81 FR 71122 - Destra Capital Advisors LLC, et al.; Notice of Application

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 81, Issue 199 (October 14, 2016)

Page Range		71122-71123
FR Document		2016-24841

Federal Register, Volume 81 Issue 199 (Friday, October 14, 2016)

[Federal Register Volume 81, Number 199 (Friday, October 14, 2016)]
[Notices]
[Pages 71122-71123]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-24841]


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SECURITIES AND EXCHANGE COMMISSION

[Investment Company Act Release No. 32308; File No. 812-14628]


Destra Capital Advisors LLC, et al.; Notice of Application

October 7, 2016.
AGENCY: Securities and Exchange Commission (``Commission'').

ACTION: Notice of an application for an order under section 12(d)(1)(J) 
of the Investment Company Act of 1940 (the ``Act'') for an exemption 
from sections 12(d)(1)(A), (B), and (C) of the Act and under sections 
6(c) and 17(b) of the Act for an exemption from section 17(a) of the 
Act. The requested order would permit certain registered open-end 
investment companies to acquire shares of certain registered open-end 
investment companies, registered closed-end investment companies, 
business development companies, as defined in section 2(a)(48) of the 
Act (``BDCs''), and registered unit investment trusts (collectively, 
``Underlying Funds'') that are within and outside the same group of 
investment companies as the acquiring investment companies, in excess 
of the limits in section 12(d)(1) of the Act.

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Applicants: Destra Investment Trust, Destra Investment Trust II and 
Destra Exchange-Traded Fund Trust, each a Massachusetts business trust, 
that is registered, or, in the case of Destra Exchange-Traded Fund 
Trust, intends to register, under the Act as an open-end management 
investment company with multiple series (each, a ``Trust''); Destra 
Capital Advisors LLC (the ``Initial Adviser''), a Delaware limited 
liability company, registered as an investment adviser under the 
Investment Advisers Act of 1940; and Destra Capital Investments LLC, a 
Delaware limited liability company, registered as a broker-dealer under 
the Securities Exchange Act of 1934 (the ``Exchange Act'').

DATES:  Filing Dates: The application was filed on March 18, 2016 and 
amended on July 29, 2016.

Hearing or Notification of Hearing: An order granting the requested 
relief will be issued unless the Commission orders a hearing. 
Interested persons may request a hearing by writing to the Commission's 
Secretary and serving applicants with a copy of the request, personally 
or by mail. Hearing requests should be received by the Commission by 
5:30 p.m. on October 31, 2016 and should be accompanied by proof of 
service on the applicants, in the form of an affidavit, or, for 
lawyers, a certificate of service. Pursuant to Rule 0-5 under the Act, 
hearing requests should state the nature of the writer's interest, any 
facts bearing upon the desirability of a hearing on the matter, the 
reason for the request, and the issues contested. Persons who wish to 
be notified of a hearing may request notification by writing to the 
Commission's Secretary.

ADDRESSES: Brent J. Fields, Secretary, U.S. Securities and Exchange 
Commission, 100 F Street NE., Washington, DC 20549-1090. Applicants: c/
o Jane Hong Shissler, Destra Capital Investments LLC, One North Wacker 
Drive, 48th Floor, Chicago, Illinois 60606.

FOR FURTHER INFORMATION CONTACT: Laura J. Riegel, Senior Counsel, at 
(202) 551-3038, or Mary Kay Frech, Branch Chief, at (202) 551-6821 
(Division of Investment Management, Chief Counsel's Office).

SUPPLEMENTARY INFORMATION: The following is a summary of the 
application. The complete application may be obtained via the 
Commission's Web site by searching for the file number, or for an 
applicant using the Company name box, at http://www.sec.gov/search/search.htm, or by calling (202) 551-8090.

Summary of the Application

    1. Applicants request an order to permit (a) a Fund \1\ (each a 
``Fund of

[[Page 71123]]

Funds'') to acquire shares of Underlying Funds \2\ in excess of the 
limits in sections 12(d)(1)(A) and (C) of the Act and (b) the 
Underlying Funds that are registered open-end investment companies or 
series thereof, their principal underwriters and any broker or dealer 
registered under the Exchange Act to sell shares of the Underlying Fund 
to the Fund of Funds in excess of the limits in section 12(d)(1)(B) of 
the Act.\3\ Applicants also request an order of exemption under 
sections 6(c) and 17(b) of the Act from the prohibition on certain 
affiliated transactions in section 17(a) of the Act to the extent 
necessary to permit the Underlying Funds to sell their shares to, and 
redeem their shares from, the Funds of Funds.\4\ Applicants state that 
such transactions will be consistent with the policies of each Fund of 
Funds and each Underlying Fund and with the general purposes of the Act 
and will be based on the net asset values of the Underlying Funds.
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    \1\ Applicants request that the order apply to each existing and 
future series of a Trust and to each existing and future registered 
open-end investment company or series thereof that is advised by the 
Initial Adviser or its successors or by any other investment adviser 
controlling, controlled by or under common control with the Initial 
Adviser, and is part of the same ``group of investment companies'' 
as a Trust (each, a ``Fund''). For purposes of the requested order, 
``successor'' is limited to an entity that results from a 
reorganization into another jurisdiction or a change in the type of 
business organization. For purposes of the request for relief, the 
term ``group of investment companies'' means any two or more 
registered investment companies, including closed-end investment 
companies and BDCs, that hold themselves out to investors as related 
companies for purposes of investment and investor services.
    \2\ Certain of the Underlying Funds have obtained exemptions 
from the Commission necessary to permit their shares to be listed 
and traded on a national securities exchange at negotiated prices 
and, accordingly, to operate as an exchange-traded fund (``ETF'').
    \3\ Applicants do not request relief for the Fund of Funds to 
invest in reliance on the order in BDCs or closed-end investment 
companies that are not listed and traded on a national securities 
exchange.
    \4\ Applicants note that a Fund of Funds generally would 
purchase and sell shares of an Underlying Fund that operates as an 
ETF or a closed-end fund through secondary market transactions 
rather than through principal transactions with the Underlying Fund. 
Applicants nevertheless request relief from sections 17(a)(1) and 
(2) to permit each ETF or closed-end fund that is an affiliated 
person, or an affiliated person of an affiliated person, as defined 
in section 2(a)(3) of the Act, of a Fund of Funds to sell shares to 
or redeem shares from the Fund of Funds. This includes, in the case 
of sales and redemptions of shares of ETFs, in-kind transactions 
that accompany such sales and redemptions. Applicants are not 
seeking relief from section 17(a) for, and the requested relief will 
not apply to, transactions where an ETF or closed-end fund could be 
deemed an affiliated person, or an affiliated person of an 
affiliated person, of a Fund of Funds because an investment adviser 
to the ETF or closed-end fund or an entity controlling, controlled 
by or under common control with the investment adviser to the ETF or 
closed-end fund, is also an investment adviser to the Fund of Funds.
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    2. Certain Underlying Funds may invest up to 25% of their assets in 
a wholly-owned and controlled subsidiary of the Underlying Fund 
organized under the laws of the Cayman Islands as an exempted company 
or under the laws of another non-U.S. jurisdiction (each, a ``Cayman 
Sub''), in order to invest in commodity-related instruments and certain 
other instruments. Applicants state that these Cayman Subs are created 
for tax purposes in order to ensure that the Underlying Fund would 
remain qualified as a regulated investment company for U.S. federal 
income tax purposes.
    3. Applicants agree that any order granting the requested relief 
will be subject to the terms and conditions stated in the application. 
Such terms and conditions are designed to, among other things, help 
prevent any potential (i) undue influence over an Underlying Fund that 
is not in the same ``group of investment companies'' as the Fund of 
Funds through control or voting power, or in connection with certain 
services, transactions, and underwritings, (ii) excessive layering of 
fees, and (iii) overly complex fund structures, which are the concerns 
underlying the limits in sections 12(d)(1)(A), (B), and (C) of the Act.
    4. Section 12(d)(1)(J) of the Act provides that the Commission may 
exempt any person, security, or transaction, or any class or classes of 
persons, securities, or transactions, from any provision of section 
12(d)(1) if the exemption is consistent with the public interest and 
the protection of investors. Section 17(b) of the Act authorizes the 
Commission to grant an order permitting a transaction otherwise 
prohibited by section 17(a) if it finds that (a) the terms of the 
proposed transaction are fair and reasonable and do not involve 
overreaching on the part of any person concerned; (b) the proposed 
transaction is consistent with the policies of each registered 
investment company involved; and (c) the proposed transaction is 
consistent with the general purposes of the Act. Section 6(c) of the 
Act permits the Commission to exempt any persons or transactions from 
any provision of the Act if such exemption is necessary or appropriate 
in the public interest and consistent with the protection of investors 
and the purposes fairly intended by the policy and provisions of the 
Act.

    For the Commission, by the Division of Investment Management, 
pursuant to delegated authority.
Brent J. Fields,
Secretary.
[FR Doc. 2016-24841 Filed 10-13-16; 8:45 am]
 BILLING CODE 8011-01-P

Federal Register / Vol. 81, No. 199 / Friday, October 14, 2016 / Notices 71123

Funds’’) to acquire shares of Underlying order to invest in commodity-related SECURITIES AND EXCHANGE
Funds 2 in excess of the limits in instruments and certain other COMMISSION
sections 12(d)(1)(A) and (C) of the Act instruments. Applicants state that these
and (b) the Underlying Funds that are Cayman Subs are created for tax Sunshine Act Meeting; Additional Item
registered open-end investment purposes in order to ensure that the
companies or series thereof, their FEDERAL REGISTER CITATION OF PREVIOUS
Underlying Fund would remain
principal underwriters and any broker ANNOUNCEMENT: To Be Published.
qualified as a regulated investment
or dealer registered under the Exchange company for U.S. federal income tax PREVIOUSLY ANNOUNCED TIME AND DATE OF
Act to sell shares of the Underlying THE MEETING: Thursday, October 13,
purposes.
Fund to the Fund of Funds in excess of 2016.
the limits in section 12(d)(1)(B) of the 3. Applicants agree that any order
CHANGES IN THE MEETING: The following
Act.3 Applicants also request an order of granting the requested relief will be matter will also be considered during
exemption under sections 6(c) and 17(b) subject to the terms and conditions the 10:00 a.m. Open Meeting scheduled
of the Act from the prohibition on stated in the application. Such terms for Thursday, October 13, 2016, in the
certain affiliated transactions in section and conditions are designed to, among Auditorium, Room L–002:
17(a) of the Act to the extent necessary other things, help prevent any potential • The Commission will consider
to permit the Underlying Funds to sell (i) undue influence over an Underlying whether to adopt rule and form
their shares to, and redeem their shares Fund that is not in the same ‘‘group of amendments that would permit open-
from, the Funds of Funds.4 Applicants investment companies’’ as the Fund of end management investment companies
state that such transactions will be Funds through control or voting power, to use ‘‘swing pricing’’ under certain
consistent with the policies of each or in connection with certain services, circumstances.
Fund of Funds and each Underlying transactions, and underwritings, (ii) This item is now being separately
Fund and with the general purposes of excessive layering of fees, and (iii) listed for the Open Meeting in open
the Act and will be based on the net overly complex fund structures, which session as a procedural matter, and the
asset values of the Underlying Funds. are the concerns underlying the limits duty officer determined that
2. Certain Underlying Funds may Commission business required such
invest up to 25% of their assets in a in sections 12(d)(1)(A), (B), and (C) of
the Act. earlier than one week from today. No
wholly-owned and controlled earlier notice of this action was
subsidiary of the Underlying Fund 4. Section 12(d)(1)(J) of the Act
practicable.
organized under the laws of the Cayman provides that the Commission may
Islands as an exempted company or CONTACT PERSON FOR MORE INFORMATION:
exempt any person, security, or
under the laws of another non-U.S. transaction, or any class or classes of For further information and to ascertain
jurisdiction (each, a ‘‘Cayman Sub’’), in what, if any, matters have been added,
persons, securities, or transactions, from
deleted, or postponed, please contact
any provision of section 12(d)(1) if the
limited to an entity that results from a Brent J. Fields in the Office of the
exemption is consistent with the public
reorganization into another jurisdiction or a change Secretary at (202) 551–5400.
in the type of business organization. For purposes interest and the protection of investors.
of the request for relief, the term ‘‘group of Section 17(b) of the Act authorizes the Dated: October 11, 2016.
investment companies’’ means any two or more Commission to grant an order Brent J. Fields,
registered investment companies, including closed- Secretary.
end investment companies and BDCs, that hold permitting a transaction otherwise
themselves out to investors as related companies for prohibited by section 17(a) if it finds [FR Doc. 2016–24988 Filed 10–12–16; 11:15 am]
purposes of investment and investor services. that (a) the terms of the proposed BILLING CODE 8011–01–P
2 Certain of the Underlying Funds have obtained

exemptions from the Commission necessary to
transaction are fair and reasonable and
permit their shares to be listed and traded on a do not involve overreaching on the part
national securities exchange at negotiated prices of any person concerned; (b) the SECURITIES AND EXCHANGE
and, accordingly, to operate as an exchange-traded proposed transaction is consistent with COMMISSION
fund (‘‘ETF’’).
3 Applicants do not request relief for the Fund of the policies of each registered
[Release No. 34–79074; File No. SR–Phlx–
Funds to invest in reliance on the order in BDCs investment company involved; and (c) 2016–92]
or closed-end investment companies that are not the proposed transaction is consistent
listed and traded on a national securities exchange.
4 Applicants note that a Fund of Funds generally
with the general purposes of the Act. Self-Regulatory Organizations;
would purchase and sell shares of an Underlying Section 6(c) of the Act permits the NASDAQ PHLX LLC; Notice of Filing of
Fund that operates as an ETF or a closed-end fund Commission to exempt any persons or Partial Amendment Nos. 1, 2 and 3,
through secondary market transactions rather than transactions from any provision of the and Order Granting Accelerated
through principal transactions with the Underlying
Fund. Applicants nevertheless request relief from Act if such exemption is necessary or Approval of a Proposed Rule Change,
sections 17(a)(1) and (2) to permit each ETF or appropriate in the public interest and as Modified by Partial Amendment
closed-end fund that is an affiliated person, or an consistent with the protection of Nos. 1, 2 and 3, to System
affiliated person of an affiliated person, as defined Functionality Necessary to Implement
in section 2(a)(3) of the Act, of a Fund of Funds to investors and the purposes fairly
sell shares to or redeem shares from the Fund of intended by the policy and provisions of the Regulation NMS Plan To Implement
Funds. This includes, in the case of sales and the Act. a Tick Size Pilot Program
redemptions of shares of ETFs, in-kind transactions
that accompany such sales and redemptions. For the Commission, by the Division of October 7, 2016.
Applicants are not seeking relief from section 17(a) Investment Management, pursuant to
I. Introduction
rmajette on DSK2TPTVN1PROD with NOTICES

for, and the requested relief will not apply to, delegated authority.
transactions where an ETF or closed-end fund
could be deemed an affiliated person, or an Brent J. Fields, On September 7, 2016, NASDAQ
affiliated person of an affiliated person, of a Fund PHLX LLC (‘‘Exchange’’ or ‘‘Phlx’’) filed
Secretary.
of Funds because an investment adviser to the ETF with the Securities and Exchange
or closed-end fund or an entity controlling, [FR Doc. 2016–24841 Filed 10–13–16; 8:45 am]
Commission (‘‘SEC’’ or ‘‘Commission’’)
controlled by or under common control with the BILLING CODE 8011–01–P
investment adviser to the ETF or closed-end fund,
pursuant to Section 19(b)(1) of the
is also an investment adviser to the Fund of Funds. Securities Exchange Act of 1934

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Document Created: 2016-10-14 00:01:00
Document Modified: 2016-10-14 00:01:00

Category		Regulatory Information
Collection		Federal Register
sudoc Class		AE 2.7: GS 4.107: AE 2.106:
Publisher		Office of the Federal Register, National Archives and Records Administration
Section		Notices
Action		Notice of an application for an order under section 12(d)(1)(J) of the Investment Company Act of 1940 (the ``Act'') for an exemption from sections 12(d)(1)(A), (B), and (C) of the Act and under sections 6(c) and 17(b) of the Act for an exemption from section 17(a) of the Act. The requested order would permit certain registered open-end investment companies to acquire shares of certain registered open-end investment companies, registered closed-end investment companies, business development companies, as defined in section 2(a)(48) of the Act (``BDCs''), and registered unit investment trusts (collectively, ``Underlying Funds'') that are within and outside the same group of investment companies as the acquiring investment companies, in excess of the limits in section 12(d)(1) of the Act.
Contact		Laura J. Riegel, Senior Counsel, at (202) 551-3038, or Mary Kay Frech, Branch Chief, at (202) 551-6821 (Division of Investment Management, Chief Counsel's Office).
FR Citation		81 FR 71122