82 FR 14043 - Parker Global Strategies, LLC; Notice of Application

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 82, Issue 50 (March 16, 2017)

Page Range		14043-14045
FR Document		2017-05207

Federal Register, Volume 82 Issue 50 (Thursday, March 16, 2017)

[Federal Register Volume 82, Number 50 (Thursday, March 16, 2017)]
[Notices]
[Pages 14043-14045]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2017-05207]


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SECURITIES AND EXCHANGE COMMISSION

[Investment Company Act Release No. IC-32528; 812-14709]


Parker Global Strategies, LLC; Notice of Application

March 10, 2017.
AGENCY: Securities and Exchange Commission (``Commission'').

ACTION: Notice of an application for an order under section 6(c) of the 
Investment Company Act of 1940 (the ``Act'') for an exemption from 
sections 2(a)(32), 5(a)(1), 22(d), and 22(e) of the Act and rule 22c-1 
under the Act, under sections 6(c) and 17(b) of the Act for an 
exemption from sections 17(a)(1) and 17(a)(2) of the Act, and under 
section 12(d)(1)(J) for an exemption from sections 12(d)(1)(A) and 
12(d)(1)(B) of the Act. The requested order would permit (a) index-
based series of certain open-end management investment companies 
(``Funds'') to issue shares redeemable in large aggregations only 
(``Creation Units''); (b) secondary market transactions in Fund shares 
to occur at negotiated market prices rather than at net asset value 
(``NAV''); (c) certain Funds to pay redemption proceeds, under certain 
circumstances, more than seven days after the tender of shares for 
redemption; (d) certain affiliated persons of a Fund to deposit 
securities into, and receive securities from, the Fund in connection 
with the purchase and redemption of Creation Units; and (e) certain 
registered management investment companies and unit investment trusts 
outside of the same group of investment companies as the Funds (``Funds 
of Funds'') to acquire shares of the Funds.

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Applicants: Parker Global Strategies, LLC (the ``Initial Adviser''), a 
Connecticut limited liability company that will be registered as an 
investment adviser under the Investment Advisers Act of 1940, ETF 
Series Solutions (the ``Trust''), a Delaware statutory trust registered 
under the Act as an open-end management investment company with 
multiple series, and Quasar Distributors, LLC (the ``Distributor''), a 
Delaware limited liability company and broker-dealer registered under 
the Securities Exchange Act of 1934 (``Exchange Act'').

Filing Dates: The application was filed on October 20, 2016 and amended 
on February 9, 2017.

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

[[Page 14044]]

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 April 4, 2017, and should be accompanied 
by proof of service on 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: Secretary, Securities and Exchange Commission, 100 F Street 
NE., Washington, DC 20549-1090; Applicants: The Initial Adviser, 9 West 
Broad Street, Suite 300, Stamford, CT 06902; the Trust and the 
Distributor, 615 East Michigan Street, 4th Floor, Milwaukee, WI 53202.

FOR FURTHER INFORMATION CONTACT: Aaron T. Gilbride, Senior Counsel, at 
(202) 551-6906, or Holly Hunter-Ceci, Acting Assistant Chief Counsel, 
at (202) 551-6825 (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 that would allow Funds to operate as 
index exchange traded funds (``ETFs'').\1\ Fund shares will be 
purchased and redeemed at their NAV in Creation Units only. All orders 
to purchase Creation Units and all redemption requests will be placed 
by or through an ``Authorized Participant'', which will have signed a 
participant agreement with the Distributor. Shares will be listed and 
traded individually on a national securities exchange, where share 
prices will be based on the current bid/offer market. Any order 
granting the requested relief would be subject to the terms and 
conditions stated in the application.
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    \1\ Applicants request that the order apply to the new series of 
the Trust and any additional series of the Trust, and any other 
open-end management investment company or series thereof (each, 
included in the term ``Fund''), each of which will operate as an ETF 
and will track a specified index comprised of domestic or foreign 
equity and/or fixed income securities (each, an ``Underlying 
Index''). Any Fund will (a) be advised by the Initial Adviser or an 
entity controlling, controlled by, or under common control with the 
Initial Adviser (each, an ``Adviser'') and (b) comply with the terms 
and conditions of the application.
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    2. Each Fund will hold investment positions selected to correspond 
generally to the performance of an Underlying Index. In the case of 
Self-Indexing Funds, an affiliated person, as defined in section 
2(a)(3) of the Act (``Affiliated Person''), or an affiliated person of 
an Affiliated Person (``Second-Tier Affiliate''), of the Trust or a 
Fund, of the Adviser, of any sub-adviser to or promoter of a Fund, or 
of the Distributor will compile, create, sponsor or maintain the 
Underlying Index.\2\
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    \2\ Each Self-Indexing Fund will post on its Web site the 
identities and quantities of the investment positions that will form 
the basis for the Fund's calculation of its NAV at the end of the 
day. Applicants believe that requiring Self-Indexing Funds to 
maintain full portfolio transparency will help address, together 
with other protections, conflicts of interest with respect to such 
Funds.
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    3. Shares will be purchased and redeemed in Creation Units and 
generally on an in-kind basis. Except where the purchase or redemption 
will include cash under the limited circumstances specified in the 
application, purchasers will be required to purchase Creation Units by 
depositing specified instruments (``Deposit Instruments''), and 
shareholders redeeming their shares will receive specified instruments 
(``Redemption Instruments''). The Deposit Instruments and the 
Redemption Instruments will each correspond pro rata to the positions 
in the Fund's portfolio (including cash positions) except as specified 
in the application.
    4. Because shares will not be individually redeemable, applicants 
request an exemption from section 5(a)(1) and section 2(a)(32) of the 
Act that would permit the Funds to register as open-end management 
investment companies and issue shares that are redeemable in Creation 
Units only.
    5. Applicants also request an exemption from section 22(d) of the 
Act and rule 22c-1 under the Act as secondary market trading in shares 
will take place at negotiated prices, not at a current offering price 
described in a Fund's prospectus, and not at a price based on NAV. 
Applicants state that (a) secondary market trading in shares does not 
involve a Fund as a party and will not result in dilution of an 
investment in shares, and (b) to the extent different prices exist 
during a given trading day, or from day to day, such variances occur as 
a result of third-party market forces, such as supply and demand. 
Therefore, applicants assert that secondary market transactions in 
shares will not lead to discrimination or preferential treatment among 
purchasers. Finally, applicants represent that share market prices will 
be disciplined by arbitrage opportunities, which should prevent shares 
from trading at a material discount or premium from NAV.
    6. With respect to Funds that effect creations and redemptions of 
Creation Units in kind and that are based on certain Underlying Indexes 
that include foreign securities, applicants request relief from the 
requirement imposed by section 22(e) in order to allow such Funds to 
pay redemption proceeds within fifteen calendar days following the 
tender of Creation Units for redemption. Applicants assert that the 
requested relief would not be inconsistent with the spirit and intent 
of section 22(e) to prevent unreasonable, undisclosed or unforeseen 
delays in the actual payment of redemption proceeds.
    7. Applicants request an exemption to permit Funds of Funds to 
acquire Fund shares beyond the limits of section 12(d)(1)(A) of the 
Act; and the Funds, and any principal underwriter for the Funds, and/or 
any broker or dealer registered under the Exchange Act, to sell shares 
to Funds of Funds beyond the limits of section 12(d)(1)(B) of the Act. 
The application's terms and conditions are designed to, among other 
things, help prevent any potential (i) undue influence over a Fund 
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) and (B) of the Act.
    8. Applicants request an exemption from sections 17(a)(1) and 
17(a)(2) of the Act to permit persons that are Affiliated Persons, or 
Second-Tier Affiliates, of the Funds, solely by virtue of certain 
ownership interests, to effectuate purchases and redemptions in-kind. 
The deposit procedures for in-kind purchases of Creation Units and the 
redemption procedures for in-kind redemptions of Creation Units will be 
the same for all purchases and redemptions and Deposit Instruments and 
Redemption Instruments will be valued in the same manner as those 
investment positions currently held by the Funds. Applicants also seek 
relief from the prohibitions on affiliated transactions in section 
17(a) to permit a Fund to sell its shares to and redeem its shares from 
a Fund of Funds, and to engage in the accompanying in-kind

[[Page 14045]]

transactions with the Fund of Funds.\3\ The purchase of Creation Units 
by a Fund of Funds directly from a Fund will be accomplished in 
accordance with the policies of the Fund of Funds and will be based on 
the NAVs of the Funds.
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    \3\ The requested relief would apply to direct sales of shares 
in Creation Units by a Fund to a Fund of Funds and redemptions of 
those shares. Applicants, moreover, are not seeking relief from 
section 17(a) for, and the requested relief will not apply to, 
transactions where a Fund could be deemed an Affiliated Person, or a 
Second-Tier Affiliate, of a Fund of Funds because an Adviser or an 
entity controlling, controlled by or under common control with an 
Adviser provides investment advisory services to that Fund of Funds.
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    9. 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. 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.

    For the Commission, by the Division of Investment Management, 
under delegated authority.
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-05207 Filed 3-15-17; 8:45 am]
 BILLING CODE 8011-01-P

Federal Register / Vol. 82, No. 50 / Thursday, March 16, 2017 / Notices 14045

transactions with the Fund of Funds.3 Notice is hereby given that pursuant information shall have practical utility;
The purchase of Creation Units by a to the Paperwork Reduction Act of 1995 (b) the accuracy of the agency’s estimate
Fund of Funds directly from a Fund will (44 U.S.C. 3501 et seq.) the Securities of the burden of the proposed collection
be accomplished in accordance with the and Exchange Commission of information; (c) ways to enhance the
policies of the Fund of Funds and will (‘‘Commission’’) is soliciting comments quality, utility, and clarity of the
be based on the NAVs of the Funds. on the existing collection of information information to be collected; and (d)
9. Section 6(c) of the Act permits the provided for in Rule 15c3–3 (17 CFR ways to minimize the burden of the
Commission to exempt any persons or 240.15c3–3), under the Securities collection of information on
transactions from any provision of the Exchange Act of 1934 (15 U.S.C. 78a et respondents, including through the use
Act if such exemption is necessary or seq.) (‘‘Exchange Act’’). The of automated collection techniques or
appropriate in the public interest and Commission plans to submit this other forms of information technology.
consistent with the protection of existing collection of information to the Consideration will be given to
investors and the purposes fairly Office of Management and Budget comments and suggestions submitted in
intended by the policy and provisions of (‘‘OMB’’) for extension and approval. writing within 60 days of this
the Act. Section 12(d)(1)(J) of the Act Rule 15c3–3 requires that a broker- publication.
provides that the Commission may dealer that holds customer securities An agency may not conduct or
exempt any person, security, or obtain and maintain possession and sponsor, and a person is not required to
transaction, or any class or classes of control of fully-paid and excess margin respond to, a collection of information
persons, securities, or transactions, from securities they hold for customers. In under the PRA unless it displays a
any provision of section 12(d)(1) if the addition, the Rule requires that a broker- currently valid OMB control number.
exemption is consistent with the public dealer that holds customer funds make Please direct your written comments
interest and the protection of investors. either a weekly or monthly computation to: Pamela Dyson, Director/Chief
Section 17(b) of the Act authorizes the to determine whether certain customer Information Officer, Securities and
Commission to grant an order funds need to be segregated in a special Exchange Commission, c/o Remi Pavlik-
permitting a transaction otherwise reserve bank account for the exclusive Simon, 100 F Street NE., Washington,
benefit of the firm’s customers. It also DC 20549, or send an email to: PRA_
prohibited by section 17(a) if it finds
requires that a broker-dealer maintain a Mailbox@sec.gov.
that (a) the terms of the proposed
written notification from each bank
transaction are fair and reasonable and Dated: March 13, 2017.
where a Special Reserve Bank Account
do not involve overreaching on the part Eduardo A. Aleman,
is held acknowledging that all assets in
of any person concerned; (b) the
the account are for the exclusive benefit Assistant Secretary.
proposed transaction is consistent with
of the broker-dealer’s customers, and to [FR Doc. 2017–05269 Filed 3–15–17; 8:45 am]
the policies of each registered
provide written notification to the BILLING CODE 8011–01–P
investment company involved; and (c)
Commission (and its designated
the proposed transaction is consistent
examining authority) under certain,
with the general purposes of the Act. specified circumstances. Finally, broker- SECURITIES AND EXCHANGE
For the Commission, by the Division of dealers that sell securities futures COMMISSION
Investment Management, under delegated products (‘‘SFP’’) to customers must
authority. provide certain notifications to [Release No. 34–80205; File No. SR–
Eduardo A. Aleman, customers and make a record of any BatsBZX–2017–17]
Assistant Secretary. changes of account type.
[FR Doc. 2017–05207 Filed 3–15–17; 8:45 am] A broker-dealer required to maintain Self-Regulatory Organizations; Bats
BILLING CODE 8011–01–P the Special Reserve Bank Account BZX Exchange, Inc.; Notice of Filing
prescribed by Rule 15c3–3 must obtain and Immediate Effectiveness of a
and retain a written notification from Proposed Rule Change Related to Fees
SECURITIES AND EXCHANGE each bank in which it has a Special for Use on the Exchange’s Equity
COMMISSION Reserve Bank Account to evidence the Options Platform
bank’s acknowledgement that assets
Proposed Collection; Comment deposited in the Account are being held March 10, 2017.
Request by the bank for the exclusive benefit of Pursuant to Section 19(b)(1) of the
the broker-dealer’s customers. In Securities Exchange Act of 1934 (the
Upon Written Request, Copies Available addition, a broker-dealer must ‘‘Act’’),1 and Rule 19b–4 thereunder,2
From: Securities and Exchange immediately notify the Commission and notice is hereby given that on March 1,
Commission, Office of Investor its designated examining authority if it 2017, Bats BZX Exchange, Inc. (the
Education and Advocacy, fails to make a required deposit to its ‘‘Exchange’’ or ‘‘BZX’’) filed with the
Washington, DC 20549–0213. Special Reserve Bank Account. Finally, Securities and Exchange Commission
Extension: a broker-dealer that effects transactions (the ‘‘Commission’’) the proposed rule
Rule 15c3–3, SEC File No. 270–087, OMB in SFPs for customers also will have change as described in Items I, II, and
Control No. 3235–0078 paperwork burdens to make a record of III below, which Items have been
each change in account type. prepared by the Exchange. The
3 The requested relief would apply to direct sales
The Commission staff estimates a total Exchange has designated the proposed
of shares in Creation Units by a Fund to a Fund of annual time burden of 517,348 hours
mstockstill on DSK3G9T082PROD with NOTICES

rule change as one establishing or
Funds and redemptions of those shares. Applicants,
moreover, are not seeking relief from section 17(a) and an aggregate cost of $1,433,254 to changing a member due, fee, or other
for, and the requested relief will not apply to, comply with the rule. charge imposed by the Exchange under
transactions where a Fund could be deemed an Written comments are invited on: (a) Section 19(b)(3)(A)(ii) of the Act 3 and
Affiliated Person, or a Second-Tier Affiliate, of a Whether the proposed collection of
Fund of Funds because an Adviser or an entity
controlling, controlled by or under common control
information is necessary for the proper 1 15 U.S.C. 78s(b)(1).
with an Adviser provides investment advisory performance of the functions of the 2 17 CFR 240.19b–4.
services to that Fund of Funds. agency, including whether the 3 15 U.S.C. 78s(b)(3)(A)(ii).

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Document Created: 2017-03-16 02:18:58
Document Modified: 2017-03-16 02:18:58

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 6(c) of the Investment Company Act of 1940 (the ``Act'') for an exemption from sections 2(a)(32), 5(a)(1), 22(d), and 22(e) of the Act and rule 22c-1 under the Act, under sections 6(c) and 17(b) of the Act for an exemption from sections 17(a)(1) and 17(a)(2) of the Act, and under section 12(d)(1)(J) for an exemption from sections 12(d)(1)(A) and 12(d)(1)(B) of the Act. The requested order would permit (a) index- based series of certain open-end management investment companies (``Funds'') to issue shares redeemable in large aggregations only (``Creation Units''); (b) secondary market transactions in Fund shares to occur at negotiated market prices rather than at net asset value (``NAV''); (c) certain Funds to pay redemption proceeds, under certain circumstances, more than seven days after the tender of shares for redemption; (d) certain affiliated persons of a Fund to deposit securities into, and receive securities from, the Fund in connection with the purchase and redemption of Creation Units; and (e) certain registered management investment companies and unit investment trusts outside of the same group of investment companies as the Funds (``Funds of Funds'') to acquire shares of the Funds.
Dates		The application was filed on October 20, 2016 and amended on February 9, 2017.
Contact		Aaron T. Gilbride, Senior Counsel, at (202) 551-6906, or Holly Hunter-Ceci, Acting Assistant Chief Counsel, at (202) 551-6825 (Division of Investment Management, Chief Counsel's Office).
FR Citation		82 FR 14043