83 FR 48663 - Ares Credit and Income Trust and Ares Capital Management III LLC; Notice of Application

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 83, Issue 187 (September 26, 2018)

Page Range		48663-48665
FR Document		2018-20956
Federal Register, Volume 83 Issue 187 (Wednesday, September 26, 2018)
[Federal Register Volume 83, Number 187 (Wednesday, September 26, 2018)]
[Notices]
[Pages 48663-48665]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2018-20956]


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SECURITIES AND EXCHANGE COMMISSION

[Investment Company Act Release No. 33243; File No. 812-14892]


Ares Credit and Income Trust and Ares Capital Management III LLC; 
Notice of Application

September 21, 2018.
AGENCY: Securities and Exchange Commission (``Commission'').

ACTION: Notice.

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    Notice of an application for an order under section 12(d)(1)(J) of 
the Investment Company Act of 1940 (the ``Act'') for an exemption from 
sections 12(d)(1)(A), (B), and (C) of the Act and under sections 6(c) 
and 17(b) of the Act for an exemption from sections 17(a)(1) and (2) of 
the Act. The requested order would permit certain registered open-end 
investment companies to acquire shares of certain registered open-end

[[Page 48664]]

investment companies, registered closed-end investment companies, 
business development companies, as defined in section 2(a)(48) of the 
Act, and registered unit investment trusts (collectively, ``Underlying 
Funds'') that are within and outside the same group of investment 
companies as the acquiring investment companies, in excess of the 
limits in section 12(d)(1) of the Act.

APPLICANTS: Ares Credit and Income Trust (the ``Trust''), a Delaware 
statutory trust that will be registered under the Act as an open-end 
management investment company with multiple series, and Ares Capital 
Management III LLC (the ``Initial Adviser''), a Delaware limited 
liability company registered as an investment adviser under the 
Investment Advisers Act of 1940.

FILING DATES: The application was filed on April 3, 2018 and amended on 
August 3, 2018.

HEARING OR NOTIFICATION OF HEARING: An order granting the requested 
relief will be issued unless the Commission orders a hearing. 
Interested persons may request a hearing by writing to the Commission's 
Secretary and serving applicants with a copy of the request, personally 
or by mail. Hearing requests should be received by the Commission by 
5:30 p.m. on October 16, 2018, and should be accompanied by proof of 
service on the applicants, in the form of an affidavit, or, for 
lawyers, a certificate of service. Pursuant to Rule 0-5 under the Act, 
hearing requests should state the nature of the writer's interest, any 
facts bearing upon the desirability of a hearing on the matter, the 
reason for the request, and the issues contested. Persons who wish to 
be notified of a hearing may request notification by writing to the 
Commission's Secretary.

ADDRESSES: Secretary, U.S. Securities and Exchange Commission, 100 F 
Street NE, Washington, DC 20549-1090. Applicants: Daniel J. Hall, Ares 
Capital Management III, LLC, 2000 Avenue of the Stars, 12th Floor, Los 
Angeles, CA 90067; Steven B. Boehm, Esq., Cynthia M. Krus, Esq., and 
Cynthia R. Beyea, Esq., Eversheds Sutherland (US) LLP, 700 Sixth 
Street, NW, Suite 700, Washington, DC 20001.

FOR FURTHER INFORMATION CONTACT: Matthew B. Archer-Beck, Senior 
Counsel, at (202) 551-5044, or Kaitlin C. Bottock, Branch Chief, at 
(202) 551-6825 (Division of Investment Management, Chief Counsel's 
Office).

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

Summary of the Application

    1. Applicants request an order to permit (a) a Fund \1\ (each a 
``Fund of Funds'') to acquire shares of Underlying Funds \2\ in excess 
of the limits in sections 12(d)(1)(A) and (C) of the Act and (b) the 
Underlying Funds that are registered open-end investment companies or 
series thereof, their principal underwriters and any broker or dealer 
registered under the Securities Exchange Act of 1934 to sell shares of 
the Underlying Fund to the Fund of Funds in excess of the limits in 
section 12(d)(1)(B) of the Act.\3\ Applicants also request an order of 
exemption under sections 6(c) and 17(b) of the Act from the prohibition 
on certain affiliated transactions in section 17(a) of the Act to the 
extent necessary to permit the Underlying Funds to sell their shares 
to, and redeem their shares from, the Funds of Funds.\4\ Applicants 
state that such transactions will be consistent with the policies of 
each Fund of Funds and each Underlying Fund and with the general 
purposes of the Act and will be based on the net asset values of the 
Underlying Funds.
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    \1\ Applicants request that the order apply to each existing and 
future series of the Trust and to each existing and future 
registered open-end management investment company or series thereof 
that is advised by Initial Adviser or its successor-in-interest or 
by any other investment adviser controlling, controlled by or under 
common control with the Initial Adviser or its successor-in-interest 
and is part of the same ``group of investment companies'' as the 
Trust (each, a ``Fund''). For purposes of the requested order, 
``successor-in-interest'' is limited to an entity that results from 
a reorganization into another jurisdiction or a change in the type 
of business organization. For purposes of the request for relief, 
the term ``group of investment companies,'' as defined in Section 
12(d)(1)(G)(ii) of the Act, means any two or more registered 
investment companies, including closed-end investment companies and 
business development companies, that hold themselves out to 
investors as related companies for purposes of investment and 
investor services.
    \2\ Certain of the Underlying Funds have obtained exemptions 
from the Commission necessary to permit their shares to be listed 
and traded on a national securities exchange at negotiated prices 
and, accordingly, to operate as an exchange-traded fund (``ETF'').
    \3\ Applicants do not request relief for Funds of Funds to 
invest in reliance on the order in business development companies 
and registered closed-end investment companies that are not listed 
and traded on a national securities exchange.
    \4\ A Fund of Funds generally would purchase and sell shares of 
an Underlying Fund that operates as an ETF through secondary market 
transactions rather than through principal transactions with the 
Underlying Fund. Applicants nevertheless request relief from 
sections 17(a)(1) and (2) to permit each ETF that is an affiliated 
person, or an affiliated person of an affiliated person, as defined 
in section 2(a)(3) of the Act, of a Fund of Funds, to sell shares to 
or redeem shares from the Fund of Funds. This includes, in the case 
of sales and redemptions of shares of ETFs, the in-kind transactions 
that accompany such sales and redemptions. Applicants are not 
seeking relief from section 17(a) for, and the requested relief will 
not apply to, transactions where an ETF could be deemed an 
affiliated person, or an affiliated person of an affiliated person, 
of a Fund of Funds because an investment adviser to the ETF or an 
entity controlling, controlled by or under common control with the 
investment adviser to the ETF is also an investment adviser to the 
Fund of Funds. A Fund of Funds will purchase and sell shares of an 
Underlying Fund that is a closed-end fund (including a business 
development company) through secondary market transactions at market 
prices rather than through principal transactions with the closed-
end fund. Accordingly, applicants are not requesting section 17(a) 
relief with respect to principal transactions with closed-end funds.
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    2. Applicants agree that any order granting the requested relief 
will be subject to the terms and conditions stated in the application. 
Such terms and conditions are designed to, among other things, help 
prevent any potential (a) undue influence over an Underlying Fund that 
is not in the same ``group of investment companies'' as the Fund of 
Funds through control or voting power, or in connection with certain 
services, transactions, and underwritings, (b) excessive layering of 
fees, and (c) overly complex fund structures, which are the concerns 
underlying the limits in sections 12(d)(1)(A), (B), and (C) of the Act.
    3. Section 12(d)(1)(J) of the Act provides that the Commission may 
exempt any person, security, or transaction, or any class or classes of 
persons, securities, or transactions, from any provision of section 
12(d)(1) if the exemption is consistent with the public interest and 
the protection of investors. Section 17(b) of the Act authorizes the 
Commission to grant an order permitting a transaction otherwise 
prohibited by section 17(a) if it finds that (a) the terms of the 
proposed transaction are fair and reasonable and do not involve 
overreaching on the part of any person concerned; (b) the proposed 
transaction is consistent with the policies of each registered 
investment company involved; and (c) the proposed transaction is 
consistent with the general purposes of the Act. Section 6(c) of the 
Act permits the Commission to exempt any persons or transactions from 
any provision of the Act if such exemption is necessary or appropriate 
in the public interest and consistent with the protection of investors 
and the purposes fairly intended by the policy and provisions of the 
Act.


[[Page 48665]]


    For the Commission, by the Division of Investment Management, 
pursuant to delegated authority.
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-20956 Filed 9-25-18; 8:45 am]
 BILLING CODE 8011-01-P
Federal Register / Vol. 83, No. 187 / Wednesday, September 26, 2018 / Notices 48663

allows the Exchange the flexibility to public interest. The Exchange has internet website (http://www.sec.gov/
administer the badges within its System. requested that the Commission waive rules/sro.shtml). Copies of the
the 30-day operative delay so that the submission, all subsequent
B. Self-Regulatory Organization’s
proposed rule change may become amendments, all written statements
Statement on Burden on Competition
operative upon filing. The Exchange with respect to the proposed rule
The Exchange does not believe that argues that waiver of the operative delay change that are filed with the
the proposed rule change will impose would allow the Exchange to Commission, and all written
any burden on competition not immediately incorporate all risk communications relating to the
necessary or appropriate in furtherance protections into Rule 714 and bring proposed rule change between the
of the purposes of the Act. The proposal greater transparency to the risk Commission and any person, other than
does not impose an intra-market burden protections offered on the Exchange. those that may be withheld from the
on competition with respect to the The Commission believes that waiver of public in accordance with the
reorganization and relocation of the the 30-day operative delay is consistent provisions of 5 U.S.C. 552, will be
various rules into Rule 714 because the with the protection of investors and the available for website viewing and
various risk protections are mandatory public interest. Accordingly, the printing in the Commission’s Public
and will continue to apply uniformly to Commission hereby waives the Reference Room, 100 F Street NE,
all market participants. The Exchange operative delay and designates the Washington, DC 20549 on official
also believes that the addition of proposed rule change operative upon business days between the hours of
specific limitations to both the Limit filing.23 10:00 a.m. and 3:00 p.m. Copies of the
Order Price Protection and Market At any time within 60 days of the filing also will be available for
Order Spread Protection rules will filing of the proposed rule change, the inspection and copying at the principal
provide market participants with greater Commission summarily may office of the Exchange. All comments
information as to when these temporarily suspend such rule change if received will be posted without change.
protections will apply. These it appears to the Commission that such Persons submitting comments are
limitations apply uniformly to all action is necessary or appropriate in the cautioned that we do not redact or edit
market participants. The remainder of public interest, for the protection of personal identifying information from
the rule changes are intended to bring investors, or otherwise in furtherance of comment submissions. You should
greater transparency to the current the purposes of the Act. If the submit only information that you wish
operation of the Exchange’s rules. Commission takes such action, the tomake available publicly. All
C. Self-Regulatory Organization’s Commission shall institute proceedings submissions should refer to File
Statement on Comments on the to determine whether the proposed rule Number SR–ISE–2018–80, and should
Proposed Rule Change Received From change should be approved or be submitted on or before October 17,
Members, Participants, or Others disapproved. 2018.
No written comments were either IV. Solicitation of Comments For the Commission, by the Division of
Trading and Markets, pursuant to delegated
solicited or received. Interested persons are invited to authority.24
III. Date of Effectiveness of the submit written data, views, and Brent J. Fields,
Proposed Rule Change and Timing for arguments concerning the foregoing,
Secretary.
Commission Action including whether the proposed rule
[FR Doc. 2018–20881 Filed 9–25–18; 8:45 am]
change is consistent with the Act.
Because the foregoing proposed rule Comments may be submitted by any of BILLING CODE 8011–01–P
change does not: (i) Significantly affect the following methods:
the protection of investors or the public
interest; (ii) impose any significant Electronic Comments SECURITIES AND EXCHANGE
burden on competition; and (iii) become • Use the Commission’s internet COMMISSION
operative for 30 days from the date on comment form (http://www.sec.gov/ [Investment Company Act Release No.
which it was filed, or such shorter time rules/sro.shtml); or 33243; File No. 812–14892]
as the Commission may designate, it has • Send an email to rule-comments@
become effective pursuant to Section sec.gov. Please include File Number SR– Ares Credit and Income Trust and Ares
19(b)(3)(A) of the Act 19 and Rule 19b– ISE–2018–80 on the subject line. Capital Management III LLC; Notice of
4(f)(6) thereunder.20 Application
A proposed rule change filed Paper Comments
September 21, 2018.
pursuant to Rule 19b–4(f)(6) under the • Send paper comments in triplicate
Act 21 normally does not become to Secretary, Securities and Exchange AGENCY: Securities and Exchange
operative for 30 days after the date of its Commission, 100 F Street NE, Commission (‘‘Commission’’).
filing. However, Rule 19b–4(f)(6)(iii) 22 Washington, DC 20549–1090. ACTION: Notice.
permits the Commission to designate a All submissions should refer to File Notice of an application for an order
shorter time if such action is consistent Number SR–ISE–2018–80. This file under section 12(d)(1)(J) of the
with the protection of investors and the number should be included on the Investment Company Act of 1940 (the
subject line if email is used. To help the ‘‘Act’’) for an exemption from sections
19 15 U.S.C. 78s(b)(3)(A). Commission process and review your 12(d)(1)(A), (B), and (C) of the Act and
20 17 CFR 240.19b–4(f)(6). As required under Rule comments more efficiently, please use under sections 6(c) and 17(b) of the Act
daltland on DSKBBV9HB2PROD with NOTICES

19b–4(f)(6)(iii), the Exchange provided the
Commission with written notice of its intent to file only one method. The Commission will for an exemption from sections 17(a)(1)
the proposed rule change, along with a brief post all comments on the Commission’s and (2) of the Act. The requested order
description and the text of the proposed rule would permit certain registered open-
change, at least five business days prior to the date 23 For purposes only of waiving the 30-day
of filing of the proposed rule change, or such end investment companies to acquire
operative delay, the Commission also has
shorter time as designated by the Commission. considered the proposed rule’s impact on shares of certain registered open-end
21 17 CFR 240.19b–4(f)(6).
efficiency, competition, and capital formation. See
22 17 CFR 240.19b–4(f)(6)(iii). 15 U.S.C. 78c(f). 24 17 CFR 200.30–3(a)(12).

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Document Created: 2018-09-26 00:47:21
Document Modified: 2018-09-26 00:47:21
Category		Regulatory Information
Collection		Federal Register
sudoc Class		AE 2.7: GS 4.107: AE 2.106:
Publisher		Office of the Federal Register, National Archives and Records Administration
Section		Notices
Action		Notice.
Dates		The application was filed on April 3, 2018 and amended on August 3, 2018.
Contact		Matthew B. Archer-Beck, Senior Counsel, at (202) 551-5044, or Kaitlin C. Bottock, Branch Chief, at (202) 551-6825 (Division of Investment Management, Chief Counsel's Office).
FR Citation		83 FR 48663