82 FR 25870 - Dreyfus ETF Trust

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 82, Issue 106 (June 5, 2017)

Page Range		25870-25872
FR Document		2017-11510
Federal Register, Volume 82 Issue 106 (Monday, June 5, 2017)
[Federal Register Volume 82, Number 106 (Monday, June 5, 2017)]
[Notices]
[Pages 25870-25872]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2017-11510]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Investment Company Act Release No. 32666; 812-14703]


Dreyfus ETF Trust

May 30, 2017.
AGENCY:  Securities and Exchange Commission (``Commission'').

ACTION:  Notice.

-----------------------------------------------------------------------

    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; (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; and (f) certain Funds 
(``Feeder Funds'') to create and redeem Creation Units in-kind in a 
master-feeder structure.

Applicants:  Dreyfus ETF Trust (the ``Trust''), a Massachusetts 
business trust registered under the Act as an open-end management 
investment company, The Dreyfus Corporation (the ``Initial Adviser''), 
a New York corporation registered as an investment adviser under the 
Investment Advisers Act of 1940 (the ``Advisers Act'') and Mellon 
Capital Management Corporation, a Delaware corporation registered with 
the Commission as an investment adviser under the Advisers Act.

Filing Dates:  The application was filed on September 28, 2016, and 
amended on February 21, 2017.

Hearing or Notification of Hearing:  An order granting the requested 
relief will be issued unless the Commission

[[Page 25871]]

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 June 24, 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 Dreyfus Corporation, 
200 Park Avenue, New York, New York 10166.

FOR FURTHER INFORMATION CONTACT:  Rachel Loko, Senior Counsel, at (202) 
551-6883, or Aaron Gilbride, Acting Branch Chief, at (202) 551-6906 
(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 a broker-dealer that will be registered 
under the Securities Exchange Act of 1934 (``Exchange Act'') (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. Certain Funds will operate as Feeder Funds in 
a master-feeder structure. Any order granting the requested relief 
would be subject to the terms and conditions stated in the application.
---------------------------------------------------------------------------

    \1\ Applicants request that the order apply to the existing 
series of the Trust that are index ETFs and any additional series of 
the Trust, and any other open-end management investment company or 
series thereof, that may be created in the future (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.
---------------------------------------------------------------------------

    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\
---------------------------------------------------------------------------

    \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.
---------------------------------------------------------------------------

    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

[[Page 25872]]

shares from a Fund of Funds, and to engage in the accompanying in-kind 
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.
---------------------------------------------------------------------------

    \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.
---------------------------------------------------------------------------

    9. Applicants also request relief to permit a Feeder Fund to 
acquire shares of another registered investment company managed by the 
Adviser having substantially the same investment objectives as the 
Feeder Fund (``Master Fund'') beyond the limitations in section 
12(d)(1)(A) and permit the Master Fund, and any principal underwriter 
for the Master Fund, to sell shares of the Master Fund to the Feeder 
Fund beyond the limitations in section 12(d)(1)(B).
    10. 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. 2017-11510 Filed 6-2-17; 8:45 am]
 BILLING CODE 8011-01-P
25872 Federal Register / Vol. 82, No. 106 / Monday, June 5, 2017 / Notices

shares from a Fund of Funds, and to SECURITIES AND EXCHANGE the most significant aspects of such
engage in the accompanying in-kind COMMISSION statements..
transactions with the Fund of Funds.3
A. Self-Regulatory Organization’s
The purchase of Creation Units by a [Release No. 34–80814; File No. SR–BX–
2017–027]
Statement of the Purpose of, and the
Fund of Funds directly from a Fund will
Statutory Basis for, the Proposed Rule
be accomplished in accordance with the
Self-Regulatory Organizations; Change
policies of the Fund of Funds and will
be based on the NAVs of the Funds. NASDAQ BX, Inc.; Notice of Filing of 1. Purpose
Proposed Rule Change To Eliminate
9. Applicants also request relief to Requirements That Will Be Duplicative The Exchange proposes to amend
permit a Feeder Fund to acquire shares of CAT Rule 6950 relating to the Order Audit
of another registered investment Trail System (‘‘OATS’’), Rule 8211 and
company managed by the Adviser May 30, 2017. Chapter IX, Section IV relating to
having substantially the same Pursuant to Section 19(b)(1) of the Electronic Blue Sheets (‘‘EBS’’), Chapter
investment objectives as the Feeder Securities Exchange Act of 1934 VII, Section VII relating to account
Fund (‘‘Master Fund’’) beyond the (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 identification, and Chapter V, Section
limitations in section 12(d)(1)(A) and notice is hereby given that on May 30, VII relating to the Consolidated Options
permit the Master Fund, and any 2017, NASDAQ BX, Inc. (‘‘BX’’ or Audit Trail System (‘‘COATS’’) to reflect
principal underwriter for the Master ‘‘Exchange’’) filed with the Securities changes to these rules once members are
Fund, to sell shares of the Master Fund and Exchange Commission (‘‘SEC’’ or effectively reporting to the CAT, and the
to the Feeder Fund beyond the ‘‘Commission’’) the proposed rule CAT’s accuracy and reliability meets
limitations in section 12(d)(1)(B). change as described in Items I, II, and certain standards as described below.3
10. Section 6(c) of the Act permits the III below, which Items have been
prepared by the Exchange. The Background
Commission to exempt any persons or
transactions from any provision of the Commission is publishing this notice to Bats BYX Exchange, Inc.; Bats BZX
Act if such exemption is necessary or solicit comments on the proposed rule Exchange, Inc.; Bats EDGA Exchange,
appropriate in the public interest and change from interested persons. Inc.; Bats EDGX Exchange, Inc.; BOX
consistent with the protection of I. Self-Regulatory Organization’s Options Exchange LLC; C2 Options
investors and the purposes fairly Statement of the Terms of Substance of Exchange, Incorporated; Chicago Board
intended by the policy and provisions of the Proposed Rule Change Options Exchange, Incorporated;
the Act. Section 12(d)(1)(J) of the Act Chicago Stock Exchange, Inc.; FINRA;
provides that the Commission may The Exchange proposes to amend International Securities Exchange, LLC;
exempt any person, security, or Rule 6950 relating to the Order Audit Investors’ Exchange LLC; ISE Gemini,
transaction, or any class or classes of Trail System, Rule 8211 and Chapter IX, LLC; ISE Mercury, LLC; Miami
persons, securities, or transactions, from Section IV relating to Electronic Blue International Securities Exchange LLC;
any provision of section 12(d)(1) if the Sheets, Chapter VII, Section VII relating MIAX PEARL, LLC; NASDAQ BX, Inc.;
exemption is consistent with the public to account identification, and Chapter NASDAQ PHLX LLC; The NASDAQ
interest and the protection of investors. V, Section VII relating to the Stock Market LLC; National Stock
Section 17(b) of the Act authorizes the Consolidated Options Audit Trail Exchange, Inc.; New York Stock
Commission to grant an order System to reflect changes to these rules Exchange LLC; NYSE MKT LLC; and
permitting a transaction otherwise once members are effectively reporting NYSE Arca, Inc. (collectively, the
prohibited by section 17(a) if it finds to the Consolidated Audit Trail (‘‘CAT’’) ‘‘Participants’’) filed with the
that (a) the terms of the proposed and the CAT’s accuracy and reliability Commission, pursuant to Section 11A of
transaction are fair and reasonable and meets certain standards as described the Exchange Act 4 and Rule 608 of
do not involve overreaching on the part below. Regulation NMS thereunder,5 the
of any person concerned; (b) the The text of the proposed rule change National Market System Plan Governing
proposed transaction is consistent with is available on the Exchange’s Web site the Consolidated Audit Trail (the ‘‘CAT
the policies of each registered at http://nasdaqbx.cchwallstreet.com/, NMS Plan’’ or ‘‘Plan’’).6 The
investment company involved; and (c) at the principal office of the Exchange,
the proposed transaction is consistent and at the Commission’s Public 3 The Exchange initially filed the proposed rule

with the general purposes of the Act. Reference Room. change on May 15, 2017 (SR–BX–2017–025). On
May 30, 2017, the Exchange withdrew that filing
For the Commission, by the Division of II. Self-Regulatory Organization’s and submitted this filing.
Investment Management, under delegated Statement of the Purpose of, and 4 15 U.S.C. 78k–1.
5 17 CFR 242.608.
authority. Statutory Basis for, the Proposed Rule
6 See Letter from the Participants to Brent J.
Eduardo A. Aleman, Change
Fields, Secretary, Commission, dated September 30,
Assistant Secretary. In its filing with the Commission, the 2014; and Letter from Participants to Brent J. Fields,
[FR Doc. 2017–11510 Filed 6–2–17; 8:45 am] Exchange included statements Secretary, Commission, dated February 27, 2015.
On December 24, 2015, the Participants submitted
BILLING CODE 8011–01–P concerning the purpose of and basis for an amendment to the CAT NMS Plan. See Letter
the proposed rule change and discussed from Participants to Brent J. Fields, Secretary,
asabaliauskas on DSKBBXCHB2PROD with NOTICES

3 The requested relief would apply to direct sales any comments it received on the Commission, dated December 23, 2015.
of shares in Creation Units by a Fund to a Fund of proposed rule change. The text of these ISE Gemini, LLC, ISE Mercury, LLC and
Funds and redemptions of those shares. Applicants, International Securities Exchange, LLC have been
moreover, are not seeking relief from section 17(a)
statements may be examined at the renamed Nasdaq GEMX, LLC, Nasdaq MRX, LLC,
for, and the requested relief will not apply to, places specified in Item IV below. The and Nasdaq ISE, LLC, respectively. See Securities
transactions where a Fund could be deemed an Exchange has prepared summaries, set Exchange Act Release No. 80248 (March 15, 2017),
Affiliated Person, or a Second-Tier Affiliate, of a forth in sections A, B, and C below, of 82 FR 14547 (March 21, 2017); Securities Exchange
Fund of Funds because an Adviser or an entity Act Release No. 80326 (March 29, 2017), 82 FR
controlling, controlled by or under common control 16460 (April 4, 2017); and Securities Exchange Act
1 15 U.S.C. 78s(b)(1).
with an Adviser provides investment advisory Release No. 80325 (March 29, 2017), 82 FR 16445
services to that Fund of Funds. 2 17 CFR 240.19b–4. (April 4, 2017).

VerDate Sep<11>2014 17:31 Jun 02, 2017 Jkt 241001 PO 00000 Frm 00118 Fmt 4703 Sfmt 4703 E:\FR\FM\05JNN1.SGM 05JNN1
Document Created: 2018-11-14 10:01:26
Document Modified: 2018-11-14 10:01:26
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.
Dates		The application was filed on September 28, 2016, and amended on February 21, 2017.
Contact		Rachel Loko, Senior Counsel, at (202) 551-6883, or Aaron Gilbride, Acting Branch Chief, at (202) 551-6906 (Division of Investment Management, Chief Counsel's Office).
FR Citation		82 FR 25870