[Code of Federal Regulations]
[Title 17, Volume 2]
[Revised as of April 1, 2002]
From the U.S. Government Printing Office via GPO Access
[CITE: 17CFR230.151]

[Page 498-499]
 
              TITLE 17--COMMODITY AND SECURITIES EXCHANGES
 
             CHAPTER II--SECURITIES AND EXCHANGE COMMISSION
 
PART 230--GENERAL RULES AND REGULATIONS, SECURITIES ACT OF 1933--Table of Contents
 
Sec. 230.151  Safe harbor definition of certain ``annuity contracts or optional annuity contracts'' within the meaning of section 3(a)(8).

    (a) Any annuity contract or optional annuity contract (a contract) 
shall be deemed to be within the provisions of section 3(a)(8) of the 
Securities Act of 1933 (15 U.S.C. 77c(a)(8)), Provided, That
    (1) The annuity or optional annuity contract is issued by a 
corporation (the insurer) subject to the supervision of the insurance 
commissioner, bank commissioner, or any agency or officer performing 
like functions, of any State or Territory of the United States or the 
District of Columbia;
    (2) The insurer assumes the investment risk under the contract as 
prescribed in paragraph (b) of this section; and
    (3) The contract is not marketed primarily as an investment.
    (b) The insurer shall be deemed to assume the investment risk under 
the contract if:
    (1) The value of the contract does not vary according to the 
investment experience of a separate account;
    (2) The insurer for the life of the contract
    (i) Guarantees the principal amount of purchase payments and 
interest credited thereto, less any deduction (without regard to its 
timing) for sales, administrative or other expenses or charges; and
    (ii) Credits a specified rate of interest (as defined in paragraph 
(c) of this section to net purchase payments and interest credited 
thereto; and
    (3) The insurer guarantees that the rate of any interest to be 
credited in excess of that described in paragraph (b)(2)(ii) of this 
section will not be

[[Page 499]]

modifed more frequently than once per year.
    (c) The term specified rate of interest, as used in paragraph 
(b)(2)(ii) of this section, means a rate of interest under the contract 
that is at least equal to the minimum rate required to be credited by 
the relevant nonforfeiture law in the jurisdiction in which the contract 
is issued. If that jurisdiction does not have any applicable 
nonforfeiture law at the time the contract is issued (or if the minimum 
rate applicable to an existing contract is no longer mandated in that 
jurisdiction), the specified rate under the contract must at least be 
equal to the minimum rate then required for individual annuity contracts 
by the NAIC Standard Nonforfeiture Law.

[51 FR 20262, June 4, 1986]