the offer, but they participate on terms different from those afforded
other target security holders.\357\ Where permissible, the vendor
placement procedure allows a bidder in a cross-border exchange offer to
extend the offer into the United States without registering the
issuance of the securities offered under Section 5 of the Securities
Act.
---------------------------------------------------------------------------

    \357\ We are advised that some foreign regulators object to the
use of the vendor placement procedure on equal treatment and other
grounds. Where a vendor placement structure is used in a cross-
border exchange offer, it should comply with the laws of the
applicable foreign jurisdiction. We do not intend to imply by the
discussion here or in the Proposing Release that the use of this
structure is required under U.S. law.
---------------------------------------------------------------------------

    We included a discussion of existing vendor placement no-action
letters in the Proposing Release because the staff continues to receive
frequent inquiries on the use of this mechanism for cross-border
exchange offers.\358\ When the existing cross-border exemptions were
adopted in 1999, they codified the ability of bidders in exchange
offers conducted under Tier I to offer cash to U.S. holders in lieu of
cash and stock or stock only offered to foreign holders. This ability
was conditioned on the bidder having a reasonable basis to believe that
the cash offered is substantially equivalent in value to the non-cash
consideration offered to foreign target holders.\359\ When U.S. holders
receive a cash alternative as permitted under the Tier I exemption, the
process is different than in a vendor placement because the bidder
issues a fixed amount of cash directly to U.S. holders. In a vendor
placement, by contrast, the bidder technically issues securities, which
are then sold abroad on behalf of U.S. persons, who receive the cash
proceeds from that sale. The amount of the proceeds a U.S. person
receives will depend on the market price of the securities sold.
---------------------------------------------------------------------------

    \358\ See Proposing Release, Section II.G.3.
    \359\ See Exchange Act Rules 13e-4(h)(8)(ii)(C) [17 CFR 240.13e-
4(h)(8)(ii)(C)] and 14d-1(c)(2)(iii) [17 CFR 240.14d-1(c)(2)(iii)].
U.S. holders who receive cash pursuant to these rules may under
specified circumstances request from the bidder an opinion of an
independent expert stating that the consideration offered them is
substantially equivalent to the non-cash consideration offered to
foreign holders. See id.
---------------------------------------------------------------------------

    Since 1999, Tier I has afforded a method by which bidders in cross-
border exchange offers may issue cash to U.S. target holders.
Therefore, the staff no longer intends to issue vendor placement no-
action letters regarding the registration requirements of Section 5.
Bidders should employ the vendor placement procedure only to the extent
that such procedure does not result in an offer or sale of securities
for which registration under Section 5 would be required.

    The guidance we provide here, which reiterates the guidance set
forth in the Proposing Release and previous relief,\360\ is intended to
provide clarity about the factors that bidders should consider when
contemplating the use of the vendor placement procedure. It is not
intended to expand the circumstances under which we believe this
procedure should be available.\361\ The factors include:
---------------------------------------------------------------------------

    \360\ See, e.g., Singapore Telecommunications Ltd. (May 15,
2001); Oldcastle, Inc. (July 3, 1986); Electrocomponents PLC
(September 23, 1982); Equitable Life Mortgage and Realty Investors
(December 23, 1982); Getty Oil (Canadian Operations) Ltd. (May 19,
1983); and Hudson Bay Mining and Smelting Co. Ltd. (June 19, 1985).
    \361\ One commenter requested that we expand the availability of
the vendor placement procedure by making this procedure available
whenever the target securities that are the subject of the tender
offer are not registered under Section 12 of the Exchange Act. See
letter from Cravath. We believe the factors we articulate here,
rather than the unregistered status of the target securities, are
the appropriate measure of when the vendor placement procedure
should be available.
---------------------------------------------------------------------------

     The level of U.S. ownership in the target company; \362\
---------------------------------------------------------------------------

    \362\ As we stated in the Proposing Release, offerors should be
particularly cognizant of this factor. See Proposing Release,
Section II.G.3.
---------------------------------------------------------------------------

     The number of bidder securities to be issued in the
business combination transaction as a whole as compared to the amount
of bidder securities outstanding before the offer;
     The amount of bidder securities to be issued to tendering
U.S. holders and subject to the vendor placement, as compared to the
amount of bidder securities outstanding before the offer;
     The liquidity and general trading market for the bidder's
securities;
     The likelihood that the vendor placement can be effected
within a very short period of time after the termination of the offer
and the bidder's acceptance of shares tendered in the offer;
     The likelihood that the bidder plans to disclose material
information around the time of the vendor placement sales; and
     The process used to effect the vendor placement
sales.\363\
---------------------------------------------------------------------------

    \363\ We assume that the sales will be effected pursuant to the
procedure under Category 1 of Regulation S [17 CFR 230.903(b)(1)].
---------------------------------------------------------------------------

    We believe the liquidity of the market for the bidder's securities
is relevant to whether registration under Section 5 should be required.
Unless the market for the bidder's securities to be sold through the
vendor placement process is highly liquid and robust and the number of
bidder securities to be issued for the benefit of U.S. target holders
relatively small compared to the total number of bidder securities
outstanding, a vendor placement arrangement in a cross-border exchange
offer would in our view be subject to Securities Act registration under
Section 5.
    In addition to the factors listed above, we believe it is relevant
whether sales of a bidder's securities in the vendor placement process
are accomplished within a few business days of the close of the offer
and whether the bidder announces material information, such as earning
results, forecasts or other financial or operating information, before
the sales process is complete. In addition, whether the vendor
placement involves special selling efforts by brokers or others acting
on behalf of the bidder is relevant. These factors are important
because they indicate whether the market price which U.S. investors
will receive when the bidder's securities are sold on their behalf is
representative. The factors also are designed to ensure that U.S.
investors are not effectively making an investment decision with
respect to a purchase of securities (which would require registration
under the Securities Act), but rather, are making a decision to tender
their target securities in exchange for an amount of cash that,
although it is not for a fixed sum,\364\ can be readily determined and
estimated based on historic trading prices.
---------------------------------------------------------------------------

    \364\ Early vendor placement letters featured a fixed price
guaranteed by the bidder. However, most letters, including all of
the more recent ones, do not include a floor on the cash value to be
received by U.S. holders. Rather, they receive whatever proceeds are
generated from the sale of the bidder's securities in an overseas
market.
---------------------------------------------------------------------------

    Bidders may continue to use the vendor placement procedure in
accordance with the guidance set forth here. The vendor placement
process, where appropriately used, avoids the need for registration of
the bidder securities sold on behalf of U.S. holders under Section 5 of
the Securities Act. Where the tender offer also is subject to the equal
treatment provisions of U.S. tender offer rules,\365\ bidders also must
seek an exemption from those rules in order to offer U.S. security
holders a different form of consideration than what is provided to
foreign target holders. In offers subject to the equal treatment
provisions of the U.S. tender offer rules, it is not permissible under
those rules to exclude most U.S. target holders and include only the
U.S. holders (such as large institutional investors) for whom an
exemption from Section 5 of the Securities Act is available.\366\ For
the same reasons, issuing securities to some U.S. holders, such as U.S.
institutions, while providing cash to all others pursuant to a vendor
placement arrangement is inconsistent with the equal treatment
requirements of U.S. tender offer rules.\367\
---------------------------------------------------------------------------

    \365\ See Exchange Act Rules 13e-4(f)(8) [17 CFR 240.13e-
4(f)(8)] and 14d-10 [17 CFR 240.14d-10].
    \366\ See Proposing Release, Section II.G.3 and footnote 91 in
the 1999 Cross-Border Adopting Release.
    \367\ See Proposing Release, Section II.G.3.
---------------------------------------------------------------------------

    Most of the vendor placement no-action letters issued by the staff
involved tender offers that were not subject to U.S. equal treatment
provisions.\368\ In the future, the staff will consider whether
requests for relief from the equal treatment provisions of U.S. tender
offer rules where a vendor placement procedure is used are appropriate
and in the best interests of U.S. security holders.\369\ We generally
believe that cross-border tender offers eligible to be conducted under
the Tier I exemption represent the appropriate circumstances under
which bidders may provide cash to U.S. target holders while offering
securities to foreign target holders.
---------------------------------------------------------------------------

    \368\ See footnote 360 above. But see TABCORP Holdings Ltd.
(August 20, 1999) (``TABCORP'').
    \369\ One commenter requested clarification on the circumstances
under which the Commission will grant relief from the equal
treatment provisions of U.S. tender offer rules where a vendor
placement procedure is used. See letter from Cleary. The staff no-
action letters in this area provide some guidance on the limited
circumstances under which the staff has done so in the past. See
TABCORP. While each transaction presents unique facts and
circumstances, in our view, such relief is not always appropriate,
even where a vendor placement procedure otherwise could be used to
avoid the registration requirements of Section 5 of the Securities
Act.
---------------------------------------------------------------------------

III. Paperwork Reduction Act

    Some provisions of the rule amendments adopted today constitute a
``collection of information'' within the meaning of the Paperwork
Reduction Act of 1995 (the ``PRA'').\370\ We have submitted the
revisions to the Office of Management and Budget (``OMB'') for review
in accordance with the PRA.\371\
---------------------------------------------------------------------------

    \370\ 44 U.S.C. 3501 et seq.
    \371\ 44 U.S.C. 3507(d); 5 CFR 1320.11.
---------------------------------------------------------------------------

    The hours and costs associated with preparing and filing the
disclosure, filing the forms and schedules and retaining records
required by this regulation constitute reporting and cost burdens
imposed by each collection of information. An agency may not conduct or
sponsor, and a person is not required to respond to, a collection of
information unless it displays a currently valid OMB control number.
The titles for the collection of information are:
    (1) ``Form S-4'' (OMB Control No. 3235-0065);
    (2) ``Form F-4'' (OMB Control No. 3235-0325);

    (3) ``Form ID'' (OMB Control No. 3235-0328);
    (4) ``Form CB'' (OMB Control No. 3235-0518);
    (5) ``Form F-X'' (OMB Control No. 3235-0379);
    (6) ``Schedule TO'' (OMB Control No. 3235-0515);
    (7) ``Securities Ownership--Regulation 13D (Commission Rules 13d-1
through 13d-7 and Schedules 13D and 13G)'' (OMB Control No. 3235-0145);
    (8) ``Form 3'' (OMB Control No. 3235-0104); and
    (9) ``Form 4'' (OMB Control No. 3235-0287).

A. Summary of the Amendments

1. Amendments to the Tier I Exemption and Form CB
    The rule amendments add to the types of affiliated transactions
that may be effected in reliance on the Tier I exemption from Exchange
Act Rule 13e-3(g)(6). A Form CB will be required when an issuer or
acquiror relies on the expanded Tier I exemption from Rule 13e-3(g)(6)
and publishes or otherwise disseminates an informational document to
holders of the subject securities. Because more transactions will be
eligible to rely on the exemption from Rule 13e-3 for cross-border
transactions, this rule change may result in additional submissions of
Form CB. If the exemption were not expanded, however, the issuer or
affiliate would be required to comply with the more burdensome filing
requirements of Schedule 13E-3 if the issuer or affiliate sought to
include U.S. security holders in the transaction. We believe the
amended rule and reduced filing requirement will encourage issuers or
affiliates to include U.S. security holders in transactions that
otherwise may have excluded them to avoid complying with Rule 13e-3 and
the corresponding Schedule 13E-3 filing requirements. Domestic or
foreign entities or persons engaged in cross-border business
combination transactions will likely be the respondents to the
collection of information requirements.
    Unlike Schedule 13E-3, Form CB is a notice filing that is little
more than a cover sheet that incorporates offer documents sent to
security holders pursuant to applicable foreign rules in the issuer's
or target's home country. The party furnishing the form must attach an
English translation of the offer materials disseminated abroad. Form CB
must be submitted by the next U.S. business day after that document is
disseminated under home country rules. For purposes of the PRA, we
estimate that the additional burden cost resulting from the amendment
will be zero.
2. Amendments to Form CB, Forms S-4 and F-4, and Schedule TO
    We are adopting amendments to require that all Forms CB, and
accompanying Forms F-X, be filed electronically. A person that is not
already filing reports electronically with the Commission will be
required to obtain access codes to permit the filing of documents on
EDGAR. Registrants, individuals, transfer agents, third-party filers or
their agents must file a Form ID to request the assignment of access
codes that permit the filing of securities documents on EDGAR. This
form enables the Commission to assign an identification number (CIK),
confirmation code, password and password modification authorization
code to each EDGAR filer, each of which is designed to protect the
security of the EDGAR system. While we do not expect that the
amendments will affect the overall collection of information burden of
Forms CB and F-X, we do expect that it will cause additional
respondents to file a Form ID each year and, as a result, will increase
the annual collection of information burden for that form. We estimated
that 65,700 respondents file Form ID each year at an estimated burden
of .15 hours per response, all of which is borne internally by the
respondent for a total annual burden of 9,855 hours. For fiscal year
2007, a total of 189 Form CBs were filed with the Commission. Of those
189 Form CBs, 100 were filed in paper. We expect the amendments will
cause an additional 100 respondents to file a Form ID each year and, as
a result, cause an additional annual burden of 15 hours (100 x .15).
For purposes of the PRA, we estimated that the additional burden cost
resulting from the proposed amendments will be zero.
    We are adopting amendments to the cover page of Forms S-4 and F-4
and Schedule TO that will require the filer to check a box specifying
the applicable cross-border exemption being relied upon in connection
with the transaction. Domestic and foreign persons or entities filing
these documents will be the respondents to the collection of
information requirement. This change will not affect the substantive
obligation to file the forms or schedule. This additional information
will allow the staff to better process such filings and monitor the
application of the cross-border exemptions. The amount of information
required to be included in each Schedule TO and Forms S-4 and F-4 will
change minimally with the addition of a check box. Accordingly, for
purposes of the PRA, our estimate is that the amount of time necessary
to prepare each schedule or form, and hence, the total amount of burden
hours, will not change.
3. Amendments to Schedule 13G
    Exchange Act Schedule 13G is a short-form filing for persons to
report ownership of more than five percent of a class of equity
securities registered under Section 12 of the Exchange Act. Generally,
the filer must certify that the securities have not been acquired and
are not held for the purpose of, or with the effect of, changing or
influencing the control of the issuer of the securities. For purposes
of the PRA, we estimate that compliance with the Schedule 13G
requirements under Regulation 13D requires 98,800 burden hours in
aggregate each year, broken down into 24,700 hours (or 2.6 hours per
respondent) of respondent personnel time and costs of $29,640,000 (or
$3,120 per respondent) for the services of outside professionals.\372\
---------------------------------------------------------------------------

    \372\ These figures assume 9,500 respondents file Schedule 13G
with the Commission annually. We estimate that 25 percent of the
burden of preparation is carried by the company internally and that
75 percent of the burden of preparation is carried by outside
professionals retained by the issuer. These figures estimate an
average cost of $400 per hour for the services of outside
professionals, based on our consultations with several registrants
and law firms and other persons who regularly assist registrants in
preparing and filing with the Commission.
---------------------------------------------------------------------------

    The amendment to Exchange Act Rule 13d-1 will expand the
availability of Schedule 13G to foreign institutions governed by a
regulatory system substantially comparable to the U.S. regulatory
system for domestic institutions. The amendment will allow specified
foreign institutions to report beneficial ownership of more than five
percent of a subject class of securities on Schedule 13G instead of
Schedule 13D. Foreign institutions of the type specified in amended
Rule 13d-1(b) will be the likely respondents to the collection of
information requirements. If the amendment was not adopted, these
institutions either would have to file on Schedule 13D or would be
required to seek no-action letters from the staff to permit them to
file on Schedule 13G to the same extent as their domestic counterparts,
so long as they satisfy certain conditions. Amending the rule will
enable foreign institutions meeting the conditions in the rule to file
the Schedule 13G without seeking a no-action letter. Therefore, the
amended

rule may result in only a slight increase in the number of Schedule 13G
filers.\373\
---------------------------------------------------------------------------

    \373\ Based on the number of no-action requests in this area in
recent years, we believe that approximately three filers per year
will benefit from this proposed change and will avoid the time and
expense of submitting a no-action request to the staff. In addition,
foreign institutions currently filing on Schedule 13D who have not
sought no-action relief to file on Schedule 13G will also benefit by
becoming eligible to use the shorter Schedule 13G. See discussion
above.
---------------------------------------------------------------------------

    For purposes of the PRA, we estimate that the amendments to
Schedule 13G will create an incremental burden of two hours per
response, which we will add to the existing Schedule 13G burden
resulting in a total burden of 117,800 hours.\374\ We note that the
burden associated with the amendments to Schedule 13G initially will be
higher with an estimated burden of five hours. Over time, however, we
believe that on average the burden will lessen and therefore estimate
an incremental burden of two hours per response. Each additional filer
will incur a burden of approximately .50 hours of respondent personnel
time (25 percent of the total burden) and costs of $600 for the
services of outside professionals (75 percent of the total burden). In
sum, we estimate that the amendments to Schedule 13G will increase the
annual paperwork burden by approximately 1.50 hours of respondent
personnel time \375\ and a cost of approximately $1,800 for the
services of outside professionals.\376\
---------------------------------------------------------------------------

    \374\ We currently estimate the burden for preparing a Schedule
13G filing to be 10.4 hours, resulting in a total of 98,800 burden
hours in aggregate each year. If each additional filer incurred an
additional two hours, the resulting burden would be 117,800 total
burden hours ((10.4 hours + two hours) x 9500 respondents).
    \375\ Three additional filers x .50 hours of respondent
personnel time = 1.50 aggregate burden hours.
    \376\ Three additional filers x $600 = $1,800.
---------------------------------------------------------------------------

    We previously have estimated that Schedule 13D has a total burden
of approximately 14.5 hours per response to prepare and is filed by
3,000 respondents annually. For purposes of the PRA, we have estimated
that compliance with the Schedule 13D requirements under Regulation 13D
requires 43,500 burden hours in aggregate each year, broken down into
10,875 hours (or 3.6 hours per respondent) of respondent personnel time
and costs of $13,050,000 (or $4,350 per respondent) for the services of
outside professionals.
    Based upon these estimates, a foreign institution currently filing
a Schedule 13D that will be eligible to file a Schedule 13G pursuant to
the amended rule will benefit from a cost reduction of $630 per
respondent.\377\ As noted above, however, for a number of years, the
staff has provided no-action relief to foreign institutions seeking to
file a Schedule 13G rather than a Schedule 13D. For those institutions
that are already filing a Schedule 13G pursuant to no-action relief,
the amended rules will likely only increase the cost associated with
providing the required certification in Schedule 13G and will not
significantly impact the cost of complying with the requirements of
Regulation 13D.
---------------------------------------------------------------------------

    \377\ We calculate this figure in the following manner: $4,350--
($3,120 + $600) = $630. The total cost burden of Schedule 13G is
estimated currently at an aggregate burden of $29,640,000 or $3,120
per respondent ($29,640,000/9,500 respondents = $3,120).
---------------------------------------------------------------------------

    For purposes of PRA, we estimate that the amendments to Exchange
Act Rule 16a-1 will reduce the number of Form 3 filers by three
respondents, which will reduce the incremental burden by .5 hours per
filer, or 1.5 total hours.\378\ The reduction in three respondents
corresponds with the estimated increase in respondents for Schedule 13G
relying on the new provision for foreign institutions. In addition, we
estimate that the amendments will reduce the number of Form 4 filings
by 3 filings, which will reduce the incremental burden by .5 hours per
filing, or a total of 1.5 total hours.\379\ For purposes of the PRA, we
estimate that the burden cost resulting from the amendments will be
zero.
---------------------------------------------------------------------------

    \378\ We calculate this figure in the following manner: 14,500
hours/29,000 filers = .5 hours reporting burden per filer.
    \379\ We calculate this figure in the following manner: 112,500
hours/225,000 filings annually = .5 hours reporting burden per
filing. Our estimates account for one Form 4 filing per year per
filer.
---------------------------------------------------------------------------

IV. Cost-Benefit Analysis

    We are adopting amendments to our rules that are expected to reduce
the overall cost for issuers and acquirors engaged in cross-border
business combination transactions. We also provide interpretive
guidance regarding the application of certain rules. Under the rule
amendments adopted today, much of the no-action and exemptive relief
sought in the past will be available without the need for no-action or
exemptive letters. As a result, issuers and acquirors will benefit from
an increase in regulatory certainty about the U.S. rules governing
cross-border business combination transactions and a substantial
savings in the cost of preparing letters requesting relief. Decreasing
the burden on acquirors of complying with U.S. rules governing business
combination transactions is designed to encourage them to extend more
transactions to U.S. target holders; therefore, we believe the rule
revisions are in the interests of U.S. investors, while continuing to
provide appropriate protections. We did not receive any comments
regarding the cost of preparing such letters and the amount of time
spent working through concerns raised during the review of such
letters.
    In analyzing the costs and benefits of the revised rules, we
compared estimated future cross-border transaction activity that will
likely occur under the revised rules with what will likely occur in a
benchmark case without the rules.

A. Changes to the Eligibility Test for Determining Eligibility To Rely
on the Cross-Border Exemptions

1. Amendments
a. Adoption of the Alternate Test and Revision To Test for Non-
Negotiated Transactions
    The changes we proposed to the test for determining eligibility to
rely on the cross-border exemptions for business combination
transactions were limited in nature and scope, as are the changes we
are adopting today. The changes are intended to address specific
problems acquirors have faced in determining whether they can rely on
the cross-border exemptions. We are adopting many of the changes as
proposed, but we also are adopting an alternate test for situations in
which an acquiror is unable to conduct the look-through analysis in a
negotiated transaction. The alternative test uses ADTV as one of three
elements that must be satisfied. The alternate test we are adopting
will replace the hostile presumption. We do not believe the amendments
we are adopting will materially affect the cost of undertaking such
transactions because an acquiror will continue to be required to
conduct the look-through analysis in a negotiated transaction, as it is
required to do today. The alternate test will aid acquirors that are
unable to conduct the look-through analysis by permitting them to use
readily available average daily trading volume numbers to determine
eligibility.
    We also proposed limited changes to the manner in which U.S.
ownership may be calculated for cross-border tender offers accomplished
on a non-negotiated or hostile basis. These changes are intended to
clarify certain elements of the former ``hostile presumption'' test,
which are now incorporated into the alternate test, that have created
uncertainty for acquirors in the past. As discussed above, the
alternate test uses public announcement as the reference date when
determining

eligibility to use the exemptions. Finally, in this release and the
amended rules, we provide some guidance on the ``reason to know''
element of the alternate test, which we hope will make the application
of the test simpler and more certain for acquirors.
i. Benefits
    The alternate test we are adopting is expected to reduce costs
involved in certain cross-border transactions. As discussed above, a
bidder will be able to take advantage of the alternate test in
situations where it is unable to conduct the look-through analysis.
This may allow an acquiror to avail itself of an exemption that it
otherwise would not have been able to use due to its inability to
conduct the look-through analysis.
    The relative easing of the burden on potential acquirors is
expected to translate to monetary benefits to U.S. investors. When an
acquiror is unable to conduct the look-through inquiry but is able to
satisfy the alternate test, U.S. investors who own securities of the
target company may benefit from being included in the tender offer and
being eligible to receive tender offer premiums.
ii. Costs
    Although the new alternate test is not designed to increase the
cost of enacting cross-border transactions, there may be economic costs
that arise from the low correlation between ADTV and the level of U.S.
beneficial ownership. There may be an economic cost to U.S. investors
owning securities in a target company if these U.S. investors no longer
receive the Williams Act protection based on the acquiror's reliance on
the alternate test. We believe these costs are balanced by the benefit
of facilitating U.S. participation in the offer as a result of the
availability of the alternate test.
    The staff conducted an empirical analysis on the relationship
between U.S. beneficial ownership and ADTV and found their correlation
to be low.\380\ Based on the transactions considered, the analysis
suggests that the level of trading activity of certain securities in
the United States may not accurately reflect the level of U.S.
beneficial ownership of those securities. In turn, we may have
situations in which U.S. beneficial ownership of a security is high but
its trading activity is low, and vice versa.
---------------------------------------------------------------------------

    \380\ This analysis was based on U.S. beneficial ownership
figures that were reported in no-action requests submitted to the
staff. In those no-action requests, however, the calculation would
have excluded large target security holders, consistent with the
Commission's rules at the time. The memorandum outlining the
analysis appears in the comment file for the Proposing Release, on
our Web site at http://www.sec.gov/comments/s7-10-08/s71008-8.pdf.
---------------------------------------------------------------------------

b. Revised Calculation Date and Inclusion of More Than 10 Percent
Holders
    Acquirors will now be permitted to calculate the required U.S.
beneficial ownership figure within a range of dates that is no more
than 60 days before announcement of the transaction and no more than 30
days after the announcement. Before today's amendments, the calculation
was required to be done as of the 30th day before commencement of a
cross-border business combination transaction. The revision to allow a
range of dates is expected to provide acquirors with additional
flexibility in structuring transactions and availing themselves of the
cross-border exemptions.
    Additionally, under the amended rules, the calculation of U.S.
beneficial ownership for the look-through analysis will include the
securities held by security holders who own more than 10 percent of the
target securities. Because we are changing the manner in which the
ratio must be calculated, the amendment will result in a change in the
transactions that will qualify for the exemption. In most cases, as
noted above, this amendment will increase the availability of the
exemptions. It is possible, however, that under the amended rules
transactions that may have qualified for an exemption previously may no
longer qualify. Specifically, the amendment eliminates any possibility
of relying on the Tier I exemption in cases where there is at least one
U.S. security holder who owns more than 10 percent of the target
securities. A similar situation could arise in which transactions that
previously would have qualified for the Tier II exemptions no longer
qualify, if there were an unusually large proportion of large U.S.
target security holders. Nevertheless, based on our experience and the
comment letters received, we believe that the practical effect is to
increase the number of transactions that will qualify for exemption.
i. Benefits
    We anticipate that the enhanced flexibility to choose a date within
a range may make it easier for acquirors to accomplish the required
calculation as specified under our rules, thereby promoting use of the
exemptions and the inclusion of U.S. holders while reducing the
acquirors' burden of seeking no-action or exemptive letters in this
area. Allowing the calculation of U.S. ownership to be conducted within
60 days before public announcement of the transaction will enable
acquirors to perform the calculation as of a date when the target's
security holder base may be unaffected (or less affected, if there are
some changes in response to rumors in the market) by the announcement
of the transaction, which is expected to provide a more accurate
picture of the security holder base. This change also will allow
acquirors more flexibility in planning cross-border business
combination transactions, and therefore we expect bidders will be
encouraged to engage in these transactions. Additionally, extending the
range for calculation of U.S. ownership to no more than 30 days after
public announcement is expected to benefit acquirors who, for
confidentiality reasons, wish to announce a business combination
transaction prior to conducting a calculation of U.S. ownership. It is
unclear whether using public announcement as the reference point for
the calculation will have the effect of increasing or reducing U.S.
ownership in the target company.
    To the extent that inclusion of large target security holders in
the calculation of U.S. beneficial ownership will allow for a number of
new foreign private issuers to qualify for exemption, the amended rules
provide an economic benefit both to U.S. investors and potential
acquirors. In particular, primary benefits will accrue to U.S.
shareholders of target securities in which U.S. investors hold a
relatively large fraction of the securities held by small security
holders but a relatively small fraction of securities held by large
security holders. In such cases, the securities may not have been
eligible for exemption under the prior rules, but will now be eligible.
Because all shares held by U.S. investors represent U.S. aggregate
economic interest, this extension of the exemption is a benefit to U.S.
investors because it may encourage bidders to include U.S. security
holders in their offers that otherwise would not have done so.
    Even cases where transactions that previously would have qualified
for an exemption no longer qualify for it could offer an economic
benefit to U.S. investors. The presence of a U.S. investor who is a
large target security holder indicates that U.S. investors collectively
own a significant portion of the securities. Therefore, it is in the
potential bidder's interest to include them in the transaction despite
the cost of complying with the Williams Act rules. In this case, U.S.
investors will gain from additional disclosure of information from the
bidder. This

expected benefit will dissipate, however, if the bidder chooses to
exclude U.S. holders from the offer.
ii. Costs
    The amendments also will impose additional costs, but these costs
are expected to be borne mainly by potential bidders. As explained
above, when large U.S. holders own a sufficiently large proportion of
the target securities, the transaction may no longer qualify for the
previously available exemption. For the reasons discussed above, we
believe that where there are significant U.S. holdings, potential
bidders are likely to continue to include U.S. shareholders in their
transactions in order to gain control of the majority of securities. It
is possible, however, that in some cases there would be a cost to U.S.
investors, if the bidder excluded them from the transaction.
    Under the amendments, U.S. investors may lose certain protections
under the U.S. rules governing cross-border business combination
transactions if the foreign private issuer in which they own securities
becomes the subject of such a transaction and the acquiror relies on
the cross-border exemptions. To the extent that the applicable cross-
border exemptions will exempt the acquiror from compliance with U.S.
registration, filing and disclosure requirements, U.S. investors will
lose these protections. In such circumstances, however, we believe that
the benefit to U.S. investors of being included in the transaction
rather than being excluded justifies the cost of reduced protections
under U.S. law. Otherwise, we do not believe that U.S. investors will
be harmed by the flexibility in calculation of U.S. ownership.

B. Changes to the Tier I Exemption

1. Expansion of the Tier I Exemption From Exchange Act Rule 13e-3
    We are expanding the set of cross-border business combination
transactions that are exempt from the requirements of Rule 13e-3.
Before these amendments, the cross-border exemption from Rule 13e-3
applied only to tender or exchange offers or business combinations
conducted under Tier I. We are amending the exemption to encompass any
kind of affiliated transaction that otherwise meets the conditions of
the Tier I exemption, including schemes of arrangement, cash mergers,
compulsory acquisitions for cash, and other types of transactions.
a. Benefits
    The expansion of the Tier I exemption from Rule 13e-3 will likely
result in fewer filings of Schedule 13E-3, thus reducing the costs for
issuers and affiliates in cross-border transactions that would
otherwise be subject to those rules. As we noted in the Proposing
Release, under the rules before today's amendments, the burden of
complying with Rule 13e-3 and Schedule 13E-3 may be greater for foreign
filers than domestic filers.\381\ Foreign filers may not have a
counterpart to these rule provisions in their home jurisdiction and may
not be subject to the same fiduciary duty standards that form the basis
for this heightened disclosure system for affiliated transactions.
---------------------------------------------------------------------------

    \381\ See discussion in the Proposing Release, Section V.B.1.a.
---------------------------------------------------------------------------

    Before the amendment we are adopting today, some entities engaged
in affiliated cross-border business combination transactions would have
been subject to Rule 13e-3 unless they requested individual exemptive
relief. These requests have routinely been granted. To the extent that
these kinds of requests will no longer be necessary as a result of the
rule revision we adopt today, the revision will result in reduced costs
for these entities. Issuers and affiliates may have excluded U.S.
holders from transactions where they would have been required to file a
Schedule 13E-3. We have been told that entities may have avoided making
an offer to U.S. holders to avoid application of these rules, although
it is difficult to isolate the effect of this provision on the number
of entities that chose not to include U.S. holders. During 2007,
approximately 110 Schedules 13E-3 were filed, 10 of which were filed by
foreign private issuers. During that same period, no requests for
relief on this issue were granted. Therefore, we expect the overall
effect would not be significant, although the number of transactions
that may have been structured to avoid U.S. jurisdictional means would
not be reflected by filings on Schedule 13E-3. We believe the rule
amendment will result in a cost reduction because it will lower the
costs and burdens associated with extending these kinds of transactions
into the United States. This amendment will be in the interests of U.S.
investors to the extent that the expanded exemption from Rule 13e-3
motivates an acquiror to include U.S. investors in the transaction.
Because the exemption applies only where U.S. security holders make up
no more than 10 percent of the subject security holder base, and
because the heightened disclosure requirements of Schedule 13E-3 may be
onerous for foreign filers, we believe this exemption may result in
more cross-border transactions being extended to U.S. investors.
b. Costs
    U.S. investors of foreign private issuer targets in cross-border
business combination transactions that would have been subject to Rule
13e-3 but for our rule amendment will lose the benefits of the
disclosure in Schedule 13E-3, to the extent that such disclosure is not
required under applicable foreign law. This cost is mitigated by the
fact that, without the exemption, U.S. holders may be excluded from the
transaction.
    We sought data regarding the number of Schedules 13E-3 filed with
respect to the securities of foreign private issuers, the number of
entities or persons that the proposed rule amendment would affect, and
the increases or decreases in cost that are likely to result, so we
could attempt to estimate the costs and benefits associated with any
possible reduction of Schedule 13E-3 filings. We did not receive any
data from commenters in response to our request. Based on the number of
Schedules 13E-3 filed by foreign private issuers in 2007, we do not
expect the overall impact to be significant, although the number of
transactions that may have been structured to avoid U.S. jurisdictional
means would not be reflected by filings on Schedule 13E-3.
2. Technical Change to Rule 802 of Regulation C
    We are adopting technical changes to the language of Rule 802.
These changes are not intended to substantively change the filing
obligations under the current rule, and we do not believe they will
have any impact on the way that rule currently functions, except to
clarify how it may be used. Therefore, the change will minimally affect
costs and benefits.

C. Changes to the Tier II Cross-Border Exemptions

    The rule changes we adopt today represent an expansion of the
cross-border exemptions available to tender offers that meet the
conditions outlined in the rules. The Tier II exemptions previously
applied to tender offers conducted by third parties, issuers or
affiliates, where those tender offers are subject to Rule 13e-4 or
Regulation 14D. Today's amendments will expand the relief provided in
the Tier II exemptions to address areas of frequent conflict between
U.S. and foreign law or practice

for which individual relief is frequently requested, and will clarify
that the Tier II exemptions also may be used for cross-border tender
offers subject only to Regulation 14E of the Exchange Act. We also are
expanding Tier II relief for dual offers by allowing offerors to make
more than one concurrent non-U.S. offer, and to allow certain U.S.
offers to include non-U.S. persons and certain foreign offers to
include U.S. persons. Additionally, we are adopting changes to Rule
14e-5 to codify recent exemptive relief for Tier II-eligible tender
offers.
1. Benefits
    These changes to the Tier II cross-border exemptions will expand
the relief provided for eligible cross-border tender offers.\382\ The
rule changes will reduce the need for bidders to seek individual no-
action or exemptive relief from the staff. Since they represent areas
in which relief is most frequently requested and granted for these
kinds of transactions, the changes will reduce the associated costs and
burdens of applying for relief. Where we already have reduced the
associated costs and burdens of requesting and granting relief through
Rule 14e-5 class exemptive letters, the codification of that relief in
rule text benefits market participants by modernizing the rule and
enhancing its utility by providing one readily-accessible location for
exempted activities. Because the rule changes will make it easier to
make purchases outside of a U.S. tender offer in a manner consistent
with relief frequently granted in this area, we believe the changes
also will have the effect of encouraging acquirors and bidders to
extend cross-border tender offers to U.S. target holders on the same
terms as all other target security holders.
---------------------------------------------------------------------------

    \382\ See the discussion above regarding the changes to the
threshold eligibility determination relating to the calculation of
U.S. ownership.
---------------------------------------------------------------------------

    To the extent that some of the relief codified in today's rule
changes was not contemplated in the 1999 Cross-Border Adopting Release
and came about only as a result of the staff's issuance of no-action
and exemptive letters, we have analyzed the benefits and costs of the
proposed revisions against the rules adopted in 1999 rather than
against the perceived state of the rules as created by the issuance of
no-action relief. When the Tier II exemption was adopted in 1999, by
its terms it only applied to tender offers subject to Rule 13e-4 or
Regulation 14D. We are expanding the Tier II exemption to apply equally
to cross-border tender offers governed by Regulation 14E only. By
expanding the Tier II exemption to cover such offers, the changes we
are adopting today will allow more acquirors to take advantage of the
exemption and thus allow more U.S. investors to benefit from being
included in the offer. Expanding the category of offers for which Tier
II relief is granted also will allow more flexibility in structuring
offers and encourage more acquirors to take advantage of the exemption.
Similarly, the changes to the Tier II relief for dual offers and the
changes to Rule 14e-5 are intended to address certain foreign
regulatory conflicts that were not fully appreciated when the Tier II
exemption was adopted in 1999. By revising our rules to address these
conflicts, we expect to enhance the applicability of the Tier II
exemptions and the exemptions to Rule 14e-5 and therefore encourage
more acquirors to take advantage of the exemptions and include U.S.
holders in cross-border transactions.
2. Costs
    As with transactions governed by Regulation 14D and Rule 13e-4, the
cost of reducing the protections of the Williams Act may include
reduced procedural and informational safeguards for U.S. investors;
however, the exemptions have been designed to reduce such a
possibility. We are not aware of any other cost that will be incurred
by expanding Tier II relief to tender offers governed by Regulation 14E
only. In addition, because these amendments will not change the filing
obligations of acquirors, investors would not lose the benefits of any
required disclosure. The amendments we are making to Tier II do not
affect the registration requirements of Section 5 of the Securities
Act, which are not covered by these exemptions.
    The codification of Rule 14e-5 class exemptive letters into rule
text is not expected to increase costs to market participants, as the
substance of the relief is not being altered. Instead, the mechanism
for the relief is being changed from class exemptive letters to rule
exemptions. While permitting purchases outside of a tender offer might
negatively impact U.S. investors by weakening the equal treatment and
proration protections of our rules, we believe that the conditions
imposed on the ability to purchase outside of a Tier II tender offer
under the revised rules will help to safeguard the interests of U.S.
security holders.

D. Expanded Availability of Early Commencement

1. Amendment to Securities Act Rule 162
    The amendments we adopt today will expand the ability to commence
an exchange offer before the registration statement filed with respect
to the securities offered is declared effective by the Commission. Our
previous rules permitted ``early commencement'' only where an exchange
offer was subject to Rule 13e-4 or Regulation 14D. For tender offers
conducted under Tier II, we proposed to extend the option to all
exchange offers, so long as withdrawal rights and other protections
were provided to the same extent as would be required under Rule 13e-4
or Regulation 14D. We solicited comment regarding whether the ability
to early commence should be extended to domestic offers as well.
Commenters supported the proposed extension of early commencement to
all exchange offers conducted under Tier II. They also supported
extending early commencement to domestic offers. As adopted, the rules
will permit early commencement for both cross-border and domestic
exchange offers.
a. Benefits
    We believe the rule amendments will further harmonize the treatment
of exchange offers and cash tender offers by eliminating the timing
disparity between the commencement of cash tender offers and stock
tender offers. Domestic and foreign bidders that may have used a cash
tender offer for a transaction due to timing concerns may benefit from
elimination of the timing disparity. The amendments will not impact the
filing and disclosure obligations of the acquiror under the Securities
Act, or the requirement to comply with the tender offer rules in
Regulation 14E. Because foreign law may provide that a tender offer for
one class of securities will trigger an obligation to make a
contemporaneous offer for a related class, this rule change could
enhance the ability of such exchange offers to commence early, and
therefore may enhance the speed with which such offers may be effected.
The amendment to Tier II also may allow combined offers to compete with
cash bids.
    When used, the rule will provide the benefit to investors of
receiving withdrawal rights when they otherwise would not have been
required under U.S. rules. The rule amendment also may cause offerors
to extend an exchange offer to U.S. target security holders, where
concerns about delays

arising from the U.S. registration process might otherwise have caused
them to exclude U.S. investors.
b. Costs
    As discussed above, allowing an early commencement option for an
exchange offer may result in additional informational costs in some
circumstances. To the extent that an offeror commences early and
disseminates offer materials upon the filing of the underlying
registration statement, it may receive staff comments after
dissemination. This may present increased costs for offerors who must
recirculate in circumstances where they have elected to commence their
offer early, before the staff comment process (where applicable) is
complete.

E. Changes to Forms and Schedules

    We are adopting changes to the manner in which several forms and
schedules are filed. We are requiring that all Form CBs, and Form F-Xs
filed in connection with a Form CB, be filed electronically. A Form F-X
filed in connection with a Form CB must be filed electronically under
the same circumstances.
    In addition, we proposed to add a box to the cover page of Schedule
TO and Forms S-4 and F-4 where the filing person would specify the
applicable cross-border exemption or exemptions being relied upon to
conduct the applicable transaction.\383\ We are adopting the amendments
to those forms as proposed. Under the revised rules, filers relying on
the Tier II cross-border exemptions and filing a Schedule TO will be
required to indicate which, if any, cross-border exemption they are
relying on in conducting their tender offer.
---------------------------------------------------------------------------

    \383\ The cover page of Form CB already requires disclosure of
this information. However, Form CB needs to be filed only for some
cross-border transactions, and only for those conducted under Tier I
or Securities Act Rules 801 or 802.
---------------------------------------------------------------------------

    Similarly, filers of Form S-4 or F-4 that are conducting a cross-
border transaction under the Tier II exemptions will be required to
specify the cross-border exemption claimed on the cover page of those
forms. In some cases, they also may be filing a Schedule TO, where the
exchange offer is subject to Rule 13e-4 or Regulation 14D. In some
instances, such as where an exchange offer commences early, a Form S-4
or F-4 may be filed before Schedule TO. It would be helpful for the
staff to have this information at the earliest possible time in the
offering process; therefore, we are adopting the requirement for Forms
S-4 and F-4 as well. The changes we are making to Schedule TO and Forms
S-4 and F-4 will have no impact on the obligation of an offeror to file
those forms.
1. Benefits
    Requiring electronic filing of all Form CBs will benefit investors
because these Forms will be more easily accessible. Form CBs currently
submitted in paper form may be accessed through our public reference
room. Electronic filing will make Form CB accessible to investors more
easily and more quickly.
    As to the information sought in Form S-4 or F-4 or Schedule TO, we
believe this information will serve an important function for purposes
of the staff review process and also will benefit filers. Currently,
the staff may not be aware when reviewing a registration statement or
tender offer statement that the filer is relying upon an applicable
cross-border exemption to modify the terms of its offer. Consequently,
the staff may not know whether non-compliance with all the rules that
would govern a particular transaction is a matter that the staff should
pursue through the comment process. Providing this information when the
Form S-4 or F-4 or Schedule TO is initially filed will eliminate the
need for the staff to issue, and the bidder to respond to, unnecessary
comments based on a lack of knowledge about reliance on a cross-border
exemption.
2. Costs
    We believe the costs associated with the changes to Schedule TO and
Forms S-4 and F-4 will be minimal. As discussed above, these changes
will not impact the obligation to file the schedule or form, nor will
they change the substantive disclosure required. Filers will already
know whether, and if so, what cross-border exemption they will rely
upon in conducting their transaction. The change will require them only
to specify that information for the benefit of the staff and others
viewing the filings.
    We received two comments in response to the proposal to require e-
filing of Form CB. One commenter argued against requiring electronic
filing due to the ``costs and practical issues.'' \384\ Another
commenter cautiously supported the proposed changes but expressed
concern with the possible deterrent effects of such requirements, such
as potential hardships and liability arising from widespread
availability of the filings on EDGAR.\385\ While we understand the
commenters' concerns, we do not believe that requiring the electronic
submission of Form CB and the accompanying Form F-X will be a
significant burden and therefore we are adopting the revisions as
proposed. We note that in situations in which the electronic submission
poses a significant burden, a hardship exemption is available.
Additionally, the Form CB is furnished, not filed, and therefore not
subject to Section 18 liability. With regard to the concern about
widespread availability on EDGAR, investors can see that a Form CB has
been filed when they view a company's filings on EDGAR, although they
cannot view the actual document. They can request a copy of the
submission from the public reference room. Therefore, we do not believe
that requiring electronic submission of the forms should increase the
potential liability issues. We do not expect these amendments to
materially affect the cost burden of these forms.
---------------------------------------------------------------------------

    \384\ Letter from S&C.
    \385\ Letter from ABA.
---------------------------------------------------------------------------

F. Changes to the Beneficial Ownership Reporting Rules

    We are amending the beneficial ownership rules to allow foreign
institutions of the same type as the domestic institutions listed in
Exchange Act Rule 13d-1(b)(1)(ii) to file on Schedule 13G instead of
Schedule 13D. The revised rule will permit specified types of
institutions to file on Schedule 13G, where those institutions have
acquired securities in the ordinary course of their business and not
with the purpose or effect of changing or influencing control of the
issuer of the subject securities. In order to use Schedule 13G to the
same extent as their U.S. counterparts, these foreign ``qualified
institutional'' filers also will have to meet the conditions specified
in the revised rule and Schedule 13G. The conditions set forth in the
rule and the certification now included in Schedule 13G codify the
conditions previously contained in the staff's no-action letters. One
such condition is the requirement to certify that the regulatory scheme
applicable to that type of institution in its home country is
substantially comparable to the regulatory system applicable to its
U.S. counterpart. Another such condition is an undertaking to provide
to the Commission staff, upon request, the information that would have
been required under Schedule 13D.
1. Benefits
    The staff commonly grants no-action requests from foreign
institutions comparable to the types of institutions listed in Rule
13d-1(b)(1)(ii) to file on Schedule 13G if they meet the

conditions outlined in the no-action letters. The release adopting
amendments to the beneficial ownership rules in 1998 discussed the fact
that in the past, foreign institutional investors requested exemptive
and no-action letters.\386\ The release also stated that foreign
institutions that wanted to use Schedule 13G as a qualified
institutional investor should continue to request no-action relief from
the staff. Because the staff's issuance of no-action letters was
contemplated at the time of the 1998 amendments to the beneficial
ownership rules, we only consider the costs and benefits of the
proposed rule relevant to the staff's current practice of issuing no-
action letters. From this perspective, the rule change would eliminate
the costs and burdens on foreign institutions of seeking such relief
individually. For foreign institutions that would otherwise have been
eligible to file on Schedule 13G as passive investors under the current
rules, filing under Rule 13d-1(b) reduces the burden on those filers
because the initial filing obligation is less onerous for qualified
institutional filers. For example, qualified institutions filing under
Rule 13d-1(b) are required to file a Schedule 13G within 45 days after
the end of the calendar year in which they own over five percent of the
subject class as of the last day of that year. By contrast, passive
investors reporting on Schedule 13G pursuant to Rule 13d-1(c) must file
their initial report within ten days of the acquisition of more than
five percent of the class. Unlike qualified institutional filers,
passive investors may not file on Schedule 13G when their ownership
equals or exceeds 20 percent of the subject class. No such limit exists
for qualified institutional filers.
---------------------------------------------------------------------------

    \386\ See Amendments to Beneficial Ownership Reporting
Requirements, Release No. 34-39538 (January 12, 1998) [63 FR 2854].
---------------------------------------------------------------------------

2. Costs
    Schedule 13D requires more extensive disclosure than Schedule 13G.
Therefore, to the extent that a filer taking advantage of the rule
revisions otherwise would be required to file a Schedule 13D (or a
Schedule 13G as a passive investor), there may be some information cost
to U.S. investors by permitting the filer to use Schedule 13G. For
instance, Schedule 13D requires information about the purpose of the
beneficial owner's transaction in the securities, investment intent,
and sources of funding. To the extent that such information may be of
value to investors in making informed investment decisions, there will
be a cost in permitting these institutions to file on Schedule 13G. We
sought comment on the usefulness to investors of requiring these
foreign institutions to file on Schedule 13D; however, we did not
receive any comments in response to our request. We believe that
investors will be able to obtain useful information from Schedules 13G
filed by foreign institutions that acquire securities in the ordinary
course of business and not with the purpose or effect of influencing
control of the issuer. We do not believe the reduction of the amount of
information filed by these institutions will be detrimental to
investors because such institutions will not have the purpose or effect
of influencing control of the issuers in which they hold securities.
Thus, some of the additional information that would be required by
Schedule 13D would be inapplicable.
    Foreign institutions wishing to take advantage of the rule change
will incur certain costs to satisfy the conditions for filing on
Schedule 13G. In particular, foreign institutions will need to assess
whether their home country regulatory scheme is substantially
comparable to the regulatory scheme applicable to their U.S.
counterparts. This might involve seeking the advice of home country or
U.S. legal counsel. However, we believe the incremental costs of
complying with the revised rule will be minimal because foreign
institutions are commonly granted no-action relief to file on Schedule
13G under the same circumstances as permitted under the new rule.
    We also are adopting a corresponding change to Exchange Act Rule
16a-1(a)(1) to include the foreign institutions eligible to rely on
Rule 13d-1(b)(1)(ii)(J) in response to two commenters who requested it;
\387\ such a change would be consistent with the agency's regulatory
history of aligning the scope of these two rules. Rule 16a-1(a)
includes the definition of beneficial ownership for purposes of
determining who is a more than 10 percent beneficial owner for purposes
of Exchange Act Section 16. Rule 16a-1(a)(1) allows the institutions
identified in the rule to exclude from 10 percent ownership
calculations the shares they hold for the benefit of third parties or
in customer or fiduciary accounts in the ordinary course of business,
without the purpose or effect of changing control of the issuer, nor in
connection with or as a participant in any transaction that has such a
purpose or effect, including any transaction subject to Rule 13d-3(b).
Similar to the change to Rule 13d-1(b)(1)(ii)(J), the change we are
adopting to Rule 16a-1(a)(1) may have an information cost to U.S.
investors because it will exempt certain foreign institutions from
Section 16(a) reporting. We do not believe the reduction of the amount
of information filed by these institutions will be detrimental to
investors because investors will have access to the information
provided by these institutions in Schedule 13G.
---------------------------------------------------------------------------

    \387\ See letters from ABA and S&C.
---------------------------------------------------------------------------

V. Consideration of Impact on Economy, Burden on Competition and
Promotion of Efficiency, Competition and Capital Formation

    Section 2(b) of the Securities Act \388\ and Section 3(f) of the
Exchange Act \389\ require us, when engaged in rulemaking, to consider
or determine whether an action is necessary or appropriate in the
public interest, and to consider, in addition to the protection of
investors, whether the action will promote efficiency, competition, and
capital formation. When adopting rules under the Exchange Act, Section
23(a)(2) of the Exchange Act \390\ requires us to consider the impact
that any new rule would have on competition. In addition, Section
23(a)(2) prohibits us from adopting any rule that would impose a burden
on competition not necessary or appropriate in furtherance of the
purposes of the Exchange Act.
---------------------------------------------------------------------------

    \388\ 15 U.S.C. 77b(b)
    \389\ 15 U.S.C. 78c(f).
    \390\ 15 U.S.C. 78w(a)(2).
---------------------------------------------------------------------------

    The amendments generally are expected to enhance efficiency in
conducting cross-border tender offers and business combination
transactions by streamlining the application of U.S. and foreign rules
that may apply to those transactions. We expect that they will promote
capital formation by facilitating cross-border business combination
transactions conducted under multiple, and possibly conflicting,
regulatory systems. Some of the rule revisions, such as the changes
that broaden the availability of early commencement for exchange offers
and the applicability of the Tier II exemptions for tender offers not
subject to Exchange Act Rule 13e-4 or Regulation 14D, may be viewed as
enhancing competition between competing offers for the same target
securities, because they will make these provisions available to
different kinds of offers. Furthermore, the rule changes are expected
to reduce the regulatory burden on entities engaging in cross-border
business combination transactions generally, which may promote
competition by encouraging additional entities to engage in these types
of transactions.

    The changes to the test for determining eligibility to rely on the
Tier I and Tier II cross-border exemptions and Securities Act Rule 802
under Regulation C are intended to facilitate the application of those
exemptions. When the exemptions were adopted in 1999, we determined
that the cross-border exemptions would serve to promote the inclusion
of U.S. investors in transactions required to be conducted in
accordance with a foreign regulatory system. The amendments we adopt
today enhance the utility of the exemptions by addressing recurring
conflicts between U.S. law and foreign law and practice.
    The purpose of the amendment to Exchange Act Rule 13e-3(g)(6) is to
expand the exemption from Rule 13e-3 for cross-border transactions
meeting the conditions of Tier I. This amendment is expected to reduce
regulatory compliance burdens for issuers and affiliates engaged in
affiliated cross-border transactions that would otherwise be subject to
Rule 13e-3. The ability to avoid the application of Rule 13e-3 for
certain cross-border transactions is expected to benefit U.S.
investors, because an issuer or affiliate may choose to exclude them if
that is the only means to avoid the heightened disclosure burdens of
Rule 13e-3. This amendment may increase efficiency for issuers and
affiliates engaged in cross-border transactions because they will be
able to use transaction structures that are common abroad but that were
not permitted under the exemption before these amendments.
    The purpose of the changes to the Tier II tender offer exemptions
in Exchange Act Rules 13e-4(i), 14d-1(d) and 14e-5 is to expand those
exemptions to better address areas of recurring regulatory conflict. By
codifying relief previously granted for individual transactions, the
changes are expected to reduce compliance burdens on issuers and
bidders who no longer need to seek such relief for each individual
transaction. By enhancing the flexibility of U.S. tender offer rules in
cross-border transactions, where those rules conflict with common
elements of foreign law or practice, we believe the changes will
increase the likelihood that bidders will include U.S. investors in
these transactions.
    We do not anticipate that the changes to Rule 14e-5 will have a
significant impact, if any, on the economy because they codify the
current scope of activities exempted from that rule's prohibitions
through existing class exemptive letters. We believe that the changes
to Rule 14e-5 likely will not place any burden on competition, as the
rule changes apply equally to all market participants covered by the
rule. We believe that the Rule 14e-5 class exemptive letters concerning
Tier II cross-border transactions have promoted efficiency and capital
formation by eliminating the time and cost burdens associated with
individual grants of relief. We believe that the codification of those
letters similarly will foster efficiency and cross-border capital
formation.
    The amendment to Securities Act Rule 162(a), expanding the ability
of offerors to commence an exchange offer early where a tender offer is
not subject to Regulation 14D or Rule 13e-4, is expected to further
equalize the regulatory burden between cash tender offers and exchange
offers, thereby promoting competition. Because foreign rules often
contain a mandatory offer requirement, obligating an offeror to make a
tender offer for a given class of securities, these rule changes likely
will place mandatory offers for unregistered classes of securities on
an equal footing with offers for registered equity securities. The
ability of offerors to commence an exchange offer early is being
extended to domestic offers as well. This change likely will equalize
the regulatory burden between cash tender offers and exchange offers in
the United States.
    The changes to Schedule TO and Forms S-4 and F-4 will likely
improve efficiency because disclosure of the exemptions being relied
upon by the bidder will aid the staff in its review of these documents
and likely eliminate staff comments based upon assumptions as to the
exemption being relied upon by the bidder.

VI. Final Regulatory Flexibility Act Analysis

    This Final Regulatory Flexibility Act Analysis has been prepared in
accordance with the Regulatory Flexibility Act.\391\ It relates to
revisions to the rules and forms that we are adopting today.\392\ An
Initial Regulatory Flexibility Act Analysis was prepared in accordance
with the Regulatory Flexibility Act and included in the Proposing
Release.
---------------------------------------------------------------------------

    \391\ 5 U.S.C. 601.
    \392\ Based on an analysis of the language and legislative
history of the Regulatory Flexibility Act, Congress does not appear
to have intended the Act to apply to foreign issuers. Therefore, we
are analyzing the impact on small U.S. entities only.
---------------------------------------------------------------------------

A. Need for the Amendments

    These amendments are necessary to facilitate the inclusion of U.S.
target security holders in cross-border business combination
transactions. The rule changes are expected to result in further
reductions in the cost and burdens associated with including U.S.
target holders in those transactions. U.S. target holders previously
excluded from such transactions will benefit by having additional
transactions extended to them.
    The rule changes are incremental in nature and are not a
significant departure from the previous cross-border exemptions. The
changes further harmonize U.S. and foreign law and practice, and
facilitate greater inclusion of U.S. target holders in cross-border
transactions. In many instances, the changes codify existing
interpretations and exemptive relief. We do not believe any less
restrictive alternative to the rule amendments exists that would serve
the purpose of the tender offer and registration requirements of the
federal securities laws. We did not identify alternatives to the rule
amendments that are consistent with their objectives and our statutory
authority. The amended rules do not duplicate or conflict with any
existing federal rule provisions.

B. Significant Issues Raised by Public Comments

    An Initial Regulatory Flexibility Analysis was prepared in
accordance with the Regulatory Flexibility Act in connection with the
Proposing Release, and we solicited comments on any impact the proposed
changes might have on small entities. We did not receive any public
comments that responded directly to the IRFA or that dealt directly
with the proposal's impact on small entities.

C. Small Entities Subject to the Final Amendments

    The Regulatory Flexibility Act defines ``small entity'' to mean
``small business,'' ``small organization,'' or ``small governmental
jurisdiction.'' \393\ The Commission's rules define ``small business''
and ``small organization'' for purposes of the Regulatory Flexibility
Act for each of the types of entities regulated by the Commission.\394\
A ``small business'' and ``small organization,'' when used with
reference to an issuer other than an investment company, generally
means an issuer with total assets of $5 million or less on the last day
of its most recent fiscal year. We estimate that there are
approximately 1,100 issuers that may be considered reporting small
entities.\395\

The revised rules may affect each of the approximately 1,100 issuers
that may be considered reporting small entities. The number of
reporting or non-reporting small businesses that actually rely on the
revised rules, or may otherwise be impacted by the rule revisions, will
depend on many factors. Acquirors relying on the exemptions may or may
not have reporting obligations under the Exchange Act before engaging
in a cross-border business combination transaction. An acquiror's
ability to rely on the exemptions is not determined by the acquiror's
size or market capitalization; however, we believe that small
businesses are not typically acquirors in cross-border transactions. We
believe that the amendments likely will result in savings to entities
(both small and large) that qualify for the exemptions.
---------------------------------------------------------------------------

    \393\ 5 U.S.C. 601(6).
    \394\ Securities Act Rule 157 [17 CFR 230.157] and Exchange Act
Rule 0-10 [17 CFR 240.0-10] contain the applicable definitions.
    \395\ The estimated number of reporting small entities is based
on 2007 data, including the Commission's EDGAR database and Thomson
Financial's Worldscope database.
---------------------------------------------------------------------------

D. Reporting, Recordkeeping and Other Compliance Requirements

    The amended rules do not impose any new reporting, recordkeeping or
other compliance requirements on small entities.

E. Agency Action To Minimize Effect on Small Entities

    The Regulatory Flexibility Act directs the Commission to consider
significant alternatives that would accomplish the stated objective,
while minimizing any significant adverse impact on small entities. In
connection with the amendments adopted today, the Commission considered
the following alternatives: (i) The establishment of differing
compliance or reporting requirements or timetables that take into
account the resources of small entities; (ii) the clarification,
consolidation or simplification of compliance and reporting
requirements under the rule for small entities; (iii) the use of
performance rather than design standards; and (iv) an exemption from
coverage from the amendments, or any part thereof, for small entities.
Our objective in adopting the amendments is to facilitate the inclusion
of U.S. holders in cross-border business combinations. While we
considered the above alternatives to accomplish our stated objective,
we believe that different compliance or reporting requirements are not
necessary because the amendments do not establish any new reporting,
recordkeeping, or compliance requirements for small entities.
Establishing a different standard for small business entities would
impose a greater compliance burden on small entities and would be
inconsistent with the benefits provided for all entities that are able
to avail themselves of the exemptions.

VII. Statutory Basis and Text of Amendments

    We are amending the forms and rules under the authority set forth
in Sections 3(b), 7, 8, 9, 10, 19 and 28 of the Securities Act, and
Sections 12, 13, 14, 23, 35A, and 36 of the Exchange Act.

List of Subjects in 17 CFR Parts 230, 231, 232, 239, 240, 241, and
249

    Reporting and recordkeeping requirements, Securities.

Text of Amendments

0
For the reasons set out in the preamble, we are amending Title 17,
Chapter II of the Code of Federal Regulations as follows:

PART 230--GENERAL RULES AND REGULATIONS, SECURITIES ACT OF 1933

0
1. The authority citation for part 230 continues to read, in part, as
follows:

    Authority: 15 U.S.C. 77b, 77c, 77d, 77f, 77g, 77h, 77j, 77r,
77s, 77z-3, 77sss, 78c, 78d, 78j, 78l, 78m, 78n, 78o, 78t, 78w,
78ll(d), 78mm, 80a-8, 80a-24, 80a-28, 80a29, 80a-30, and 80a-37,
unless otherwise noted.
* * * * *

0
2. Revise Sec.  230.162 to read as follows:

Sec.  230.162  Submission of tenders in registered exchange offers.

    (a) Notwithstanding section 5(a) of the Act (15 U.S.C. 77e(a)), an
offeror may solicit tenders of securities in an exchange offer before a
registration statement is effective as to the security offered, so long
as no securities are purchased until the registration statement is
effective and the tender offer has expired in accordance with the
tender offer rules, and either:
    (1) The exchange offer is subject to Sec.  240.13e-4 or Sec. Sec.
240.14d-1 through 14d-11 of this chapter; or
    (2) The offeror provides withdrawal rights to the same extent as
would be required if the exchange offer were subject to the
requirements of Sec.  240.13e-4 or Sec. Sec.  240.14d-1 through 14d-11
of this chapter; and if a material change occurs in the information
published, sent or given to security holders, the offeror complies with
the provisions of Sec.  240.13e-4(e)(3) or Sec.  240.14d-4(b) and (d)
of this chapter in disseminating information about the material change
to security holders, and including the minimum periods during which the
offer must remain open (with withdrawal rights) after notice of the
change is provided to security holders.
    (b) Notwithstanding Section 5(b)(2) of the Act (15 U.S.C.
77e(b)(2)), a prospectus that meets the requirements of Section 10(a)
of the Act (15 U.S.C. 77j(a)) need not be delivered to security holders
in an exchange offer that commences before the effectiveness of a
registration statement in accordance with the provisions of Sec.
230.162(a) of this section, so long as a preliminary prospectus,
prospectus supplements and revised prospectuses are delivered to
security holders in accordance with Sec.  240.13e-4(e)(2) or Sec.
240.14d-4(b) of this chapter. This applies not only to exchange offers
subject to those provisions, but also to exchange offers not subject to
those provisions that meet the conditions in Sec.  230.162(a)(2) of
this section.
    Instruction to Sec.  230.162 of this section: Notwithstanding the
provisions of Sec.  230.162 of this section above, for going-private
transactions (as defined by Sec.  240.13e-3) and roll-up transactions
(as described by Item 901 of Regulation S-K (Sec.  229.901 of this
chapter)), a registration statement registering the securities to be
offered must have become effective and only a prospectus that meets the
requirements of Section 10(a) of the Securities Act may be delivered to
security holders on the date of commencement.

0
3. Amend Sec.  230.800 by revising paragraph (h)(1) and(h)(2) and
adding paragraphs (h)(6) and (h)(7) to read as follows:

Sec.  230.800  Definitions for Sec. Sec.  230.800, 230.801 and 230.802.

* * * * *
    (h) * * *
    (1) Calculate the percentage of outstanding securities held by U.S.
holders as of a date no more than 60 days before or 30 days after the
public announcement of a business combination conducted under Sec.
230.802 under the Act or of the record date in a rights offering
conducted under Sec.  230.801 under the Act. For a business combination
conducted under Sec.  230.802, if you are unable to calculate as of a
date within these time frames, the calculation may be made as of the
most recent practicable date before public announcement, but in no
event earlier than 120 days before public announcement.
    (2) Include securities underlying American Depositary Shares
convertible or exchangeable into the securities that are the subject of
the tender offer when calculating the number of subject securities
outstanding, as well as the number held by U.S. holders. Exclude from
the calculation other types of securities that are convertible or

exchangeable into the securities that are the subject of the tender
offer, such as warrants, options and convertible securities. Exclude
from those calculations securities held by the acquiror in an exchange
offer or business combination;
* * * * *
    (6) For exchange offers conducted pursuant to Sec.  230.802 under
the Act by persons other than the issuer of the subject securities or
its affiliates that are not made pursuant to an agreement with the
issuer of the subject securities, the issuer of the subject securities
will be presumed to be a foreign private issuer and U.S. holders will
be presumed to hold 10 percent or less of the outstanding subject
securities, unless paragraphs (h)(7)(i), (ii) or (iii) of this section
indicate otherwise.
    (7) For rights offerings and business combinations, including
exchange offers conducted pursuant to Sec.  230.802 under the Act,
where the offeror is unable to conduct the analysis of U.S. ownership
set forth in paragraph (h)(3) of this section, the issuer of the
subject securities will be presumed to be a foreign private issuer and
U.S. holders will be presumed to hold 10 percent or less of the
outstanding subject securities so long as there is a primary trading
market for the subject securities outside the United States, as defined
in Sec.  240.12h-6(f)(5) of this chapter, unless:
    (i) Average daily trading volume of the subject securities in the
United States for a recent twelve-month period ending on a date no more
than 60 days before the public announcement of the business combination
or of the record date for a rights offering exceeds 10 percent of the
average daily trading volume of that class of securities on a worldwide
basis for the same period; or
    (ii) The most recent annual report or annual information filed or
submitted by the issuer with securities regulators of the home
jurisdiction or with the Commission or any jurisdiction in which the
subject securities trade before the public announcement of the offer
indicates that U.S. holders hold more than 10 percent of the
outstanding subject class of securities; or
    (iii) The acquiror or issuer knows or has reason to know, before
the public announcement of the offer, that the level of U.S. ownership
exceeds 10 percent of such securities. As an example, an acquiror or
issuer is deemed to know information about U.S. ownership of the
subject class of securities that is publicly available and that appears
in any filing with the Commission or any regulatory body in the
issuer's jurisdiction of incorporation or (if different) the non-U.S.
jurisdiction in which the primary trading market for the subject
securities is located. The acquiror in a business combination is deemed
to know information about U.S. ownership available from the issuer. The
acquiror or issuer is deemed to know information obtained or readily
available from any other source that is reasonably reliable, including
from persons it has retained to advise it about the transaction, as
well as from third-party information providers. These examples are not
intended to be exclusive.
* * * * *

0
4. Amend Sec.  230.802 by revising paragraphs (a)(2) and (a)(3) and
removing paragraph (c).
    The revisions read as follows:

Sec.  230.802  Exemption for offerings in connection with an exchange
offer or business combination for the securities of foreign private
issuers.

* * * * *
    (a) * * *
    (2) Equal treatment. The offeror must permit U.S. holders to
participate in the exchange offer or business combination on terms at
least as favorable as those offered any other holder of the subject
securities. The offeror, however, need not extend the offer to security
holders in those states or jurisdictions that require registration or
qualification, except that the offeror must offer the same cash
alternative to security holders in any such state that it has offered
to security holders in any other state or jurisdiction.
    (3) Informational documents. (i) If the offeror publishes or
otherwise disseminates an informational document to the holders of the
subject securities in connection with the exchange offer or business
combination, the offeror must furnish that informational document,
including any amendments thereto, in English, to the Commission on Form
CB (Sec.  239.800 of this chapter) by the first business day after
publication or dissemination. If the offeror is a foreign company, it
must also file a Form F-X (Sec.  239.42 of this chapter) with the
Commission at the same time as the submission of the Form CB to appoint
an agent for service of process in the United States.
    (ii) The offeror must disseminate any informational document to
U.S. holders, including any amendments thereto, in English, on a
comparable basis to that provided to security holders in the foreign
subject company's home jurisdiction.
    (iii) If the offeror disseminates by publication in its home
jurisdiction, the offeror must publish the information in the United
States in a manner reasonably calculated to inform U.S. holders of the
offer.
* * * * *

PART 231--INTERPRETATIVE RELEASES RELATING TO THE SECURITIES ACT OF
1933 AND GENERAL RULES AND REGULATIONS THEREUNDER

0
5. Part 231 is amended by adding Release No. 33-8957 and the release
date of September 19, 2008, to the list of interpretative releases.
* * * * *

PART 232--REGULATION S-T--GENERAL RULES AND REGULATIONS FOR
ELECTRONIC FILINGS

0
6. The authority citation for part 232 continues to read, in part, as
follows:

    Authority: 15 U.S.C. 77f, 77g, 77h, 77j, 77s(a), 77z-3,
77sss(a), 78c(b), 78l, 78m, 78n, 78o(d), 78w(a), 78ll, 80a-6(c),
80a-8, 80a-29, 80a-30, 80a-37, and 7201 et seq.; and 18 U.S.C. 1350.
* * * * *

0
7. Amend Sec.  232.101 by:
0
a. Revising paragraphs (a)(1)(vi) and (a)(1)(vii);
0
b. Removing and reserving paragraph (b)(7); and
0
c. Revising paragraph (b)(8).
    The revisions read as follows:

Sec.  232.101  Mandated electronic submissions and exceptions.

    (a) * * *
    (1) * * *
    (vi) Form CB (Sec. Sec.  239.800 and 249.480 of this chapter) filed
or submitted under Sec.  230.801 or 230.802 of this chapter or Sec.
240.13e-4(h)(8), 240.14d-1(c), or 240.14e-2(d) of this chapter;
    (vii) Form F-X (Sec.  239.42 of this chapter) when filed in
connection with a Form CB (Sec. Sec.  239.800 and 249.480 of this
chapter);
* * * * *
    (b) * * *
    (8) Form F-X (Sec.  232.42 of this chapter) if filed by a Canadian
issuer when qualifying an offering statement pursuant to the provisions
of Regulation A (Sec. Sec.  230.251 230.263 of this chapter); and

PART 239--FORMS PRESCRIBED UNDER THE SECURITIES ACT OF 1933

0
8. The authority citation for part 239 continues to read, in part, as
follows:

    Authority: 15 U.S.C. 77f, 77g, 77h, 77j, 77s, 77z-2, 77z-3,
77sss, 78c, 78l, 78m, 78n, 78o(d), 78u-5, 78w(a), 78ll, 78mm, 80a-
2(a), 80a-3, 80a-8, 80a-9, 80a-10, 80a-13, 80a-24, 80a-26, 80a-29,
80a-30, and 80a-37, unless otherwise noted.

0
9. Form S-4 (referenced in Sec.  239.25) is amended by adding a
statement regarding reliance on the cross-border exemptions and check
boxes on the cover page immediately before the ``Calculation of
Registration Fee'' table to read as follows:

    Note-- The text of Form S-4 does not and this amendment will not
appear in the Code of Federal Regulations.

FORM S-4

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

* * * * *
    If applicable, place an X in the box to designate the appropriate
rule provision relied upon in conducting this transaction:
Exchange Act Rule 13e-4(i) (Cross-Border Issuer Tender Offer) [ballot]
Exchange Act Rule 14d-1(d) (Cross-Border Third-Party Tender Offer)
[ballot]
* * * * *

0
10. Amend Form F-4 (referenced in Sec.  239.34) by adding a statement
regarding reliance on the cross-border exemptions and check boxes on
the cover page immediately before the ``Calculation of Registration
Fee'' table to read as follows:

    Note-- The text of Form F-4 does not and this amendment will not
appear in the Code of Federal Regulations.

FORM F-4

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

* * * * *
    If applicable, place an X in the box to designate the appropriate
rule provision relied upon in conducting this transaction:
Exchange Act Rule 13e-4(i) (Cross-Border Issuer Tender Offer) [ballot]
Exchange Act Rule 14d-1(d) (Cross-Border Third-Party Tender Offer)
[ballot]
* * * * *

0
11. Amend Form F-X (referenced in Sec.  239.42) by revising the Note to
General Instruction II.B.(2) to read as follows:

    Note-- The text of Form F-X does not and this amendment will not
appear in the Code of Federal Regulations.

FORM F-X

APPOINTMENT OF AGENT FOR SERVICE OF PROCESS AND UNDERTAKING

GENERAL INSTRUCTIONS

* * * * *
    II. * * *
    B. * * *
    (2) * * *

    Note: Regulation S-T Rule 101(b)(8) only permits the filing of
the Form F-X in paper if filed by a Canadian issuer when qualifying
an offering statement pursuant to the provisions of Regulation A
(Sec. Sec.  230.251-230.263 of this chapter).

* * * * *

PART 240--GENERAL RULES AND REGULATIONS, SECURITIES EXCHANGE ACT OF
1934

0
12. The authority citation for part 240 continues to read, in part, as
follows:

    Authority: 15 U.S.C. 77c, 77d, 77g, 77j, 77s, 77z-2, 77z-3,
77eee, 77ggg, 77nnn, 77sss, 77ttt, 78c, 78d, 78e, 78f, 78g, 78i,
78j, 78j-1, 78k, 78k-1, 78l, 78m, 78n, 78o, 78p, 78q, 78s, 78u-5,
78w, 78x, 78ll, 78mm, 80a-20, 80a-23, 80a-29, 80a-37, 80b-3, 80b-4,
80b-11, and 7201 et seq.; and 18 U.S.C. 1350, unless otherwise
noted.
* * * * *

0
13. Amend Sec.  240.13d-1 by:
0
a. Revising paragraph (b)(1)(ii)(G) and (J);
0
b. Removing ``and'' from the end of paragraph (b)(1)(ii)(I);
0
c. Adding paragraph (b)(1)(ii)(K); and
0
d. Removing the authority citation following the section.
    The revisions and addition reads as follows:

Sec.  240.13d-1.  Filing of Schedules 13D and 13G.

* * * * *
    (b)(1) * * *
    (ii) * * *
    (G) A parent holding company or control person, provided the
aggregate amount held directly by the parent or control person, and
directly and indirectly by their subsidiaries or affiliates that are
not persons specified in Sec.  240.13d-1(b)(1)(ii)(A) through (J), does
not exceed one percent of the securities of the subject class;
* * * * *
    (J) A non-U.S. institution that is the functional equivalent of any
of the institutions listed in Sec.  240.13d-1 (b)(1)(ii)(A) through
(I), so long as the non-U.S. institution is subject to a regulatory
scheme that is substantially comparable to the regulatory scheme
applicable to the equivalent U.S. institution; and
    (K) A group, provided that all the members are persons specified in
Sec.  240.13d-1(b)(1)(ii)(A) through (J).
* * * * *

0
14. Amend Sec.  240.13d-102 by:
0
a. Revising Instruction 12 to the Instruction for the Cover Page before
the Notes;
0
b. In Item 3 removing the period at the end of paragraphs (a), (b),
(c), and (d) and in each place adding a semicolon;
0
c. In Item 3 revising paragraph (j) and adding paragraph (k); and
0
d. In Item 10 redesignating paragraph (b) as paragraph (c) and adding
new paragraph (b).
    The revision and additions read as follows:

Sec.  240.13d-102  Schedule 13G--Information to be included in
statements filed pursuant to Sec.  240.13d-1(b), (c), and (d) and
amendments thereto filed pursuant to Sec.  240.13d-2.

* * * * *
    Instructions for Cover Page:
* * * * *
    (12) Type of Reporting Person--Please classify each ``reporting
person'' according to the following breakdown (see Item 3 of Schedule
13G) and place the appropriate Symbol on the form:

------------------------------------------------------------------------
                           Category                              Symbol
------------------------------------------------------------------------
Broker Dealer................................................         BD
Bank.........................................................         BK
Insurance Company............................................         IC
Investment Company...........................................         IV
Investment Adviser...........................................         IA
Employee Benefit Plan or Endowment Fund......................         EP
Parent Holding Company/Control Person........................         HC
Savings Association..........................................         SA
Church Plan..................................................         CP
Corporation..................................................         CO
Partnership..................................................         PN
Individual...................................................         IN
Non-U.S. Institution.........................................         FI
Other........................................................         OO
------------------------------------------------------------------------

* * * * *
    Item 3. * * *
    (j) [ ] A non-U.S. institution in accordance with Sec.  240.13d-
1(b)(1)(ii)(J);
    (k) [ ] Group, in accordance with Sec.  240.13d-1(b)(1)(ii)(K). If
filing as a non-U.S. institution in accordance with Sec.  240.13d-
1(b)(1)(ii)(J), please specify the type of institution: --------
* * * * *

Item 10. Certification

* * * * *
    (b) The following certification shall be included if the statement
is filed pursuant to Sec.  240.13d-1(b)(1)(ii)(J), or if the statement
is filed pursuant to Sec.  240.13d-1(b)(1)(ii)(K) and a member of the
group is a non-U.S. institution eligible to file pursuant to Sec.
240.13d-1(b)(1)(ii)(J):
    By signing below I certify that, to the best of my knowledge and
belief, the foreign regulatory scheme applicable to [insert particular
category of institutional investor] is substantially comparable to the
regulatory scheme

applicable to the functionally equivalent U.S. institution(s). I also
undertake to furnish to the Commission staff, upon request, information
that would otherwise be disclosed in a Schedule 13D.
* * * * *

0
15. Amend Sec.  240.13e-3 by revising paragraph (g)(6) to read as
follows:

Sec.  240.13e-3  Going private transactions by certain issuers or their
affiliates.

* * * * *
    (g) * * *
    (6) Any tender offer or business combination made in compliance
with Sec.  230.802 of this chapter, Sec.  240.13e-4(h)(8) or Sec.
240.14d-1(c) or any other kind of transaction that otherwise meets the
conditions for reliance on the cross-border exemptions set forth in
Sec.  240.13e-4(h)(8), 240.14d-1(c) or 230.802 of this chapter except
for the fact that it is not technically subject to those rules.
    Instruction to Sec.  240.13e-3(g)(6): To the extent applicable, the
acquiror must comply with the conditions set forth in Sec.  230.802 of
this chapter, and Sec. Sec.  240.13e-4(h)(8) and 14d-1(c). If the
acquiror publishes or otherwise disseminates an informational document
to the holders of the subject securities in connection with the
transaction, the acquiror must furnish an English translation of that
informational document, including any amendments thereto, to the
Commission under cover of Form CB (Sec.  239.800 of this chapter) by
the first business day after publication or dissemination. If the
acquiror is a foreign entity, it must also file a Form F-X (Sec.
239.42 of this chapter) with the Commission at the same time as the
submission of the Form CB to appoint an agent for service in the United
States.

0
16. Amend Sec.  240.13e-4 by:
0
a. Revising paragraph (h)(8)(i);
0
b. Revising the introductory text of paragraph (i);
0
c. Revising paragraph (i)(1)(ii);
0
d. Revising paragraph (i)(2)(ii);
0
e. Adding paragraphs (i)(2)(v) and (vi);
0
f. Revising paragraphs 2.i. and ii. to the Instructions to paragraph
(h)(8) and (i);
0
g. Redesignating Instructions 3 and 4 to paragraphs (h)(8) and (i) as
Instructions 4 and 5 respectively;
0
h. Adding a new Instruction 3 to paragraphs (h)(8) and (i); and
0
i. Revising the newly redesignated Instructions 4 and 5 to paragraphs
(h)(8) and (i).
    The revisions and additions read as follows:

Sec.  240.13e-4  Tender offers by issuers.

    (h) * * *
    (8) * * *
    (i) Except in the case of an issuer tender offer that is commenced
during the pendency of a tender offer made by a third party in reliance
on Sec.  240.14d-1(c), U.S. holders do not hold more than 10 percent of
the subject class sought in the offer (as determined under Instructions
2 or 3 to paragraph (h)(8) and paragraph (i) of this section);
* * * * *
    (i) Cross-border tender offers (Tier II). Any issuer tender offer
(including any exchange offer) that meets the conditions in paragraph
(i)(1) of this section shall be entitled to the exemptive relief
specified in paragraph (i)(2) of this section, provided that such
issuer tender offer complies with all the requirements of this section
other than those for which an exemption has been specifically provided
in paragraph (i)(2) of this section. In addition, any issuer tender
offer (including any exchange offer) subject only to the requirements
of section 14(e) of the Act and Regulation 14E (Sec. Sec.  240.14e-1
through 240.14e-8) thereunder that meets the conditions in paragraph
(i)(1) of this section also shall be entitled to the exemptive relief
specified in paragraph (i)(2) of this section, to the extent needed
under the requirements of Regulation 14E, so long as the tender offer
complies with all requirements of Regulation 14E other than those for
which an exemption has been specifically provided in paragraph (i)(2)
of this section:
* * * * *
    (1) * * *
    (ii) Except in the case of an issuer tender offer commenced during
the pendency of a tender offer made by a third party in reliance on
Sec.  240.14d-1(d), U.S. holders do not hold more than 40 percent of
the class of securities sought in the offer (as determined in
accordance with Instructions 2 or 3 to paragraphs (h)(8) and (i) of
this section).
    (2) * * *
    (ii) Equal treatment--separate U.S. and foreign offers.
Notwithstanding the provisions of paragraph (f)(8) of this section, an
issuer or affiliate conducting an issuer tender offer meeting the
conditions of paragraph (i)(1) of this section may separate the offer
into multiple offers: one offer made to U.S. holders, which also may
include all holders of American Depositary Shares representing
interests in the subject securities, and one or more offers made to
non-U.S. holders. The U.S. offer must be made on terms at least as
favorable as those offered any other holder of the same class of
securities that is the subject of the tender offers. U.S. holders may
be included in the foreign offer(s) only where the laws of the
jurisdiction governing such foreign offer(s) expressly preclude the
exclusion of U.S. holders from the foreign offer(s) and where the offer
materials distributed to U.S. holders fully and adequately disclose the
risks of participating in the foreign offer(s).
* * * * *
    (v) Suspension of withdrawal rights during counting of tendered
securities. The issuer or affiliate may suspend withdrawal rights
required under paragraph (f)(2) of this section at the end of the offer
and during the period that securities tendered into the offer are being
counted, provided that:
    (A) The issuer or affiliate has provided an offer period, including
withdrawal rights, for a period of at least 20 U.S. business days;
    (B) At the time withdrawal rights are suspended, all offer
conditions have been satisfied or waived, except to the extent that the
issuer or affiliate is in the process of determining whether a minimum
acceptance condition included in the terms of the offer has been
satisfied by counting tendered securities; and
    (C) Withdrawal rights are suspended only during the counting
process and are reinstated immediately thereafter, except to the extent
that they are terminated through the acceptance of tendered securities.
    (vi) Early termination of an initial offering period. An issuer or
affiliate conducting an issuer tender offer may terminate an initial
offering period, including a voluntary extension of that period, if at
the time the initial offering period and withdrawal rights terminate,
the following conditions are met:
    (A) The initial offering period has been open for at least 20 U.S.
business days;
    (B) The issuer or affiliate has adequately discussed the
possibility of and the impact of the early termination in the original
offer materials;
    (C) The issuer or affiliate provides a subsequent offering period
after the termination of the initial offering period;
    (D) All offer conditions are satisfied as of the time when the
initial offering period ends; and
    (E) The issuer or affiliate does not terminate the initial offering
period or any extension of that period during any mandatory extension
required under U.S. tender offer rules.
    Instructions to paragraph (h)(8) and (i) of this section:
* * * * *

    2. * * *
    i. Calculate the U.S. ownership as of a date no more than 60 days
before and no more than 30 days after the public announcement of the
tender offer. If you are unable to calculate as of a date within these
time frames, the calculation may be made as of the most recent
practicable date before public announcement, but in no event earlier
than 120 days before announcement;
    ii. Include securities underlying American Depositary Shares
convertible or exchangeable into the securities that are the subject of
the tender offer when calculating the number of subject securities
outstanding, as well as the number held by U.S. holders. Exclude from
the calculations other types of securities that are convertible or
exchangeable into the securities that are the subject of the tender
offer, such as warrants, options and convertible securities;
* * * * *
    3. If you are unable to conduct the analysis of U.S. ownership set
forth in Instruction 2 above, U.S. holders will be presumed to hold 10
percent or less of the outstanding subject securities (40 percent for
Tier II) so long as there is a primary trading market outside the
United States, as defined in Sec.  240.12h-6(f)(5) of this chapter,
unless:
    i. Average daily trading volume of the subject securities in the
United States for a recent twelve-month period ending on a date no more
than 60 days before the public announcement of the tender offer exceeds
10 percent (or 40 percent) of the average daily trading volume of that
class of securities on a worldwide basis for the same period; or
    ii. The most recent annual report or annual information filed or
submitted by the issuer with securities regulators of the home
jurisdiction or with the Commission or any jurisdiction in which the
subject securities trade before the public announcement of the offer
indicates that U.S. holders hold more than 10 percent (or 40 percent)
of the outstanding subject class of securities; or
    iii. You know or have reason to know, before the public
announcement of the offer, that the level of U.S. ownership of the
subject securities exceeds 10 percent (or 40 percent) of such
securities. As an example, you are deemed to know information about
U.S. ownership of the subject class of securities that is publicly
available and that appears in any filing with the Commission or any
regulatory body in the home jurisdiction and, if different, the non-
U.S. jurisdiction in which the primary trading market for the subject
class of securities is located. You are also deemed to know information
obtained or readily available from any other source that is reasonably
reliable, including from persons you have retained to advise you about
the transaction, as well as from third-party information providers.
These examples are not intended to be exclusive.
    4. United States means the United States of America, its
territories and possessions, any State of the United States, and the
District of Columbia.
    5. The exemptions provided by paragraphs (h)(8) and (i) of this
section are not available for any securities transaction or series of
transactions that technically complies with paragraph (h)(8) and (i) of
this section but are part of a plan or scheme to evade the provisions
of this section.
* * * * *

0
17. Amend Sec.  240.14d-1 by:
0
a. Revising paragraph (a);
0
b. Revising paragraph (c)(1);
0
c. Revising the introductory text of paragraph (d), paragraphs
(d)(1)(ii), (d)(2)(ii) and (d)(2)(iv);
0
d. Adding paragraphs (d)(2)(vi), (d)(2)(vii), (d)(2)(viii), and
(d)(2)(ix); and
0
e. Revising Instructions 2.i., 2.ii., 3. introductory text, 3.i.,
3.ii., and 3.iii. to the Instructions to paragraphs (c) and (d).
    The revisions and additions read as follows:

Sec.  240.14d-1  Scope of and definitions applicable to Regulations 14D
and 14E.

    (a) Scope. Regulation 14D (Sec. Sec.  240.14d-1 through 240.14d-
101) shall apply to any tender offer that is subject to section
14(d)(1) of the Act (15 U.S.C. 78n(d)(1)), including, but not limited
to, any tender offer for securities of a class described in that
section that is made by an affiliate of the issuer of such class.
Regulation 14E (Sec. Sec.  240.14e-1 through 240.14e-8) shall apply to
any tender offer for securities (other than exempted securities) unless
otherwise noted therein.
* * * * *
    (c) * * *
    (1) U.S. ownership limitation. Except in the case of a tender offer
that is commenced during the pendency of a tender offer made by a prior
bidder in reliance on this paragraph or Sec.  240.13e-4(h)(8), U.S.
holders do not hold more than 10 percent of the class of securities
sought in the offer (as determined under Instructions 2 or 3 to
paragraphs (c) and (d) of this section).
* * * * *
    (d) Tier II. A person conducting a tender offer (including any
exchange offer) that meets the conditions in paragraph (d)(1) of this
section shall be entitled to the exemptive relief specified in
paragraph (d)(2) of this section, provided that such tender offer
complies with all the requirements of this section other than those for
which an exemption has been specifically provided in paragraph (d)(2)
of this section. In addition, a person conducting a tender offer
subject only to the requirements of section 14(e) of the Act (15 U.S.C.
78n(e)) and Regulation 14E thereunder (Sec. Sec.  240.14e-1 through
240.14e-8) that meets the conditions in paragraph (d)(1) of the section
also shall be entitled to the exemptive relief specified in paragraph
(d)(2) of this section, to the extent needed under the requirements of
Regulation 14E, so long as the tender offer complies with all
requirements of Regulation 14E other than those for which an exemption
has been specifically provided in paragraph (d)(2) of this section:
    (1) * * *
    (ii) Except in the case of a tender offer that is commenced during
the pendency of a tender offer made by a prior bidder in reliance on
this paragraph or Sec.  240.13e-4(i), U.S. holders do not hold more
than 40 percent of the class of securities sought in the offer (as
determined under Instructions 2 or 3 to paragraphs (c) and (d) of this
section); and
    (2) * * *
    (ii) Equal treatment--separate U.S. and foreign offers.
Notwithstanding the provisions of Sec.  240.14d-10, a bidder conducting
a tender offer meeting the conditions of paragraph (d)(1) of this
section may separate the offer into multiple offers: One offer made to
U.S. holders, which also may include all holders of American Depositary
Shares representing interests in the subject securities, and one or
more offers made to non-U.S. holders. The U.S. offer must be made on
terms at least as favorable as those offered any other holder of the
same class of securities that is the subject of the tender offers. U.S.
holders may be included in the foreign offer(s) only where the laws of
the jurisdiction governing such foreign offer(s) expressly preclude the
exclusion of U.S. holders from the foreign offer(s) and where the offer
materials distributed to U.S. holders fully and adequately disclose the
risks of participating in the foreign offer(s).
* * * * *
    (iv) Prompt payment. Payment made in accordance with the
requirements of the home jurisdiction law or practice will satisfy the
requirements of Sec.  240.14e-1(c). Where payment may not be made on a
more expedited basis

under home jurisdiction law or practice, payment for securities
tendered during any subsequent offering period within 20 business days
of the date of tender will satisfy the prompt payment requirements of
Sec.  240.14d-11(e). For purposes of this paragraph (d), a business day
is determined with reference to the target's home jurisdiction.
* * * * *
    (vi) Payment of interest on securities tendered during subsequent
offering period. Notwithstanding the requirements of Sec.  240.14d-
11(f), the bidder may pay interest on securities tendered during a
subsequent offering period, if required under applicable foreign law.
Paying interest on securities tendered during a subsequent offering
period in accordance with this section will not be deemed to violate
Sec.  240.14d-10(a)(2).
    (vii) Suspension of withdrawal rights during counting of tendered
securities. The bidder may suspend withdrawal rights required under
section 14(d)(5) of the Act (15 U.S.C. 78n(d)(5)) at the end of the
offer and during the period that securities tendered into the offer are
being counted, provided that:
    (A) The bidder has provided an offer period including withdrawal
rights for a period of at least 20 U.S. business days;
    (B) At the time withdrawal rights are suspended, all offer
conditions have been satisfied or waived, except to the extent that the
bidder is in the process of determining whether a minimum acceptance
condition included in the terms of the offer has been satisfied by
counting tendered securities; and
    (C) Withdrawal rights are suspended only during the counting
process and are reinstated immediately thereafter, except to the extent
that they are terminated through the acceptance of tendered securities.
    (viii) Mix and match elections and the subsequent offering period.
Notwithstanding the requirements of Sec.  240.14d-11(b), where the
bidder offers target security holders a choice between different forms
of consideration, it may establish a ceiling on one or more forms of
consideration offered. Notwithstanding the requirements of Sec.
240.14d-11(f), a bidder that establishes a ceiling on one or more forms
of consideration offered pursuant to this subsection may offset
elections of tendering security holders against one another, subject to
proration, so that elections are satisfied to the greatest extent
possible and prorated to the extent that they cannot be satisfied in
full. Such a bidder also may separately offset and prorate securities
tendered during the initial offering period and those tendered during
any subsequent offering period, notwithstanding the requirements of
Sec.  240.14d-10(c).
    (ix) Early termination of an initial offering period. A bidder may
terminate an initial offering period, including a voluntary extension
of that period, if at the time the initial offering period and
withdrawal rights terminate, the following conditions are met:
    (A) The initial offering period has been open for at least 20 U.S.
business days;
    (B) The bidder has adequately discussed the possibility of and the
impact of the early termination in the original offer materials;
    (C) The bidder provides a subsequent offering period after the
termination of the initial offering period;
    (D) All offer conditions are satisfied as of the time when the
initial offering period ends; and
    (E) The bidder does not terminate the initial offering period or
any extension of that period during any mandatory extension required
under U.S. tender offer rules.
    Instructions to paragraphs (c) and (d):
* * * * *
    2. * * *
    i. Calculate the U.S. ownership as of a date no more than 60 before
and no more than 30 days after public announcement of the tender offer.
If you are unable to calculate as of a date within these time frames,
the calculation may be made as of the most recent practicable date
before public announcement, but in no event earlier than 120 days
before announcement;
    ii. Include securities underlying American Depositary Shares
convertible or exchangeable into the securities that are the subject of
the tender offer when calculating the number of subject securities
outstanding, as well as the number held by U.S. holders. Exclude from
the calculations other types of securities that are convertible or
exchangeable into the securities that are the subject of the tender
offer, such as warrants, options and convertible securities. Exclude
from those calculations securities held by the bidder;
* * * * *
    3. In a tender offer by a bidder other than an affiliate of the
issuer of the subject securities that is not made pursuant to an
agreement with the issuer of the subject securities, the issuer of the
subject securities will be presumed to be a foreign private issuer and
U.S. holders will be presumed to hold less than 10 percent (40 percent
in the case of paragraph (d) of this section) of such outstanding
securities, unless paragraphs 3.i., ii., or iii. of the instructions to
paragraphs (c) and (d) of this section indicate otherwise. In addition,
where the bidder is unable to conduct the analysis of U.S. ownership
set forth in Instruction 2 to paragraphs (c) and (d) of this section,
the bidder may presume that the percentage of securities held by U.S.
holders is less than 10 percent (40 percent in the case of paragraph
(d) of this section) of the outstanding securities so long as there is
a primary trading market for the subject securities outside the U.S.,
as defined in Sec.  240.12h-6(f)(5) of this chapter, unless:
    i. Average daily trading volume of the subject securities in the
United States for a recent twelve-month period ending on a date no more
than 60 days before the public announcement of the offer exceeds 10
percent (40 percent in the case of paragraph (d) of this section) of
the average daily trading volume of that class of securities on a
worldwide basis for the same period; or
    ii. The most recent annual report or annual information filed or
submitted by the issuer with securities regulators of the home
jurisdiction or with the Commission or any jurisdiction in which the
subject securities trade before the public announcement of the offer
indicates that U.S. holders hold more than 10 percent (40 percent in
the case of paragraph (d) of this section) of the outstanding subject
class of securities; or
    iii. The bidder knows or has reason to know, before the public
announcement of the offer, that the level of U.S. ownership exceeds 10
percent (40 percent in the case of paragraph (d) of this section) of
such securities. As an example, a bidder is deemed to know information
about U.S. ownership of the subject class of securities that is
publicly available and that appears in any filing with the Commission
or any regulatory body in the issuer's jurisdiction of incorporation or
(if different) the non-U.S. jurisdiction in which the primary trading
market for the subject securities is located. The bidder is deemed to
know information about U.S. ownership available from the issuer or
obtained or readily available from any other source that is reasonably
reliable, including from persons it has retained to advise it about the
transaction, as well as from third-party information providers. These
examples are not intended to be exclusive.
* * * * *

0
18. Amend Sec.  240.14d-11 by revising the introductory text to read as
follows:

Sec.  240.14d-11.  Subsequent offering period.

    A bidder may elect to provide a subsequent offering period of at
least three business days during which tenders will be accepted if:
* * * * *

0
19. Amend Sec.  240.14d-100 by adding a statement regarding reliance on
the cross-border exemptions and check boxes on the cover page
immediately before the General Instructions to read as follows:

Sec.  240.14d-100  Schedule TO. Tender offer statement under section
14(d)(1) or 13(e)(1) of the Securities Exchange Act of 1934.

* * * * *
    If applicable, check the appropriate box(es) below to designate the
appropriate rule provision(s) relied upon:
[ ] Rule 13e-4(i) (Cross-Border Issuer Tender Offer)
[ ] Rule 14d-1(d) (Cross-Border Third-Party Tender Offer)
* * * * *

0
20. Amend Sec.  240.14e-5 by:
0
a. Removing ``and'' at the end of paragraphs (b)(9)(v) and (c)(6);
0
b. Removing the period at the end of paragraphs (b)(10)(v) and (c)(7)
and adding in its place ``; and''; and
0
c. Adding paragraphs (b)(11), (b)(12), (c)(8), and (c)(9).
    The additions read as follows:

Sec.  240.14e-5.  Prohibiting purchases outside of a tender offer.

* * * * *
    (b) * * *
    (11) Purchases or arrangements to purchase pursuant to a foreign
tender offer(s). Purchases or arrangements to purchase pursuant to a
foreign offer(s) where the offeror seeks to acquire subject securities
through a U.S. tender offer and a concurrent or substantially
concurrent foreign offer(s), if the following conditions are satisfied:
    (i) The U.S. and foreign tender offer(s) meet the conditions for
reliance on the Tier II cross-border exemptions set forth in Sec.
240.14d-1(d);
    (ii) The economic terms and consideration in the U.S. tender offer
and foreign tender offer(s) are the same, provided that any cash
consideration to be paid to U.S. security holders may be converted from
the currency to be paid in the foreign tender offer(s) to U.S. dollars
at an exchange rate disclosed in the U.S. offering documents;
    (iii) The procedural terms of the U.S. tender offer are at least as
favorable as the terms of the foreign tender offer(s);
    (iv) The intention of the offeror to make purchases pursuant to the
foreign tender offer(s) is disclosed in the U.S. offering documents;
and
    (v) Purchases by the offeror in the foreign tender offer(s) are
made solely pursuant to the foreign tender offer(s) and not pursuant to
an open market transaction(s), a private transaction(s), or other
transaction(s); and
    (12) Purchases or arrangements to purchase by an affiliate of the
financial advisor and an offeror and its affiliates.
    (i) Purchases or arrangements to purchase by an affiliate of a
financial advisor and an offeror and its affiliates that are
permissible under and will be conducted in accordance with the
applicable laws of the subject company's home jurisdiction, if the
following conditions are satisfied:
    (A) The subject company is a foreign private issuer as defined in
Sec.  240.3b-4(c);
    (B) The covered person reasonably expects that the tender offer
meets the conditions for reliance on the Tier II cross-border
exemptions set forth in Sec.  240.14d-1(d);
    (C) No purchases or arrangements to purchase otherwise than
pursuant to the tender offer are made in the United States;
    (D) The United States offering materials disclose prominently the
possibility of, or the intention to make, purchases or arrangements to
purchase subject securities or related securities outside of the tender
offer, and if there will be public disclosure of purchases of subject
or related securities, the manner in which information regarding such
purchases will be disseminated;
    (E) There is public disclosure in the United States, to the extent
that such information is made public in the subject company's home
jurisdiction, of information regarding all purchases of subject
securities and related securities otherwise than pursuant to the tender
offer from the time of public announcement of the tender offer until
the tender offer expires;
    (F) Purchases or arrangements to purchase by an offeror and its
affiliates must satisfy the following additional condition: the tender
offer price will be increased to match any consideration paid outside
of the tender offer that is greater than the tender offer price; and
    (G) Purchases or arrangements to purchase by an affiliate of a
financial advisor must satisfy the following additional conditions:
    (1) The financial advisor and the affiliate maintain and enforce
written policies and procedures reasonably designed to prevent the
transfer of information among the financial advisor and affiliate that
might result in a violation of U.S. federal securities laws and
regulations through the establishment of information barriers;
    (2) The financial advisor has an affiliate that is registered as a
broker or dealer under section 15(a) of the Act (15 U.S.C. 78o(a));
    (3) The affiliate has no officers (or persons performing similar
functions) or employees (other than clerical, ministerial, or support
personnel) in common with the financial advisor that direct, effect, or
recommend transactions in the subject securities or related securities
who also will be involved in providing the offeror or subject company
with financial advisory services or dealer-manager services; and
    (4) The purchases or arrangements to purchase are not made to
facilitate the tender offer.
    (ii) Reserved.
    (c) * * *
    (8) Subject company has the same meaning as in Sec.  229.1000 of
this chapter; and
    (9) Home jurisdiction has the same meaning as in the Instructions
to paragraphs (c) and (d) of Sec.  240.14d-1.
* * * * *

0
21. Amend Sec.  240.16a-1 by:
0
a. Revising paragraph (a)(1)(vii);
0
b. Removing ``and'' from the end of paragraph (a)(1)(ix); and
0
c. Revising paragraphs (a)(1)(x) and (xi).
    The revisions read as follows:

Sec.  240.16a-1  Definition of terms.

* * * * *
    (a) * * *
    (1) * * *
    (vii) A parent holding company or control person, provided the
aggregate amount held directly by the parent or control person, and
directly and indirectly by their subsidiaries or affiliates that are
not persons specified in Sec.  240.16a-1 (a)(1)(i) through (x), does
not exceed one percent of the securities of the subject class;
* * * * *
    (x) A non-U.S. institution that is the functional equivalent of any
of the institutions listed in paragraphs (a)(1)(i) through (ix) of this
section, so long as the non-U.S. institution is subject to a regulatory
scheme that is substantially comparable to the regulatory scheme
applicable to the equivalent U.S. institution and the non-U.S.
institution is eligible to file a Schedule 13G pursuant to Sec.
240.13d-1(b)(1)(ii)(J); and
    (xi) A group, provided that all the members are persons specified
in Sec.  240.16a-1 (a)(1)(i) through (x).
* * * * *

PART 241--INTERPRETATIVE RELEASES RELATING TO THE SECURITIES
EXCHANGE ACT OF 1934 AND GENERAL RULES AND REGULATIONS THEREUNDER

0
22. Part 241 is amended by adding Release No. 34-58597 and the release
date of September 19, 2008, to the list of interpretative releases.

PART 239--FORMS PRESCRIBED UNDER THE SECURITIES ACT OF 1933

PART 249--FORMS, SECURITIES EXCHANGE ACT OF 1934

0
23. The authority citation for part 249 continues to read in part as
follows:

    Authority: 15 U.S.C. 78a et seq., 7202, 7233, 7241, 7262, 7264,
and 7265; and 18 U.S.C. 1350, unless otherwise noted.
* * * * *

0
24. Amend Form CB (referenced in Sec.  239.800 and Sec.  249.480) by:
0
a. Revising General Instruction II.A.(1); and
0
b. Revising General Instruction II.A.(4).

    Note: The text of Form CB does not and this amendment will not
appear in the Code of Federal Regulations.

Form CB

TENDER OFFER/RIGHTS OFFERING NOTIFICATION FORM

(AMENDMENT NO. --------)

* * * * *

GENERAL INSTRUCTIONS

* * * * *

II. Instructions for Submitting Form

    A. (1) Regulation S-T Rule 101(a)(1)(vi) (17 CFR 232.101(a)(1)(vi))
requires a party to submit the Form CB in electronic format via the
Commission's Electronic Data Gathering and Retrieval system (EDGAR) in
accordance with the EDGAR rules set forth in Regulation S-T (17 CFR
Part 232). For assistance with technical questions about EDGAR or to
request an access code, call the EDGAR Filer Support Office at (202)
551-8900.
* * * * *
    (4) If filing the Form CB in paper in accordance with a hardship
exemption, you must furnish five copies of this Form and any amendment
to the Form (see Part I, Item 1.(b)), including all exhibits and any
other paper or document furnished as part of the Form, to the
Commission at its principal office. You must bind, staple or otherwise
compile each copy in one or more parts without stiff covers. You must
make the binding on the side or stitching margin in a manner that
leaves the reading matter legible.
* * * * *

    By the Commission.

    Dated: September 19, 2008.
J. Lynn Taylor,
Assistant Secretary.
[FR Doc. E8-22515 Filed 10-8-08; 8:45 am]

BILLING CODE 8011-01-P