction C.3.(h) of Form N–6 (§§ 239.17c and 274.11d of this chapter), or General Instruction C.4 of Form N–CSR (§ 274.128 of this
chapter), as applicable;
(3) * * *
(i) If the electronic filer is neither a management investment company registered under the Investment Company Act of 1940 (15 U.S.C. 80a et seq.), nor a separate account as defined in Section 2(a)(14) of the Securities Act (15 U.S.C. 77b(a)(14)) registered under the Investment Company Act of 1940, nor a business development company as defined in Section 2(a)(48) of the Investment Company Act of 1940 (15 U.S.C. 80a–2(a)(48)), and is not within one of the categories specified in paragraph (f)(1)(i) of this section, as partly embedded into a filing with the remainder simultaneously submitted as an exhibit to:

(ii) If the electronic filer is either a management investment company registered under the Investment Company Act of 1940 (15 U.S.C. 80a et seq.), or a separate account (as defined in Section 2(a)(14) of the Securities Act (15 U.S.C. 77b(a)(14)) registered under the Investment Company Act of 1940, or a business development company as defined in Section 2(a)(48) of the Investment Company Act of 1940 (15 U.S.C. 80a–2(a)(48)), and is not within one of the categories specified in paragraph (f)(1)(ii) of this section, as partly embedded into a filing with the remainder simultaneously submitted as an exhibit to a filing that contains the disclosure this section requires to be tagged; and (4) Be submitted in accordance with the EDGAR Filer Manual and, as applicable, either Item 601(b)(101) of Regulation S–K (§ 229.601(b)(101) of this chapter), paragraph (101) of Part II—Information Not Required to be Delivered to Offerees or Purchasers of Form F–10 (§ 239.40 of this chapter), paragraph 101 of the Instructions as to Exhibits of Form 20–F (§ 249.220f of this
chapter), paragraph B.(15) of the General
Instructions to Form 40–F (§ 249.240f of this chapter), paragraph C.(6) of the General Instructions to Form 6–K (§ 249.306 of this chapter), General Instruction C.3.(g) of Form N–1A (§§ 239.15A and 274.11A of this
chapter), General Instruction I of Form
N–2 (§§ 239.14 and 274.11a–1 of this
chapter), General Instruction C.3.(h) of
Form N–3 (§§ 239.17a and 274.11b of this chapter), General Instruction C.3.(h) of Form N–4 (§§ 239.17b and 274.11c of

this chapter), General Instruction C.3.(h) of Form N–6 (§§ 239.17c and 274.11d of this chapter); or General Instruction C.4 of Form N–CSR (§ 274.128 of this
chapter).
(b) Content—categories of information presented. (1) If the electronic filer is neither a management investment company registered under the Investment Company Act of 1940 (15 U.S.C. 80a et seq.), nor a separate account (as defined in Section 2(a)(14) of the Securities Act (15 U.S.C. 77b(a)(14)) registered under the Investment Company Act of 1940, nor a business development company as defined in Section 2(a)(48) of the Investment Company Act of 1940 (15 U.S.C. 80a–2(a)(48)) an Interactive Data File must consist of only a complete set of information for all periods required to be presented in the corresponding data in the Related Official Filing, no more and no less, from all of the following categories:

(3) If the electronic filer is either a closed-end management investment company registered under the Investment Company Act of 1940 (15 U.S.C. 80a et seq.) or a business development company as defined in
Section 2(a)(48) of the Investment
Company Act of 1940 (15 U.S.C. 80a– 2(a)(48)), an Interactive Data File must consist only of a complete set of information for all corresponding data in the Related Official Filing, no more and no less, as follows:
(i) For a business development company, for all periods required to be presented:
(A) The complete set of the electronic filer’s financial statements (which includes the face of the financial statements and all footnotes); and (B) All schedules set forth in §§ 210.12–01 through 210.12–29 of this
chapter (Article 12 of Regulation S–X)
related to the electronic filer’s financial statements; (ii) All of the information required on the cover page of Form N–2 (§§ 239.14 and 274.11a–1 of this chapter) except the Calculation of Registration Fee table; and (iii) As applicable, all of the information provided in response to Items 3.1, 4.3, 8.2.b, 8.2.d, 8.3.a, 8.3.b, 8.5.b, 8.5.c, 8.5.e, 10.1.a–d, 10.2.a–c, 10.2.e, 10.3, and 10.5 of Form N–2 in any registration statement or posteffective amendment thereto filed on Form N–2; or any form of prospectus filed pursuant to § 230.424 of this
chapter (Rule 424 under the Securities
Act); or, if a Registrant is filing a registration statement pursuant to General Instruction A.2 of Form N–2, any filing on Form N–CSR, Form 10–K, Form 10–Q, or Form 8–K to the extent such information appears therein.

Note 2 to § 232.405: * * * For an issuer that is a management investment company or separate account registered under the Investment Company Act of 1940 (15 U.S.C. 80a et seq.) or a business development company as defined in Section 2(a)(48) of the Investment Company Act of 1940 (15 U.S.C. 80a–2(a)(48)), General Instruction C.3.(g) of Form N–1A (§§ 239.15A and 274.11A of this chapter), General Instruction I of Form N–2 (§§ 239.14 and 274.11a–1 of this chapter), General Instruction C.3.(h) of Form N–3 (§§ 239.17a and 274.11b of this chapter), General Instruction C.3.(h) of Form N– 4 (§§ 239.17b and 274.11c of this
chapter), General Instruction C.3.(h) of
Form N–6 (§§ 239.17c and 274.11d of this chapter), and General Instruction C.4 of Form N–CSR (§ 274.128 of this
chapter), as applicable, specifies the
circumstances under which an Interactive Data File must be submitted.
PART 239—FORMS PRESCRIBED
UNDER THE SECURITIES ACT OF 1933

29. The authority citation for part 239
continues to read, in part, as follows:
Authority: 15 U.S.C. 77c, 77f, 77g, 77h, 77j, 77s, 77z–2, 77z–3, 77sss, 78c, 78l,78m,78n, 78o(d), 78o–7 note, 78u–5, 78w(a), 78ll,78mm, 80a–2(a), 80a–3, 80a–8, 80a–9, 80a–10, 80a–13, 80a–24, 80a–26, 80a–29, 80a–30, and 80a–37; and sec. 107, Pub. L. 112–106, 126 Stat. 312, unless otherwise noted. Sections 239.31, 239.32 and 239.33 are also issued under 15 U.S.C. 78l, 78m, 78o, 78w, 80a–8, 80a–29, 80a–30, 80a–37 and 12 U.S.C. 241.

1. Effective August 1, 2021, amend
  Form S–1 (referenced in § 239.11) by revising the note that immediately follows the ‘‘Calculation of Registration Fee’’ table to read as follows:
  Note: The text of Form S–1 does not, and this amendment will not, appear in the Code of Federal Regulations. UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM S–1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

CALCULATION OF REGISTRATION FEE

Note: Specific details relating to the fee calculation shall be furnished in notes to the table, including references to provisions of Rule 457 (§ 230.457 of this chapter) relied upon, if the basis of the calculation is not otherwise evident from the information presented in the
table. If the filing fee is calculated
pursuant to Rule 457(o) under the Securities Act, only the title of the class of securities to be registered, the proposed maximum aggregate offering price for that class of securities and the amount of registration fee need to appear in the Calculation of Registration Fee table. If an offering of an indeterminate amount of exchangetraded vehicle securities is being registered, state that the registration statement covers an indeterminate amount of securities to be offered or sold and that the filing fee will be calculated and paid in accordance with Rule 456(d) and Rule 457(u) (§ 230.456(d) and § 230.457(u) of this
chapter), respectively. Any difference
between the dollar amount of securities registered for such offerings and the dollar amount of securities sold may be carried forward on a future registration statement pursuant to Rule 429 under the Securities Act.

1. Effective August 1, 2021, amend
  Form S–3 (referenced in § 239.13) by adding Instruction 5 to the notes that immediately follow the ‘‘Calculation of Registration Fee’’ table to read as follows:
  Note: The text of Form S–3 does not, and this amendment will not, appear in the Code of Federal Regulations. UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM S–3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

CALCULATION OF REGISTRATION FEE

If an offering of an indeterminate
amount of exchange-traded vehicle securities is being registered, the Fee
Table must state that the registration
statement covers an indeterminate amount of securities to be offered or sold and the filing fee will be calculated and paid in accordance with Rule

456(d) and Rule 457(u) (§ 230.456(d) and § 230.457(u) of this chapter), respectively.

1. Amend Form N–14 (referenced in
  § 239.23) by revising the first and second undesignated paragraphs of General Instruction G to read as follows:
  Note: The text of Form N–14 does not, and these amendments will not, appear in the Code of Federal Regulations. UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM N–14 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

GENERAL INSTRUCTIONS

G. Incorporation by Reference and Delivery of Prospectuses or Reports Filed With the Commission If any party to a transaction registered on Form N–14 is registered under the 1940 Act or is a business development company as defined by Section 2(a)(48) of the 1940 Act and has a current prospectus which meets the requirements of Section 10(a)(3) of the 1933 Act or is current in its reports filed pursuant to Section 13(a) or 15(d) of the 1934 Act and Section 30 of the 1940 Act, the registrant may, if it so elects, incorporate by reference the prospectus, the corresponding Statement of Additional Information, or reports, or any information in the prospectus, the corresponding Statement of Additional Information, or reports, which satisfies the disclosure required by Items 5, 6, and 11 through 14 of this Form. If the registrant elects to incorporate information by reference into the prospectus, a copy of each document from which information is incorporated by reference must accompany the prospectus, except that a prospectus from which information has been incorporated by reference need not be sent to an investor if the obligation to deliver a prospectus under Section 5(b)(2) of the Securities Act [15 U.S.C. 77e] has already been satisfied with respect to that investor pursuant to Rule 498A(j) for the offering described in the prospectus being incorporated by reference. Notwithstanding the foregoing the registrant may, at its discretion, incorporate any or all of the Statement of Additional Information into the prospectus delivered to investors, without delivering the Statement with the prospectus, so long as the Statement of Additional Information is available to investors as provided in General Instruction F. The registrant also may incorporate by reference into the prospectus information about the company being acquired without delivering the information with the prospectus under certain conditions pursuant to Item 6 of Form N–14, and in accordance with the requirements of Instruction F. If the registrant elects to incorporate information by reference into the Statement of Additional Information, a copy of each document from which information is incorporated by reference must accompany the Statement of Additional Information sent to shareholders.

1. Effective August 1, 2021, amend
  Form F–1 (referenced in § 239.31) by revising the note that immediately follows the ‘‘Calculation of Registration Fee’’ table to read as follows:
  Note: The text of Form F–1 does not, and this amendment will not, appear in the Code of Federal Regulations. UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM F–1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

CALCULATION OF REGISTRATION FEE

1. Effective August 1, 2021, amend
  Form F–3 (referenced in § 239.33) by adding Instruction 5 to the notes that immediately follow the ‘‘Calculation of Registration Fee’’ table to read as follows:
  Note: The text of Form F–3 does not, and this amendment will not, appear in the Code of Federal Regulations. UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM F–3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

GENERAL INSTRUCTIONS

If an offering of an indeterminate
amount of exchange-traded vehicle securities is being registered, the Fee
Table must state that the registration
statement covers an indeterminate amount of securities to be offered or sold and that the filing fee will be calculated and paid in accordance with Rule 456(d) and Rule 457(u) (§ 230.456(d) and § 230.457(u) of this
chapter), respectively.

PART 240—GENERAL RULES AND
REGULATIONS, SECURITIES
EXCHANGE ACT OF 1934

35. The general authority citation for
part 240 continues to read as follows:
Authority: 15 U.S.C. 77c, 77d, 77g, 77j, 77s, 77z–2, 77z–3, 77eee, 77ggg, 77nnn, 77sss, 77ttt, 78c, 78c–3, 78c–5, 78d, 78e, 78f, 78g, 78i, 78j, 78j–1, 78k, 78k–1, 78l, 78m, 78n, 78n–1, 78o, 78o–4, 78o–10, 78p, 78q, 78q–1, 78s, 78u–5, 78w, 78x, 78dd, 78ll, 78mm, 80a–20, 80a–23, 80a–29, 80a–37, 80b– 3, 80b–4, 80b–11, and 7201 et seq., and 8302; 7 U.S.C. 2(c)(2)(E); 12 U.S.C. 5221(e)(3); 18 U.S.C. 1350; Pub. L. 111–203, 939A, 124 Stat. 1376 (2010); and Pub. L. 112–106, sec. 503 and 602, 126 Stat. 326 (2012), unless otherwise noted.

1. Amend § 240.14a–101 by:
a. Revising paragraph E of the ‘‘Notes’’
section; and
b. Revising paragraph (b)(1) of ‘‘Item

Financial and other information.
(See Notes D and E at the beginning of this Schedule.)’’. The revisions read as follows:
§ 240.14a–101 Schedule 14A. Information required in proxy statement.
Schedule 14A Information
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934

Notes
Notes: * * *
E. In Item 13 of this Schedule, the reference to ‘‘meets the requirement of Form S–3’’ or ‘‘meets the requirements of General Instruction A.2 of Form N– 2’’ shall refer to a registrant who meets the following requirements:
(a) A registrant meets the requirements of Form S–3 if:
(1) The registrant meets the requirements of General Instruction I.A. of Form S–3 (§ 239.13 of this chapter); and (2) One of the following is met:
(i) The registrant meets the aggregate market value requirement of General Instruction I.B.1 of Form S–3; or (ii) Action is to be taken as described in Items 11, 12, and 14 of this schedule which concerns non-convertible debt or preferred securities issued by a registrant meeting the requirements of General Instruction I.B.2. of Form S–3 (referenced in 17 CFR 239.13); or (iii) The registrant is a majorityowned subsidiary and one of the conditions of General Instruction I.C. of Form S–3 is met. (b) A registrant meets the requirements of General Instruction A.2 of Form N–2 (§§ 239.14 and 274.11a–1 of this chapter) if the registrant meets the conditions included in such General Instruction, provided that General Instruction A.2.c of Form N–2 is subject to the same limitations described in paragraph (a)(2) of this Note E.

Item 13. Financial and other information. (See Notes D and E at the beginning of this Schedule.)

(b) * * *
(1) S–3 registrants and certain N–2 registrants. If the registrant meets the requirements of Form S–3 or General Instruction A.2 of Form N–2 (see Note E to this Schedule), it may incorporate by reference to previously-filed documents any of the information required by paragraph (a) of this Item, provided that the requirements of paragraph (c) are met. Where the registrant meets the requirements of Form S–3 or General Instruction A.2 of Form N–2 and has elected to furnish the required information by incorporation by reference, the registrant may elect to update the information so incorporated by reference to information in subsequently-filed documents.

PART 243—REGULATION FD

37. The authority citation for part 243
continues to read as follows:
Authority: 15 U.S.C. 78c, 78i, 78j, 78m, 78o, 78w, 78mm, and 80a–29, unless otherwise noted.
1. Amend § 243.103 by revising
  paragraph (a) to read as follows:
  § 243.103 No effect on Exchange Act reporting status.

(a) For purposes of Forms S–3 (17 CFR 239.13), S–8 (17 CFR 239.16b) and SF–3 (17 CFR 239.45) under the Securities Act of 1933 (15 U.S.C. 77a et seq.), or Form N–2 (17 CFR 239.14 and 274.11a–1) under the Securities Act of 1933 (15 U.S.C. 77a et seq.) and the Investment Company Act of 1940 (15 U.S.C. 80a–1 et seq.), an issuer is deemed to have filed all the material required to be filed pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)) or where applicable, has made those filings in a timely manner; or

PART 270—RULES AND
REGULATIONS, INVESTMENT
COMPANY ACT OF 1940

39. The authority citation for part 270
continues to read, in part, as follows:
Authority: 15 U.S.C. 80a–1 et seq., 80a– 34(d), 80a–37, 80a–39, and Pub. L. 111–203, sec. 939A, 124 Stat. 1376 (2010), unless otherwise noted.

Section 270.23c–3 also issued under
15 U.S.C. 80a–23(c).
Section 270.24f–2 also issued under
15 U.S.C. 80a–24(f)(4).

1. Amend § 270.8b–16 by revising
  paragraphs (b)(2) and (4) and adding paragraph (e) to read as follows:
  § 270.8b–16 Amendments to registration statement.

(b) * * *
(2) The company’s investment objectives and policies (described in Item 8.2 of Form N–2), and any material changes to same that have not been approved by shareholders;

(4) The principal risk factors associated with investment in the company (described in Item 8.3 of Form N–2), and any material changes to same; and

(e) The changes required to be disclosed by paragraphs (b)(2) through (5) of this section must be described in enough detail to allow investors to understand each change and how it may affect the fund. Such disclosures must be prefaced with the following legend:
‘‘The following information [in this annual report] is a summary of certain changes since [date]. This information may not reflect all of the changes that have occurred since you purchased [this fund].’’

41. Effective August 1, 2021, amend
§ 270.23c–3 by adding paragraph (e) to read as follows:
§ 270.23c–3 Repurchase offers by closedend companies.

(e) Registration of an indefinite amount of securities. A company that makes repurchase offers pursuant to paragraph (b) of this section shall be deemed to have registered an indefinite amount of securities pursuant to Section 24(f) of the Act (15 U.S.C. 80a–24(f)) upon the effective date of its registration statement.

42. Effective August 1, 2021, amend
§ 270.24f–2 by revising the first sentence of paragraph (a) to read as follows:
§ 270.24f–2 Registration under the Securities Act of 1933 of certain investment company securities. (a) General. Any face-amount certificate company, open-end management company, closed-end management company that makes periodic repurchase offers pursuant to § 270.23c–3(b), or unit investment trust (‘‘issuer’’) that is deemed to have registered an indefinite amount of securities pursuant to Section 24(f) of the Act (15 U.S.C. 80a–24(f)) must not later than 90 days after the end of any fiscal year during which it has publicly offered such securities, file Form 24F– 2 (17 CFR 274.24) with the Commission.

PART 274—FORMS PRESCRIBED
UNDER THE INVESTMENT COMPANY ACT of 1940

43. The authority citation for part 274
continues to read as follows:

Authority: 15 U.S.C. 77f, 77g, 77h, 77j, 77s, 78c(b), 78l, 78m, 78n, 78o(d), 80a–8, 80a–24, 80a–26, 80a–29, and Pub. L. 111–203, sec. 939A, 124 Stat. 1376 (2010), unless otherwise noted.
Section 274.128 is also issued under
15 U.S.C. 78j–1, 7202, 7233, 7241, 7264, and 7265; and 18 U.S.C. 1350.

44. Revise Form N–2 (referenced in
§§ 239.14 and 274.11a–1) to read as follows:
Note: The text of Form N–2 does not, and this amendment will not, appear in the Code of Federal Regulations. BILLING CODE 8011–01–P ER01JN20.000</GPH>

ER01JN20.001</GPH>

BILLING CODE 8011–01–C
CALCULATION OF REGISTRATION FEE UNDER THE SECURITIES ACT OF 1933 Title of securities being registered Amount being registered Proposed maximum offering price per unit Proposed maximum aggregate offering price Amount of registration fee Instructions. Complete the Registration Fee table and provide the following (unless payment will be provided using Form 24F–2 [17 CFR 274.24]). If the registration statement or amendment is filed under only one of the Acts, omit reference to the other Act from the facing sheet. Include the ‘‘Approximate Date of Commencement of Proposed Public Offering’’ and the
table showing the calculation of the
registration fee only where shares are being registered under the Securities Act. If the filing fee is calculated pursuant to Rule 457(o) under the Securities Act [17 CFR 230.457], only the title of the class of securities to be registered, the proposed maximum aggregate offering price for that class of securities, and the amount of registration fee need to appear in the Calculation of Registration Fee table. If the filing fee is calculated pursuant to Rule 457(r) under the Securities Act, the Calculation of Registration Fee table must state that it registers an unspecified amount of securities of each identified class of securities and must provide that the Registrant is relying on Rule 456(b) [17 CFR 230.456] and Rule 457(r). If the Calculation of Registration Fee table is amended in a post-effective amendment to the registration statement or in a prospectus filed in accordance with Rule 456(b)(1)(ii), the table must specify the aggregate offering price for all classes of securities in the referenced offering or offerings and the applicable registration fee. Any difference between the dollar amount of securities registered for such offerings and the dollar amount of securities sold may be carried forward on a future registration statement pursuant to Rule 457 under the Securities Act. Fill in the 811–lll, 814–lll and 33–lll blanks only if these filing numbers (for the Investment Company Act registration and/or the Securities Act registration, respectively) have already been assigned by the Securities and Exchange Commission. Form N–2 is to be used by closed-end management investment companies, except small business investment companies licensed as such by the United States Small Business Administration, to register under the Investment Company Act and to offer their shares under the Securities Act. The Commission has designed Form N– 2 to provide investors with information that will assist them in making a decision about investing in an investment company eligible to use the Form. The Commission also may use the information provided on Form N–2 in its regulatory, disclosure review, inspection, and policy making roles. ER01JN20.002</GPH>

A Registrant is required to disclose the information specified by Form N–2, and the Commission will make this information public. A Registrant is not required to respond to the collection of information contained in Form N–2 unless the Form displays a currently valid Office of Management and Budget (‘‘OMB’’) control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. 3507. Persons who respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB control number. Contents of Form N–2 General Instructions A. Use of Form N–2 B. Automatic Shelf Offerings by WellKnown Seasoned Issuers
C. Registration Fees
D. Application of General Rules and Regulations E. Amendments F. Incorporation by Reference G. Documents Composing the Registration Statement or Amendment H. Preparation of the Registration Statement or Amendment
I. Interactive Data Files
J. Registration of Additional Securities
Part A: The Prospectus
Part B: Statement of Additional
Information
General Instructions for Parts A and B
Part A—Information Required in a
Prospectus
Item 1. Outside Front Cover Item 2. Cover Pages; Other Offering Information Item 3. Fee Table and Synopsis Item 4. Financial Highlights Item 5. Plan of Distribution Item 6. Selling Shareholders Item 7. Use of Proceeds Item 8. General Description of the Registrant Item 9. Management Item 10. Capital Stock, Long-Term Debt, and Other Securities Item 11. Defaults and Arrears on Senior Securities Item 12. Legal Proceedings Item 13. [Removed and reserved.]
Part B—Information Required in a
Statement of Additional Information Item 14. Cover Page Item 15. Table of Contents Item 16. General Information and History Item 17. Investment Objective and Policies Item 18. Management Instructions Item 19. Control Persons and Principal Holders of Securities Item 20. Investment Advisory and Other Services Item 21. Portfolio Managers Item 22. Brokerage Allocation and Other Practices Item 23. Tax Status Item 24. Financial Statements
Part C—Other Information
Item 25. Financial Statements and Exhibits Item 26. Marketing Arrangements Item 27. Other Expenses of Issuance and Distributions Item 28. Persons Controlled by or Under Common Control Item 29. Number of Holders of Securities Item 30. Indemnification Item 31. Business and Other Connections of Investment Adviser Item 32. Location of Accounts and Records Item 33. Management Services Item 34. Undertakings Signatures General Instructions A. Use of Form N–2

General. Form N–2 is used by all
closed-end management investment companies (‘‘Registrant’’ or ‘‘Fund’’), except small business investment companies licensed as such by the United States Small Business Administration, to file: (1) An initial registration statement under Section 8(b) of the Investment Company Act and any amendments to the registration statement, including amendments required by Rule 8b–16 under the Investment Company Act [17 CFR 270.8b–16]; (2) a registration statement under the Securities Act and any amendment to it; or (3) any combination of these filings.
Optional Use of Form for Certain
Registrants. A Registrant may elect to file a registration statement pursuant to this General Instruction A.2, including a registration statement used in connection with an offering pursuant to Rule 415(a)(1)(x) under the Securities Act [17 CFR 230.415], if it meets all of the following requirements:
a. The Registrant meets the requirements of General Instruction I.A. of Form S–3 [17 CFR 239.13]; b. if the Registrant is registered under the Investment Company Act, it has been registered for a period of at least twelve calendar months immediately preceding the filing of the registration statement on this Form, and has timely filed all reports required to be filed pursuant to Section 30 of the Investment Company Act during the twelve calendar months and any portion of a month immediately preceding the filing of the registration statement; and
c. the registration statement to be filed
pursuant to this General Instruction A.2 relates to a transaction specified in General Instruction I.B. or I.C of Form S–3, as applicable, and meets all of the conditions to the transaction specified in the applicable instruction. A registration statement filed pursuant to this instruction shall specifically incorporate by reference into the prospectus and statement of additional information (‘‘SAI’’) all of the materials specified in General Instruction F.3, pursuant to the requirements set forth in that instruction. A Registrant must indicate that the registration statement is being filed pursuant to this instruction by checking the appropriate box on the facing sheet. Note to General Instruction A.2. Attention is directed to the General Instructions of Form S–3, including General Instructions II.D, F, and G, which contain general information regarding the preparation and filing of automatic and non-automatic shelf registration statements. B. Automatic Shelf Offerings by WellKnown Seasoned Issuers Any Registrant that is a Well-Known Seasoned Issuer as defined in Rule 405 of the Securities Act [17 CFR 230.405] at the most recent eligibility determination date specified in paragraph (2) of that definition may use a registration statement filed under General Instruction A.2 of this Form as an automatic shelf registration statement for registration under the Securities Act of securities offerings, other than pursuant to Rule 415(a)(1)(vii) or (viii) of the Securities Act, only for the transactions that are described in, and consistent with the requirements of, General Instruction I.D. of Form S–3. Note to General Instruction B. Attention is directed to the General Instructions of Form S–3, including General Instructions II.E, F, G, and IV.B, which contain general information regarding the preparation and filing of automatic shelf registration statements.
C. Registration Fees
Section 6(b) of the Securities Act and
Rule 457 thereunder set forth the fee requirements under the Securities Act. Registrants that are required to pay registration fees on an annual net basis

pursuant to Rule 24f–2 under the Investment Company Act must provide payment using Form 24F–2. D. Application of General Rules and Regulations If the registration statement is being filed under both the Securities and Investment Company Acts or under only the Securities Act, the General Rules and Regulations under the Securities Act, particularly Regulation C, shall apply. If the registration statement is being filed under only the Investment Company Act, the General Rules and Regulations under the Investment Company Act, particularly those under
Section 8(b), shall apply.
E. Amendments
1. Paragraph (a) of Rule 8b–16 under
the Investment Company Act requires closed-end management investment companies to annually amend the Investment Company Act registration statement. Paragraph (b) of Rule 8b–16 exempts a closed-end management investment company from this requirement if it provides certain information specified by that rule to shareholders in its annual report.
2. If Form N–2 is used to file a
registration statement under both the Securities and Investment Company Acts, any amendment of that registration statement shall be deemed to be filed under both Acts unless otherwise indicated on the facing sheet.
3. Registrants offering securities on a
delayed or continuous basis in reliance upon Rule 415 under the Securities Act must provide the undertakings with respect to post-effective amendments required by Item 34 of Form N–2.
4. A post-effective amendment to a
registration statement on this Form, or a registration statement filed for the purpose of registering additional shares of common stock for which a registration statement filed on this Form is effective or for the purpose of complying with Rule 415(a)(5) and (a)(6), filed on behalf of a Registrant which makes periodic repurchase offers pursuant to Rule 23c–3 under the Investment Company Act [17 CFR 270.23c–3] or which makes a continuous offering of securities pursuant to Rule 415(a)(1)(ix) under the Securities Act may become effective automatically in accordance with Rule 486 under the Securities Act [17 CFR 230.486], as applicable. In accordance with Rule 429 under the Securities Act [17 CFR 230.429], a Registrant filing a new registration statement for the purpose of registering additional shares of common stock may use a prospectus with respect to the additional shares also in connection with the shares covered by earlier registration statements if such prospectus includes all of the information which would currently be required in a prospectus relating to the securities covered by the earlier statements. The filing fee required by the Securities Act and Rule 457 under the Securities Act shall be paid with respect to the additional shares only. F. Incorporation by Reference
1. General Requirements. All
incorporation by reference must comply with the requirements of this Form and the following rules on incorporation by reference: Rule 411 under the Securities Act [17 CFR 230.411] (general rules on incorporation by reference in a prospectus); Rule 303 of Regulation S– T [17 CFR 232.303] (specific requirements for electronically filed documents); and Rule 0–4 [17 CFR 270.0–4], (additional rules on incorporation by reference for investment companies).
2. Specific Requirements for
Incorporation by Reference for Registrants Not Relying on General Instruction A.2. a. A Registrant may not incorporate by reference into a prospectus information that Part A of this Form requires to be included in a prospectus, except as specifically permitted by Part A of this Form or paragraph F.2.d below. b. A Registrant may incorporate by reference any or all of the SAI into the prospectus (but not to provide any information required by Part A to be included in the prospectus) without delivering the SAI with the prospectus.
c. A Registrant may incorporate by
reference into the SAI or its response to
Part C, information that Parts B and C
require to be included in the Registrant’s registration statement. d. A Registrant may incorporate by reference into the prospectus or the SAI in response to Items 4.1 or 24 of this Form the information contained in Form N–CSR [17 CFR 249.331 and 274.128] or any report to shareholders meeting the requirements of Section 30(e) of the Investment Company Act and Rule 30e– 1 [17 CFR 270.30e–1] thereunder (and a Registrant that has elected to be regulated as a business development company may so incorporate into Items 4.1, 4.2, 8.6.c, or 24 of this Form the information contained in its annual report under the Exchange Act), provided:
(1) The material incorporated by reference is prepared in accordance with, and covers the periods specified by, this Form; and (2) the Registrant states in the prospectus or the SAI, at the place where the information required by Items 4.1, 4.2, 8.6.c., or 24 of this Form would normally appear, that the information is incorporated by reference from a report to shareholders or a report on Form N– CSR or an annual report on Form 10– K [17 CFR 249.310]. (The Registrant also may describe briefly, in either the prospectus, the SAI, or Part C of the registration statement (in response to Item 25.1) those portions of the report to shareholders or report on Form N– CSR or Form 10–K that are not incorporated by reference and are not a
part of the registration statement.)
3. Specific Requirements for
Incorporation by Reference for Certain Registrants. If a Registrant is filing a registration statement pursuant to General Instruction A.2, the following requirements apply:
a. Backward Incorporation by Reference. The documents listed in (1) and (2) below shall be specifically incorporated by reference into the prospectus and SAI by means of a statement to that effect in the prospectus and SAI listing all such documents:
(1) The Registrant’s latest annual report filed pursuant to Section 13(a) or
Section 15(d) of the Exchange Act that
contains financial statements for the Registrant’s latest fiscal year for which a Form N–CSR or Form 10–K was required to be filed; (2) all other reports filed pursuant to
Section 13(a) or Section 15(d) of the
Exchange Act since the end of the fiscal year covered by the annual report referred to in (1) above; and (3) if capital stock is to be registered and securities of the same class are registered under Section 12 of the Exchange Act, the description of such class of securities which is contained in a registration statement filed under the Exchange Act, including any amendment or reports filed for the purpose of updating such description. b. Forward Incorporation by Reference. The prospectus and SAI shall also state that all documents subsequently filed by the Registrant pursuant to Sections 13(a), 13(c), 14, or 15(d) of the Exchange Act, prior to the termination of the offering shall be deemed to be incorporated by reference into the prospectus and SAI.
c. Use of Information to be
Incorporated. Any information required in the prospectus and SAI in response to Items 3–12 and Items 16–24 of this Form may be included in the prospectus and SAI through documents filed pursuant to Sections 13(a), 14, or 15(d) of the Exchange Act that are incorporated or deemed incorporated by

reference into the prospectus and SAI that are part of the registration statement. Instruction. Attention is directed to Rule 439 under the Securities Act [17 CFR 230.439] regarding consent to use of material incorporated by reference.
4. Disclosure.
a. The Registrant must make its prospectus, SAI, and any periodic and current reports filed pursuant to Section 13 or Section 15(d) of the Exchange Act that are incorporated by reference readily available and accessible on a website maintained by or for the Registrant and containing information about the Registrant. b. The Registrant must state in its prospectus and SAI:
(1) That it will provide to each person, including any beneficial owner, to whom a prospectus or SAI is delivered, a copy of any or all information that has been incorporated by reference into the prospectus or SAI but not delivered with the prospectus or SAI; (2) that it will provide this information upon written or oral request; (3) that it will provide this information at no charge; (4) the name, address, telephone number, and email address, if any, to which the request for this information must be made; and (5) the Registrant’s website address where the prospectus, SAI, and any incorporated information may be accessed. Instruction. If the Registrant sends any of the information that is incorporated by reference into the prospectus or SAI to security holders, it also must send any exhibits that are specifically incorporated by reference into that information.
c. The Registrant also must:
(1) Identify the reports and other information that it files with the SEC; and (2) state that the SEC maintains an internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC and state the address of that site (http://www.sec.gov). G. Documents Composing the Registration Statement or Amendment
1. A registration statement or an
amendment to it filed under both the Securities and Investment Company Acts consists of the facing sheet of the Form, Part A, Part B, Part C, required signatures, all other documents filed as a part of the registration statement, and documents or information permitted to be incorporated by reference.
2. A registration statement or
amendment to it that is filed under only the Securities Act shall contain all the information and documents specified in paragraph 1 of this Instruction G.
3. A registration statement or an
amendment to it that is filed under only the Investment Company Act shall consist of the facing sheet of the Form, responses to all items of Parts A and B except Items 1, 2, 3.2, 4, 5, 6, and 7 of
Part A, responses to all items of Part C
except Items 25.2.h, 25.2.l, 25.2.n, and 25.2.o, required signatures, and all other documents that are required or which the Registrant may file as part of the registration statement. H. Preparation of the Registration Statement or Amendment The following instructions for completing Form N–2 are divided into three parts. Part A relates to the prospectus required by Section 10(a) of the Securities Act. Part B relates to the SAI that must be provided upon request to recipients of the prospectus. Part C relates to other information that is required to be in the registration statement.
I. Interactive Data Files
1. An Interactive Data File as defined
in Rule 11 of Regulation S–T [17 CFR 232.11] is required to be submitted to the Commission in the manner provided by Rule 405 of Regulation S–T [17 CFR 232.405] for any registration statement or post-effective amendment thereto filed on Form N–2 that contains the cover page information specified in Rule 405 of Regulation S–T. The Interactive Data File must be submitted either with the filing, or as an amendment to the registration statement to which it relates that is submitted on or before the date the registration statement or posteffective amendment that contains the related information becomes effective.
2. An Interactive Data File is required
to be submitted to the Commission in the manner provided by Rule 405 of Regulation S–T for any registration statement or post-effective amendment thereto filed on Form N–2 or for any form of prospectus filed pursuant to Rule 424 under the Securities Act [17 CFR 230.424] that includes or amends information provided in response to Items 3.1, 4.3, 8.2.b, 8.2.d, 8.3.a, 8.3.b, 8.5.b, 8.5.c, 8.5.e, 10.1.a–d, 10.2.a–c, 10.2.e, 10.3, or 10.5. The Interactive Data File must be submitted either with the filing, or as an amendment to the registration statement to which it relates, on or before the date the registration statement or post-effective amendment that contains the related information becomes effective. Interactive Data Files must be submitted with the filing made pursuant to Rule 424.
3. If a Registrant is filing a registration
statement pursuant to General Instruction A.2, an Interactive Data File is required to be submitted to the Commission in the manner provided by Rule 405 of Regulation S–T for any of the documents listed in General Instruction F.3.(a) or General Instruction F.3.(b) that include or amend information provided in response to Items 3.1, 4.3, 8.2.b, 8.2.d, 8.3.a, 8.3.b, 8.5.b, 8.5.c, 8.5.e, 10.1.a–d, 10.2.a–c, 10.2.e, 10.3, or 10.5. The Interactive Data File must be submitted with the filing of the document(s) listed in General Instruction F.3.(a) or General Instruction F.3.(b).
4. The Interactive Data Files must be
submitted in accordance with the specifications in the EDGAR Filer Manual, and must be submitted in such a manner that—for any information that does not relate to all of the classes of a Registrant—will permit each class of the Registrant to be separately identified. J. Registration of Additional Securities With respect to the registration of additional securities for an offering pursuant to Rule 462(b) under the Securities Act [17 CFR 230.462], the Registrant may file a registration statement consisting only of the following: the facing page; a statement that the contents of the earlier registration statement, identified by file number, are incorporated by reference; required opinions and consents; the signature page; and any price-related information omitted from the earlier registration statement in reliance on Rule 430A [17 CFR 230.430A] that the Registrant chooses to include in the new registration statement. The information contained in such a Rule 462(b) registration statement shall be deemed to be part of the earlier registration statement as of the date of effectiveness of the Rule 462(b) registration statement. Any opinion or consent required in such a registration statement may be incorporated by reference from the earlier registration statement with respect to the offering, if: (i) Such opinion or consent expressly provides for such incorporation; and (ii) such opinion relates to the securities registered pursuant to Rule 462(b). See Rules 411(c), 439(b), and 483(c) under the Securities Act [17 CFR 230.483].
Part A: The Prospectus
The purpose of the prospectus is to provide essential information about the Registrant in a way that will help investors make informed decisions

about whether to purchase the securities being offered. THE INFORMATION IN THE PROSPECTUS SHOULD BE CLEAR, CONCISE, AND UNDERSTANDABLE. AVOID THE USE OF TECHNICAL OR LEGAL TERMS, COMPLEX LANGUAGE, OR EXCESSIVE DETAIL. Responses to the items of Part A should be as simple and direct as possible and should include only information needed to understand the fundamental characteristics of the Registrant. Descriptions of practices that are required by law generally should not include detailed discussions of the law itself. No response is required for inapplicable items.
Part B: Statement of Additional
Information
The items in Part B call for additional information about the Registrant that may be of interest to some investors.
Part B also allows the Registrant to
augment discussions of matters described in the prospectus with additional information the Registrant believes may be of interest to some investors. If information is included in the prospectus, it need not be repeated in the SAI, and a Registrant need not prepare a SAI or refer to it in the prospectus (or provide the undertaking required by Item 34.7 as to the SAI) if all of the information required to be in the SAI is included in the prospectus. A Registrant placing information in Part B should not repeat information that is in the prospectus, except where necessary to make Part B understandable. Information in the SAI need not be included in the prospectus or be sent to investors with the prospectus provided that the cover page of the prospectus states that the SAI is available upon oral or written request and without charge, and includes a toll-free telephone number and email address, if any, for use by prospective investors to request the SAI. If the request is made prior to delivery of a confirmation with respect to a security offered by the prospectus, the SAI must be sent in a manner reasonably calculated for it to arrive prior to the confirmation. The SAI may be sent to the address to which the prospectus was delivered, unless the requester provides an alternate address for delivery of the SAI. General Instructions for Parts A and B
1. The information in the prospectus
and the SAI should be organized to make it easy to understand the organization and operation of the Registrant. The information need not be in any particular order, with the exception that Items 1, 2, 3, and 4 must appear in order in the prospectus and may not be preceded or separated by any other information.
2. The prospectus or the SAI may
contain more information than called for by this Form, provided the information is not incomplete, inaccurate, or misleading and does not, because of its nature, quantity, or manner of presentation, obscure or impede understanding of required information.
3. The requirements for dating the
prospectus apply equally to dating the SAI for purposes of Rule 423 under the Securities Act [17 CFR 230.423]. The SAI should be made available at the same time that the prospectus becomes available for purposes of Rules 430 and 460 under the Securities Act [17 CFR
230.430 and 230.460].
4. The prospectus should not be
presented in fold-out or road-map type fashion.
5. Instructions for charts, graphs, and
sales literature:
(a) A registration statement may include any chart, graph, or table that is not misleading; however, only the fee
table and the table of contents (required
by Rule 481(c) under the Securities Act [17 CFR 230.481]) may precede the financial highlights specified in Item 4. (b) If ‘‘sales literature’’ is included in the prospectus, (1) it should not significantly lengthen the prospectus nor obscure essential disclosure, and (2) members of the Financial Industry Regulatory Authority (‘‘FINRA’’) are not relieved of the filing and other FINRA requirements for investment company sales literature. (See Securities Act Release No. 5359, Jan. 26, 1973 [38 FR 7220 (Mar. 19, 1973)].)
Part A—Information Required in a
Prospectus
Item 1. Outside Front Cover
1. The outside front cover must
contain the following information:
a. the Registrant’s name; b. identification of the type of Registrant (e.g., bond fund, balanced fund, business development company, etc.) or a brief statement of the Registrant’s investment objective(s);
c. the title and amount of securities
offered and a brief description of such securities (unless not necessary to indicate the material terms of the securities, as in the case of an issue of common stock with full voting rights and the dividend and liquidation rights usually associated with common stock); d. a statement that (A) the prospectus sets forth concisely the information about the Registrant that a prospective investor ought to know before investing; (B) the prospectus should be retained for future reference; and (C) additional information about the Registrant has been filed with the Commission and is available upon written or oral request and without charge (this statement should explain how to obtain the SAI, and whether any of it has been incorporated by reference into the prospectus). This statement should also explain how to obtain the Registrant’s annual and semi-annual reports to shareholders. Provide a toll-free (or collect) telephone number for investors to call, and email address, if any, to request the Registrant’s SAI; annual report; semi-annual report; or other information about the Registrant; and to make shareholder inquiries. Also state whether the Registrant makes available its SAI and annual and semi-annual reports, free of charge, on or through the Registrant’s website at a specified internet address. If the Registrant does not make its SAI and shareholder reports available in this manner, disclose the reasons why it does not do so (including, where applicable, that the Registrant does not have an internet website). Also include the information that the Commission maintains a website (http://www.sec.gov) that contains the SAI, material incorporated by reference, and other information regarding Registrants; e. the date of the prospectus and the date of the Statement of Additional Information; f. if any of the securities being registered are to be offered for the account of shareholders, a statement to that effect; g. information in substantially the tabular form indicated as to all securities being registered that are to be offered for cash (estimate, if necessary):
Price to public Sales load Proceeds to registrant or other persons
Per Share ...........................................................
Total ....................................................................

Instructions.
1. If it is impracticable to state the
price to the public, briefly explain how the price will be determined (e.g., by reference to net asset value). If the securities will be offered at the market, indicate the market involved and the market price as of the latest practicable date.
2. The term ‘‘sales load’’ is defined in
Section 2(a)(35) of the Investment
Company Act. Subject to Instruction 3, only include the portion of the sales load that consists of underwriting discounts and commissions, and include any commissions paid by selling shareholders (the term ‘‘commissions’’ is defined in paragraph 17 of Schedule A of the Securities Act [15 U.S.C. 77aa(17)]). Commissions paid by other persons and other consideration to underwriters shall be noted in the second column and briefly described in a footnote.
3. Include in the table as sales load
amounts borrowed to pay underwriting discounts and commissions or any other offering costs that are required to be repaid in less than one year. Exclude from the table, but include in a note thereto, the amount of funds borrowed to pay such costs that are required to be repaid in more than one year, and provide a cross-reference to the prospectus discussion of the borrowed amounts and the effect of repayment on fund assets available for investment.
4. Where an underwriter has received
an over-allotment option, present maximum-minimum information in the price table or in a note thereto, based on the purchase of all or none of the shares subject to the option. The terms of the option may be described briefly in response to Item 5 rather than on the prospectus cover page.
5. If the securities are to be offered on
a best efforts basis, set forth the termination date of the offering, any minimum required purchase, and any arrangements to place the funds received in an escrow, trust, or similar arrangement. If no arrangements have been made, so state. Set forth the following table in lieu of the ‘‘Total’’ information called for by the required
table.
Price to public Sales load Proceeds to registrant or other persons
Total Minimum ....................................................
Total Maximum ...................................................
6. Set forth in a note to the proceeds
column the total of other expenses of issuance and distribution called for by Item 27, stated separately for the Registrant and for the selling shareholders, if any. h. the statements required by paragraphs (1) and (2) of Rule 481(b) under the Securities Act;
i. if the Registrant’s securities have no
history of public trading, a prominent statement to that effect and a statement describing the tendency of closed-end fund shares to trade frequently at a discount from net asset value and the risk of loss this creates for investors purchasing shares in the initial public offering; Instruction. A Registrant may omit the discount statement if it believes that, as a result of its investment or other policies, its capital structure, or the markets in which its shares trade, its shares are unlikely to trade at a discount from net asset value. j. a cross-reference to the prospectus discussion of any factors that make the offering speculative or one of high risk, printed in bold face common type at least as large as ten point modern type and at least two points leaded; and Instruction. No cross-reference is required where the risks associated with securities in which the Registrant is authorized to invest are only the basic risks of investing in securities (e.g., the risk that the value of portfolio securities may fluctuate depending upon market conditions, or the risks that debt securities may be prepaid and the proceeds from the prepayments invested in debt instruments with lower interest rates). Include the cross-reference if the nature of the Registrant’s investment objectives, investment policies, capital structure, or the trading markets for the Registrant’s securities increase the likelihood that an investor could lose a significant portion of his or her investment. k. any other information required by Commission rules or by any other governmental authority having jurisdiction over the Registrant or the issuance of its securities.
l. A statement to the following effect,
if applicable:
Beginning on [date], as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Registrant’s shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports from the Registrant [or from your financial intermediary, such as a broker-dealer or bank]. Instead, the reports will be made available on a website, and you will be notified by mail each time a report is posted and provided with a website link to access the report. If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from the Registrant [or your financial intermediary] electronically by [insert instructions]. You may elect to receive all future reports in paper free of charge. You can inform the Registrant [or your financial intermediary] that you wish to continue receiving paper copies of your shareholder reports by [insert instructions]. Your election to receive reports in paper will apply to all funds held with [the fund complex/your financial intermediary].
2. The cover page may include other
information if it does not, by its nature, quantity, or manner of presentation impede understanding of the required information. Item 2. Cover Pages; Other Offering Information
1. Disclose whether any national
securities exchange or the Nasdaq Stock Market lists the securities offered, naming the particular market(s), and identify the trading symbol(s) for those securities on the inside front or outside back cover page of the prospectus, unless the information appears on the front cover page.
2. Provide the information required by
paragraph (d) of Rule 481 under the Securities Act in an appropriate place in the prospectus.
3. Provide the information required by
paragraph (e) of Rule 481 under the Securities Act on the outside back cover
page of the prospectus.
Item 3. Fee Table and Synopsis
1. If the prospectus offers common
stock of the Registrant, include information about the costs and expenses that the investor will bear directly or indirectly, using the captions and tabular format illustrated below:

Instructions.
General Instructions
1. Immediately after the table, provide
a brief narrative explaining that the purpose of the table is to assist the investor in understanding the various costs and expenses that an investor in the fund will bear directly or indirectly. Include, where appropriate, crossreferences to the relevant sections of the prospectus for more complete descriptions of the various costs and expenses.
2. Any caption not applicable to the
Registrant may be omitted from the
table.
3. Round all dollar figures to the
nearest dollar and all percentages to the nearest hundredth of one percent. Shareholder Transaction Expenses
4. ‘‘Dividend Reinvestment and Cash
Purchase Plan Fees’’ include all fees (except brokerage commissions) that are charged to participating shareholder accounts. The basis on which such fees are imposed should be described briefly in a note to the table.
5. If the Registrant (or any other party
under an agreement with the Registrant) charges any other transaction fee, add another caption describing it, and list the maximum amount of the fee or basis on which the fee is deducted. Underwriters’ compensation that is paid with the proceeds of debt that is not to be repaid within one year need not be identified as sales load, but should be set forth as a shareholder transaction expense with a brief narrative following the table explaining the nature of such payments. Annual Expenses
6. State the basis on which payments
will be made. ‘‘Other Expenses’’ should be estimated and stated (after any expense reimbursement or waiver) as a percentage of net asset value attributable to common shares. State in the narrative following the table that ‘‘Other Expenses’’ are based on estimated amounts for the current fiscal year. 7.a. ‘‘Management Fees’’ include investment advisory fees (including any component thereof based on the performance of the Registrant), any other management fees payable to the investment adviser or its affiliates, and administrative fees payable to the investment adviser or its affiliates not included as ‘‘Other Expenses,’’ and any expenses incurred within the Registrant’s own organization in connection with the research, selection, and supervision of investments. Where management fees are ‘‘tiered’’ or based on a ‘‘sliding scale,’’ they should be calculated based on the fund’s asset size after giving effect to the anticipated net proceeds of the present offering. In the case of a performance fee arrangement, assume the base fee. With respect to a best-efforts offering with breakpoints, assume the maximum fee will be payable. b. In lieu of the information about management fees required by Item 3.1, a business development company with a fee structure that is not based solely on the aggregate amount of assets under management should provide disclosure concerning the fee arrangement to allow investors to assess its impact on the Registrant’s expenses; a business development company may use any appropriate expense categories and may include items that may not, for accounting purposes, be treated as expenses. A business development company with special fee arrangements should provide a cross-reference, where applicable, to the discussion in Item 9.1.a of special management compensation plans.
8. ‘‘Interest Payments on Borrowed
Funds’’ include all interest paid in connection with outstanding loans ER01JN20.003</GPH>

(including interest paid on funds borrowed to pay underwriting expenses), bonds, or other forms of debt. Show interest expenses as a percentage of net assets attributable to common shares and not the face amount of debt.
9. ‘‘Other Expenses’’ include all
expenses (except fees and expenses reported in other items in the table) that are deducted from the Registrant’s assets and will be reflected as expenses in the Registrant’s statement of operations (including increases resulting from complying with paragraph 2(g) of Rule 6–07 [17 CFR 210.6–07] of Regulation S–X).
10. a. If the Registrant invests, or
intends to invest based upon the anticipated net proceeds of the present offering, in shares of one or more ‘‘Acquired Funds,’’ add a subcaption to the ‘‘Annual Expenses’’ portion of the
table directly above the subcaption
titled ‘‘Total Annual Expenses.’’ Title the additional subcaption: ‘‘Acquired Fund Fees and Expenses.’’ Disclose in the subcaption fees and expenses incurred indirectly by the Registrant as a result of investment in shares of one or more Acquired Funds. For purposes of this Item, an ‘‘Acquired Fund’’ means any company in which the Registrant invests or intends to invest (A) that is an investment company or (B) that would be an investment company under
Section 3(a) of the Investment Company
Act but for the exceptions to that definition provided for in Sections 3(c)(1) and 3(c)(7) of the Investment Company Act. If a Registrant uses another term in response to other requirements of this Form to refer to Acquired Funds, it may include that term in parentheses following the subcaption title. In the event the fees and expenses incurred indirectly by the Registrant as a result of investment in shares of one or more Acquired Funds do not exceed 0.01 percent (one basis point) of average net assets of the Registrant, the Registrant may include these fees and expenses under the subcaption ‘‘Other Expenses’’ in lieu of this disclosure requirement. b. Determine the ‘‘Acquired Fund Fees and Expenses’’ according to the following formula:
AFFE = [(F1/FY)AI1 D1]+[(F2/FY)AI2 D2]+[(F3/FY)AI3 D3] + TRANSACTION FEES + INCENTIVE ALLOCATIONS Average Net Assets of the Registrant Where:
AFFE ................................................ Acquired Fund fees and expenses; F1, F2, F3, . . . ................................. Total annual operating expense ratio for each Acquired Fund; FY ..................................................... Number of days in the relevant fiscal year; AI1, AI2, AI3, . . . ............................. Average invested balance in each Acquired Fund; D1, D2, D3, . . . ................................ Number of days invested in each Acquired Fund; ‘‘Transaction Fees’’ .......................... The total amount of sales loads, redemption fees, or other transaction fees paid by the Registrant in connection with acquiring or disposing of shares in any Acquired Funds during the most recent fiscal year; and ‘‘Incentive Allocations’’ ..................... Any allocation of capital from the Acquiring Fund to the adviser of the Acquired Fund (or its affiliate) based on a percentage of the Acquiring Fund’s income, capital gains and/or appreciation in the Acquired Fund.
c. Calculate the average net assets of
the Registrant for the most recent fiscal year, as provided in Item 4.1 (see Instruction 15 to Item 4.1), and include the anticipated net proceeds of the present offering. d. The total annual operating expense ratio used for purposes of this calculation (F1) is the annualized ratio of operating expenses to average net assets for the Acquired Fund’s most recent fiscal period as disclosed in the Acquired Fund’s most recent shareholder report. If the ratio of expenses to average net assets is not included in the most recent shareholder report or the Acquired Fund is a newly formed fund that has not provided a shareholder report, then the ratio of expenses to average net assets of the Acquired Fund is the ratio of total annual operating expenses to average annual net assets of the Acquired Fund for its most recent fiscal period as disclosed in the most recent communication from the Acquired Fund to the Registrant. If the Registrant has a written fee agreement with the Acquired Fund that would affect the ratio of expenses to average net assets as disclosed in the Acquired Fund’s most recent shareholder report, the Registrant should determine the ratio of expenses to average net assets for the Acquired Fund’s most recent fiscal period using the written fee agreement. For purposes of this instruction: (i) Acquired Fund expenses include increases resulting from brokerage service and expense offset arrangements and reductions resulting from fee waivers or reimbursements by the Acquired Funds’ investment advisers or sponsors; and (ii) Acquired Fund expenses do not include any expenses (i.e., performance fees) that are calculated solely upon the realization and/or distribution of gains, or the sum of the realization and/or distribution of gains and unrealized appreciation of assets distributed inkind. If an Acquired Fund has no operating history, include in the Acquired Funds’ expenses any fees payable to the Acquired Fund’s investment adviser or its affiliates stated in the Acquired Fund’s registration statement, offering memorandum or other similar communication without giving effect to any performance. e. If a Registrant has made investments in the most recent fiscal year, to determine the average invested balance (AI1), the numerator is the sum of the amount initially invested in an Acquired Fund during the most recent fiscal year (if the investment was held at the end of the previous fiscal year, use the amount invested as of the end of the previous fiscal year) and the amounts invested in the Acquired Fund no less frequently than monthly during the period the investment is held by the Registrant (if the investment was held through the end of the fiscal year, use each month-end through and including the fiscal year-end). Divide the numerator by the number of measurement points included in the calculation of the numerator (i.e., if an investment is made during the fiscal year and held for 3 succeeding months, the denominator would be 4). f. For
investments based upon the anticipated net proceeds from the present offering, base the ‘‘Acquired Fund Fees and Expenses’’ on: (i) Assumptions about specific funds in which the Registrant expects to invest, (ii) estimates of the amount of assets the Registrant expects to invest in each of those Acquired Funds, and (iii) an assumption that the investment was held for all of the Registrant’s most

recent fiscal year and was subject to the Acquired Funds’ fees and expenses for that year. Disclose in a footnote to the
table that Acquired Fund fees and
expenses are based on estimated amounts for the current fiscal year. g. If an Acquired Fund charges an Incentive Allocation or any other fee based on income, capital gains and/or appreciation (i.e., performance fee), the Registrant must include a footnote to the ‘‘Acquired Fund Fees and Expenses’’ subcaption that:
(1) discloses the typical Incentive Allocation or such other fee (expressed as a percentage) to be paid to the investment advisers of the Acquired Funds (or an affiliate); (2) discloses that Acquired Funds’ fees and expenses are based on historic fees and expenses; and (3) states that future Acquired Funds’ fees and expenses may be substantially higher or lower because certain fees are based on the performance of the Acquired Funds, which may fluctuate over time. h. If the Registrant is a Feeder Fund, reflect the aggregate expenses of the Feeder Fund and the Master Fund in the ‘‘Acquired Fund Fees and Expenses.’’ The aggregate expenses of the MasterFeeder Fund must include the fees and expenses incurred indirectly by the Feeder Fund as a result of the Master Fund’s investment in shares of one or more companies (A) that are investment companies or (B) that would be investment companies under Section 3(a) of the Investment Company Act but for the exceptions to that definition provided for in Sections 3(c)(1) and 3(c)(7) of the Investment Company Act. For purposes of this instruction, a ‘‘Master-Feeder Fund’’ means a twotiered arrangement in which one or more investment companies registered under the Investment Company Act (each a ‘‘Feeder Fund’’) holds shares of a single management investment company registered under the Investment Company Act (the ‘‘Master Fund’’) in accordance with Section 12(d)(1)(E) of the Investment Company Act.
i. The Registrant may clarify in a
footnote to the fee table that the total annual expenses item under Item 3.1 is different from the ratio of expenses to average net assets given in response to Item 4.1, which reflects the operating expenses of the Registrant and does not include Acquired Fund fees and expenses. Example
11. For purposes of the Example in
the table:
a. assume that the rates listed under ‘‘Annual Expenses’’ remain the same each year, except to reduce annual expenses to reflect the scheduled maturity of outstanding debt or the completion of organization expense amortization; b. assume reinvestment of all dividends and distributions at net asset value;
c. reflect all recurring and
nonrecurring fees including underwriting discounts and commissions; and d. prominently disclose that the Example should not be considered a representation of future expenses and that actual expenses may be greater or lesser than those shown.
2. Include a synopsis of information
contained in the prospectus when the prospectus is long or complex. Normally, a synopsis should not be provided where the prospectus is twelve or fewer printed pages. Instruction. The synopsis should provide a clear and concise description of the key features of the offering and the Registrant, with cross-references to relevant disclosures elsewhere in the prospectus or Statement of Additional Information.
3. In the case of a business
development company, include the information required by Item 101(e) of Regulation S–K [17 CFR 229.101] (concerning reports and other information filed with the Commission). Item 4. Financial Highlights
1. General. Furnish the following
information for the Registrant, or for the Registrant and its subsidiaries, consolidated as prescribed in Rule 6–03 of Regulation S–X [17 CFR 210.6–03]:
Financial Highlights
Per Share Operating Performance a. Net Asset Value, Beginning of Period (1) Net Investment Income (2) Net Gains or Losses on Securities (both realized and unrealized) b. Total From Investment Operations
c. Less Distributions
(1) Dividends (from net investment income) (A) To Preferred Shareholders (B) To Common Shareholders (2) Distributions (from capital gains) (A) To Preferred Shareholders (B) To Common Shareholders (3) Returns of Capital (A) To Preferred Shareholders (B) To Common Shareholders d. Total Distributions e. Net Asset Value, End of Period f. Per Share Market Value, End of Period g. Total Investment Return Ratios/Supplemental Data h. Net Assets, End of Period
i. Ratio of Expenses to Average Net
Assets j. Ratio of Net Income to Average Net Assets k. Portfolio Turnover Rate Instructions. General Instructions
1. [Removed and reserved.]
2. Briefly explain the nature of the
information contained in the table and its source. The auditor’s report as to the financial highlights need not be included in the prospectus. Note that the auditor’s report is contained elsewhere in the registration statement, specify its location, and state that it can be obtained by shareholders.
3. Present the information in
comparative columns for each of the last ten fiscal years of the Registrant (or for the life of the Registrant and its immediate predecessors, if less), but only for periods subsequent to the effective date of the Registrant’s first Securities Act registration statement. In addition, present the information for the period between the end of the latest fiscal year and the date of the latest balance sheet or statement of assets and liabilities. Where the period for which the Registrant provides financial highlights is less than a full fiscal year, the ratios set forth in the table may be annualized but the fact of this annualization must be disclosed in a note to the table.
4. List per share amounts at least to
the nearest cent. If the offering price is computed in tenths of a cent or more, state the amounts on the table in tenths of a cent. Present all information using a consistent number of decimal places.
5. Provide all information in the table,
including distributions to preferred shareholders, on a common share equivalent basis.
6. Make, and indicate in a note,
appropriate adjustments to reflect any stock split or stock dividend during the period.
7. If the investment adviser has been
changed during the period covered by this Item, indicate the date(s) of the change(s) in a note.
8. The financial highlights for at least
the latest five fiscal years must be audited and must so state. Per Share Operating Performance
9. Derive the amount for caption a(1)
by adding (deducting) the increase (decrease) per share in undistributed net investment income for the period to

(from) dividends from net investment income per share for the period. The increase (decrease) may be derived by comparing the per share figures obtained by dividing undistributed net investment income at the beginning and end of the period by the number of shares outstanding on those dates. Other methods may be acceptable but should be explained briefly in a note to the
table.
10. The amount shown at caption a(2)
is the balancing figure derived from the other figures in the statement. The amount shown at this caption for a share outstanding throughout the year may not agree with the change in the aggregate gains and losses in the portfolio securities for the year because of the timing of sales and repurchases of the Registrant’s shares in relation to fluctuating market values for the portfolio.
11. For any distributions made from
sources other than net investment income and capital gains, state the per share amounts thereof separately at caption c(3) and note the nature of the distributions.
12. In caption e, use the net asset
value for the end of each period for which information is being provided. If the Registrant has not been in operation for a full fiscal year, state its net asset value immediately after the closing of its first public offering in a note to the caption. Total Investment Return
13. When calculating ‘‘total
investment return’’ for caption g:
a. Assume a purchase of common stock at the current market price on the first day and a sale at the current market price on the last day of each period reported on the table; b. note that the total investment return does not reflect sales load; and
c. assume reinvestment of dividends
and distributions at prices obtained by the Registrant’s dividend reinvestment plan or, if there is no plan, at the lower of the per share net asset value or the closing market price of the Registrant’s shares on the dividend/distribution date.
14. A Registrant also may include, as
a separate caption, total return based on per share net asset value, provided the Registrant briefly explains in a note the differences between this calculation and the calculation required by caption g. Ratios and Supplemental Data
15. Compute ‘‘average net assets’’ for
captions i and j based on the value of net assets determined no less frequently than the end of each month. Indicate in a note that the expense ratio and net investment income ratio do not reflect the effect of dividend payments to preferred shareholders.
16. Compute the ‘‘ratio of expenses to
average net assets’’ using the amount of expenses shown in the Registrant’s statement of operations for the relevant fiscal year, including increases resulting from complying with paragraph 2(g) of Rule 6–07 of Regulation S–X, and including reductions resulting from complying with paragraphs 2(a) and (f) of Rule 6–07 regarding fee waivers and reimbursements. If a change in the methodology for determining the ratio of expenses to average net assets results from applying paragraph 2(g) of Rule 6– 07, explain in a note that the ratio reflects fees paid with brokerage commissions and fees reduced in connection with specific agreements only for fiscal years ending after September 1, 1995.
17. Compute portfolio turnover rate as
follows:
a. Divide (A) the lesser of purchases or sales of portfolio securities for the fiscal year by (B) the monthly average of the value of portfolio securities owned by the Registrant during the fiscal year. Calculate the monthly average by totaling the values of portfolio securities as of the beginning and end of the first month of the fiscal year and as of the end of each of the succeeding eleven months and dividing the sum by 13. b. Exclude from both the numerator and denominator all securities, including options, whose maturity or expiration date at the time of acquisition was one year or less. Include all longterm securities, including U.S. Government securities. Purchases include cash paid upon conversion of one portfolio security into another and the cost of rights or warrants. Sales include net proceeds of the sale of rights or warrants and net proceeds of portfolio securities that have been called or for which payment has been made through redemption or maturity.
c. If during the fiscal year the
Registrant acquired the assets of another investment company or of a personal holding company in exchange for its own shares, exclude from purchases the value of securities so acquired, and, from sales, all sales of the securities made following a purchase-of-assets transaction to realign the Registrant’s portfolio. Appropriately adjust the denominator of the portfolio turnover computation, and disclose the exclusions and adjustments. d. Include in purchases and sales short sales that the Registrant intends to maintain for more than one year and put and call options with expiration dates more than one year from the date of acquisition. Include proceeds from a short sale in the value of portfolio securities sold during the period; include the cost of covering a short sale in the value of portfolio securities purchased during the period. Include premiums paid to purchase options in the value of portfolio securities purchased during the reporting period; include premiums received from the sale of options in the value of portfolio securities sold during the period.
2. Business Development Companies.
If the Registrant is regulated as a business development company under the Investment Company Act, furnish in a separate section the information required by Items 301, 302, and 303 of Regulation S–K.
3. Senior Securities. Furnish the
following information as of the end of the last ten fiscal years for each class of senior securities (including bank loans) of the Registrant. If consolidated statements were prepared as of any of the dates specified, furnish the information on a consolidated basis:
Year
Total amount outstanding exclusive of treasury securities Asset coverage per unit Involuntary liquidating preference per unit Average market value per unit (exclude bank loans) (1) (2) (3) (4) (5) Instructions.
1. Instructions 2, 3, and 8 to Item 4.1
also apply to this sub-item.
2. Use the method described in
Section 18(h) of the Investment
Company Act to calculate the asset coverage to be set forth in column (3). However, in lieu of expressing asset coverage in terms of a ratio, as described in Section 18(h), express it for each class of senior securities in terms of dollar amounts per share (in the case of preferred stock) or per $1,000 of indebtedness (in the case of senior indebtedness).

3. Column (4) need be included only
with respect to senior stock.
4. Set forth in a note to the table the
method used to determine the averages called for by column (5) (e.g., weighted, monthly, daily, etc.).
5. Briefly explain the terms used in
the headings of the columns.
Item 5. Plan of Distribution Briefly describe how the securities being registered will be distributed. Include the following information:
1. For each principal underwriter
distributing the securities being offered set forth:
a. Its name and principal business address; b. a brief discussion of the nature of any material relationship with the Registrant (other than that of principal underwriter), including any arrangement under which a principal underwriter or its affiliates will perform administrative or custodial services for the Registrant; Instruction. Any material relationship between the underwriter (or its affiliates) and the investment adviser (or its affiliates) of the Registrant relating to the business or operation of the Registrant constitutes a material relationship of the underwriter with the Registrant.
c. the amount of securities
underwritten; and d. the nature of the obligation to distribute the Registrant’s securities. Instruction. All that is required to be disclosed as to the nature of the underwriter’s obligation is whether the underwriter will be committed to take and pay for all the securities if any are taken, or whether it is merely an agency or ‘‘best-efforts’’ arrangement under which the underwriter is required to take and pay for only such securities as it may sell to the public. Conditions precedent to the underwriter’s taking the securities, including ‘‘market outs,’’ need not be described, except in the case of an agency or ‘‘best-efforts’’ arrangement.
2. The price to the public.
Instructions.
1. If it is impracticable to state the
price to the public, concisely explain the manner in which the price will be determined, including a description of the valuation procedure used by the Registrant in determining the price. If the securities are to be offered at the market price, or if the offering price is to be determined by a formula related to market price, indicate the market involved and the market price as of the latest practicable date.
2. For restrictions on distributions
and repurchases of closed-end company securities, see Section 23 of the Investment Company Act, and Investment Company Act Rel. No. 3187 (Feb. 6, 1961) [26 FR 1275 (Feb. 15, 1961)].
3. Briefly explain the basis for any
differences in the price at which securities are offered to the public, as individuals and/or as groups, and to officers, directors and employees of the Registrant, its adviser or underwriter.
3. To the extent not set forth on the
cover page of the prospectus, state the amount of the sales load, if any, as a percentage of the public offering price, and concisely describe the commissions to be allowed or paid to (i) underwriters, including all other items that would be deemed by FINRA to constitute underwriting compensation for purposes of FINRA’s rules regarding securities offerings, underwriting and compensation, and (ii) dealers, including all cash, securities, contracts, and/or other considerations to be realized by any dealer in connection with the sale of securities. Instruction. If any dealers are to act in the capacity of sub-underwriters and are allowed or paid any additional discounts or commission for acting in such capacity, a general statement to that effect will suffice without giving the additional amounts to be sold.
4. If the underwriting agreement
provides for indemnification by the Registrant of the underwriters or their controlling persons against any liability arising under the Securities Act or Investment Company Act, briefly describe such indemnification provisions.
5. Provide the identity of any finder
and, if applicable, concisely describe the nature of any material relationship between such finder and the Registrant, its officers, directors, principal shareholders, finders or promoters or the principal underwriter(s), or the managing underwriter(s), if any, and, in each case, the affiliates or associates thereof.
6. Indicate the date by which
investors must pay for the securities.
7. If the securities are being offered in
conjunction with any retirement plan, provide a statement regarding the manner in which further information about the plan can be obtained.
8. If investors’ funds will be
forwarded to an escrow account, identify the escrow agent, and briefly describe the conditions for release of the funds, whether such funds will accrue interest while in escrow, and the manner in which the monies in such account will be distributed if such conditions are not satisfied, including how accrued interest, if any, will be distributed to investors.
9. If the securities offered by the
Registrant are not being listed on a national securities exchange, disclose whether any of the underwriters intends to act as a market maker with respect to such unlisted securities.
10. Briefly outline the plan of
distribution of any securities that are to be offered other than through underwriters. a. If the securities are to be offered through the selling efforts of brokers or dealers, concisely describe the plan of distribution and the terms of any agreement, arrangement, or understanding entered into with broker(s) or dealer(s) prior to the effective date of the registration statement, including volume limitations on sales, parties to the agreement, and the conditions under which the agreement may be terminated. If known, identify the broker(s) or dealer(s) that will participate in the offering, and state the amount to be offered through each. b. If any of the securities being registered are to be offered other than for cash, describe briefly the general purposes of the distribution, the basis upon which the securities are to be offered, the amount of compensation and other expenses of distribution, and the person(s) responsible for such expenses.
c. If the distribution is to be made
under a plan of acquisition, reorganization, readjustment, or succession, provide a statement regarding the general effect of the plan and when it becomes operative. As to any material amount of assets to be acquired under the plan, furnish the information required by Instruction 4 to Item 7.1 below. Item 6. Selling Shareholders If any securities being registered are to be offered for the account of shareholders, furnish the information required by Item 507 of Regulation S–K [17 CFR 229.507]. Item 7. Use of Proceeds
1. State the principal purposes for
which the net proceeds of the offering are intended to be used and the approximate amount intended to be used for each purpose. Instructions.
1. If any substantial portion of the
proceeds will not be allocated in accordance with the investment objectives and policies of the Registrant, a statement to that effect should be made together with a statement of the amount involved and an indication of how that amount will be invested.

2. If a material part of the proceeds
will be used to discharge indebtedness, state the interest rate and maturity of the indebtedness.
3. If the Registrant intends to incur
loans to pay underwriting commissions or any other organizational or offering expenses, disclose this fact and state the name of the lender, the amount of the first installment, the rate of interest, the date on which payments will begin, the dates and amounts of subsequent installments, and the final maturity date. Explain that the interest paid on such borrowing will not be available for investment purposes and will increase the expenses of the fund.
4. If any material part of the proceeds
will be used to acquire assets other than in the ordinary course of business, briefly describe the assets, the names of the persons from whom they are to be acquired, the cost of the assets to the Registrant, and how the costs were determined.
2. Disclose how long it is expected to
take to fully invest net proceeds in accordance with the Registrant’s investment objectives and policies, the reasons for any anticipated lengthy delay in investing the net proceeds, and the consequences of any delay. Item 8. General Description of the Registrant Concisely discuss the organization and operation, or proposed operation, of the Registrant. Include the information specified below.
1. General. Briefly describe the
Registrant, including:
a. The date and form of organization and the name of the state or other jurisdiction under whose laws it is organized; and b. the classification and subclassification under Sections 4 and 5 of the Investment Company Act.
2. Investment Objectives and Policies.
Concisely describe the investment objectives and policies of the Registrant that will constitute its principal portfolio emphasis, including the following:
a. If these objectives may be changed without a vote of the holders of a majority of voting securities, a brief statement to that effect; b. how the Registrant proposes to achieve its objectives, including:
(1) The types of securities in which the Registrant invests or will invest principally; (2) the identity of any particular industry or group of industries in which the Registrant proposes to concentrate. Instruction. Concentration, for purposes of this Item, is deemed 25 percent or more of the value of the Registrant’s total assets invested or proposed to be invested in a particular industry or group of industries. The policy on concentration should not be inconsistent with the Registrant’s name.
c. identify other policies of the
Registrant that may not be changed without the vote of a majority of the outstanding voting securities, including those policies that the Registrant deems to be fundamental within the meaning of Section 8(b) of the Investment Company Act; and d. briefly describe the significant investment practices or techniques that the Registrant employs or intends to employ (such as risk arbitrage, reverse repurchase agreements, forward delivery contracts, when-issued securities, stand-by commitments, options and futures contracts, options on futures contracts, currency transactions, foreign securities, investing for control of management, and/or lending of portfolio securities) that are not described pursuant to subparagraph 2.c above or subparagraph 3 below.
3. Risk Factors. Concisely describe the
risks associated with an investment in the Registrant, including the following:
a. General. Discuss the principal risk factors associated with investment in the Registrant specifically as well as those factors generally associated with investment in a company with investment objectives, investment policies, capital structure, or trading markets similar to the Registrant’s. b. Effects of Leverage. If the prospectus offers common stock of the Registrant and the Registrant has outstanding or is offering a class of senior securities as defined in Section 18 of the Investment Company Act, then:
(1) Set forth the annual rate of interest or dividend payments on the senior securities; Instruction. If payments will vary because the interest or dividend rate is variable, provide the initial rate or, if the security is currently outstanding, the current rate. (2) Set forth the annual return that the Registrant’s portfolio must experience in order to cover annual interest or dividend payments on senior securities; and (3) provide a table illustrating the effect on return to a common stockholder of leverage (using senior securities) in the format illustrated below, using the captions provided, and assuming annual returns on the Registrant’s portfolio (net of expenses) of minus ten, minus five, zero, five, and ten percent. (4) The table should be accompanied by a brief narrative explaining that the purpose of the table is to assist the investor in understanding the effects of leverage. Indicate that the figures appearing in the table are hypothetical and that actual returns may be greater or less than those appearing in the table. Assumed Return on Portfolio (Net of Expenses) ................ ¥10% ¥5% 0% 5% 10% Corresponding Return to Common Stockholder ................. % % % % % Instructions.
1. Round all percentages to the
nearest hundredth of one percent.
2. A Registrant may assume additional
rates of return on its portfolio; however, to the extent a Registrant shows an additional positive rate of return, it must also show an additional negative rate of return of the same magnitude. A Registrant may show the positive rate of return at which the corresponding rate of return to the common stockholder is zero without showing the corresponding negative rate of return.
3. Compute the ‘‘corresponding return
to common stockholder’’ as follows:
Multiply the total amount of fund assets at the beginning of the period by the assumed rate of return; subtract from the resulting product all interest accrued or dividends declared on senior securities that would be made during the year following the offering; and divide the resulting difference by the total amount of fund assets attributable to common stock. If payments will vary because the interest or dividend rate is variable, use the initial rate or, if the security is currently outstanding, the current rate.
4. Other Policies. Briefly discuss the
types of investments that will be made by the Registrant, other than those that will constitute its principal portfolio emphasis (as discussed in Item 8.2 above), and any policies or practices relating to those investments. Instructions.
1. This discussion should receive less
emphasis in the prospectus than that required by Item 8.2 and, if appropriate in light of Instructions 2 and 3 below, may be omitted or limited to the

information necessary to identify the type of investment, policy, or practice.
2. Do not discuss a policy that
prohibits a particular practice or permits a practice that the Registrant has not used within the past twelve months (or since its initial public offering, if that period is shorter) and does not intend to use in the future.
3. If a policy limits a particular
practice so that no more than five percent of the Registrant’s net assets are at risk, or if the Registrant has not followed that practice within the last year (or since its initial public offering, if such period is shorter) in such a manner that more than five percent of net assets were at risk and does not intend to follow such practice so as to put more than five percent of net assets at risk, limit the prospectus disclosure about such practice to that necessary to identify the practice. Disclose whether or not the Registrant will provide prior notice to security holders of its intention to commence or expand the use of such practice. The amount of the Registrant’s net assets that are at risk for purposes of determining whether ‘‘more than five percent of net assets are at risk’’ is not limited to the initial amount of the Registrant’s assets that are invested in a particular practice, e.g., the purchase price of an option. The amount of net assets at risk is determined by reference to the potential liability or loss that may be incurred by the Registrant in connection with a particular practice.
5. Share Price Data. If the prospectus
offers common stock or other type of common equity security (collectively ‘‘common stock’’) and if the Registrant’s common stock is publicly held, provide the following information:
a. Identify the principal United States market or markets in which the common stock is being traded. Where there is no established public trading market, furnish a statement to that effect. Instruction. The existence of limited or sporadic quotations should not itself be deemed to constitute an ‘‘established public trading market.’’ b. If the principal United States market for the common stock is an exchange, state the high and low sales prices for the stock for each full quarterly period within the two most recent fiscal years and each full fiscal quarter since the beginning of the current fiscal year, as reported in the consolidated transaction reporting system or, if not so reported, as reported on the principal exchange market for the stock. If the principal United States market for the common stock is not an exchange, state the range of high and low bid information for the common stock for the periods described in the preceding sentence, as regularly quoted in the automated quotation system of a registered securities association or, if not so quoted, the range of reported high and low bid quotations, indicating the source of the quotations. Instructions.
1. This information should be set
forth in tabular form.
2. Indicate, as applicable, that such
over-the-counter market quotations reflect inter-dealer prices, without retail mark-up, mark-down, or commission and may not necessarily represent actual transactions.
3. Where there is an absence of an
established public trading market, qualify reference to quotations by an appropriate explanation.
4. With respect to each quotation,
disclose the net asset value and the discount or premium to net asset value (expressed as a percentage) represented by the quotation.
5. Where the shares of the Registrant
trade at their high or low share price for more than one day during the period, the Registrant should provide the discount or premium information for the day on which the premium or discount was greatest.
c. Include share price and
corresponding net asset value and premium/discount information as of the latest practicable date. d. Disclose whether the Registrant’s common stock has historically traded for an amount less than, equal to, or exceeding net asset value. Disclose any methods undertaken or to be undertaken by the Registrant that are intended to reduce any discount (such as the repurchase of fund shares, providing for the ability to convert to an open-end investment company, guaranteed distribution plans, etc.), and briefly discuss the effects that these measures have or may have on the Registrant. e. If the shares of the Registrant have no history of public trading, discuss the tendency of closed-end fund shares to trade frequently at a discount from net asset value and the risk of loss this creates for investors purchasing shares in the initial public offering. If the Registrant has omitted the statement required by Item 1.i, describe the basis for the Registrant’s belief that its shares will not trade at a discount from net asset value.
6. Business Development Companies.
A Registrant that is a business development company should, in addition, provide the following information:
a. Portfolio Companies. For each portfolio company in which the Registrant is investing, disclose: (1) The name and address; (2) nature of business; (3) title, class, percentage of class, and value of portfolio company securities held by the Registrant; (4) amount and general terms of all loans to portfolio companies; and (5) the relationship of the portfolio companies to the Registrant. Instructions.
1. The description of the nature of the
business of a portfolio company in which the Registrant is investing may vary according to the extent of the Registrant’s investment in the particular portfolio company. The Registrant need only briefly identify the nature of the business of a portfolio company in which the Registrant’s investment constitutes less than five percent of the Registrant’s assets.
2. In describing the nature of the
business of a portfolio company, include matters such as the competitive conditions of the business of the company; its market share; dependence on a single or small number of customers; importance to it of any patents, trademarks, licenses, franchises, or concessions held; key operating personnel; and particular vulnerability to changes in government regulation, interest rates, or technology.
3. In describing the relationship of
portfolio companies to the Registrant, include a discussion of the extent to which the Registrant makes available significant managerial assistance to its portfolio companies. Disclose any other material business, professional, or family relationship between the officers and directors of the Registrant and any portfolio company, its officers, directors, and affiliates (as defined in Rule 12b–2 under the Exchange Act [17 CFR 240.12b–2]). b. Certain Subsidiaries. If the Registrant has a wholly-owned small business investment company subsidiary, disclose: (1) Whether the subsidiary is regulated as a business development company or investment company under the Investment Company Act; (2) the percentage of the Registrant’s assets invested in the subsidiary; and (3) material information about the small business investment company’s operations, including the special risks of investing in a portfolio heavily invested in securities of small and developing or financially troubled businesses.
c. Financial Statements. Unless the
business development company has had less than one fiscal year of operations, provide the financial statements of the Registrant. Instructions.
1. a. Furnish, in a separate section
following the responses to the above

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