Rule 204-3 (17 CFR 275.204-3) under the Investment Advisers Act of 1940

Forms and Documents

Document Name	Status
Rule 204-3 (Brochure Rule) - Supporting Statement (Cyber).pdf Supporting Statement A	2022-04-14

IC Document Collections

IC ID	Document Title	Status
34124	Rule 204-3 under the Investment Advisers Act of 1940 -- Written Disclosure Statements	Modified

ICR Details

OMB Control No: 3235-0047	ICR Reference No: 202204-3235-003
Status: Received in OIRA	Previous ICR Reference No: 201905-3235-011
Agency/Subagency: SEC	Agency Tracking No: IM-270-42
Title: Rule 204-3 (17 CFR 275.204-3) under the Investment Advisers Act of 1940
Type of Information Collection: Revision of a currently approved collection	Common Form ICR:  No
Type of Review Request: Regular	Date Submitted to OIRA: 04/14/2022

	Requested	Previously Approved
Expiration Date	36 Months From Approved	11/30/2022
Responses	14,774	13,832
Time Burden (Hours)	2,982,280	49,090
Cost Burden (Dollars)	0	0

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Abstract: Rule 204-3 requires an investment adviser to deliver its brochure and brochure supplements to its new clients or prospective clients before or at the start of the advisory relationship and to deliver annually thereafter the full updated brochure or a summary of material changes to its brochure. The rule also requires that advisers deliver an amended brochure or brochure supplement (or just a statement describing the amendment) to clients only when disciplinary information in the brochure or supplement becomes materially inaccurate. The proposed amendments to rule 204-3 would require an adviser to deliver interim brochure amendments promptly to existing clients if the adviser adds disclosure of a cybersecurity incident to its brochure or materially revises information already disclosed in its brochure about such an incident.

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Authorizing Statute(s): US Code: 15 USC 10b-6(4) Name of Law: Investment Advisers Act of 1940
   US Code: 15 USC 80b-11(a) Name of Law: Investment Advisers Act of 1940
   US Code: 15 USC 80b-11(h) Name of Law: Investment Advisers Act of 1940
   US Code: 15 USC 80b-3(d) Name of Law: Investment Advisers Act of 1940
  

Citations for New Statutory Requirements: None

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Associated Rulemaking Information
RIN:	Stage of Rulemaking:	Federal Register Citation:	Date:
3235-AN08	Proposed rulemaking	87 FR 16590	03/23/2022

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Federal Register Notices & Comments

Did the Agency receive public comments on this ICR? No

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Number of Information Collection (IC) in this ICR: 1

IC Title	Form No.	Form Name
Rule 204-3 under the Investment Advisers Act of 1940 -- Written Disclosure Statements

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ICR Summary of Burden

	Total Request	Previously Approved	Change Due to New Statute	Change Due to Agency Discretion	Change Due to Adjustment in Estimate	Change Due to Potential Violation of the PRA
Annual Number of Responses	14,774	13,832	0	942	0	0
Annual Time Burden (Hours)	2,982,280	49,090	0	2,933,190	0	0
Annual Cost Burden (Dollars)	0	0	0	0	0	0

Burden increases because of Program Change due to Agency Discretion: Yes

Burden Increase Due to: Miscellaneous Actions

Burden decreases because of Program Change due to Agency Discretion: No

Burden Reduction Due to:

Short Statement: The estimated annual burden hours associated with rule 204-3 has increased from 49,090 hours to 2,982,279.64 hours (an increase of 2,933,189.64 hours). In addition, the external cost burden associated with rule 204-3 ($0) has not changed. The change in annual burden hours is due to our proposed amendments to rule 204-3 requiring an adviser to deliver interim brochure amendments promptly to existing clients if the adviser adds disclosure of a cybersecurity incident to its brochure or materially revises information already disclosed in its brochure about such an incident.

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Annual Cost to Federal Government: $0

Does this IC contain surveys, censuses, or employ statistical methods? No

Does this ICR request any personally identifiable information (see OMB Circular No. A-130 for an explanation of this term)? Please consult with your agency's privacy program when making this determination.     No

Does this ICR include a form that requires a Privacy Act Statement (see 5 U.S.C. §552a(e)(3))? Please consult with your agency's privacy program when making this determination.     No

Is this ICR related to the Affordable Care Act [Pub. L. 111-148 & 111-152]? No

Is this ICR related to the Dodd-Frank Wall Street Reform and Consumer Protection Act, [Pub. L. 111-203]? No

Is this ICR related to the American Recovery and Reinvestment Act of 2009 (ARRA)? No

Is this ICR related to the Pandemic Response? No

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Common Form ICR:  No

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On behalf of this Federal agency, I certify that the collection of information encompassed by this request complies with 5 CFR 1320.9 and the related provisions of 5 CFR 1320.8(b)(3).

The following is a summary of the topics, regarding the proposed collection of information, that the certification covers:

(a) It is necessary for the proper performance of agency functions;

(b) It avoids unnecessary duplication;

(c) It reduces burden on small entities;

(d) It uses plain, coherent, and unambiguous language that is understandable to respondents;

(e) Its implementation will be consistent and compatible with current reporting and recordkeeping practices;

(f) It indicates the retention periods for recordkeeping requirements;

(g) It informs respondents of the information called for under 5 CFR 1320.8 (b)(3) about:

(i) Why the information is being collected;

(ii) Use of information;

(iii) Burden estimate;

(iv) Nature of response (voluntary, required for a benefit, or mandatory);

(v) Nature and extent of confidentiality; and

(vi) Need to display currently valid OMB control number;

(h) It was developed by an office that has planned and allocated resources for the efficient and effective management and use of the information to be collected.

(i) It uses effective and efficient statistical survey methodology (if applicable); and

(j) It makes appropriate use of information technology.

If you are unable to certify compliance with any of these provisions, identify the item by leaving the box unchecked and explain the reason in the Supporting Statement.

Certification Date: 04/14/2022

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