COMMENTS RECEIVED ON NOVEMBER 18, 2011
FROM EDWARD BARTZ
FIDELITY CENTRAL INVESTMENT PORTFOLIOS LLC (File No. 811-21667)
Fidelity High Income Central Fund 2
Fidelity Specialized High Income Central Fund
AMENDMENT NO. 28
FIDELITY HANOVER STREET TRUST (File No. 811-03466)
Fidelity Emerging Markets Debt Central Fund
AMENDMENT NO. 48
1. All funds
"Investment Details" (Part A of the Registration Statements)
"Principal Investment Strategies"
(Example from Fidelity High Income Central Fund 2)
"FMRC normally invests the fund's assets primarily in income-producing debt securities, preferred stocks, and convertible securities, with an emphasis on lower-quality debt securities. Many lower-quality debt securities are subject to legal or contractual restrictions limiting FMRC's ability to resell the securities to the general public. FMRC may also invest the fund's assets in non-income producing securities, including defaulted securities and common stocks, but currently intends to limit common stocks to 10% of the fund's total assets. FMRC may invest in companies whose financial condition is troubled or uncertain and that may be involved in bankruptcy proceedings, reorganizations, or financial restructurings."
C: The Staff requests that we add a maturity policy for each fund.
R: The funds do not have a principal investment strategy to invest in securities of a particular maturity. Accordingly, we have not modified disclosure.
2. Fidelity High Income Central Fund 2 and Fidelity Specialized High Income Central Fund
"Investment Details" (Part A of the Registration Statements)
"Principal Investment Strategies"
(Example from Fidelity High Income Central Fund 2)
"FMRC normally invests the fund's assets primarily in income-producing debt securities, preferred stocks, and convertible securities, with an emphasis onlower-quality debt securities. Manylower-quality debt securities are subject to legal or contractual restrictions limiting FMRC's ability to resell the securities to the general public. FMRC may also invest the fund's assets in non-income producing securities, including defaulted securities and common stocks, but currently intends to limit common stocks to 10% of the fund's total assets. FMRC may invest in companies whose financial condition is troubled or uncertain and that may be involved in bankruptcy proceedings, reorganizations, or financial restructurings."
C: The Staff requests that lower-quality debt securities be referred to as "junk bonds."
R: We are not aware of any requirements to use the term "junk bonds" in disclosure regarding "lower-quality debt securities." It is our understanding that the Division's formal guidance on "junk bond" disclosure was rescinded as part of the general overhaul of Form N-1A in 1998. See footnote 214 to Investment Company Act Release No. 23064 (Mar. 13, 1998) (providing that generic comment letters will not apply to registration statements prepared on the amended Form). Further, we note that the term "lower-quality debt securities" is defined under the heading "Principal Investment Risks" in the "Issuer Specific Changes" paragraph. Accordingly, we respectfully decline to modify the disclosure.
3. All funds
"Fund Summary" (Part A of the Registration Statements)
"Purchase and Sale of Shares"
(example from Fidelity Emerging Markets Debt Central Fund)
"Shares of the fund are not offered to the public.
The price to buy one share of the fund is its net asset value per share (NAV). Your shares will be bought at the NAV next calculated after your order is received in proper form.
The price to sell one share of the fund is its NAV. Your shares will be sold at the NAV next calculated after your order is received in proper form.
The fund is open for business each day the New York Stock Exchange (NYSE) is open.
The fund has no minimum investment requirement."
C: The Staff requests that the second and fourth paragraphs be removed.
R: We believe the information in the second and fourth paragraphs is consistent with the purchase and sale information required by Item 6(a) and (b). Accordingly, we have not removed disclosure.
4. Fidelity High Income Central Fund 2 and Fidelity Specialized High Income Central Fund
"Investment Details" (Part A of the Registration Statements)
"Principal Investment Strategies"
(Example from Fidelity High Income Central Fund 2)
"Foreign Exposure. Foreign securities, foreign currencies, and securities issued by U.S. entities with substantial foreign operations can involve additional risks relating to political, economic, or regulatory conditions in foreign countries. These risks include fluctuations in foreign currencies; withholding or other taxes; trading, settlement, custodial, and other operational risks; and the less stringent investor protection and disclosure standards of some foreign markets. All of these factors can make foreign investments,especially those in emerging markets, more volatile and potentially less liquid than U.S. investments. In addition, foreign markets can perform differently from the U.S. market."
C: The Staff requests we add an emerging markets strategy to "Principal Investment Strategies".
R: The funds do not have a principal investment strategy to invest in emerging markets. Accordingly, we have not modified disclosure.
5. All funds
"Trustees and Officers" (Part B of the Registration Statements)
"Experience, Skills, Attributes, and Qualifications of the Fund's Trustees. The Governance and Nominating Committee has adopted a statement of policy that describes the experience, qualifications, attributes, and skills that are necessary and desirable for potential Independent Trustee candidates (Statement of Policy). The Board believes that each Trustee satisfied at the time he or she was initially elected or appointed a Trustee, and continues to satisfy, the standards contemplated by the Statement of Policy. The Governance and Nominating Committee also engages professional search firms to help identify potential Independent Trustee candidates who have the experience, qualifications, attributes, and skills consistent with the Statement of Policy. From time to time, additional criteria based on the composition and skills of the current Independent Trustees, as well as experience or skills that may be appropriate in light of future changes to board composition, business conditions, and regulatory or other developments, have also been considered by the professional search firms and the Governance and Nominating Committee. In addition, the Board takes into account the Trustees' commitment and participation in Board and committee meetings, as well as their leadership of standing and ad hoccommittees throughout their tenure.
In determining that a particular Trustee was and continues to be qualified to serve as a Trustee, the Board has considered a variety of criteria, none of which, in isolation, was controlling. The Board believes that, collectively, the Trustees have balanced and diverse experience, qualifications, attributes, and skills, which allow the Board to operate effectively in governing the fund and protecting the interests of shareholders. Information about the specific experience, skills, attributes, and qualifications of each Trustee, which in each case led to the Board's conclusion that the Trustee should serve (or continue to serve) as a trustee of the fund, is provided below."
C: The Staff asserts that the current disclosure in the Trustees and Officers section does not adequately describe the reasoning behind each Trustee's appointment to the Board. The Staff also requests that additional information be added describing why a particular Trustee's skills or background are conducive to their position on the Board.
R: We continue to be of the view that, as required by Item 17(b)(10), the current disclosure in the "Trustees and Officers" section includes a brief discussion of the experience, qualifications, attributes, or skills that led to the conclusion that each Trustee should serve as a Trustee for the funds. In addition to the disclosure cited by the Staff, we call the Staff's attention to the disclosure under "Standing Committees of the Fund's Trustees" that describes certain minimum qualifications for Independent Trustees, and to each Trustee's biographical information, which includes each Trustee's principal occupation during the last five years and other information relating to the experience, attributes, and skills relevant to each Trustee's qualifications to serve as a Trustee, and which led to the conclusion that each Trustee should serve as a Trustee for the funds.
6. All funds
"Trustees and Officers" (Part B of the Registration Statements)
C: The Staff would like confirmation that biographies reflect all directorships for the past five years.
R: In accordance with Item 17 of Form N-1A, directorships held during the past five years are disclosed.
7. Fidelity Emerging Markets Debt Central Fund
"Investment Details" (Part A of the Registration Statement)
"Investment Objective"
"The fund seeks high total return."
C: The Staff requests that we define "total return," as a definition is not present in the document.
R: We believe total return is commonly understood to mean a combination of capital changes and income. Accordingly, we have not modified disclosure.
8. Fidelity Emerging Markets Debt Central Fund
"Investment Details" (Part A of the Registration Statement)
"Principal Investment Strategies"
"FMRC normally invests at least 80% of the fund's assets in debt securities of issuers in emerging markets and other debt investments that aretied economically to emerging markets. Emerging markets include countries that have an emerging stock market as defined by MSCI, countries or markets with low- to middle-income economies as classified by the World Bank, and other countries or markets with similar emerging characteristics. Emerging markets tend to have relatively low gross national product per capita compared to the world's major economies and may have the potential for rapid economic growth."
C: The Staff would like to know the criteria for an investment to be tied economically to emerging markets.
R: The factors FMRC considers to determine whether an investment is tied economically to a particular country or region (including emerging markets) are disclosed in Part A of the fund's registration statement under the heading, "Country or Geographic Region." In Part B of the fund's registration statement, we also disclose the following information:
"Country or Geographic Region. FMR considers a number of factors to determine whether an investment is tied economically to a particular country or region including: whether the investment is issued or guaranteed by a particular government or any of its agencies, political subdivisions, or instrumentalities; whether the investment has its primary trading market in a particular country or region; whether the issuer is organized under the laws of, derives at least 50% of its revenues from, or has at least 50% of its assets in a particular country or region; whether the investment is included in an index representative of a particular country or region; and whether the investment is exposed to the economic fortunes and risks of a particular country or region."
We also direct the Staff's attention to the following Part B disclosure related to the fund's name test:
"Countries and Markets Considered Emerging. For purposes of the fund, emerging markets include countries that have an emerging stock market as defined by MSCI, countries or markets with low- to middle-income economies as classified by the World Bank, and other countries or markets with similar emerging characteristics. For example, as of December 31, 2010, countries in the JPMorgan Emerging Markets Bond Index Global (EMBI Global), Greece, Hong Kong, Israel, and Singapore are considered to be emerging."
9. Fidelity Emerging Markets Debt Central Fund
"Investment Details" (Part A of the Registration Statement)
"Principal Investment Strategies"
"FMRC normally invests at least 80% of the fund's assets in debt securities of issuers in emerging markets and other debt investments that are tied economically to emerging markets. Emerging markets include countries that have an emerging stock market as defined by MSCI, countries or markets with low- to middle-income economies as classified by the World Bank, and other countries or markets with similar emerging characteristics. Emerging markets tend to have relatively low gross national product per capita compared to the world's major economies and may have the potential for rapid economic growth."
C: The Staff questions whether the fund will use derivatives to meet the 80% test.
R: Though we understand that in appropriate circumstances derivatives may qualify for a fund's name test, at this time the fund does not intend to count derivatives for purposes of its 80% policy.
10. All funds
Tandy Representations (Part A and Part B of the Registration Statements)
C: The Staff would like us to affirm the following three statements:
1) The funds are responsible for the adequacy and accuracy of the disclosure in the filings.
2) Staff comments or changes to disclosure in response to Staff comments in the filings reviewed by the Staff do not foreclose the Commission from taking any action with respect to the filing.
3) The funds may not assert Staff comments as a defense in any proceeding initiated by the Commission or any other person under the Federal Securities Laws.
R: We affirm the aforementioned statements.
