83 FR 29589 - Self-Regulatory Organizations; Cboe BZX Exchange, Inc.; Order Instituting Proceedings To Determine Whether To Approve or Disapprove a Proposed Rule Change, as Modified by Amendment No. 2 Thereto, To List and Trade Shares of Eighteen ADRPLUS Funds of the Precidian ETFs Trust Under Rule 14.11(i), Managed Fund Shares
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 83, Issue 122 (June 25, 2018)
Federal Register Volume 83, Issue 122 (June 25, 2018)
| Page Range | 29589-29593 | |
| FR Document | 2018-13508 |
[Federal Register Volume 83, Number 122 (Monday, June 25, 2018)] [Notices] [Pages 29589-29593] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2018-13508] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-83467; File No. SR-CboeBZX-2018-019] Self-Regulatory Organizations; Cboe BZX Exchange, Inc.; Order Instituting Proceedings To Determine Whether To Approve or Disapprove a Proposed Rule Change, as Modified by Amendment No. 2 Thereto, To List and Trade Shares of Eighteen ADRPLUS Funds of the Precidian ETFs Trust Under Rule 14.11(i), Managed Fund Shares June 19, 2018. I. Introduction On March 5, 2018, Cboe BZX Exchange, Inc. filed with the Securities and Exchange Commission (``Commission''), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4 thereunder,\2\ a proposed rule change to list and trade shares (``Shares'') of eighteen ADRPLUS Funds (``Funds'') of the Precidian ETFs Trust (``Trust''). The proposed rule change was published for comment in the Federal Register on March 21, 2018.\3\ On April 25, 2018, the Exchange filed Amendment No. 1 to the proposed rule change,\4\ and the Commission, pursuant to Section 19(b)(2) of the Act,\5\ designated a longer [[Page 29590]] period within which to approve the proposed rule change, disapprove the proposed rule change, or institute proceedings to determine whether to disapprove the proposed rule change.\6\ On May 17, 2018, the Exchange filed Amendment No. 2 to the proposed rule change.\7\ The Commission has received no comment letters on the proposed rule change, as modified by Amendment No. 2 thereto. This order institutes proceedings under Section 19(b)(2)(B) of the Act \8\ to determine whether to approve or disapprove the proposed rule change, as modified by Amendment No. 2 thereto. --------------------------------------------------------------------------- \1\ 15 U.S.C. 78s(b)(1). \2\ 17 CFR 240.19b-4. \3\ See Securities Exchange Act Release No. 82881 (March 15, 2018), 83 FR 12449. \4\ Amendment No. 1 replaced and superseded the original rule filing in its entirety. Amendment No. 1 is available at https://www.sec.gov/comments/sr-cboebzx-2018-019/cboebzx2018019-3551361-162325.pdf. Amendment No. 1 was subsequently replaced and superseded in its entirety by Amendment No. 2. See note 7, infra. \5\ 15 U.S.C. 78s(b)(2). \6\ See Securities Exchange Act Release No. 83102 (April 25, 2018), 83 FR 19126 (May 1, 2018). The Commission designated June 19, 2018, as the date by which the Commission would either approve or disapprove, or institute proceedings to determine whether to disapprove, the proposed rule change. \7\ In Amendment No. 2, which amends the proposed rule change and replaces and supersedes Amendment No. 1 in its entirety, the Exchange: (1) Specified that the Funds' investments in derivatives would be limited to over-the-counter (``OTC'') currency swaps; (2) corrected references to Exchange rules; (3) deleted a representation that the Funds may not meet the requirement in Exchange Rule 14.11(i)(4)(C)(iv)(b) that the aggregate gross notional value of listed derivatives based on any single underlying reference asset shall not exceed 30% of the weight of the portfolio (including gross notional exposures); (4) represented that the Funds' investments in cash equivalents would be limited to the cash equivalents listed in Exchange Rule 14.11(i)(4)(C)(iii); (5) represented that the Trust would comply with the surveillance requirements for Managed Fund Shares under Exchange Rule 14.11(i); (6) represented that each Fund expects to invest in excess of 95% of its net assets in the Unhedged ADRs (as defined herein), and that each Fund expects that the gross notional value of the Currency Hedge (as defined herein) would be equal to the value of the Unhedged ADRs, which would be approximately 50% of the weight of the portfolio (including gross notional exposures); (7) represented that the Exchange will suspend trading and commence delisting proceedings for a Fund if the Unhedged ADR held by the Fund has been suspended from trading or delisted by the Unhedged ADR's listing exchange; (8) represented that the Exchange or FINRA, on behalf of the Exchange, is able to access, as needed, trade information for certain fixed income instruments reported to TRACE; (9) deleted repetitive information and information irrelevant to this proposal; and (10) made other clarifications, corrections, and technical and conforming changes. Amendment No. 2 is available at: https://www.sec.gov/comments/sr-cboebzx-2018-019/cboebzx2018019-3665011-162423.pdf. Because Amendment No. 2 to the proposed rule change does not materially alter the substance of the proposed rule change or raise unique or novel regulatory issues, Amendment No. 2 is not subject to notice and comment. \8\ 15 U.S.C. 78s(b)(2)(B). --------------------------------------------------------------------------- II. Description of the Proposed Rule Change The Exchange proposes to list and trade Shares of eighteen different series of the Trust under Rule 14.11(i), which governs the listing and trading of Managed Fund Shares on the Exchange. Specifically, the Exchange proposes to list Shares of Anheuser-Busch InBev SA/NV ADRPLUS Fund, AstraZeneca PLC ADRPLUS Fund, Banco Santander, S.A. ADRPLUS Fund, BP P.L.C. ADRPLUS Fund, British American Tobacco p.l.c. ADRPLUS Fund, Diageo plc ADRPLUS Fund, GlaxoSmithKline plc ADRPLUS Fund, HSBC Holdings Plc ADRPLUS Fund, Mitsubishi UFJ Financial Group, Inc. ADRPLUS Fund, Novartis AG ADRPLUS Fund, Novo Nordisk A/S (B Shares) ADRPLUS Fund, Royal Dutch Shell plc (Class A) ADRPLUS Fund, Royal Dutch Shell plc (Class B) ADRPLUS Fund, Sanofi ADRPLUS Fund, SAP AG ADRPLUS Fund, Total S.A. ADRPLUS Fund, Toyota Motor Corporation ADRPLUS Fund, and Vodafone Group Plc ADRPLUS Fund. The Funds are a series of, and the Shares will be offered by, the Trust, which was organized as a Delaware statutory trust on August 27, 2010.\9\ Precidian Funds LLC (``Adviser'') \10\ will serve as the investment adviser to the Funds.\11\ The Exchange has made the following representations and statements in describing the Funds and their investment strategies.\12\ --------------------------------------------------------------------------- \9\ The Exchange represents that the Trust is registered with the Commission as an open-end management investment company and has filed a registration statement on behalf of the Funds on Form N-1A (``Registration Statement'') with the Commission. See Registration Statement on Form N-1A for the Trust, filed with the Commission on June 14, 2017 (File Nos. 333-171987 and 811-22524). The descriptions of the Funds and the Shares contained herein are based, in part, on information in the Registration Statement. \10\ The Exchange represents that the Commission has issued an order granting certain exemptive relief to the Adviser and open-end management companies advised by the Adviser under the Investment Company Act of 1940 (15 U.S.C. 80a-1). See Investment Company Act Release No. 32622 (May 2, 2017) (File No. 812-14584). \11\ According to the Exchange, the Adviser is not a registered broker-dealer and is not affiliated with a broker-dealer. In addition, Adviser personnel who make decisions regarding a Fund's portfolio are subject to procedures designed to prevent the use and dissemination of material nonpublic information regarding the Fund's portfolio. In the event that (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 a registered broker-dealer or becomes affiliated with a broker-dealer, it will implement and maintain a fire wall with respect to its relevant personnel or such broker- dealer affiliate, as applicable, regarding access to information concerning the composition and/or changes to the portfolio, and will be subject to procedures designed to prevent the use and dissemination of material non-public information regarding such portfolio. \12\ Additional information regarding the Funds, the Trust, and the Shares, including investment strategies, risks, creation and redemption procedures, fees, portfolio holdings disclosure policies, calculation of net asset value (``NAV''), distributions, and taxes, among other things, can be found in Amendment No. 2 to the proposed rule change and the Registration Statement, as applicable. See supra notes 7 and 9, respectively. --------------------------------------------------------------------------- A. Exchange's Description of the ADRPLUS Funds Each Fund seeks to provide investment results that correspond generally, before fees and expenses, to the price and yield performance of a particular American Depositary Receipt, hedged against fluctuations in the exchange rate between the U.S. dollar and the local currency of the foreign security underlying the American Depositary Receipt (``Local Currency''). The following chart lists the underlying company and the Local Currency for each of the Funds. ------------------------------------------------------------------------ Underlying Fund name company Local currency ------------------------------------------------------------------------ Anheuser-Busch InBev SA/NV Anheuser-Busch Euro. ADRPLUS Fund. InBev SA/NV. AstraZeneca PLC ADRPLUS Fund.. AstraZeneca PLC.. British pound. Banco Santander, S.A. ADRPLUS Banco Santander, Euro. Fund. S.A. BP P.L.C. ADRPLUS Fund........ BP p.l.c......... British pound. British American Tobacco British American British pound. p.l.c. ADRPLUS Fund. Tobacco p.l.c. Diageo plc ADRPLUS Fund....... Diageo plc....... British pound. GlaxoSmithKline plc ADRPLUS GlaxoSmithKline British pound. Fund. plc. HSBC Holdings Plc ADRPLUS Fund HSBC Holdings Plc British pound. Mitsubishi UFJ Financial Mitsubishi UFJ Japanese yen. Group, Inc. ADRPLUS Fund. Financial Group, Inc. Novartis AG ADRPLUS Fund...... Novartis AG...... Swiss franc. Novo Nordisk A/S (B Shares) Novo Nordisk A/S Danish krone. ADRPLUS Fund. (B Shares). Royal Dutch Shell plc (Class Royal Dutch Shell Euro. A) ADRPLUS Fund. plc (Class A). Royal Dutch Shell plc (Class Royal Dutch Shell British pound. B) ADRPLUS Fund. plc (Class B). Sanofi ADRPLUS Fund........... Sanofi........... Euro. SAP AG ADRPLUS Fund........... SAP AG........... Euro. [[Page 29591]] Total S.A. ADRPLUS Fund....... Total S.A........ Euro. Toyota Motor Corporation Toyota Motor Japanese yen. ADRPLUS Fund. Corporation. Vodafone Group Plc ADRPLUS Vodafone Group British pound. Fund. Plc. ------------------------------------------------------------------------ Each of the Funds will hold only: (i) Shares of an American Depositary Receipt (``Unhedged ADR'') listed on a U.S. national securities exchange; (ii) OTC currency swaps that hedge against fluctuations in the exchange rate (``Exchange Rate'') between the U.S. dollar and the Local Currency (``Currency Hedge''); and (iii) cash and cash equivalents.\13\ --------------------------------------------------------------------------- \13\ The Exchange states that for purposes of this filing and consistent with Rule 14.11(i)(4)(C)(iii), cash equivalents are short-term instruments with maturities of less than three months, that include only the following: (i) U.S. Government securities, including bills, notes, and bonds differing as to maturity and rates of interest, which are either issued or guaranteed by the U.S. Treasury or by U.S. Government agencies or instrumentalities; (ii) certificates of deposit issued against funds deposited in a bank or savings and loan association; (iii) bankers acceptances, which are short-term credit instruments used to finance commercial transactions; (iv) repurchase agreements and reverse repurchase agreements; (v) bank time deposits, which are monies kept on deposit with banks or savings and loan associations for a stated period of time at a fixed rate of interest; (vi) commercial paper, which are short-term unsecured promissory notes; and (vii) money market funds. --------------------------------------------------------------------------- The Exchange states that the Funds will provide investors with the opportunity to easily eliminate currency exposure that they may not even realize exists with Unhedged ADRs without having to transact in the currency derivatives market. The Exchange believes that this confers a significant benefit to investors and the broader marketplace by adding transparency and simplifying the process of eliminating risk from an investor's portfolio. As further described below in the section entitled Policy Discussion, the Exchange believes that the policy concerns underlying the listing rules which the Funds would or may not meet, specifically Rules 14.11(i)(4)(C)(i)(a)(3)-(4) \14\ and 14.11(i)(4)(C)(v),\15\ are mitigated by the structure, holdings, and purpose of the Funds. --------------------------------------------------------------------------- \14\ The Exchange states that the Funds will not meet: (i) The requirement under Exchange Rule 14.11(i)(4)(C)(i)(a)(3) that the most heavily weighted component stock shall not exceed 30% of the equity weight of the portfolio; and (ii) the requirement under Exchange Rule 14.11(i)(4)(C)(i)(a)(4) that the equity portion of the portfolio shall include a minimum of 13 component stocks. \15\ The Exchange states that the Funds may not meet the requirement under Exchange Rule 14.11(i)(4)(C)(v) that the aggregate gross notional value of OTC derivatives shall not exceed 20% of the weight of the portfolio (including gross notional exposures). --------------------------------------------------------------------------- The Trust is required to comply with Rule 10A-3 under the Act \16\ for the initial and continued listing of the Shares of each Fund. In addition, the Exchange represents that the Shares of each Fund will meet and be subject to all other requirements of the Generic Listing Rules, as defined below, and other applicable continued listing requirements for Managed Fund Shares under Exchange Rule 14.11(i), including those requirements regarding the Disclosed Portfolio (as defined in the Exchange rules) and the requirement that the Disclosed Portfolio and the NAV will be made available to all market participants at the same time,\17\ intraday indicative value,\18\ suspension of trading or removal,\19\ trading halts,\20\ disclosure,\21\ firewalls,\22\ and surveillance.\23\ Further, at least 100,000 Shares of each Fund will be outstanding upon the commencement of trading.\24\ The Exchange also provides that all statements and representations made in the filing regarding the description of the portfolio or reference assets, limitations on portfolio holdings or reference assets, dissemination and availability of reference assets and intraday indicative values, and the applicability of Exchange listing rules specified in the filing will constitute continued listing requirements for the Funds. The Exchange states that the Trust, on behalf of the Funds, has represented to the Exchange that it will advise the Exchange of any failure by a Fund or the Shares to comply with the continued listing requirements, and, pursuant to its obligations under Section 19(g)(1) of the Act, the Exchange will surveil for compliance with the continued listing requirements. If a Fund or the Shares are not in compliance with the applicable listing requirements, the Exchange will commence delisting procedures under Exchange Rule 14.12. --------------------------------------------------------------------------- \16\ 17 CFR 240.10A-3. \17\ See Exchange Rules 14.11(i)(4)(A)(ii) and 14.11(i)(4)(B)(ii). \18\ See Exchange Rule 14.11(i)(4)(B)(i). \19\ See Exchange Rule 14.11(i)(4)(B)(iii). \20\ See Exchange Rule 14.11(i)(4)(B)(iv). The Exchange will also halt trading in a Fund where there has been a regulatory trading halt declared in the associated Unhedged ADR until trading in the Unhedged ADR resumes. \21\ See Exchange Rule 14.11(i)(6). \22\ See Exchange Rule 14.11(i)(7). \23\ See Exchange Rule 14.11(i)(2)(C). \24\ See Exchange Rule 14.11(i)(4)(A)(i). --------------------------------------------------------------------------- B. Exchange's Policy Discussion The Exchange believes that, while the Funds do not meet the Generic Listing Standards, in particular Rules 14.11(i)(4)(C)(i)(a)(3) and (4) and 14.11(i)(4)(C)(v), the policy issues that those rules are intended to address are otherwise mitigated by the structure, holdings, and purpose of the Funds.\25\ The Exchange believes that Rule 14.11(i)(4)(C)(i)(a)(3) is intended to ensure that no single equity security constitutes too concentrated of a position in a series of Managed Fund Shares, and Rule 14.11(i)(4)(C)(i)(a)(4) is similarly intended to diversify the holdings of a series of Managed Fund Shares. The Exchange believes that these policy concerns are mitigated because: (i) The Unhedged ADR will meet the market cap and liquidity requirements of Rules 14.11(i)(4)(C)(i)(a)(1) and (2); and (ii) the intended function of the Funds is to eliminate currency exposure risk for a single security, which means that the Funds are necessarily concentrated. The Exchange represents that the creation and redemption mechanism will provide a near frictionless arbitrage opportunity that would minimize the risk of manipulation of either the Unhedged ADR or the applicable Fund and, thus, mitigate the manipulation concerns that Rules 14.11(i)(4)(C)(i)(a)(3) and (4) were intended to address. --------------------------------------------------------------------------- \25\ The Exchange represents that each Fund expects to invest in excess of 95% of its net assets in the Unhedged ADRs, and each Fund expects that the gross notional value of the Currency Hedge would be equal to the value of the Unhedged ADRs, which would be approximately 50% of the weight of the portfolio (including gross notional exposures). --------------------------------------------------------------------------- The Exchange also believes that the policy issues that Rule 14.11(i)(4)(C)(v) is intended to address are also mitigated by the way that the Funds would use OTC currency swaps. According to the Exchange, the rule is intended to mitigate concerns around the manipulability of a particular underlying reference asset or derivatives contract and to minimize counterparty risk. While the Currency Hedge positions taken by the Currency Hedged ADRs would not meet the Generic Listing Standards related to OTC [[Page 29592]] derivatives holdings, the Exchange believes that the policy concerns about limiting exposure to potentially manipulable underlying reference assets that the Generic Listing Standards are intended to address are otherwise mitigated by the liquidity in the underlying spot currency market that prevents manipulation of the reference prices used by the Currency Hedge. Further, the Exchange states that the Funds will attempt to limit counterparty risk in OTC currency swaps by: (i) Entering into such contracts only with counterparties the Advisor believes are creditworthy; (ii) limiting a Fund's exposure to each counterparty; and (iii) monitoring the creditworthiness of each counterparty and the Fund's exposure to each counterparty on an ongoing basis. The Exchange believes that counterparty risk associated with OTC currency swaps is further mitigated because the currency swaps are settled on a daily basis and, thus, the counterparty risk for any particular swap is limited in two ways--first, that the counterparty credit exposure is always limited to a 24 hour period and second, that the exposure of the swap is only to the movement in the currencies over that same 24 hour period. III. Proceedings To Determine Whether To Approve or Disapprove SR- CboeBZX-2018-019 and Grounds for Disapproval Under Consideration The Commission is instituting proceedings pursuant to Section 19(b)(2)(B) of the Act \26\ to determine whether the proposed rule change, as modified by Amendment No. 2, should be approved or disapproved. Institution of such proceedings is appropriate at this time in view of the legal and policy issues raised by the proposed rule change. Institution of proceedings does not indicate that the Commission has reached any conclusions with respect to any of the issues involved. Rather, as described below, the Commission seeks and encourages interested persons to provide comments on the proposed rule change. --------------------------------------------------------------------------- \26\ 15 U.S.C. 78s(b)(2)(B). --------------------------------------------------------------------------- Pursuant to Section 19(b)(2)(B) of the Act,\27\ the Commission is providing notice of the grounds for disapproval under consideration. The Commission is instituting proceedings to allow for additional analysis of the proposed rule change's consistency with Section 6(b)(5) of the Act, which requires, among other things, that the rules of a national securities exchange be ``designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade,'' and ``to protect investors and the public interest.'' \28\ --------------------------------------------------------------------------- \27\ Id. \28\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- IV. Procedure: Request for Written Comments The Commission requests that interested persons provide written submissions of their views, data, and arguments with respect to the issues identified above, as well as any other concerns they may have with the proposal. In particular, the Commission invites the written views of interested persons concerning whether the proposal is consistent with Section 6(b)(5) or any other provision of the Act, or the rules and regulations thereunder. Although there do not appear to be any issues relevant to approval or disapproval that would be facilitated by an oral presentation of views, data, and arguments, the Commission will consider, pursuant to Rule 19b-4, any request for an opportunity to make an oral presentation.\29\ --------------------------------------------------------------------------- \29\ Section 19(b)(2) of the Act, as amended by the Securities Act Amendments of 1975, Public Law 94-29 (June 4, 1975), grants the Commission flexibility to determine what type of proceeding--either oral or notice and opportunity for written comments--is appropriate for consideration of a particular proposal by a self-regulatory organization. See Securities Act Amendments of 1975, Senate Comm. on Banking, Housing & Urban Affairs, S. Rep. No. 75, 94th Cong., 1st Sess. 30 (1975). --------------------------------------------------------------------------- Interested persons are invited to submit written data, views, and arguments regarding whether the proposal should be approved or disapproved by July 16, 2018. Any person who wishes to file a rebuttal to any other person's submission must file that rebuttal by July 30, 2018. The Commission asks that commenters address the sufficiency of the Exchange's statements in support of the proposal, which are set forth in Amendment No. 2 to the proposed rule change,\30\ in addition to any other comments they may wish to submit about the proposed rule change. --------------------------------------------------------------------------- \30\ See supra note 7. --------------------------------------------------------------------------- The Commission notes that the Exchange proposes to list and trade, pursuant to its Rule 14.11(i), Managed Fund Shares of Funds that would invest in shares of a single Unhedged ADR, along with a Currency Hedge and cash and cash equivalents. A proposal to list and trade Managed Fund Shares hat are designed to reflect, generally, the price and performance of a single equity security, hedged against fluctuations in a given exchange rate, is novel. Accordingly, the Commission specifically seeks comment on whether it is appropriate to permit the listing and trading of shares of an exchange-traded fund with underlying holdings concentrated in a single (or a few unique) equity securities. What impact, if any, would such shares have on the market for the underlying equity security (or securities)? What impact, if any, would such shares have on the equity markets more generally, especially if funds investing in a single equity security proliferate? Are the listing and trading of such shares consistent with the requirements of Section 6(b)(5) of the Act, which, among other things, requires that the rules of an exchange be designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, and, in general, to protect investors and the public interest? 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 rule-comments@sec.gov. Please include File Number SR-CboeBZX-2018-019 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 Numbers SR-CboeBZX-2018-019. 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 website (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 website 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 these filings also will be available for inspection and copying at the principal office of the Exchange. All comments received will be posted without change; the Commission does not edit personal [[Page 29593]] identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR-CboeBZX-2018-019 and should be submitted on or before July 16, 2018. Rebuttal comments should be submitted by July 30, 2018. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\31\ --------------------------------------------------------------------------- \31\ 17 CFR 200.30-3(a)(57). --------------------------------------------------------------------------- Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2018-13508 Filed 6-22-18; 8:45 am] BILLING CODE 8011-01-P
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protections are substantially similar to provisions of 5 U.S.C. 552, will be Commission, 100 F Street NE,
protections offered on Phlx. Therefore, available for website viewing and Washington, DC 20549–2521.
the Commission designates the printing in the Commission’s Public SUPPLEMENTARY INFORMATION: The draft
proposed rule change operative upon Reference Room, 100 F Street NE, strategic plan is available at the
filing.47 Washington, DC 20549 on official Commission’s website at https://
At any time within 60 days of the business days between the hours of www.sec.gov/files/sec-strategic-plan-
filing of such proposed rule change, the 10:00 a.m. and 3:00 p.m. Copies of such 2018-2022.pdf or by contacting Nicole
Commission summarily may filing also will be available for Puccio, Branch Chief, Office of
temporarily suspend such rule change if inspection and copying at the principal Financial Management, at (202) 551–
it appears to the Commission that such office of the Exchange. All comments 6638, Securities and Exchange
action is necessary or appropriate in the received will be posted without change. Commission, 100 F Street NE,
public interest, for the protection of Persons submitting comments are Washington, DC 20549–2521.
investors, or otherwise in furtherance of cautioned that we do not redact or edit
the purposes of the Act. If the By the Commission.
personal identifying information from
Commission takes such action, the comment submissions. You should Dated: June 19, 2018.
Commission shall institute proceedings submit only information that you wish Brent J. Fields,
under Section 19(b)(2)(B) of the Act 48 to to make available publicly. All Secretary.
determine whether the proposed rule submissions should refer to File [FR Doc. 2018–13484 Filed 6–22–18; 8:45 am]
change should be approved or Number SR–ISE–2018–55, and should BILLING CODE 8011–01–P
disapproved. be submitted on or before July 16, 2018.
IV. Solicitation of Comments For the Commission, by the Division of
Trading and Markets, pursuant to delegated SECURITIES AND EXCHANGE
Interested persons are invited to COMMISSION
authority.49
submit written data, views, and
arguments concerning the foregoing, Eduardo A. Aleman,
[Release No. 34–83467; File No. SR–
including whether the proposed rule Assistant Secretary. CboeBZX–2018–019]
change is consistent with the Act. [FR Doc. 2018–13505 Filed 6–22–18; 8:45 am]
Comments may be submitted by any of BILLING CODE 8011–01–P Self-Regulatory Organizations; Cboe
the following methods: BZX Exchange, Inc.; Order Instituting
Proceedings To Determine Whether To
Electronic Comments SECURITIES AND EXCHANGE Approve or Disapprove a Proposed
• Use the Commission’s Internet COMMISSION Rule Change, as Modified by
comment form (http://www.sec.gov/ Amendment No. 2 Thereto, To List and
[Release No. 34–83463]
rules/sro.shtml); or Trade Shares of Eighteen ADRPLUS
• Send an e-mail to rule- Draft 2018–2022 Strategic Plan for Funds of the Precidian ETFs Trust
comments@sec.gov. Please include File Securities and Exchange Commission Under Rule 14.11(i), Managed Fund
Number SR–ISE–2018–55 on the subject Shares
line. AGENCY: Securities and Exchange
Commission. June 19, 2018.
Paper Comments
ACTION: Request for comment. I. Introduction
• Send paper comments in triplicate
to Secretary, Securities and Exchange SUMMARY: The Securities and Exchange On March 5, 2018, Cboe BZX
Commission, 100 F Street NE, Commission (SEC) is providing notice Exchange, Inc. filed with the Securities
Washington, DC 20549–1090. that it is seeking comments on its draft and Exchange Commission
All submissions should refer to File 2018–2022 Strategic Plan. The draft (‘‘Commission’’), pursuant to Section
Number SR–ISE–2018–55. This file Strategic Plan includes a draft of the 19(b)(1) of the Securities Exchange Act
number should be included on the SEC’s mission, vision, values, strategic of 1934 (‘‘Act’’) 1 and Rule 19b–4
subject line if e-mail is used. To help the goals, and planned initiatives. thereunder,2 a proposed rule change to
Commission process and review your DATES: Comments should be received on list and trade shares (‘‘Shares’’) of
comments more efficiently, please use or before July 25, 2018. eighteen ADRPLUS Funds (‘‘Funds’’) of
only one method. The Commission will ADDRESSES: Comments may be
the Precidian ETFs Trust (‘‘Trust’’). The
post all comments on the Commission’s submitted by any of the following proposed rule change was published for
Internet website (http://www.sec.gov/ methods: comment in the Federal Register on
rules/sro.shtml). Copies of the March 21, 2018.3 On April 25, 2018, the
submission, all subsequent Electronic Comments Exchange filed Amendment No. 1 to the
amendments, all written statements Send an email to proposed rule change,4 and the
with respect to the proposed rule PerformancePlanning@sec.gov. Commission, pursuant to Section
change that are filed with the 19(b)(2) of the Act,5 designated a longer
Commission, and all written Paper Comments
communications relating to the Send paper comments to Nicole 1 15 U.S.C. 78s(b)(1).
proposed rule change between the Puccio, Branch Chief, Securities and 2 17 CFR 240.19b–4.
3 See Securities Exchange Act Release No. 82881
Commission and any person, other than Exchange Commission, 100 F Street NE,
amozie on DSK3GDR082PROD with NOTICES1
(March 15, 2018), 83 FR 12449.
those that may be withheld from the Washington, DC 20549–2521. 4 Amendment No. 1 replaced and superseded the
public in accordance with the FOR FURTHER INFORMATION CONTACT: original rule filing in its entirety. Amendment
Nicole Puccio, Branch Chief, Office of No. 1 is available at https://www.sec.gov/comments/
47 For purpose only of waiving the operative sr-cboebzx-2018-019/cboebzx2018019-3551361-
delay, the Commission has considered the proposed
Financial Management, at (202) 551– 162325.pdf. Amendment No. 1 was subsequently
rule’s impact on efficiency, competition, and capital 6638, Securities and Exchange replaced and superseded in its entirety by
formation. See 15 U.S.C. 78c(f). Amendment No. 2. See note 7, infra.
48 15 U.S.C. 78s(b)(2)(B). 49 17 CFR 200.30–3(a)(12). 5 15 U.S.C. 78s(b)(2).
VerDate Sep<11>2014 17:58 Jun 22, 2018 Jkt 244001 PO 00000 Frm 00062 Fmt 4703 Sfmt 4703 E:\FR\FM\25JNN1.SGM 25JNN1](https://thefederalregister.org/doc/83_FR_29711/page/1.svg)
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identifying information from II. Self-Regulatory Organization’s processes with those of its Affiliated
submissions. You should submit only Statement of the Purpose of, and Exchanges. The Exchange believes that
information that you wish to make Statutory Basis for, the Proposed Rule moving the co-location and direct
available publicly. All submissions Change connectivity rules to their new location
should refer to File Number SR– In its filing with the Commission, the will facilitate the use of the Rulebook by
CboeBZX–2018–019 and should be Exchange included statements Members of the Exchange who are
submitted on or before July 16, 2018. concerning the purpose of and basis for members of other Affiliated Exchanges.
Rebuttal comments should be submitted the proposed rule change and discussed Moreover, the proposed changes are of
by July 30, 2018. any comments it received on the a non-substantive nature and will not
For the Commission, by the Division of proposed rule change. The text of these amend the relocated rules other than to
Trading and Markets, pursuant to delegated statements may be examined at the update their numbers and make
authority.31 places specified in Item IV below. The conforming cross-reference changes.
Eduardo A. Aleman, Exchange has prepared summaries, set 2. Statutory Basis
Assistant Secretary. forth in sections A, B, and C below, of
[FR Doc. 2018–13508 Filed 6–22–18; 8:45 am] the most significant aspects of such The Exchange believes that its
statements. proposal is consistent with Section 6(b)
BILLING CODE 8011–01–P
of the Act,5 in general, and furthers the
A. Self-Regulatory Organization’s objectives of Section 6(b)(5) of the Act,6
Statement of the Purpose of, and in particular, in that it is designed to
SECURITIES AND EXCHANGE
Statutory Basis for, the Proposed Rule promote just and equitable principles of
COMMISSION
Change trade, to remove impediments to and
[Release No. 34–83466; File No. SR– 1. Purpose perfect the mechanism of a free and
NASDAQ–2018–045] open market and a national market
The Exchange proposes to relocate its system, and, in general to protect
Self-Regulatory Organizations; The rules governing co-location and direct investors and the public interest, by
Nasdaq Stock Market LLC; Notice of connectivity services, which presently improving the way its Rulebook is
Filing and Immediate Effectiveness of comprise Rules 7034 and 7051, organized, providing ease of reference in
Proposed Rule Change To Relocate respectively. The Exchange proposes to locating co-location and direct
the Exchange’s Rules Pertaining to Co- establish, within its new rulebook connectivity rules, and harmonizing the
Location and Direct Connectivity shell,3 a new General 8 heading, entitled Exchange’s Rules with those of the other
‘‘Connectivity,’’ to renumber Rule 7034 Affiliated Exchanges. As previously
June 19, 2018. as Section 1 thereunder, and to
Pursuant to Section 19(b)(1) of the stated, the proposed Rule relocation is
renumber Rule 7051 as Section 2 non-substantive.
Securities Exchange Act of 1934 thereunder. The Exchange furthermore
(‘‘Act’’),1 and Rule 19b–4 thereunder,2 The Exchange also believes that it is
proposes to amend Equity Rules 7007,
notice is hereby given that on June 5, just and equitable and consistent with
7015, 7025, and 7030, and Options
2018, The Nasdaq Stock Market LLC the protection of investors and the
Rules, Chapter XV to update cross
(‘‘Nasdaq’’ or ‘‘Exchange’’) filed with the interest of the public to remove expired
references therein to Rules 7034 and
Securities and Exchange Commission waiver language from the Exchange’s
7051.4 The Exchange also proposes to
(‘‘Commission’’) the proposed rule Rules.
update internal cross-references in the
change as described in Items I and II renumbered Rules. B. Self-Regulatory Organization’s
below, which Items have been prepared The Exchange considers it appropriate Statement on Burden on Competition
by the Exchange. The Commission is to relocate these Rules to better organize
publishing this notice to solicit its Rulebook. The other Affiliated The Exchange does not believe that
comments on the proposed rule change Exchanges intend to propose similar the proposed rule change will impose
from interested persons. reorganizations of their co-location and any burden on intermarket or intra-
direct connectivity rules so that these market competition that is not necessary
I. Self-Regulatory Organization’s or appropriate in furtherance of the
Statement of the Terms of Substance of rules will be harmonized among all of
the Affiliated Exchanges. purposes of the Act. The proposed
the Proposed Rule Change changes do not impose a burden on
The relocation of the co-location and
The Exchange proposes to relocate the direct connectivity rules is part of the competition because, as previously
Exchange’s rules pertaining to co- Exchange’s continued effort to promote stated, they (i) are of a non-substantive
location and direct connectivity, which efficiency and conformity of its nature, (ii) are intended to harmonize
are presently at Rules 7034 and 7051, to the Exchange’s rules with those of its
Sections 1 and 2, respectively, under a 3 Recently, the Exchange added a shell structure Affiliated Exchanges, and (iii) are
new General 8 (‘‘Connectivity’’) heading to its Rulebook with the purpose of improving intended to organize the Rulebook in a
within the Exchange’s new rulebook efficiency and readability and to align its rules way that it will ease the Members’
closer to those of its five sister exchanges: Nasdaq navigation and reading of the rules
shell, entitled ‘‘General Equity and BX, Inc.; Nasdaq PHLX LLC; Nasdaq ISE, LLC;
Options Rules.’’ Nasdaq GEMX, LLC; and Nasdaq MRX, LLC across the Affiliated Exchanges.
The text of the proposed rule change (together with Nasdaq, the ‘‘Affiliated Exchanges’’).
C. Self-Regulatory Organization’s
is available on the Exchange’s website at See Securities Exchange Act Release No. 82175
(November 29, 2017), 82 FR 57494 (December 5, Statement on Comments on the
http://nasdaq.cchwallstreet.com, at the
amozie on DSK3GDR082PROD with NOTICES1
2017) (SR–NASDAQ–2017–125). Proposed Rule Change Received From
principal office of the Exchange, and at 4 In addition to the above, the Exchange proposes
Members, Participants, or Others
the Commission’s Public Reference to delete language that exists presently in Rule
Room. 7034(b) (‘‘Connectivity to Third Party Services’’) No written comments were either
and Rule 7051(b) (‘‘Direct Circuit Connection to solicited or received.
Third Party Services’’) that each refer to expired
31 17 CFR 200.30–3(a)(57). waivers of fees for connections to third party
1 15 U.S.C. 78s(b)(1). 5 15 U.S.C. 78f(b).
services that were applicable ‘‘through April 30,
2 17 CFR 240.19b–4. 2017.’’ 6 15 U.S.C. 78f(b)(5).
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Document Created: 2018-06-23 02:29:34
Document Modified: 2018-06-23 02:29:34
| 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 | 83 FR 29589 |
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