54 STAT.] 7GTH CONG. , 3D SESS.-CH. 68G -AUG. 22, 1940 809 the Commission may prescribe as necessary or appropriate in the public interest or for the protection of investors- (1) to purchase any security on margin, except such short-term credits as are necessary for the clearance of transactions; (2) to participate on a joint or a joint and several basis in any trading account in securities, except in connection with an under- writing in which such registered company is a participant; or (3) to effect a short sale of any security, except in connection with an underwriting in which such registered company is a participant. (b) It shall be unlawful for any registered open-end company Oesend company other than a company complying with the provisions of section 10 securities. d)) to act as a distributor of securities of which it is the issuer, except through an underwriter, in contravention of such rules and regula- tions as the Commission may prescribe as necessary or appropriate in the public interest or for the protection of investors. (c) It shall be unlawful for any registered diversified company to Diversified co- make any commitment as underwriter, if immediately thereafter the derwritings. amount of its outstanding underwriting commitments, plus the value of its investments in securities of issuers (other than investment com- panies) of which it owns more than 10 per centum of the outstanding voting securities, exceeds 25 per centum of the value of its total assets. (d) It shall be unlawful for any registered investment company and chestricions on pur- any company or companies controlled by such registered investment company to purchase or otherwise acquire after the enactment of this title any security issued by or any other interest in the business of- (1) any other investment company of which such registered Investment corn- investment company and any company or companies controlled by such registered company shall not at the time of such pur- chase or acquisition own in the aggregate at least 25 per centum of the total outstanding voting stock, if such registered invest- ment company and any company or companies controlled by it own in the aggregate or as a result of such purchase or acquisi- tion will own in the aggregate more than 5 per centum of the total outstanding voting stock of such other investment com- pany if the policy of such other investment company is the concentration of investments in a particular industry or group of industries, or more than 3 per centum of the total outstand- ing voting stock of such other investment company if the policy of such other investment company is not the concentration of investments in a particular industry or group of industries except (A) a security received as a dividend or as a result of an offer of exchange approved pursuant to section 11 or of a plan of reorganization of any company (other than a plan devised for the purpose of evading the foregoing provisions), or (B) a security purchased with the proceeds of payments on periodic payment plan certificates, pursuant to the terms of the trust indenture under which such certificates are issued; or (2) any insurance company of which such registered invest- pIsurance c om - ment company and any company or companies controlled by such registered company shall not at the time of such purchase or acquisition own in the aggregate at least 25 per centum of the total outstanding voting stock, if such registered company and any company or companies controlled by it own in the aggregate or as a result of such purchase or acquisition will own in the aggregate more than 10 per centum of the total outstand- ing voting stock of such insurance company, except a security received as a dividend or as a result of a plan of reorganiza- tion of any company (other than a plan devised for the purpose of evading the foregoing provisions); or
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