[SHIP] VANGUARD /(R)/
P.O. Box 2600
Valley Forge, PA 19482-2600
610-503-5804
Frances_T_Han@vanguard.com
January 30, 2009
Christian Sandoe, Esq.
U.S. Securities & Exchange Commission via electronic filing
100 F Street, N.E.
Washington, DC 20549
RE: Vanguard International Equity Index Funds, File No. 33-32548 (the "Trust")
Dear Mr. Sandoe:
The following responds to your comments of January 23, 2009 on the
post-effective amendment of the registration statement of the Trust. You
commented on Post-Effective Amendment No. 62, which was filed on December 11,
2008.
Vanguard FTSE All-World Ex-US Small-Cap Index Fund (the "Fund")
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Comment 1: Prospectus - Primary Investment Strategies
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Comment: While the Fund's disclosure complies with Rule 35d-1 (the
"Names Rule") policy that the Fund will invest at least 80% of
its assets in the stocks that make up its target index, please
identify if the Fund's policy is to invest more than 80% of
its assets in stocks that make up its target index, and if so,
include this policy in Item 2 as well as Item 4 disclosure.
Response: The Fund's policy is to "invest at least 80% of its assets in
the stocks that make up its target index" as suggested by its
name. While we expect the Fund will invest substantially more
than 80% of its assets in stocks contained in its target
index, this percentage may fluctuate and is therefore not
appropriate or required for Item 2 disclosure. We believe our
current disclosure is in compliance with the Names Rule and
Form N-1A.
Comment 2: More on the Fund - Temporary Investment Measures
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Comment: If the Fund invests using "temporary investment measures," how
does it meet the requirements of Rule 35d-1 under normal
market conditions? The names rule provides for "temporary
defensive measures," but not for "temporary investment
measures."
Response: In Release No. IC-24828 (the "Names Rule Release"), the SEC
states that:
`...[The names] rule, as adopted, will require investment
companies to comply with the 80% investment requirement "under
normal circumstances.... The "under normal circumstances"
standard will provide funds with flexibility to manage their
portfolios, while requiring that they would normally have to
comply with the 80% investment requirement. This standard will
permit investment companies to take "temporary defensive
positions" to avoid losses in response to adverse market,
economic, political, or other conditions. IN ADDITION, IT WILL
PERMIT INVESTMENT COMPANIES TO DEPART FROM THE 80% INVESTMENT
REQUIREMENT IN OTHER LIMITED, APPROPRIATE CIRCUMSTANCES,
PARTICULARLY IN THE CASE OF UNUSUALLY LARGE CASH INFLOWS OR
REDEMPTIONS.' [emphasis added]
The Names Rule Release permits a fund to enter into temporary
investments that depart from the fund's normal investment
policies and strategies for temporary defensive positions as
well as other limited circumstances. Accordingly, we have
incorporated this concept in the "Temporary Investment
Measures" section of the Fund's prospectus. The Fund is
permitted to "temporarily depart from its normal investment
policies and strategies when doing so is believed to be in the
Fund's best interest, so long as the alternative is consistent
with the Fund's investment objective." This would include
situations "...when the fund receives large cash flows that it
cannot prudently invest immediately," as clearly permitted in
the Names Rule Release. Since the "Temporary Investment
Measures" section of the Fund's prospectus is in line with the
Names Rule Release, we do not plan to amend the disclosure.
Comment 3: Investment Advisors - PTA the Fund's Portfolio Managers
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Comment: Please confirm Vanguard's definition of "co-manager" as used
in this section.
Response: Vanguard uses the term "co-manager" to describe relationships
where portfolio managers are equals with respect to
managing portfolio assets.
Tandy Requirements
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As required by the SEC, each Fund acknowledges that:
o The Fund is responsible for the adequacy and accuracy of
the disclosure in the filing.
o Staff comments or changes 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.
o The Fund may not assert staff comments as a defense in any
proceeding initiated by the Commission or any person under
the federal securities laws of the United States.
Please contact me at (610) 503-5804 with any questions or comments regarding the
above responses and explanations.
Sincerely,
Frances Han
Associate Counsel
Securities Regulation, Legal Department