82 FR 57635 - Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Reflect a Change to the Investment Objective and the Underlying Index for the Horizons S&P 500 Covered Call ETF
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 82, Issue 233 (December 6, 2017)
Federal Register Volume 82, Issue 233 (December 6, 2017)
| Page Range | 57635-57639 | |
| FR Document | 2017-26223 |
[Federal Register Volume 82, Number 233 (Wednesday, December 6, 2017)] [Notices] [Pages 57635-57639] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2017-26223] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-82190; File No. SR-NYSEArca-2017-123] Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Reflect a Change to the Investment Objective and the Underlying Index for the Horizons S&P 500 Covered Call ETF November 30, 2017. Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby given that, on November 22, 2017, NYSE Arca, Inc. (the ``Exchange'' or ``NYSE Arca'') filed with the Securities and Exchange Commission (the ``Commission'') the proposed rule change as described in Items I and II below, which Items have been prepared by the Exchange. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. --------------------------------------------------------------------------- \1\ 15 U.S.C. 78s(b)(1). \2\ 15 U.S.C. 78a. \3\ 17 CFR 240.19b-4. --------------------------------------------------------------------------- I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to reflect a change to the investment objective and the underlying index for the Horizons S&P 500[supreg] Covered Call ETF, shares of which are currently listed and trading on the Exchange under NYSE Arca Rule 5.2-E(j)(3). The proposed change is available on the Exchange's Web site at www.nyse.com, at the principal office of the Exchange, and at the Commission's Public Reference Room. II. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, the self-regulatory organization included statements concerning the purpose of, and basis for, the proposed rule change and discussed any comments it received on the proposed rule change. The text of those statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant parts of such statements. [[Page 57636]] A. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The Exchange proposes to make certain changes relating to the investment objective, the underlying index and the investments of the Horizons S&P 500 Covered Call ETF (the ``Fund''), shares (``Shares'') of which are currently listed and trading on the Exchange under NYSE Arca Rule 5.2-E(j)(3) (Investment Company Units or ``Units'').\4\ --------------------------------------------------------------------------- \4\ An Investment Company Unit is a security that represents an interest in a registered investment company that holds securities comprising, or otherwise based on or representing an interest in, an index or portfolio of securities (or holds securities in another registered investment company that holds securities comprising, or otherwise based on or representing an interest in, an index or portfolio of securities). See NYSE Arca Rule 5.2-E(j)(3)(A). --------------------------------------------------------------------------- Shares of the Fund currently are listed and traded on the Exchange.\5\ The Shares are offered by Horizons ETF Trust I (the ``Trust''), which is organized as a Delaware statutory trust and is registered with the Commission as an open-end management investment company.\6\ --------------------------------------------------------------------------- \5\ The Commission issued notice of a proposed rule change to permit listing and trading of Shares of the Fund in Securities Exchange Act Release Nos. 68351 (December 4, 2012), 77 FR 73500 (December 10, 2012) (SR-NYSEArca-2012-131) (Notice of Filing of Proposed Rule Change Relating to Listing and Trading of Shares of the Horizons S&P 500 Covered Call ETF, Horizons S&P Financial Select Sector Covered Call ETF, and Horizons S&P Energy Select Sector Covered Call ETF under NYSE Arca Equities Rule 5.2(j)(3)) (``Prior Notice''); 68708 (January 23, 2013), 78 FR 6161 (January 29, 2013) (SR-NYSEArca-2012-131) (Order Approving Proposed Rule Change Relating to Listing and Trading of Shares of the Horizons S&P 500 Covered Call ETF, Horizons S&P Financial Select Sector Covered Call ETF, and Horizons S&P Energy Select Sector Covered Call ETF under NYSE Arca Equities Rule 5.2(j)(3)) (``Prior Order'' and, together with the Prior Notice, the ``Prior Release''). \6\ The Trust is registered under the Investment Company Act of 1940 (15 U.S.C. 80a-1) (``1940 Act''). On September 25, 2017, the Trust filed with the Commission an amendment to its Form N-1A under the Securities Act of 1933 (15 U.S.C. 77a), and under the 1940 Act relating to the Fund (File Nos. 333-183155 and 811-22732) (``Registration Statement''). The description of the operation of the Trust and the Fund herein is based, in part, on the Registration Statement. In addition, the Commission has issued an order granting certain exemptive relief to the Recon Capital Series Trust (subsequently renamed Horizons ETF Trust I), et al, under the 1940 Act. See Investment Company Act Release No. 31961 (February 9 [sic], 2016) (File No. 812-14461) (``Exemptive Order''). --------------------------------------------------------------------------- The investment adviser to the Fund is Horizons ETFs Management (US) LLC (``Adviser'').\7\ Foreside Fund Services, LLC (the ``Distributor'') is the principal underwriter and distributor of the Fund's Shares. U.S. Bank, N.A. serves as custodian for the Fund. The Bank of New York Mellon serves as sub- custodian for the Fund. U.S. Bancorp Fund Services, LLC serves as the transfer agent and administrator for the Fund.\8\ --------------------------------------------------------------------------- \7\ The Adviser is not registered as a broker-dealer and is affiliated with two broker-dealers and has implemented and will maintain a fire wall with respect to its broker-dealer affiliates regarding access to information concerning the portfolio holdings of the Fund. In the event (a) the Adviser becomes registered as a broker-dealer or newly affiliated with a broker-dealer, or (b) any new adviser or sub-adviser is or becomes affiliated with a broker- dealer, it will implement and maintain a fire wall with respect to its relevant personnel or its broker-dealer affiliate regarding access to information concerning the portfolio holdings of the Fund, and will be subject to procedures designed to prevent the use and dissemination of material non-public information regarding such portfolio. An investment adviser to an open-end fund is required to be registered under the Investment Advisers Act of 1940 (the ``Advisers Act''). As a result, the Adviser and its related personnel are subject to the provisions of Rule 204A-1 under the Advisers Act relating to codes of ethics. This Rule requires investment advisers to adopt a code of ethics that reflects the fiduciary nature of the relationship to clients as well as compliance with other applicable securities laws. Accordingly, procedures designed to prevent the communication and misuse of non- public information by an investment adviser must be consistent with Rule 204A-1 under the Advisers Act. In addition, Rule 206(4)-7 under the Advisers Act makes it unlawful for an investment adviser to provide investment advice to clients unless such investment adviser has (i) adopted and implemented written policies and procedures reasonably designed to prevent violation, by the investment adviser and its supervised persons, of the Advisers Act and the Commission rules adopted thereunder; (ii) implemented, at a minimum, an annual review regarding the adequacy of the policies and procedures established pursuant to subparagraph (i) above and the effectiveness of their implementation; and (iii) designated an individual (who is a supervised person) responsible for administering the policies and procedures adopted under subparagraph (i) above. \8\ The entities serving as the Trust, custodian and transfer agent for the Fund have changed from those identified in the Prior Release. The investment adviser to the Fund, Horizons ETFs Management (US) LLC, also has changed from the adviser identified in the Prior Release. The Adviser previously served as sub-adviser to the Fund, as stated in the Prior Release. The services provided by these entities are not changing from those described in the Prior Release. --------------------------------------------------------------------------- As described in the Prior Notice, the Fund seeks investment results that, before fees and expenses, generally correspond to the performance of the S&P 500 Stock Covered Call Index (``Underlying Index'') provided by S&P Dow Jones Indices LLC (the ``Index Provider'').\9\ The Underlying Index is comprised of all the equity securities in the S&P 500 Index (the ``Reference Index'') and a short (written) call option on each of the options-eligible securities in the Reference Index that meet, among others, stock and option price criteria of the Underlying Index methodology.\10\ --------------------------------------------------------------------------- \9\ The Underlying Index and ``New Underlying Index'' (as defined below) are provided by the Index Provider, which is unaffiliated with the Fund or the Adviser. The Index Provider maintains, calculates and publishes information regarding the Underlying Index and New Underlying Index. The Index Provider is not a broker-dealer and is not affiliated with a broker-dealer and has implemented procedures designed to prevent the use and dissemination of material, non-public information regarding the Underlying Index and New Underlying Index. \10\ The Underlying Index and New Underlying Index methodologies are available at http://us.spindices.com/indices/strategy/sp-500-stock-covered-call-index and https://www.cboe.com/products/strategy-benchmark-indexes/buywrite-indexes/cboe-s-p-500-2-otm-buywrite-index-bxy, respectively. The New Underlying Index uses the same methodology as the widely accepted CBOE S&P 500 BuyWrite Index (BXM) but the New Underlying Index is calculated using out-of-the-money S&P 500 Index (SPX) call options, rather than at-the-money SPX call options. For additional information regarding the Underlying Index, see the Prior Release. --------------------------------------------------------------------------- The Exchange proposes to reflect a change to the investment objective and the underlying index for the Fund. Going forward, the Fund will seek investment results that, before fees and expenses, generally correspond to the performance of the CBOE S&P 500 2% OTM BuyWrite Index (``New Underlying Index''). The New Underlying Index does not meet the ``generic'' listing requirements of Commentary .01(a)(A) to NYSE Arca Rule 5.2-E(j)(3) applicable to the listing of Units based upon an index of US Component Stocks. Specifically, NYSE Arca Rule 5.2-E(j)(3) provides that the term ``US Component Stock'' shall mean an equity security that is registered under Sections 12(b) or 12(g) of the Act or an American Depositary Receipt, the underlying equity security of which is registered under Sections 12(b) or 12(g) of the Act. Commentary .01(a)(A) to NYSE Arca Rule 5.2-E(j)(3) sets forth the requirements to be met by components of an index or portfolio of US Component Stocks.\11\ The New Underlying Index consists of the constituent securities of the S&P 500 Index. The New Underlying Index meets and will continue to meet all requirements of NYSE Arca Rule 5.2- E(j)(3) and Commentary .01(a)(A) thereto except that the New Underlying Index includes a call option, which is not an NMS Stock as defined in Rule 600 of Regulation NMS. As described below, the New Underlying Index consists of long positions in securities in the Reference Index and a single out- [[Page 57637]] of-the-money call option written on the S&P 500 Index.\12\ All securities in the Reference Index are listed and traded on a U.S. national securities exchange. The option on the Reference Index is traded on a U.S. national options exchange. Notwithstanding that the New Underlying Index does not meet the requirement of Commentary .01(a)(A)(5) to NYSE Arca Rule 5.2-E(j)(3), the Exchange believes that the New Underlying Index is sufficiently broad-based to deter potential manipulation in that the Reference Index stocks are among the most actively traded, highly capitalized stocks traded in the U.S. The market value of the call option will not represent more than 10% of the total weight of the New Underlying Index. --------------------------------------------------------------------------- \11\ Commentary .01(a)(A) to NYSE Arca Rule 5.2-E(j)(3) provides that components of an index or portfolio of U.S. Component Stocks underlying a series of Units listed pursuant to Rule 19b-4(e) under the Act must meet specified criteria on an initial and continued listing basis. Commentary .01(a)(A)(5) to NYSE Arca Rule 5.2-E(j)(3) states that all securities in the index or portfolio shall be U.S. Component Stocks listed on a national securities exchange and shall be NMS Stocks as defined in Rule 600 of Regulation NMS under the Act. \12\ An ``out-of-the-money'' call option is one in which the exercise (or ``strike'') price of the option is above the market price of the security. --------------------------------------------------------------------------- Horizons S&P 500 Covered Call ETF According to the Registration Statement, the Fund is an index fund that will employ a ``passive management'' investment strategy in seeking to achieve its objective of providing investment results that generally correspond to the performance of the New Underlying Index. The New Underlying Index is comprised of two parts: (1) All the equity securities in the Reference Index (i.e., the S&P 500 Index) in substantially similar weight as the Reference Index \13\; and (2) a single short (written) call option on the S&P 500 Index. The Fund will invest at least 80% of its total assets in securities that comprise its New Underlying Index. --------------------------------------------------------------------------- \13\ The Reference Index is a float-adjusted market capitalization weighted index containing equity securities of 500 industrial, information technology, utility and financial companies among other Global Industry Classification Standard (``GICS[supreg]'') sectors, regarded as generally representative of the U.S. stock market. A float-adjusted market capitalization weighted index weights each index component according to its market capitalization, using the number of shares that are readily available for purchase on the open market. --------------------------------------------------------------------------- The New Underlying Index The New Underlying Index measures the performance of a hypothetical portfolio that employs a covered call strategy.\14\ A covered call strategy is generally considered to be an investment strategy in which an investor buys a security, and sells (or ``writes'') a call option on that security in an attempt to generate more income. The ``premium'' paid by the buyer of the option provides income in addition to the security's dividends or other distributions. The New Underlying Index consists of long positions in securities in the Reference Index and an out-of-the-money call option written on the S&P 500 Index. This option is written (sold) systematically on the monthly option writing date of the New Underlying Index. --------------------------------------------------------------------------- \14\ Information regarding the New Underlying Index is available at the new Web site identified in note 9, supra, [sic] which is different than the Web site for the Underlying Index methodology identified in the Prior Release. --------------------------------------------------------------------------- The Operation of the Fund The Fund, in return for the option premium, will write call options that give the purchaser the right to receive a cash payment equal to any positive difference between the value of the security and the exercise (or ``strike'') price on the expiration date of the option. Each month the Fund will write a single out-of-the-money call option on the Reference Index as determined on the monthly option writing date of the New Underlying Index in accordance with the New Underlying Index methodology. Such short option position would be reflected in the Fund's portfolio as a negative cash balance. The Fund generally will use a replication methodology, meaning it will invest in all of the securities comprising the New Underlying Index in proportion to the weightings in the New Underlying Index. The Fund will seek correlation between the Fund's performance, before fees and expenses, and that of the New Underlying Index of 0.95 or better. A figure of 1.00 would represent perfect correlation. Under normal market conditions,\15\ the Fund will invest at least 80% of its total assets in the securities included in the New Underlying Index. The Adviser anticipates that, generally, the Fund will hold all of the securities that comprise the New Underlying Index in proportion to their weightings in such index. However, from time to time, the Fund may utilize a sampling methodology under various circumstances where it may not be possible or practicable to purchase all of the equity securities and write (sell) the call option comprising the New Underlying Index. --------------------------------------------------------------------------- \15\ The term ``normal market conditions'' for these purposes will have the same meaning as the term defined in NYSE Arca Rule 8.600-E(c)(5). --------------------------------------------------------------------------- The option in the New Underlying Index will be traded on national securities exchanges. Purely for informational purposes, as of September 29, 2017, the Reference Index and New Underlying Index included common stocks of 505 companies, with a market capitalization range of between approximately $2.7 billion and $796.1 billion. As of that date, the New Underlying Index also included a single short (written) call option on the Reference Index. The Exchange represents that the listing standards under NYSE Arca Rules 5.2-E(j)(3) and 5.5-E(g)(2) applicable to Units shall apply to the Shares. In addition, the Exchange represents that the Fund and the Shares will comply with all other requirements applicable to Units including, but not limited to, requirements relating to the dissemination of key information such as the value of the New Underlying Index, IIV, and NAV, rules governing the trading of equity securities, trading hours, trading halts, surveillance, information barriers and Information Bulletin to Equity Trading Permit Holders (``ETP Holders''), as set forth in Exchange rules applicable to Units and prior Commission orders approving the generic listing rules applicable to the listing and trading of Units.\16\ --------------------------------------------------------------------------- \16\ See, e.g., Securities Exchange Act Release No. 44551 (July 12, 2001), 66 FR 37716 (July 19, 2001) (SR-PCX-2001-14) (order approving generic listing standards for ICUs and Portfolio Depositary Receipts); Securities Exchange Act Release No. 41983 (October 6, 1999), 64 FR 56008 (October 15, 1999) (SR-PCX-98-29) (order approving rules for listing and trading of ICUs). --------------------------------------------------------------------------- Surveillance The Exchange represents that trading in the Shares will be subject to the existing trading surveillances administered by the Exchange, as well as cross-market surveillances administered by the Financial Industry Regulatory Authority (``FINRA'') on behalf of the Exchange, which are designed to detect violations of Exchange rules and applicable federal securities laws.\17\ The Exchange represents that these procedures are adequate to properly monitor Exchange trading of the Shares in all trading sessions and to deter and detect violations of Exchange rules and applicable federal securities laws. --------------------------------------------------------------------------- \17\ FINRA conducts cross-market surveillances on behalf of the Exchange pursuant to a regulatory services agreement. The Exchange is responsible for FINRA's performance under this regulatory services agreement. --------------------------------------------------------------------------- The surveillances referred to above generally focus on detecting securities trading outside their normal patterns, which could be indicative of manipulative or other violative activity. When such situations are detected, surveillance analysis follows and investigations are opened, where appropriate, to review the behavior of all relevant parties for all relevant trading violations. The Exchange or FINRA, on behalf of the Exchange, or both, will communicate as needed regarding trading in the Shares, equity securities [[Page 57638]] and options with other markets and other entities that are members of the Intermarket Surveillance Group (``ISG''), and the Exchange or FINRA, on behalf of the Exchange, or both, may obtain trading information regarding trading such securities and financial instruments from such markets and other entities. In addition, the Exchange may obtain information regarding trading in such securities from markets and other entities that are members of ISG or with which the Exchange has in place a comprehensive surveillance sharing agreement.\18\ --------------------------------------------------------------------------- \18\ For a list of the current members of ISG, see www.isgportal.org. The Exchange notes that not all holdings of the Fund may trade on markets that are members of ISG or with which the Exchange has in place a comprehensive surveillance sharing agreement. --------------------------------------------------------------------------- In addition, the Exchange also has a general policy prohibiting the distribution of material, non-public information by its employees. All statements or representations contained in this filing regarding (a) the description of the New Underlying Index, portfolio or reference asset, (b) limitations on the New Underlying Index or portfolio holdings or reference assets, or (c) the applicability of Exchange listing rules specified in such rule filing will constitute continued listing requirements for listing the Shares on the Exchange. The issuer must notify the Exchange of any failure by the Fund to comply with the continued listing requirements, and, pursuant to its obligations under Section 19(g)(1) of the Act, the Exchange will monitor for compliance with the continued listing requirements. If the Fund is not in compliance with the applicable listing requirements, the Exchange will commence delisting procedures under NYSE Arca Rule 5.5- E(m). Pursuant to its obligations under Section 19(g)(1) of the Act, the Exchange will monitor for compliance with the continued listing requirements. Except for the changes noted above, all other representations made in the Prior Release remain unchanged. Except as otherwise referenced in this proposed rule change, all representations made in the Prior Release pertaining to the Underlying Index shall continue to apply to the New Underlying Index. 2. Statutory Basis The basis under the Exchange Act for this proposed rule change is the requirement under Section 6(b)(5) \19\ that an exchange have rules that are designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, to remove impediments to, and perfect the mechanism of a free and open market and, in general, to protect investors and the public interest. --------------------------------------------------------------------------- \19\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- The Exchange believes that the proposed rule change is designed to prevent fraudulent and manipulative acts and practices in that the Shares will continue to be listed and traded on the Exchange pursuant to the listing criteria in NYSE Arca Rule 5.2-E(j)(3). The Exchange has in place surveillance procedures that are adequate to properly monitor trading in the Shares in all trading sessions and to deter and detect violations of Exchange rules and applicable federal securities laws. The Adviser is not registered as a broker-dealer and is affiliated with two broker-dealers and has implemented and will maintain a fire wall with respect to its broker-dealer affiliates regarding access to information concerning the portfolio holdings of the Fund. In the event (a) the Adviser becomes registered as or newly affiliated with a broker-dealer, or (b) any new adviser becomes registered as or newly affiliated with a broker-dealer, it will implement and maintain a fire wall with respect to such broker-dealer regarding access to information concerning the portfolio holdings of the Fund, and will be subject to procedures designed to prevent the use and dissemination of material non-public information regarding such portfolio. The Index Provider is not a broker-dealer and is not affiliated with a broker-dealer and has implemented procedures designed to prevent the use and dissemination of material, non-public information regarding the New Underlying Index. All securities in the Reference Index are listed and traded on a U.S. national securities exchange. The option on the Reference Index is traded on a U.S. national options exchange. The Reference Index's stocks are among the most actively traded, highly capitalized stocks traded in the U.S. The market value of the call option will not represent more than 10% of the total weight of the New Underlying Index. The New Underlying Index is similar to the Underlying Index, the difference being that the Underlying Index includes a short (written) call option on each of the options-eligible securities in the Reference Index as described above, whereas the New Underlying Index includes a single short (written) call option on the S&P 500 Index. The Exchange does not view the proposed index change as providing a material change to the Fund's investment objective or to the investment strategies, risks or returns of the Fund. Except for the changes noted above, all other representations made in the Prior Release remain unchanged. Except as otherwise referenced in this proposed rule change, all representations made in the Prior Release pertaining to the Underlying Index shall continue to apply to the New Underlying Index. B. Self-Regulatory Organization's Statement on Burden on Competition The Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purpose of the Act. The proposed rule change will enhance competition among exchange-traded fund issuers by permitting trading of shares of Units based on another underlying index that is not currently the underlying index for a series of Units. C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others No written comments were solicited or received with respect to the proposed rule change. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Because the foregoing proposed rule change does not: (i) Significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, the proposed rule change has become effective pursuant to Section 19(b)(3)(A) of the Act \20\ and Rule 19b-4(f)(6) thereunder.\21\ --------------------------------------------------------------------------- \20\ 15 U.S.C. 78s(b)(3)(A). \21\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii) requires a self-regulatory organization to give the Commission written notice of its intent to file the proposed rule change, along with a brief description and the text of the proposed rule change, at least five business days prior to the date of filing of the proposed rule change, or such shorter time as designated by the Commission. The Exchange has satisfied this requirement. --------------------------------------------------------------------------- A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the Act \22\ normally does not become operative for 30 days after the date of its filing. However, Rule 19b-4(f)(6)(iii) \23\ permits the Commission to designate a shorter time if such action is consistent with the protection of investors and the public interest. The Exchange has asked the Commission to waive the 30-day operative delay so that the proposal may become operative immediately upon filing. The Commission believes that [[Page 57639]] waiving the 30-day operative delay is consistent with the protection of investors and the public interest. According to the Exchange, waiver of the 30-day operative delay would permit the timely implementation of Fund efficiencies resulting from tracking an index that requires the writing of a single option on the Reference Index, instead of writing options on multiple options-eligible securities in the Reference Index. In addition, the Commission believes that the proposal does not raise unique or novel regulatory issues. Therefore, the Commission hereby waives the 30-day operative delay and designates the proposal operative upon filing.\24\ --------------------------------------------------------------------------- \22\ 17 CFR 240.19b-4(f)(6). \23\ 17 CFR 240.19b-4(f)(6)(iii). \24\ For purposes only of waiving the 30-day operative delay, the Commission has also considered the proposed rule's impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). --------------------------------------------------------------------------- At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend the rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. If the Commission takes such action, the Commission shall institute proceedings to determine whether the proposed rule change should be approved or disapproved. IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods: Electronic CommentsUse the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or Send an email to [email protected]. Please include File Number SR-NYSEArca-2017-123 on the subject line. Paper Comments Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090. All submissions should refer to File Number SR-NYSEArca-2017-123. This file number should be included on the subject line if email is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for Web site viewing and printing in the Commission's Public Reference Room, 100 F Street NE., Washington, DC 20549 on official business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of the filing also will be available for inspection and copying at the principal office of the Exchange. All comments received will be posted without change. Persons submitting comments are cautioned that we do not redact or edit personal identifying information from comment submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR-NYSEArca-2017-123 and should be submitted on or before December 27, 2017. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\25\ --------------------------------------------------------------------------- \25\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Eduardo A. Aleman Assistant Secretary. [FR Doc. 2017-26223 Filed 12-5-17; 8:45 am] BILLING CODE 8011-01-P
![Federal Register / Vol. 82, No. 233 / Wednesday, December 6, 2017 / Notices 57635
immediately to demonstrate their Comments may be submitted by any of SECURITIES AND EXCHANGE
qualification for initial listing. The the following methods: COMMISSION
proposed 30 day period will relate only
Electronic Comments
to a company’s ability to demonstrate its [Release No. 34–82190; File No. SR–
compliance with the holders • Use the Commission’s Internet NYSEArca–2017–123]
requirement, as a company’s comment form (http://www.sec.gov/
compliance with the earnings or global rules/sro.shtml); or Self-Regulatory Organizations; NYSE
market capitalization and stock price Arca, Inc.; Notice of Filing and
requirements will be apparent at the • Send an email to rule-comments@
sec.gov. Please include File Number SR– Immediate Effectiveness of Proposed
time of consummation of the Business Rule Change To Reflect a Change to
Combination. This proposed change is NYSE–2017–53 on the subject line.
the Investment Objective and the
consistent with the protection of Paper Comments Underlying Index for the Horizons S&P
investors and the public interest, as it
• Send paper comments in triplicate 500 Covered Call ETF
does not alter the substantive
quantitative requirements a company to Brent J. Fields, Secretary, Securities November 30, 2017.
must meet to remain listed. and Exchange Commission, 100 F Street
NE., Washington, DC 20549–1090. Pursuant to Section 19(b)(1) 1 of the
B. Self-Regulatory Organization’s Securities Exchange Act of 1934 (the
Statement on Burden on Competition All submissions should refer to File ‘‘Act’’) 2 and Rule 19b–4 thereunder,3
Number SR–NYSE–2017–53. This file notice is hereby given that, on
The Exchange does not believe that
number should be included on the November 22, 2017, NYSE Arca, Inc.
the proposed rule change will impose
subject line if email is used. To help the (the ‘‘Exchange’’ or ‘‘NYSE Arca’’) filed
any burden on competition that is not
Commission process and review your
necessary or appropriate in furtherance with the Securities and Exchange
comments more efficiently, please use
of the purposes of the Act. The purpose Commission (the ‘‘Commission’’) the
only one method. The Commission will
of the proposed rule is to adopt initial proposed rule change as described in
post all comments on the Commission’s
and continued listing standards for Items I and II below, which Items have
Internet Web site (http://www.sec.gov/
Acquisition Companies that better been prepared by the Exchange. The
rules/sro.shtml). Copies of the
reflect the characteristics and trading Commission is publishing this notice to
submission, all subsequent
market for Acquisition Companies. solicit comments on the proposed rule
amendments, all written statements
While the rule may permit more change from interested persons.
with respect to the proposed rule
Acquisition Companies to list, or remain
change that are filed with the I. Self-Regulatory Organization’s
listed, on the Exchange, other exchanges
Commission, and all written Statement of the Terms of Substance of
could adopt similar rules to compete for
communications relating to the the Proposed Rule Change
such listings. As such, the Exchange
proposed rule change between the
does not believe it imposes any burden
Commission and any person, other than The Exchange proposes to reflect a
on competition.
those that may be withheld from the change to the investment objective and
C. Self-Regulatory Organization’s public in accordance with the the underlying index for the Horizons
Statement on Comments on the provisions of 5 U.S.C. 552, will be S&P 500® Covered Call ETF, shares of
Proposed Rule Change Received From available for Web site viewing and which are currently listed and trading
Members, Participants, or Others printing in the Commission’s Public on the Exchange under NYSE Arca Rule
No written comments were solicited Reference Room, 100 F Street NE., 5.2–E(j)(3). The proposed change is
or received with respect to the proposed Washington, DC 20549 on official available on the Exchange’s Web site at
rule change. business days between the hours of www.nyse.com, at the principal office of
10:00 a.m. and 3:00 p.m. Copies of the
III. Date of Effectiveness of the the Exchange, and at the Commission’s
filing also will be available for
Proposed Rule Change and Timing for Public Reference Room.
inspection and copying at the principal
Commission Action office of the Exchange. All comments II. Self-Regulatory Organization’s
Within 45 days of the date of received will be posted without change. Statement of the Purpose of, and
publication of this notice in the Federal Persons submitting comments are Statutory Basis for, the Proposed Rule
Register or up to 90 days (i) as the cautioned that we do not redact or edit Change
Commission may designate if it finds personal identifying information from
such longer period to be appropriate comment submissions. You should In its filing with the Commission, the
and publishes its reasons for so finding submit only information that you wish self-regulatory organization included
or (ii) as to which the self-regulatory to make available publicly. All statements concerning the purpose of,
organization consents, the Commission submissions should refer to File and basis for, the proposed rule change
will: Number SR–NYSE–2017–53 and should and discussed any comments it received
(A) By order approve or disapprove be submitted on or before December 27, on the proposed rule change. The text
the proposed rule change, or 2017. of those statements may be examined at
(B) institute proceedings to determine For the Commission, by the Division of the places specified in Item IV below.
whether the proposed rule change Trading and Markets, pursuant to delegated The Exchange has prepared summaries,
should be disapproved. authority.18 set forth in sections A, B, and C below,
daltland on DSKBBV9HB2PROD with NOTICES
IV. Solicitation of Comments Eduardo A. Aleman, of the most significant parts of such
Interested persons are invited to Assistant Secretary. statements.
submit written data, views, and [FR Doc. 2017–26220 Filed 12–5–17; 8:45 am]
arguments concerning the foregoing, BILLING CODE 8011–01–P 1 15 U.S.C. 78s(b)(1).
including whether the proposed rule 2 15 U.S.C. 78a.
change is consistent with the Act. 18 17 CFR 200.30–3(a)(12). 3 17 CFR 240.19b–4.
VerDate Sep<11>2014 18:07 Dec 05, 2017 Jkt 244001 PO 00000 Frm 00067 Fmt 4703 Sfmt 4703 E:\FR\FM\06DEN1.SGM 06DEN1](https://thefederalregister.org/doc/82_FR_57868/page/1.svg)
![57636 Federal Register / Vol. 82, No. 233 / Wednesday, December 6, 2017 / Notices
A. Self-Regulatory Organization’s LLC (the ‘‘Distributor’’) is the principal comprised of all the equity securities in
Statement of the Purpose of, and underwriter and distributor of the the S&P 500 Index (the ‘‘Reference
Statutory Basis for, the Proposed Rule Fund’s Shares. U.S. Bank, N.A. serves as Index’’) and a short (written) call option
Change custodian for the Fund. The Bank of on each of the options-eligible securities
New York Mellon serves as sub- in the Reference Index that meet, among
1. Purpose custodian for the Fund. U.S. Bancorp others, stock and option price criteria of
The Exchange proposes to make Fund Services, LLC serves as the the Underlying Index methodology.10
certain changes relating to the transfer agent and administrator for the The Exchange proposes to reflect a
investment objective, the underlying Fund.8 change to the investment objective and
index and the investments of the As described in the Prior Notice, the the underlying index for the Fund.
Horizons S&P 500 Covered Call ETF (the Fund seeks investment results that, Going forward, the Fund will seek
‘‘Fund’’), shares (‘‘Shares’’) of which are before fees and expenses, generally investment results that, before fees and
currently listed and trading on the correspond to the performance of the expenses, generally correspond to the
Exchange under NYSE Arca Rule 5.2– S&P 500 Stock Covered Call Index performance of the CBOE S&P 500 2%
E(j)(3) (Investment Company Units or (‘‘Underlying Index’’) provided by S&P OTM BuyWrite Index (‘‘New
‘‘Units’’).4 Dow Jones Indices LLC (the ‘‘Index Underlying Index’’). The New
Shares of the Fund currently are listed Provider’’).9 The Underlying Index is Underlying Index does not meet the
and traded on the Exchange.5 The ‘‘generic’’ listing requirements of
Shares are offered by Horizons ETF access to information concerning the portfolio Commentary .01(a)(A) to NYSE Arca
Trust I (the ‘‘Trust’’), which is organized holdings of the Fund. In the event (a) the Adviser Rule 5.2–E(j)(3) applicable to the listing
becomes registered as a broker-dealer or newly
as a Delaware statutory trust and is affiliated with a broker-dealer, or (b) any new of Units based upon an index of US
registered with the Commission as an adviser or sub-adviser is or becomes affiliated with Component Stocks. Specifically, NYSE
open-end management investment a broker-dealer, it will implement and maintain a Arca Rule 5.2–E(j)(3) provides that the
fire wall with respect to its relevant personnel or term ‘‘US Component Stock’’ shall mean
company.6 its broker-dealer affiliate regarding access to
The investment adviser to the Fund is information concerning the portfolio holdings of the an equity security that is registered
Horizons ETFs Management (US) LLC Fund, and will be subject to procedures designed under Sections 12(b) or 12(g) of the Act
(‘‘Adviser’’).7 Foreside Fund Services, to prevent the use and dissemination of material or an American Depositary Receipt, the
non-public information regarding such portfolio.
An investment adviser to an open-end fund is
underlying equity security of which is
4 An Investment Company Unit is a security that
required to be registered under the Investment registered under Sections 12(b) or 12(g)
represents an interest in a registered investment Advisers Act of 1940 (the ‘‘Advisers Act’’). As a of the Act. Commentary .01(a)(A) to
company that holds securities comprising, or result, the Adviser and its related personnel are NYSE Arca Rule 5.2–E(j)(3) sets forth
otherwise based on or representing an interest in, subject to the provisions of Rule 204A–1 under the
an index or portfolio of securities (or holds Advisers Act relating to codes of ethics. This Rule the requirements to be met by
securities in another registered investment requires investment advisers to adopt a code of components of an index or portfolio of
company that holds securities comprising, or ethics that reflects the fiduciary nature of the US Component Stocks.11 The New
otherwise based on or representing an interest in, relationship to clients as well as compliance with Underlying Index consists of the
an index or portfolio of securities). See NYSE Arca other applicable securities laws. Accordingly,
Rule 5.2–E(j)(3)(A). procedures designed to prevent the communication constituent securities of the S&P 500
5 The Commission issued notice of a proposed and misuse of non-public information by an Index. The New Underlying Index meets
rule change to permit listing and trading of Shares investment adviser must be consistent with Rule and will continue to meet all
of the Fund in Securities Exchange Act Release Nos. 204A–1 under the Advisers Act. In addition, Rule requirements of NYSE Arca Rule 5.2–
68351 (December 4, 2012), 77 FR 73500 (December 206(4)-7 under the Advisers Act makes it unlawful
for an investment adviser to provide investment E(j)(3) and Commentary .01(a)(A)
10, 2012) (SR–NYSEArca–2012–131) (Notice of
Filing of Proposed Rule Change Relating to Listing advice to clients unless such investment adviser has thereto except that the New Underlying
and Trading of Shares of the Horizons S&P 500 (i) adopted and implemented written policies and Index includes a call option, which is
procedures reasonably designed to prevent
Covered Call ETF, Horizons S&P Financial Select
violation, by the investment adviser and its
not an NMS Stock as defined in Rule
Sector Covered Call ETF, and Horizons S&P Energy 600 of Regulation NMS. As described
Select Sector Covered Call ETF under NYSE Arca supervised persons, of the Advisers Act and the
Equities Rule 5.2(j)(3)) (‘‘Prior Notice’’); 68708 Commission rules adopted thereunder; (ii) below, the New Underlying Index
implemented, at a minimum, an annual review consists of long positions in securities
(January 23, 2013), 78 FR 6161 (January 29, 2013)
regarding the adequacy of the policies and
(SR–NYSEArca–2012–131) (Order Approving
procedures established pursuant to subparagraph (i) in the Reference Index and a single out-
Proposed Rule Change Relating to Listing and
above and the effectiveness of their
Trading of Shares of the Horizons S&P 500 Covered
implementation; and (iii) designated an individual 10 The Underlying Index and New Underlying
Call ETF, Horizons S&P Financial Select Sector (who is a supervised person) responsible for Index methodologies are available at http://
Covered Call ETF, and Horizons S&P Energy Select administering the policies and procedures adopted us.spindices.com/indices/strategy/sp-500-stock-
Sector Covered Call ETF under NYSE Arca Equities under subparagraph (i) above. covered-call-index and https://www.cboe.com/
Rule 5.2(j)(3)) (‘‘Prior Order’’ and, together with the 8 The entities serving as the Trust, custodian and products/strategy-benchmark-indexes/buywrite-
Prior Notice, the ‘‘Prior Release’’). indexes/cboe-s-p-500-2-otm-buywrite-index-bxy,
transfer agent for the Fund have changed from those
6 The Trust is registered under the Investment
identified in the Prior Release. The investment respectively. The New Underlying Index uses the
Company Act of 1940 (15 U.S.C. 80a–1) (‘‘1940 adviser to the Fund, Horizons ETFs Management same methodology as the widely accepted CBOE
Act’’). On September 25, 2017, the Trust filed with (US) LLC, also has changed from the adviser S&P 500 BuyWrite Index (BXM) but the New
the Commission an amendment to its Form N–1A identified in the Prior Release. The Adviser Underlying Index is calculated using out-of-the-
under the Securities Act of 1933 (15 U.S.C. 77a), previously served as sub-adviser to the Fund, as money S&P 500 Index (SPX) call options, rather
and under the 1940 Act relating to the Fund (File stated in the Prior Release. The services provided than at-the-money SPX call options. For additional
Nos. 333–183155 and 811–22732) (‘‘Registration by these entities are not changing from those information regarding the Underlying Index, see the
Statement’’). The description of the operation of the described in the Prior Release. Prior Release.
Trust and the Fund herein is based, in part, on the 9 The Underlying Index and ‘‘New Underlying 11 Commentary .01(a)(A) to NYSE Arca Rule 5.2–
Registration Statement. In addition, the Index’’ (as defined below) are provided by the Index E(j)(3) provides that components of an index or
Commission has issued an order granting certain Provider, which is unaffiliated with the Fund or the portfolio of U.S. Component Stocks underlying a
daltland on DSKBBV9HB2PROD with NOTICES
exemptive relief to the Recon Capital Series Trust Adviser. The Index Provider maintains, calculates series of Units listed pursuant to Rule 19b–4(e)
(subsequently renamed Horizons ETF Trust I), et al, and publishes information regarding the Underlying under the Act must meet specified criteria on an
under the 1940 Act. See Investment Company Act Index and New Underlying Index. The Index initial and continued listing basis. Commentary
Release No. 31961 (February 9 [sic], 2016) (File No. Provider is not a broker-dealer and is not affiliated .01(a)(A)(5) to NYSE Arca Rule 5.2–E(j)(3) states
812–14461) (‘‘Exemptive Order’’). with a broker-dealer and has implemented that all securities in the index or portfolio shall be
7 The Adviser is not registered as a broker-dealer procedures designed to prevent the use and U.S. Component Stocks listed on a national
and is affiliated with two broker-dealers and has dissemination of material, non-public information securities exchange and shall be NMS Stocks as
implemented and will maintain a fire wall with regarding the Underlying Index and New defined in Rule 600 of Regulation NMS under the
respect to its broker-dealer affiliates regarding Underlying Index. Act.
VerDate Sep<11>2014 18:07 Dec 05, 2017 Jkt 244001 PO 00000 Frm 00068 Fmt 4703 Sfmt 4703 E:\FR\FM\06DEN1.SGM 06DEN1](https://thefederalregister.org/doc/82_FR_57868/page/2.svg)
![Federal Register / Vol. 82, No. 233 / Wednesday, December 6, 2017 / Notices 57637
of-the-money call option written on the distributions. The New Underlying short (written) call option on the
S&P 500 Index.12 All securities in the Index consists of long positions in Reference Index.
Reference Index are listed and traded on securities in the Reference Index and an The Exchange represents that the
a U.S. national securities exchange. The out-of-the-money call option written on listing standards under NYSE Arca
option on the Reference Index is traded the S&P 500 Index. This option is Rules 5.2–E(j)(3) and 5.5–E(g)(2)
on a U.S. national options exchange. written (sold) systematically on the applicable to Units shall apply to the
Notwithstanding that the New monthly option writing date of the New Shares. In addition, the Exchange
Underlying Index does not meet the Underlying Index. represents that the Fund and the Shares
requirement of Commentary .01(a)(A)(5) will comply with all other requirements
The Operation of the Fund applicable to Units including, but not
to NYSE Arca Rule 5.2–E(j)(3), the
Exchange believes that the New The Fund, in return for the option limited to, requirements relating to the
Underlying Index is sufficiently broad- premium, will write call options that dissemination of key information such
based to deter potential manipulation in give the purchaser the right to receive a as the value of the New Underlying
that the Reference Index stocks are cash payment equal to any positive Index, IIV, and NAV, rules governing
among the most actively traded, highly difference between the value of the the trading of equity securities, trading
capitalized stocks traded in the U.S. The security and the exercise (or ‘‘strike’’) hours, trading halts, surveillance,
market value of the call option will not price on the expiration date of the information barriers and Information
represent more than 10% of the total option. Each month the Fund will write Bulletin to Equity Trading Permit
weight of the New Underlying Index. a single out-of-the-money call option on Holders (‘‘ETP Holders’’), as set forth in
the Reference Index as determined on Exchange rules applicable to Units and
Horizons S&P 500 Covered Call ETF prior Commission orders approving the
the monthly option writing date of the
According to the Registration New Underlying Index in accordance generic listing rules applicable to the
Statement, the Fund is an index fund with the New Underlying Index listing and trading of Units.16
that will employ a ‘‘passive methodology. Such short option
management’’ investment strategy in Surveillance
position would be reflected in the
seeking to achieve its objective of Fund’s portfolio as a negative cash The Exchange represents that trading
providing investment results that balance. in the Shares will be subject to the
generally correspond to the performance existing trading surveillances
The Fund generally will use a
of the New Underlying Index. The New administered by the Exchange, as well
replication methodology, meaning it
Underlying Index is comprised of two as cross-market surveillances
will invest in all of the securities
parts: (1) All the equity securities in the administered by the Financial Industry
comprising the New Underlying Index
Reference Index (i.e., the S&P 500 Regulatory Authority (‘‘FINRA’’) on
in proportion to the weightings in the
Index) in substantially similar weight as behalf of the Exchange, which are
New Underlying Index. The Fund will
the Reference Index 13; and (2) a single designed to detect violations of
seek correlation between the Fund’s
short (written) call option on the S&P Exchange rules and applicable federal
performance, before fees and expenses,
500 Index. The Fund will invest at least securities laws.17 The Exchange
and that of the New Underlying Index
80% of its total assets in securities that represents that these procedures are
of 0.95 or better. A figure of 1.00 would
comprise its New Underlying Index. adequate to properly monitor Exchange
represent perfect correlation.
trading of the Shares in all trading
The New Underlying Index Under normal market conditions,15 sessions and to deter and detect
The New Underlying Index measures the Fund will invest at least 80% of its violations of Exchange rules and
the performance of a hypothetical total assets in the securities included in applicable federal securities laws.
portfolio that employs a covered call the New Underlying Index. The Adviser The surveillances referred to above
strategy.14 A covered call strategy is anticipates that, generally, the Fund will generally focus on detecting securities
generally considered to be an hold all of the securities that comprise trading outside their normal patterns,
investment strategy in which an the New Underlying Index in proportion which could be indicative of
investor buys a security, and sells (or to their weightings in such index. manipulative or other violative activity.
‘‘writes’’) a call option on that security However, from time to time, the Fund When such situations are detected,
in an attempt to generate more income. may utilize a sampling methodology surveillance analysis follows and
The ‘‘premium’’ paid by the buyer of the under various circumstances where it investigations are opened, where
option provides income in addition to may not be possible or practicable to appropriate, to review the behavior of
the security’s dividends or other purchase all of the equity securities and all relevant parties for all relevant
write (sell) the call option comprising trading violations.
12 An ‘‘out-of-the-money’’ call option is one in the New Underlying Index. The Exchange or FINRA, on behalf of
which the exercise (or ‘‘strike’’) price of the option The option in the New Underlying the Exchange, or both, will
is above the market price of the security. Index will be traded on national
13 The Reference Index is a float-adjusted market
communicate as needed regarding
capitalization weighted index containing equity
securities exchanges. Purely for trading in the Shares, equity securities
securities of 500 industrial, information technology, informational purposes, as of September
utility and financial companies among other Global 29, 2017, the Reference Index and New 16 See, e.g., Securities Exchange Act Release No.
Industry Classification Standard (‘‘GICS®’’) sectors, Underlying Index included common 44551 (July 12, 2001), 66 FR 37716 (July 19, 2001)
regarded as generally representative of the U.S. (SR–PCX–2001–14) (order approving generic listing
stock market. A float-adjusted market capitalization
stocks of 505 companies, with a market standards for ICUs and Portfolio Depositary
capitalization range of between
daltland on DSKBBV9HB2PROD with NOTICES
weighted index weights each index component Receipts); Securities Exchange Act Release No.
according to its market capitalization, using the approximately $2.7 billion and $796.1 41983 (October 6, 1999), 64 FR 56008 (October 15,
number of shares that are readily available for billion. As of that date, the New 1999) (SR–PCX–98–29) (order approving rules for
purchase on the open market. listing and trading of ICUs).
14 Information regarding the New Underlying
Underlying Index also included a single 17 FINRA conducts cross-market surveillances on
Index is available at the new Web site identified in behalf of the Exchange pursuant to a regulatory
note 9, supra, [sic] which is different than the Web 15 The term ‘‘normal market conditions’’ for these services agreement. The Exchange is responsible for
site for the Underlying Index methodology purposes will have the same meaning as the term FINRA’s performance under this regulatory services
identified in the Prior Release. defined in NYSE Arca Rule 8.600–E(c)(5). agreement.
VerDate Sep<11>2014 18:07 Dec 05, 2017 Jkt 244001 PO 00000 Frm 00069 Fmt 4703 Sfmt 4703 E:\FR\FM\06DEN1.SGM 06DEN1](https://thefederalregister.org/doc/82_FR_57868/page/3.svg)
![Federal Register / Vol. 82, No. 233 / Wednesday, December 6, 2017 / Notices 57639
waiving the 30-day operative delay is Internet Web site (http://www.sec.gov/ III below, which Items have been
consistent with the protection of rules/sro.shtml). Copies of the prepared by FINRA. FINRA has
investors and the public interest. submission, all subsequent designated the proposed rule change as
According to the Exchange, waiver of amendments, all written statements concerned solely with the
the 30-day operative delay would with respect to the proposed rule administration of the self-regulatory
permit the timely implementation of change that are filed with the organization under Section
Fund efficiencies resulting from Commission, and all written 19(b)(3)(A)(iii) of the Act 3 and Rule
tracking an index that requires the communications relating to the 19b–4(f)(3) thereunder,4 which renders
writing of a single option on the proposed rule change between the the proposal effective upon receipt of
Reference Index, instead of writing Commission and any person, other than this filing by the Commission. The
options on multiple options-eligible those that may be withheld from the Commission is publishing this notice to
securities in the Reference Index. In public in accordance with the solicit comments on the proposed rule
addition, the Commission believes that provisions of 5 U.S.C. 552, will be change from interested persons.
the proposal does not raise unique or available for Web site viewing and
novel regulatory issues. Therefore, the printing in the Commission’s Public I. Self-Regulatory Organization’s
Commission hereby waives the 30-day Reference Room, 100 F Street NE., Statement of the Terms of the Substance
operative delay and designates the Washington, DC 20549 on official of the Proposed Rule Change
proposal operative upon filing.24 business days between the hours of FINRA is proposing to make technical
At any time within 60 days of the 10:00 a.m. and 3:00 p.m. Copies of the changes to FINRA’s Trade Reporting
filing of the proposed rule change, the filing also will be available for Facility limited liability company
Commission summarily may inspection and copying at the principal agreements, as they appear in the
temporarily suspend the rule change if office of the Exchange. All comments FINRA Manual, to reflect the second
it appears to the Commission that such received will be posted without change. amendment and restatement of such
action is necessary or appropriate in the Persons submitting comments are agreements.
public interest, for the protection of cautioned that we do not redact or edit The text of the proposed rule change
investors, or otherwise in furtherance of personal identifying information from is available on FINRA’s Web site at
the purposes of the Act. If the comment submissions. You should http://www.finra.org, at the principal
Commission takes such action, the submit only information that you wish office of FINRA and at the
Commission shall institute proceedings to make available publicly. All Commission’s Public Reference Room.
to determine whether the proposed rule submissions should refer to File
change should be approved or II. Self-Regulatory Organization’s
Number SR–NYSEArca–2017–123 and
disapproved. should be submitted on or before Statement of the Purpose of, and
December 27, 2017. Statutory Basis for, the Proposed Rule
IV. Solicitation of Comments Change
For the Commission, by the Division of
Interested persons are invited to Trading and Markets, pursuant to delegated In its filing with the Commission,
submit written data, views, and authority.25 FINRA included statements concerning
arguments concerning the foregoing, Eduardo A. Aleman the purpose of and basis for the
including whether the proposed rule proposed rule change and discussed any
Assistant Secretary.
change is consistent with the Act. comments it received on the proposed
[FR Doc. 2017–26223 Filed 12–5–17; 8:45 am]
Comments may be submitted by any of rule change. The text of these statements
BILLING CODE 8011–01–P
the following methods: may be examined at the places specified
Electronic Comments in Item IV below. FINRA has prepared
SECURITIES AND EXCHANGE summaries, set forth in sections A, B,
• Use the Commission’s Internet and C below, of the most significant
comment form (http://www.sec.gov/ COMMISSION
aspects of such statements.
rules/sro.shtml); or [Release No. 34–82189; File No. SR–FINRA–
• Send an email to rule-comments@ 2017–034] A. Self-Regulatory Organization’s
sec.gov. Please include File Number SR– Statement of the Purpose of, and
NYSEArca–2017–123 on the subject Self-Regulatory Organizations; Statutory Basis for, the Proposed Rule
line. Financial Industry Regulatory Change
Authority, Inc.; Notice of Filing and
Paper Comments Immediate Effectiveness of a Proposed 1. Purpose
• Send paper comments in triplicate Rule Change Relating to the Trade The FINRA Trade Reporting Facilities
to Secretary, Securities and Exchange Reporting Facility Limited Liability (‘‘TRFs’’) are facilities that FINRA
Commission, 100 F Street NE., Company Agreements members use to report over-the-counter
Washington, DC 20549–1090. (‘‘OTC’’) transactions in NMS stocks in
November 30, 2017.
All submissions should refer to File accordance with FINRA rules. There
Pursuant to Section 19(b)(1) of the currently are two TRFs: The FINRA/
Number SR–NYSEArca–2017–123. This Securities Exchange Act of 1934
file number should be included on the Nasdaq TRF and the FINRA/NYSE
(‘‘Act’’) 1 and Rule 19b–4 thereunder,2 TRF.5 The operation of each TRF is
subject line if email is used. To help the notice is hereby given that on November
Commission process and review your 21, 2017, Financial Industry Regulatory 3 15 U.S.C. 78s(b)(3)(A)(iii).
comments more efficiently, please use Authority, Inc. (‘‘FINRA’’) filed with the
daltland on DSKBBV9HB2PROD with NOTICES
4 17 CFR 240.19b–4(f)(3).
only one method. The Commission will Securities and Exchange Commission 5 The establishment of each TRF was subject to
post all comments on the Commission’s (‘‘Commission’’) the proposed rule a proposed rule change filed with the Commission.
change as described in Items I, II, and See Securities Exchange Act Release No. 54084
24 For purposes only of waiving the 30-day (June 30, 2006), 71 FR 38935 (July 10, 2006) (Order
operative delay, the Commission has also Approving File No. SR–NASD–2005–087); and
25 17 CFR 200.30–3(a)(12).
considered the proposed rule’s impact on Securities Exchange Act Release No. 55325
1 15 U.S.C. 78s(b)(1).
efficiency, competition, and capital formation. See (February 21, 2007), 72 FR 8820 (February 27, 2007)
15 U.S.C. 78c(f). 2 17 CFR 240.19b–4. Continued
VerDate Sep<11>2014 18:07 Dec 05, 2017 Jkt 244001 PO 00000 Frm 00071 Fmt 4703 Sfmt 4703 E:\FR\FM\06DEN1.SGM 06DEN1](https://thefederalregister.org/doc/82_FR_57868/page/5.svg)
Document Created: 2017-12-06 00:21:39
Document Modified: 2017-12-06 00:21:39
| 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 | |
| FR Citation | 82 FR 57635 |
2025 Federal Register | Disclaimer | Privacy Policy
USC | CFR | eCFR