Securities Exchange Act of 1934
Sections 13(d), 13(g) and 16(a)

Response of the Division of Corporation Finance
and the Division of Investment Management

May 29, 2009

John R. Utzschneider, Esq.
Bingham McCutchen LLP
One Federal Street
Boston, MA 02110-1726

Dear Mr. Utzschneider:

We are responding to your letter dated May 29, 2009 to the Division of Corporation Finance and the Division of Investment Management with regard to your request for temporary no-action relief. Our response is attached to the enclosed photocopy of your letter to avoid having to recite or summarize the facts presented in your letter. Capitalized terms in this letter have the same meaning as in your letter.

You have asked the Division of Corporation Finance for no-action relief during the applicable Relief Period for each of the Morgan Stanley Parties, the Citigroup Parties and MSSB with respect to the reporting requirements under Sections 13(d), 13(g) and 16(a) of the Exchange Act. Based on the facts and representations in your letter, but without necessarily concurring in your analysis, the Division, on behalf of the Office of Chief Counsel and the Office of Mergers and Acquisitions, will not recommend enforcement action to the Commission with respect to Section 13(d), Section 13(g) and Section 16(a) reporting if, from Legal Day One through the applicable Relief Period:

• The Morgan Stanley Parties aggregate and report the securities they beneficially own outside MSSB with the securities that they would be deemed to beneficially own within the MS Channel (with footnote disclosure reporting the portion of the holdings attributable to MSSB), and exclude from their reports the securities that they would be deemed to beneficially own within the SB Channel;

• The Citigroup Parties aggregate and report the securities they beneficially own outside MSSB with the securities that they would be deemed to beneficially own within the SB Channel (with footnote disclosure reporting the portion of the holdings attributable to MSSB), and exclude from their reports the securities that they would be deemed to beneficially own within the MS Channel; and

• MSSB does not separately report the securities that it beneficially owns.

In reaching these positions, we note particularly: your representations regarding the monitoring and reporting challenges presented by the current information technology systems of the MS Channel and of the SB Channel, the scope and scale of the task of integrating these systems, and the time needed to complete the integration; your representation that Morgan Stanley, Citigroup and MSSB will maintain information barriers to protect their respective customers' trading information; and your representation that the MS Channel and the SB Channel have their own separate processes for making investment and voting decisions, which will remain in place through the applicable Relief Periods. These factors minimize concerns regarding the sharing of information and coordinated investment and voting decisions between the MS Channel and the SB Channel.

You have asked the Division of Investment Management for temporary no-action relief with respect to the reporting requirements under Section 13(f) of the Exchange Act and under Exchange Act Rule 10a-3T. Based on the facts and representations in your letter, but without necessarily concurring with your analysis, the Division of Investment Management will not recommend enforcement action to the Commission under Section 13(f) of the Exchange Act and Rule 10a-3T under the Exchange Act against the Morgan Stanley Parties, the Citigroup Parties or MSSB if each of the Morgan Stanley Parties, the Citigroup Parties and MSSB submit Form 13F reports and Form SH reports, respectively, in the manner set forth in your May 29, 2009 letter.

We have considered your request for confidential treatment of your letter and our response. We have determined that the request is reasonable and appropriate under 17 CFR 200.81(b). Accordingly, your letter and our response will not be made public until the earlier of (1) the Closing Date and (2) 120 days after the date of our response.

The foregoing no-action relief is based on the representations made to the Divisions in your letter. Any different facts or conditions might require the Divisions to reach different conclusions.¹ This response expresses the Divisions' positions on enforcement action only and does not express any legal conclusion on the questions presented.

Sincerely,

Thomas J. Kim
Chief Counsel and Associate Director
Division of Corporation Finance

Elizabeth G. Osterman
Associate Director
Division of Investment Management

Endnotes

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¹ The relief granted in this letter relates only to the Morgan Stanley Parties, the Citigroup Parties and MSSB.

Incoming Letter:

The Incoming Letter is in Acrobat format.

http://www.sec.gov/divisions/corpfin/cf-noaction/2009/
morganstanley052909-13dg.htm