31 Pa. Code § 21.17 - Ownership of securities held in trust

(a) Beneficial ownership of a security for the purpose of section 302.1(1) of the act (40 P. S. § 422.1(1)) shall include all of the following:

(1) Ownership of securities as a trustee where either the trustee or members of his immediate family have a vested interest in the income or corpus of the trust.

(2) Ownership of a vested beneficial interest in a trust.

(3) Ownership of securities as a settlor of a trust in which the settlor has the power to revoke the trust without obtaining the consent of all the beneficiaries.

(b) Except as provided in subsection (c), beneficial ownership of securities solely as a settlor or beneficiary of a trust shall be exempt from the provisions of section 302.1(1) of the act where less than 20% in market value of the securities having a readily ascertainable market value held by the trust, determined as of the end of the preceding fiscal year of the trust, consists of equity securities with respect to which statements would otherwise be required. An exemption shall likewise be accorded from section 302.1(1) of the act with respect to any obligation which would otherwise be imposed solely by reason of ownership as settlor or beneficiary of securities held in trust where the ownership, acquisition, or disposition of such securities by the trust is made without prior approval by the settlor or beneficiary. No exemption under this subsection shall, however, be acquired or lost solely as a result of changes in the value of the trust assets during any fiscal year or during any time when there is no transaction by the trust in the securities otherwise subject to the reporting requirements of section 302.1(1) of the act.

(c) In the event that 10% of any class of any equity security of an insurer is held in a trust, such trust and the trustees thereof shall be deemed a person required to file the statements specified in section 302.1(1) of the act.

(d) Not more than one statement need be filed to report any holdings or with respect to any transaction in securities held by a trust, regardless of the number of officers, directors or 10% stockholders who are either trustees, settlors or beneficiaries of a trust, if the statement filed discloses the names of all trustees, settlors and beneficiaries who are officers, directors, or 10% stockholders. A person having an interest only as a beneficiary of a trust shall not be required to file the statement so long as he relies in good faith upon an understanding that the trustee of the trust shall file whatever statements might otherwise be required of the beneficiary.

(e) As used in this section, the term "immediate family" of a trustee shall mean:

(1) A son or daughter of the trustee, or a descendant of either.

(2) A stepson or stepdaughter of the trustee.

(3) The father or mother of the trustee, or an ancestor of either.

(4) A stepfather or stepmother of the trustee.

(5) A spouse of the trustee.

(6) For the purpose of determining whether any of the relations listed in paragraphs (1)-(5) exist, a legally adopted child of a person shall be considered a child of that person by blood.

(f) In determining, for the purposes of section 302.1(1) of the act, whether a person is the beneficial owner, directly or indirectly, of more than 10% of any class of an equity security, the interest of the person in the remainder of a trust shall be excluded from the computation.

(g) No statement shall be required by any person, whether or not otherwise subject to the requirements of filing statements under the act, with respect to his indirect interest in portfolio securities held by one of the following:

(1) A pension or retirement plan holding securities of an insurer whose employes generally are the beneficiaries of the plan.

(2) A business trust with over 25 beneficiaries.

(h) Nothing in this section shall be deemed to impose any duties or liabilities with respect to reporting any transaction or holding prior to its effective date.

Notes

31 Pa. Code § 21.17