[Federal Register Volume 75, Number 239 (Tuesday, December 14, 2010)]
[Notices]
[Pages 77922-77923]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-31256]
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SECURITIES AND EXCHANGE COMMISSION
[Investment Company Act Release No. 29522; File No. 812-13839]
Nuveen Asset Management, et al.; Notice of Application
December 8, 2010.
AGENCY: Securities and Exchange Commission (``Commission'').
ACTION: Notice of an application under section 6(c) of the Investment
Company Act of 1940 (``Act'') for an exemption from rule 12d1-2(a)
under the Act.
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Summary of Application: Applicants request an order to permit open-
end management investment companies relying on rule 12d1-2 under the
Act to invest in certain financial instruments.
Applicants: Nuveen Asset Management (``NAM''), First American
Strategy Funds, Inc. (``FASF''), First American Investment Funds, Inc.
(``FAIF'') and Nuveen Investments, LLC (``Nuveen Investments'').
Filing Dates: The application was filed on November 5, 2010 and
amended on December 7, 2010. Applicants have agreed to file an
amendment during the notice period, the substance of which is reflected
in this notice.
Hearing or Notification of Hearing: An order granting the
application will be issued unless the Commission orders a hearing.
Interested persons may request a hearing by writing to the Commission's
Secretary and serving applicants with a copy of the request, personally
or by mail. Hearing requests should be received by the Commission by
5:30 p.m. on December 28, 2010 and should be accompanied by proof of
service on applicants, in the form of an affidavit or, for lawyers, a
certificate of service. Hearing requests should state the nature of the
writer's interest, the reason for the request, and the issues
contested. Persons who wish to be notified of a hearing may request
notification by writing to the Commission's Secretary.
ADDRESSES: Secretary, Securities and Exchange Commission, 100 F Street,
NE., Washington, DC 20549-1090; Applicants: NAM and Nuveen Investments,
333 West Wacker Drive, 32nd Floor, Chicago, Illinois, 60606; FASF and
FAIF, 800 Nicollet Mall, Minneapolis, Minnesota 55402.
FOR FURTHER INFORMATION CONTACT: John Yoder, Senior Counsel, at (202)
551-6878, or Dalia Osman Blass, Branch Chief, at (202) 551-6821
(Division of Investment Management, Office of Investment Company
Regulation).
SUPPLEMENTARY INFORMATION: The following is a summary of the
application. The complete application may be obtained via the
Commission's Web site by searching for the file number, or an applicant
using the Company name box, at http://www.sec.gov/search/search.htm or
by calling (202) 551-8090.
Applicants' Representations
1. FASF is organized as a Minnesota corporation and FAIF as a
Maryland corporation, and each is registered under the Act as an open-
end management investment company. NAM, a wholly owned subsidiary of
Nuveen Investments, Inc., is organized as a Delaware corporation and is
registered as an investment adviser under the Investment Advisers Act
of 1940. Nuveen Investments, a wholly owned subsidiary of Nuveen
Investments, Inc., is organized as a Delaware limited liability company
and is registered as a broker-dealer under the Securities Exchange Act
of 1934, as amended (``Exchange Act'').
2. Applicants request the exemption to the extent necessary to
permit any existing or future registered open-end management investment
company or series thereof (i) that is advised by NAM or an entity
controlling, controlled by, under common control with NAM (each, an
``Advisor''), (ii) that is in the same group of investment companies as
defined in section 12(d)(1)(G) of the Act, (iii) that invests in other
registered open-end management investment companies in reliance on
section 12(d)(1)(G) of the Act, and (iv) that is also eligible to
invest in securities (as defined in section 2(a)(36) of the Act) in
reliance on rule 12d1-2 under the Act (each a ``Fund of Funds''), to
also invest, to the extent consistent with its investment objective,
policies, strategies and limitations, in financial instruments that may
not be securities within the meaning of section 2(a)(36) of the Act
(``Other Investments'').\1\ Applicants also request that the order
exempt any entity controlling, controlled by or under common control
with NAM or Nuveen Investments that now or in the future acts as
principal underwriter with respect to the transactions described in the
application.\2\
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\1\ Under a prior order, the Commission granted relief to FASF,
FAIF, FAF Advisors, Inc. (``FAF'') and Quasar Distributors, LLC. to
permit funds of funds relying on rule 12d1-2 under the Act to invest
in certain financial instruments. First American Strategy Funds,
Inc., et al., Investment Company Act Release Nos. 28683 (Mar. 31,
2009) (notice) and 28715 (Apr. 28, 2009) (order) (``Existing
Order''). On July 29, 2010, U.S. Bank National Association and its
wholly-owned subsidiary, FAF, entered into an agreement to transfer
identified assets associated with FAF's management of FASF and FAIF
to NAM in exchange for cash and an ownership interest in NAM's and
Nuveen Investments, Inc.'s parent company (the ``Transaction''). As
part of the Transaction, and subject to approval by the shareholders
of FASF and FAIF, NAM will replace FAF as the investment adviser to
FASF and FAIF. Applicants will not rely on the requested order until
the closing of the Transaction. Once the requested order is issued
and the Transaction is closed, applicants will cease to rely on the
Existing Order.
\2\ Every existing entity that currently intends to rely on the
requested order is named as an applicant. Any existing or future
entity that relies on the order in the future will do so only in
accordance with the terms and conditions in the application.
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3. Consistent with its fiduciary obligations under the Act, each
Fund of Funds' board of directors will review the advisory fees charged
by the Fund of Funds' Adviser to ensure that they are based on services
provided that are in addition to, rather than duplicative of, services
provided pursuant to the advisory agreement of any investment company
in which the Fund of Funds may invest.
Applicants' Legal Analysis
1. Section 12(d)(1)(A) of the Act provides that no registered
investment company (``acquiring company'') may acquire securities of
another investment company (``acquired company'') if such securities
represent more than 3% of the acquired company's outstanding voting
stock or more than 5% of the acquiring company's total assets, or if
such securities, together with the securities of other investment
companies, represent more than 10% of the acquiring company's total
assets. Section 12(d)(1)(B) of the Act provides that no registered
open-end investment company may sell its securities to another
investment company if the sale will cause the acquiring company to own
more than 3% of the acquired company's voting stock, or cause more than
10% of the acquired company's voting stock to be owned by investment
companies and companies controlled by them.
2. Section 12(d)(1)(G) of the Act provides that section 12(d)(1)
will not
[[Page 77923]]
apply to securities of an acquired company purchased by an acquiring
company if: (i) The acquired company and acquiring company are part of
the same group of investment companies; (ii) the acquiring company
holds only securities of acquired companies that are part of the same
group of investment companies, government securities, and short-term
paper; (iii) the aggregate sales loads and distribution-related fees of
the acquiring company and the acquired company are not excessive under
rules adopted pursuant to section 22(b) or section 22(c) of the Act by
a securities association registered under section 15A of the Exchange
Act or by the Commission; and (iv) the acquired company has a policy
that prohibits it from acquiring securities of registered open-end
investment companies or registered unit investment trusts in reliance
on section 12(d)(1)(F) or (G) of the Act.
3. Rule 12d1-2 under the Act permits a registered open-end
investment company or a registered unit investment trust that relies on
section 12(d)(1)(G) of the Act to acquire, in addition to securities
issued by another registered investment company in the same group of
investment companies, government securities, and short-term paper: (i)
Securities issued by an investment company that is not in the same
group of investment companies, when the acquisition is in reliance on
section 12(d)(1)(A) or 12(d)(1)(F) of the Act; (ii) securities (other
than securities issued by an investment company); and (iii) securities
issued by a money market fund, when the investment is in reliance on
rule 12d1-1 under the Act. For the purposes of rule 12d1-2,
``securities'' means any security as defined in section 2(a)(36) of the
Act.
4. Section 6(c) of the Act provides that the Commission may exempt
any person, security, or transaction from any provision of the Act, or
from any rule under the Act, if such exemption is necessary or
appropriate in the public interest and consistent with the protection
of investors and the purposes fairly intended by the policies and
provisions of the Act.
5. Applicants state that the Funds of Funds will comply with Rule
12d1-2 under the Act, but for the fact that the Funds of Funds may
invest a portion of their assets in Other Investments. Applicants
request an order under section 6(c) of the Act for an exemption from
rule 12d1-2(a) to allow the Funds of Funds to invest in Other
Investments. Applicants assert that permitting the Funds of Funds to
invest in Other Investments as described in the application would not
raise any of the concerns that the requirements of section 12(d)(1)
were designed to address.
Applicants' Condition
Applicants agree that any order granting the requested relief will
be subject to the following condition:
Applicants will comply with all provisions of rule 12d1-2 under the
Act, except for paragraph (a)(2) to the extent that it restricts any
Fund of Funds from investing in Other Investments as described in the
application.
For the Commission, by the Division of Investment Management,
under delegated authority.
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-31256 Filed 12-13-10; 8:45 am]
BILLING CODE 8011-01-P