From: Dan Rosen [drosen@mail.doshisha.ac.jp]
Sent: Wednesday, December 04, 2002 4:16 PM
To: rule-comments@sec.gov
Subject: Coment on File No. S7-36-02

Comment on File No. S7-36-02

Dear SEC,

I am filing this comment in support of the proposed rule to require mutual
funds to disclose their proxy voting activities. I write in my capacity as
an American living abroad. However, for your reference, I will mention that
I have been a professor of law at a law school in the United States and I am
now a professor of law at a university in Japan.

Viewed from abroad, one of the best features of the American securities
system is its transparency. Shareholders have real opportunities to learn
about the plans of the companies whose shares they hold, and they have
actual rights to  participate in those decisions through shareholders'
meetings and votes.

These opportunities are not nearly so strong in many other countries,
resulting in various problems of corporate governance. For example, the
annual shareholders' meetings of many companies in Japan are well-known for
their brevity. There have been innumerable problems of companies colluding
with organized crime figures to prevent questions of corporate governance
from being raised at the meetings. The questions suppressed have often
involved malfeasance or at least questionable behavior on the part of
management, to the detriment of the company, its shareholders and workers,
and society.

The American system, with its commitment to transparency, thus looks
especially good with compared with less open alternatives.

Like many Americans, I hold very little direct share ownership. However, I
am among the increasing number who participates in the market through mutual
funds. We mutual fund holders cannot vote directly as shareholders in the
companies in which are money is invested. Thus, the need to know how our
representatives are voting is critical to maintaining the advantages of the
"open" American system. Only in that way can the millions of mutual fund
market participants make intelligent decisions about how, and with whom,
they wish to entrust their investments.

The funds' fiduciary duty to act on the investors' behalf begins with at
least informing the investors on how they are exercising their duty.
Otherwise, we are unable to know whether they are the proper parties in whom
to place our trust. The proposed rule will benefit the entire market by
allowing all market participants to know how their participation rights are
being exercised and to make appropriate decisions based on that knowledge.

Thank you for considering these comments.

Sincerely,

Dan Rosen