17 CFR 270.27d-1 - Reserve requirements for principal underwriters and depositors to carry out the obligations to refund charges required by section 27(d) and section 27(f) of the Act.

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§ 270.27d-1 Reserve requirements for principal underwriters and depositors to carry out the obligations to refund charges required by section 27(d) and section 27(f) of the Act.
(a)
(1) Every depositor of or principal underwriter for the issuer of a periodic payment plan certificate sold subject to section 27(d) or section 27(f) of the Act or both, shall deposit and maintain funds in a segregated trust account as a reserve and as security for the purpose of assuring the refund of charges required by sections 27(d) and 27(f) of the Act.
(2) The assets of such trust account may be held as cash or invested only in one or more of (i) government securities as defined in section 2(a)(16) of the Act (except equity securities) or (ii) negotiable certificates of deposit issued by a bank, as defined in section 2(a)(5) of the Act and having capital and surplus of at least $10 million: Provided, That no such investment may have a maturity of more than 5 years, no more than 50 percent of the assets may be invested in obligations having a maturity of more than 1 year, and certificates of deposit of a single issuer may not constitute more than 10 percent of the value of the assets in the account.
(3) Any income, gains, or losses from assets allocated to such account, whether or not realized, shall be credited to or charged against such account without regard to other income, gains, or losses of the depositor or principal underwriter.
(4) The assets of such trust account may be withdrawn only as permitted by paragraph (f) of this section and shall in no event be chargeable with liabilities arising out of any aspect of the business of the depositor or principal underwriter other than assuring the ability of the depositor or principal underwriter to refund the amounts required by such sections.
(b) For purposes of this section:
(1) “Excess sales load” on any payment is that portion of the sales load in excess of 15 percent of that payment.
(2) “Monthly payment” shall be the amount of the smallest monthly installment scheduled to be paid during the life of the plan. If payments are required or permitted to be made on a basis less frequently than monthly, an equivalent monthly payment shall be the amount determined by dividing the smallest minimum payment required or permitted in a payment period by the number of months included in such period.
(3) The assets in the segregated trust account shall be valued as follows: (i) With respect to securities for which market quotations are readily available, the market value of such securities; and (ii) with respect to other securities, fair value as determined in good faith by the depositor or principal underwriter.
(c) For every periodic payment plan certificate governed by section 27(d), the depositor or principal underwriter shall deposit into the segregated trust account not less than 45 percent of the excess sales load on each of the first six monthly payments or their equivalent.
(d) For all periodic payment plan certificates governed by section 27(d) which have not been surrendered in accordance with their terms, and for which the depositor or principal underwriter may be liable for the refund of any sales load, the depositor or principal underwriter shall maintain in the segregated trust account an amount equal to not less than 15% of the total refundable sales load on the payments made on those certificates. The depositor or principal underwriter shall also maintain in the segregated trust account such additional amounts as the Commission by order may require for the depositor or principal underwriter to carry out refund obligations pursuant to sections 27(d) and 27(f) of the Act.
(e) For every periodic payment plan certificate governed by section 27(f) of the Act, and for which the depositor or principal underwriter has no obligation to refund any excess sales load pursuant to section 27(d) of the Act, the depositor or principal underwriter shall deposit and maintain during the refund period, at least the following amounts in the segregated trust account:
(1) For certificates that require monthly payments of $100 or less, 20 percent of the difference between the gross payments made and the net amount invested;
(2) For certificates that require monthly payments in excess of $100 and for single payment plan certificates, 30 percent of the difference between the gross payments made and the net amount invested;
(3) For certificates with respect to which the holder is entitled to receive the greater of the refund provided by section 27(f) (of the Act) or a refund of total payments and upon which a total of at least $1,000 has been paid, 100 percent of the difference between the gross payments made and net amount invested; and
(4) Such additional amounts as the Commission by order may require to carry out the obligation to refund charges pursuant to section 27(f) of the Act.
(f) Assets may be withdrawn from the segregated trust account by each depositor or principal underwriter:
(1) To refund excess sales load to a certificate holder exercising the right of surrender specified in section 27(d) of the Act; or
(2) To refund to a certificate holder exercising the right of withdrawal specified in section 27(f) of the Act the difference between the amount of his gross payments and the net amount invested; or
(3) For any other purpose: Provided, however, That such withdrawal shall not reduce the segregated trust account to an amount less than the sum of (i) 130 percent of the amount required to be maintained by paragraph (d) of this section, if any, and (ii) 100 percent of that amount required to be maintained by paragraph (e) of this section, if any.
(g) The minimum amounts required to be maintained by paragraphs (d) and (e) of this section shall be computed at least monthly. Any additional deposits required by paragraph (d) or (e) of this section shall be made immediately after such computation, and any withdrawals permitted by paragraph (f)(3) of this section may be made only at such time.
(h) Nothing in this section shall be construed to prohibit a depositor or principal underwriter, acting as such for two or more registered investment companies issuing periodic payment plan certificates, from combining in a single segregated trust account the reserves for such companies required by this section.
(i) The refunds required to be made to certificate holders pursuant to sections 27(d) and 27(f) (of the Act) shall be paid in cash not more than 7 days from the date the certificate is received in proper form by the custodian bank or such other paying agent as may be designated under the periodic payment plan.
(j) Each depositor or principal underwriter shall file with the Commission, within the appropriate period of time specified, an Accounting of Segregated Trust Account. Form N-27D-1 (§ 274.127d-1 of this chapter) is hereby prescribed as such accounting form.
[36 FR 13136, July 15, 1971, as amended at 40 FR 50712, Oct. 31, 1975]

Title 17 published on 2013-04-01

The following are only the Rules published in the Federal Register after the published date of Title 17.

For a complete list of all Rules, Proposed Rules, and Notices view the Rulemaking tab.

  • 2014-01-08; vol. 79 # 5 - Wednesday, January 8, 2014
    1. 79 FR 1316 - Removal of Certain References to Credit Ratings Under the Investment Company Act
      GPO FDSys XML | Text
      SECURITIES AND EXCHANGE COMMISSION
      Final rule.
      Effective Date: February 7, 2014; Compliance Date: July 7, 2014.
      17 CFR Parts 239, 270, and 274

This is a list of United States Code sections, Statutes at Large, Public Laws, and Presidential Documents, which provide rulemaking authority for this CFR Part.

This list is taken from the Parallel Table of Authorities and Rules provided by GPO [Government Printing Office].

It is not guaranteed to be accurate or up-to-date, though we do refresh the database weekly. More limitations on accuracy are described at the GPO site.


United States Code
U.S. Code: Title 15 - COMMERCE AND TRADE

§ 30 - Repealed.

§ 37 - Immunity from antitrust laws

§ 77f - Registration of securities

§ 77g - Information required in registration statement

§ 77h - Taking effect of registration statements and amendments thereto

§ 77j - Information required in prospectus

§ 77q - Fraudulent interstate transactions

§ 77s - Special powers of Commission

§ 77eee - Securities required to be registered under Securities Act

§ 77ggg - Qualification of indentures covering securities not required to be registered

§ 77nnn - Reports by obligor; evidence of compliance with indenture provisions

§ 77sss - Rules, regulations, and orders

§ 78c - Definitions and application

§ 78d - Securities and Exchange Commission

15 U.S. Code § -

§ 78m - Periodical and other reports

§ 78n - Proxies

15 U.S. Code § -

§ 78w - Rules, regulations, and orders; annual reports

§ 78bb - Effect on existing law

§ 78ee - Transaction fees

§ 79c

§ 79t

15 U.S. Code § 80a–1 - Findings and declaration of policy

15 U.S. Code § 80a–2 - Definitions; applicability; rulemaking considerations

15 U.S. Code § 80a–3 - Definition of investment company

15 U.S. Code § 80a–3a - Protection of philanthropy under State law

15 U.S. Code § 80a–4 - Classification of investment companies

15 U.S. Code § 80a–5 - Subclassification of management companies

15 U.S. Code § 80a–6 - Exemptions

15 U.S. Code § 80a–7 - Transactions by unregistered investment companies

15 U.S. Code § 80a–8 - Registration of investment companies

15 U.S. Code § 80a–9 - Ineligibility of certain affiliated persons and underwriters

15 U.S. Code § 80a–10 - Affiliations or interest of directors, officers, and employees

15 U.S. Code § 80a–11 - Offers to exchange securities

15 U.S. Code § 80a–12 - Functions and activities of investment companies

15 U.S. Code § 80a–13 - Changes in investment policy

15 U.S. Code § 80a–14 - Size of investment companies

15 U.S. Code § 80a–15 - Contracts of advisers and underwriters

15 U.S. Code § 80a–16 - Board of directors

15 U.S. Code § 80a–17 - Transactions of certain affiliated persons and underwriters

15 U.S. Code § 80a–18 - Capital structure of investment companies

15 U.S. Code § 80a–19 - Payments or distributions

15 U.S. Code § 80a–20 - Proxies; voting trusts; circular ownership

15 U.S. Code § 80a–21 - Loans by management companies

15 U.S. Code § 80a–22 - Distribution, redemption, and repurchase of securities; regulations by securities associations

15 U.S. Code § 80a–23 - Closed-end companies

15 U.S. Code § 80a–24 - Registration of securities under Securities Act of 1933

15 U.S. Code § 80a–25 - Reorganization plans; reports by Commission

15 U.S. Code § 80a–26 - Unit investment trusts

15 U.S. Code § 80a–27 - Periodic payment plans

15 U.S. Code § 80a–28 - Face-amount certificate companies

15 U.S. Code § 80a–29 - Reports and financial statements of investment companies and affiliated persons

15 U.S. Code § 80a–30 - Accounts and records

15 U.S. Code § 80a–31 - Accountants and auditors

15 U.S. Code § 80a–32 - Filing of documents with Commission in civil actions

15 U.S. Code § 80a–33 - Destruction and falsification of reports and records

15 U.S. Code § 80a–34 - Unlawful representations and names

15 U.S. Code § 80a–35 - Breach of fiduciary duty

15 U.S. Code § 80a–36 - Larceny and embezzlement

15 U.S. Code § 80a–37 - Rules, regulations, and orders

15 U.S. Code § 80a–38 - Procedure for issuance of rules and regulations

15 U.S. Code § 80a–39 - Procedure for issuance of orders

15 U.S. Code § 80a–40 - Hearings by Commission

15 U.S. Code § 80a–41 - Enforcement of subchapter

15 U.S. Code § 80a–42 - Court review of orders

15 U.S. Code § 80a–43 - Jurisdiction of offenses and suits

15 U.S. Code § 80a–44 - Disclosure of information filed with Commission; copies

15 U.S. Code § 80a–45 - Reports by Commission; hiring and leasing authority

15 U.S. Code § 80a–46 - Validity of contracts

15 U.S. Code § 80a–47 - Liability of controlling persons; preventing compliance with subchapter

15 U.S. Code § 80a–48 - Penalties

15 U.S. Code § 80a–49 - Construction with other laws

15 U.S. Code § 80a–50 - Separability

15 U.S. Code § 80a–51 - Short title

15 U.S. Code § 80a–52 - Effective date

15 U.S. Code § 80a–53 - Election to be regulated as business development company

15 U.S. Code § 80a–54 - Acquisition of assets by business development companies

15 U.S. Code § 80a–55 - Qualifications of directors

15 U.S. Code § 80a–56 - Transactions with certain affiliates

15 U.S. Code § 80a–57 - Changes in investment policy

15 U.S. Code § 80a–58 - Incorporation of subchapter provisions

15 U.S. Code § 80a–59 - Functions and activities of business development companies

15 U.S. Code § 80a–60 - Capital structure

15 U.S. Code § 80a–61 - Loans

15 U.S. Code § 80a–62 - Distribution and repurchase of securities

15 U.S. Code § 80a–63 - Accounts and records

15 U.S. Code § 80a–64 - Preventing compliance with subchapter; liability of controlling persons

15 U.S. Code § 80b–3 - Registration of investment advisers

15 U.S. Code § 80b–4 - Reports by investment advisers

15 U.S. Code § 80b–11 - Rules, regulations, and orders of Commission

15 U.S. Code § 79 to 79z–6 - Repealed.

15 U.S. Code § 79 to 79z–6 - Repealed.

15 U.S. Code § 79 to 79z–6 - Repealed.

Title 17 published on 2013-04-01

The following are ALL rules, proposed rules, and notices (chronologically) published in the Federal Register relating to 17 CFR 270 after this date.

  • 2014-01-08; vol. 79 # 5 - Wednesday, January 8, 2014
    1. 79 FR 1316 - Removal of Certain References to Credit Ratings Under the Investment Company Act
      GPO FDSys XML | Text
      SECURITIES AND EXCHANGE COMMISSION
      Final rule.
      Effective Date: February 7, 2014; Compliance Date: July 7, 2014.
      17 CFR Parts 239, 270, and 274