Rule 163 SupportingStatement.4-18-2011

SUPPORTING STATEMENT FOR SECURITIES ACT RULE 163

A.

Justification

1. And 2.

Circumstances Making the Collection of Information Necessary And
Purpose And Use of the Information Collection

Rule 163 was adopted on July 19, 2005 in connection with new communication rules in
Release 33-8591 (“Securities Offering Reform”). Rule 163 provides an exemption from Section
5(c) under the Securities Act for certain communications by, or on behalf of, a well-known
seasoned issuer. A primary purpose of the rule is to give eligible well-known seasoned issuers
freedom to communicate with investors at any time, including by means of a written offer other
than a statutory prospectus.
3.

Consideration Given to Information Technology

Rule 163 communications are filed with the Commission electronically using the
Commission’s Electronic Data Gathering, Analysis and Retrieval System (EDGAR).
4.

Duplication of Information

There are no other filing requirements that duplicate this information collection.
5.

Reducing the Burden on Small Entities

All issuers, including small business issuers, have discretion as to whether or not they
want to disseminate written communications under Rule 163. Furthermore, Rule 163 was
adopted in connection with other revisions, all of which were intended to decrease costs and
burdens for all issuers, including small business issuers, and enhance communications between
issuers and investors.
6.

Consequences of Not Conducting Collection

Rule 163 requires filing of written communications only when issuers choose to
disseminate them. Less frequent collection could compromise investor protection.
7.

Special Circumstances

Not applicable.

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8.

Consultations With Person Outside the Agency

Rule 163 was proposed for public comment. No comments were received on this request
during the 60-day comment period prior to OMB’s review of this submission.
9.

Payment or Gift to Respondents

Not applicable.
10.

Confidentiality

Not applicable.
11.

Sensitive Questions

Not applicable.
12.

Estimate of Respondent Reporting Burden

We estimate that it takes approximately 0.24 burden hours per response to provide the
information required under Rule 163 and that the information is filed by 53 respondents for a
total annual reporting burden of approximately 13 hours. We estimate that 25% of the 0.24
hours per response (0.06 hours) is prepared by the company for a total annual burden of
approximately 3 hours (0.06 hours per response x 53 responses). The estimated hours are made
solely for the purpose of the Paperwork Reduction Act. The hours are not derived from a
comprehensive or even representative survey or study of the hours to comply with Commission
rules and forms.
13.

Estimate of Total Annualized Cost Burden

We estimated that 75% of the .24 hours per response (0.18 hours) is prepared by the
issuer outside counsel. We estimate that Rule 163 compliance will cost $400 per hour ($400 x
0.18 hours per response x 53 responses) for a total cost of $3,816. The estimated cost is made
solely for the purpose of the Paperwork Reduction Act. The cost is not derived from a
comprehensive or even representative survey or study of the cost of Commission rules and
forms.
14.

Costs to Federal Government

Not applicable.
15.

Explanation of Changes in Burden

No change in the burden.

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16.

Information Collection Planned for Statistical Purposes

Not applicable.
17.

Displayed of OMB Approval Date

We request authorization to omit the expiration date on the electronic version of this form
for design and scheduling reasons.

B.

Statistical Methods
Not applicable.