83 FR 51745 - Self-Regulatory Organizations; Cboe BZX Exchange, Inc.; Notice of Filing of Amendment No. 1 and Order Instituting Proceedings To Determine Whether To Approve or Disapprove a Proposed Rule Change, as Modified by Amendment No. 1, To Amend BZX Rule 14.11(c) (Index Fund Shares)

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 83, Issue 198 (October 12, 2018)

Page Range		51745-51747
FR Document		2018-22207
Federal Register, Volume 83 Issue 198 (Friday, October 12, 2018)
[Federal Register Volume 83, Number 198 (Friday, October 12, 2018)]
[Notices]
[Pages 51745-51747]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2018-22207]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-84378; File No. SR-CboeBZX-2018-044]


Self-Regulatory Organizations; Cboe BZX Exchange, Inc.; Notice of 
Filing of Amendment No. 1 and Order Instituting Proceedings To 
Determine Whether To Approve or Disapprove a Proposed Rule Change, as 
Modified by Amendment No. 1, To Amend BZX Rule 14.11(c) (Index Fund 
Shares)

October 5, 2018.

I. Introduction

    On June 21, 2018, Cboe BZX Exchange, Inc. (``Exchange'' or ``BZX'') 
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 
amend BZX Rule 14.11(c) to permit either the portfolio holdings of a 
series of Index Fund Shares or the index underlying a series of Index 
Fund Shares to satisfy the listing standards under BZX Rules 
14.11(c)(3), (4), and (5). The proposed rule change was published for 
comment in the Federal Register on July 11, 2018.\3\ On August 23, 
2018, pursuant to Section 19(b)(2) of the Act,\4\ the Commission 
designated a longer period within which to approve the proposed rule 
change, disapprove the proposed rule change, or institute proceedings 
to determine whether to approve or disapprove the proposed rule 
change.\5\ On September 28, 2018, the Exchange filed Amendment No. 1 to 
the proposed rule change, which amended and replaced the proposed rule 
change as originally filed.\6\ The Commission has received no comment 
letters on the proposal. The Commission is publishing this notice and 
order to solicit comments on the proposed rule change, as modified by 
Amendment No. 1, from interested persons and to institute proceedings 
pursuant to Section 19(b)(2)(B) of the Act \7\ to determine whether to 
approve or disapprove the proposed rule change, as modified by 
Amendment No. 1.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Securities Exchange Act Release No. 83594 (July 5, 
2018), 83 FR 32158.
    \4\ 15 U.S.C. 78s(b)(2).
    \5\ See Securities Exchange Act Release No. 83919, 83 FR 44083 
(August 29, 2018). The Commission designated October 9, 2018 as the 
date by which the Commission shall approve the proposed rule change, 
disapprove the proposed rule change, or institute proceedings to 
determine whether to approve or disapprove the proposed rule change.
    \6\ In Amendment No. 1, the Exchange: (1) Proposed to delete 
certain references to the term ``portfolio'' in BZX Rules 
14.11(c)(1)(C), 14.11(c)(8), and 14.11(c)(9)(B)(i)(b) such that the 
amended provisions would apply only to the index underlying a series 
of Index Fund Shares; (2) represented that, to the extent that the 
proposal results in meaningful additional costs associated with 
regulatory review, the Exchange either already has or will dedicate 
sufficient additional resources to perform such reviews; (3) 
supplemented its arguments in support of the proposal; and (4) made 
technical and conforming changes. Amendment No. 1 is available at: 
https://www.sec.gov/comments/sr-cboebzx-2018-044/srcboebzx2018044.htm.
    \7\ 15 U.S.C. 78s(b)(2)(B).
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II. Description of the Proposal, as Modified by Amendment No. 1 \8\
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    \8\ For a full description of the proposal, see Amendment No. 1, 
supra note 6.
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    BZX Rule 14.11(c) sets forth the listing standards for Index Fund 
Shares. Currently, the Exchange determines whether a series of Index 
Fund Shares meets the initial and continued listing standards under BZX 
Rules 14.11(c)(3), (4), and (5) by assessing the underlying index. The 
Exchange now proposes to permit either the portfolio holdings of a 
series of Index Fund Shares or the index underlying a series of Index 
Fund Shares to satisfy the initial and continued listing standards 
under BZX Rules 14.11(c)(3), (4), and (5). As a result, the proposal 
would allow the Exchange to generically list a series of Index Fund 
Shares where the generic listing standards are satisfied by either its 
portfolio holdings or its underlying index.
    The Exchange also proposes to amend BZX Rules 14.11(c)(1)(C),\9\ 
14.11(c)(8),\10\ and 14.11(c)(9)(B)(i)(b) \11\ to eliminate certain 
references to the term ``portfolio'' such that the amended provisions 
would apply only to the underlying index. As proposed, all other 
references to ``index or portfolio'' or ``portfolio or index'' in BZX 
Rule 14.11(c) would mean the index underlying a series of Index Fund 
Shares or the portfolio holdings of a series of Index Fund Shares.
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    \9\ BZX Rule 14.11(c)(1)(C) currently defines the term 
``Reporting Authority'' to mean, in part, the official source for 
calculating and reporting information relating to a series of Index 
Fund Shares, including, but not limited to, any current index ``or 
portfolio'' value. The Exchange proposes to delete the term ``or 
portfolio'' from this provision.
    \10\ BZX Rule 14.11(c)(8) currently provides, in part, that the 
Exchange may list and trade Index Fund Shares based on one or more 
foreign or domestic indexes ``or portfolios'' and that each issue of 
Index Fund Shares based on each particular index ``or portfolio, or 
combination thereof,'' shall be designated as a separate series and 
shall be identified by a unique symbol. The Exchange proposes to 
delete the terms ``or portfolios'' and ``or portfolio, or 
combination thereof,'' from this provision.
    \11\ BZX Rule 14.11(c)(9)(B)(i)(b) currently provides, in part, 
that the Exchange will consider the suspension of trading in and 
will initiate delisting proceedings for a series of Index Fund 
Shares if the value of the index ``or portfolio'' of securities on 
which the series of Index Fund Shares is based is no longer 
calculated or available, or an interruption to the dissemination of 
the value of the index ``or portfolio'' of securities persists past 
the trading day in which it occurred, or the index ``or portfolio'' 
on which a series of Index Fund Shares is based is replaced with a 
new index ``or portfolio'' unless certain conditions are met. The 
Exchange proposes to delete the terms ``or portfolio'' from this 
provision.
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    The Exchange represents that it has in place surveillance 
procedures that are adequate to properly monitor trading in Index Fund 
Shares in all trading sessions and to deter and detect violations of 
Exchange rules and applicable federal securities laws. In addition, the 
Exchange states that it does not believe that the proposal will result 
in any meaningful additional costs associated with regulatory review, 
but to the extent that it does, the Exchange either already has or will 
dedicate sufficient additional resources to perform such reviews.

[[Page 51746]]

III. Proceedings to Determine Whether To Approve or Disapprove SR-
CboeBZX-2018-044, as Modified by Amendment No. 1, and Grounds for 
Disapproval Under Consideration

    The Commission is instituting proceedings pursuant to Section 
19(b)(2)(B) of the Act \12\ to determine whether the proposed rule 
change, as modified by Amendment No. 1, should be approved or 
disapproved. Institution of proceedings is appropriate at this time in 
view of the legal and policy issues raised by the proposal. 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, as modified by 
Amendment No. 1.
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    \12\ 15 U.S.C. 78s(b)(2)(B).
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    Pursuant to Section 19(b)(2)(B) of the Act,\13\ the Commission is 
providing notice of the grounds for disapproval under consideration. 
The Commission is instituting proceedings to allow for additional 
analysis of the proposal's consistency with Section 6(b)(5) of the 
Act,\14\ 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.
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    \13\ Id.
    \14\ 15 U.S.C. 78f(b)(5).
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    As discussed above, the proposal would permit either the portfolio 
holdings of a series of Index Fund Shares or the index underlying a 
series of Index Fund Shares to satisfy the initial and continued 
listing standards under BZX Rules 14.11(c)(3), (4), and (5). The 
Exchange asserts that the proposal would provide issuers of Index Fund 
Shares with a greater degree of control over whether their products 
meet their ongoing listing obligations, and that the proposal would 
accomplish the policy goals underlying the listing standards for Index 
Fund Shares.\15\ In particular, the Exchange asserts that the index 
methodology for an index underlying a series of Index Fund Shares is 
out of the control of the issuers of the products, and that it is 
problematic to require an issuer to ensure that the underlying index 
meets listing standards on an ongoing basis.\16\ The Exchange also 
asserts that, after a series of Index Fund Shares is listed on the 
Exchange, both the index constituents and the portfolio holdings are 
equally viable for evaluating whether the shares are susceptible to 
manipulation.\17\ Moreover, according to the Exchange, portfolio 
holdings are arguably a better means for making these determinations 
than the underlying index because the portfolio holdings reflect the 
actual assets held by a series of Index Fund Shares, whereas the index 
constituents are just the assets that the series is designed to 
track.\18\ Additionally, the Exchange states that any series of Index 
Fund Shares listed on the Exchange must meet all requirements 
applicable under the Investment Company Act of 1940, including Rule 
35d-1,\19\ which requires a series of Index Fund Shares to invest at 
least 80% of its assets in investments connoted by the index (``80% 
Rule'').\20\ According to the Exchange, the 80% Rule would provide 
assurance that there is significant overlap between the portfolio 
holdings and the underlying index.\21\ Finally, the Exchange compares 
Index Fund Shares to Managed Fund Shares, and notes that the generic 
listing standards for Managed Fund Shares under BZX Rule 14.11(i) apply 
to portfolio holdings.\22\
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    \15\ See Amendment No. 1, supra note 6, at 7 and 10.
    \16\ See id. at 7. According to the Exchange, where the index 
constituents no longer meet the listing standards, the only ways for 
constituents to get back into compliance are through natural market 
movements, an index rebalance, a change to the index methodology, or 
a change of index. See id. The Exchange asserts that: (1) It is not 
feasible for an issuer to rely on natural market movements to bring 
a series of Index Fund Shares back into compliance with the listing 
standards; (2) an index rebalance may or may not bring a series of 
Index Fund Shares back into compliance, and index rebalances may not 
occur within the cure periods specified in BZX Rule 14.12 (i.e., up 
to 180 calendar days from initial notice of non-compliance with the 
listing standards); and (3) changing an index's methodology or 
changing the underlying index would require significant effort and 
months of notice, and therefore also may not occur within the cure 
periods specified in BZX Rule 14.12. See id.
    \17\ See id. at 5.
    \18\ See id. at 6. The Exchange acknowledges that allowing the 
portfolio holdings to satisfy the generic listing standards could 
raise concerns that a series of Index Fund Shares may be based on an 
index that does not meet the generic listing standards and therefore 
may be susceptible to manipulation. See id. at 9. However, the 
Exchange argues that, currently, a series of Index Fund Shares 
overlying an index that meets the generic listing standards may have 
portfolio holdings that could theoretically be susceptible to 
manipulation (and/or the creation and redemption process and the 
arbitrage mechanisms would not operate efficiently) because the 
portfolio holdings do not meet the generic listing standards. See 
id.
    \19\ 17 CFR 270.35d-1.
    \20\ See Amendment No. 1, supra note 6, at 9-10.
    \21\ See id.
    \22\ See id. at 8.
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    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. 1,\23\ in addition to any other comments they may wish 
to submit about the proposal. In particular, the Commission seeks 
comment regarding whether the proposal would result in the listing and 
trading of Index Fund Shares that are susceptible to manipulation 
because they overlie indexes that do not meet the listing standards 
under BZX Rule 14.11(c). The Commission seeks comment regarding whether 
the 80% Rule or any other safeguard would help assure that, as long as 
the portfolio holdings meet the listing standards under BZX Rules 
14.11(c)(3), (4), and (5), the Index Fund Shares would not be 
susceptible to manipulation. The Commission also seeks comment 
regarding whether the proposal sufficiently addressed manipulation risk 
by merely applying, without change, the current listing standards under 
BZX Rules 14.11(c)(3), (4), and (5) that are applicable to the 
underlying index to the portfolio holdings of a series of Index Fund 
Shares.\24\ Moreover, the Commission seeks comment regarding whether 
the Exchange has sufficiently justified the flexibility it seeks under 
the proposal, which would allow the Exchange to choose to apply the 
listing standards under BZX Rules 14.11(c)(3), (4), and (5) to either 
the portfolio holdings or the underlying index, both at the time of 
initial listing and at any time thereafter.\25\ Finally, the Commission 
seeks comment regarding the sufficiency of the Exchange's statements in 
support of the deletion of certain references to the term ``portfolio'' 
in BZX Rules 14.11(c)(1)(C), 14.11(c)(8), and 14.11(c)(9)(B)(i)(b).
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    \23\ See supra note 6.
    \24\ The Commission notes that there are differences between the 
listing standards for Index Fund Shares under BZX Rule 14.11(c) and 
the listing standards for Managed Fund Shares under BZX Rule 
14.11(i).
    \25\ As proposed, the Exchange could assess the portfolio 
holdings at one time, and assess the underlying index at another 
time.
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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 proposed rule 
change, as modified by Amendment No. 1, is consistent with Section 
6(b)(5) or any other provision of the Act, or the rules and regulations

[[Page 51747]]

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 under the Act,\26\ any request for an 
opportunity to make an oral presentation.\27\
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    \26\ 17 CFR 240.19b-4.
    \27\ Section 19(b)(2) of the Act, as amended by the Securities 
Acts 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 Acts Amendments of 1975, Senate Comm. 
on Banking, Housing & Urban Affairs, S. Rep. No. 75, 94th Cong., 1st 
Sess. 30 (1975).
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    Interested persons are invited to submit written data, views, and 
arguments regarding whether the proposed rule change, as modified by 
Amendment No. 1, should be approved or disapproved by November 2, 2018. 
Any person who wishes to file a rebuttal to any other person's 
submission must file that rebuttal by November 16, 2018.
    Comments may be submitted by any of the following methods:

Electronic Comments

     Use 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-CboeBZX-2018-044 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-CboeBZX-2018-044. 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 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-CboeBZX-2018-044 and should be submitted 
by October 29, 2018. Rebuttal comments should be submitted by November 
16, 2018.
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    \28\ 17 CFR 200.30-3(a)(12); 17 CFR 200.30-3(a)(57).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\28\
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-22207 Filed 10-11-18; 8:45 am]
BILLING CODE 8011-01-P
Federal Register / Vol. 83, No. 198 / Friday, October 12, 2018 / Notices 51745

4. Section 6(c) of the Act provides that Shares to satisfy the listing standards result, the proposal would allow the
the Commission may exempt any under BZX Rules 14.11(c)(3), (4), and Exchange to generically list a series of
person, security, or transaction or any (5). The proposed rule change was Index Fund Shares where the generic
class or classes of persons, securities, or published for comment in the Federal listing standards are satisfied by either
transactions from any provisions of the Register on July 11, 2018.3 On August its portfolio holdings or its underlying
Act, or any rule thereunder, if such 23, 2018, pursuant to Section 19(b)(2) of index.
relief is necessary or appropriate in the the Act,4 the Commission designated a
public interest and consistent with the longer period within which to approve The Exchange also proposes to amend
protection of investors and purposes the proposed rule change, disapprove BZX Rules 14.11(c)(1)(C),9 14.11(c)(8),10
fairly intended by the policy and the proposed rule change, or institute and 14.11(c)(9)(B)(i)(b) 11 to eliminate
provisions of the Act. Applicants proceedings to determine whether to certain references to the term
believe that the requested relief meets approve or disapprove the proposed ‘‘portfolio’’ such that the amended
this standard because, as further rule change.5 On September 28, 2018, provisions would apply only to the
explained in the application, the the Exchange filed Amendment No. 1 to underlying index. As proposed, all other
Investment Management Agreements the proposed rule change, which references to ‘‘index or portfolio’’ or
will remain subject to shareholder amended and replaced the proposed ‘‘portfolio or index’’ in BZX Rule
approval while the role of the Sub- rule change as originally filed.6 The 14.11(c) would mean the index
Advisers is substantially similar to that Commission has received no comment underlying a series of Index Fund
of individual portfolio managers, so that letters on the proposal. The Commission Shares or the portfolio holdings of a
requiring shareholder approval of Sub- is publishing this notice and order to series of Index Fund Shares.
Advisory Agreements would impose solicit comments on the proposed rule
The Exchange represents that it has in
unnecessary delays and expenses on the change, as modified by Amendment No.
Subadvised Series. Applicants believe 1, from interested persons and to place surveillance procedures that are
that the requested relief from the institute proceedings pursuant to adequate to properly monitor trading in
Disclosure Requirements meets this Section 19(b)(2)(B) of the Act 7 to Index Fund Shares in all trading
standard because it will improve the determine whether to approve or sessions and to deter and detect
Adviser’s ability to negotiate fees paid disapprove the proposed rule change, as violations of Exchange rules and
to the Sub-Advisers that are more modified by Amendment No. 1. applicable federal securities laws. In
advantageous for the Subadvised Series. addition, the Exchange states that it
II. Description of the Proposal, as does not believe that the proposal will
For the Commission, by the Division of Modified by Amendment No. 1 8
Investment Management, under delegated result in any meaningful additional
authority. BZX Rule 14.11(c) sets forth the costs associated with regulatory review,
Eduardo A. Aleman, listing standards for Index Fund Shares. but to the extent that it does, the
Assistant Secretary.
Currently, the Exchange determines Exchange either already has or will
whether a series of Index Fund Shares dedicate sufficient additional resources
[FR Doc. 2018–22196 Filed 10–11–18; 8:45 am]
meets the initial and continued listing to perform such reviews.
BILLING CODE 8011–01–P
standards under BZX Rules 14.11(c)(3),
(4), and (5) by assessing the underlying
index. The Exchange now proposes to
SECURITIES AND EXCHANGE 9 BZX Rule 14.11(c)(1)(C) currently defines the
permit either the portfolio holdings of a
COMMISSION term ‘‘Reporting Authority’’ to mean, in part, the
series of Index Fund Shares or the index official source for calculating and reporting
[Release No. 34–84378; File No. SR– underlying a series of Index Fund information relating to a series of Index Fund
CboeBZX–2018–044] Shares to satisfy the initial and Shares, including, but not limited to, any current
continued listing standards under BZX index ‘‘or portfolio’’ value. The Exchange proposes
Self-Regulatory Organizations; Cboe Rules 14.11(c)(3), (4), and (5). As a to delete the term ‘‘or portfolio’’ from this
BZX Exchange, Inc.; Notice of Filing of provision.
Amendment No. 1 and Order Instituting 3 See Securities Exchange Act Release No. 83594
10 BZX Rule 14.11(c)(8) currently provides, in

Proceedings To Determine Whether To (July 5, 2018), 83 FR 32158. part, that the Exchange may list and trade Index
Approve or Disapprove a Proposed 4 15 U.S.C. 78s(b)(2). Fund Shares based on one or more foreign or
Rule Change, as Modified by 5 See Securities Exchange Act Release No. 83919, domestic indexes ‘‘or portfolios’’ and that each
83 FR 44083 (August 29, 2018). The Commission issue of Index Fund Shares based on each particular
Amendment No. 1, To Amend BZX Rule
designated October 9, 2018 as the date by which the index ‘‘or portfolio, or combination thereof,’’ shall
14.11(c) (Index Fund Shares) Commission shall approve the proposed rule be designated as a separate series and shall be
change, disapprove the proposed rule change, or identified by a unique symbol. The Exchange
October 5, 2018. institute proceedings to determine whether to proposes to delete the terms ‘‘or portfolios’’ and ‘‘or
approve or disapprove the proposed rule change.
I. Introduction 6 In Amendment No. 1, the Exchange: (1)
portfolio, or combination thereof,’’ from this
provision.
On June 21, 2018, Cboe BZX Proposed to delete certain references to the term
11 BZX Rule 14.11(c)(9)(B)(i)(b) currently
Exchange, Inc. (‘‘Exchange’’ or ‘‘BZX’’) ‘‘portfolio’’ in BZX Rules 14.11(c)(1)(C), 14.11(c)(8),
and 14.11(c)(9)(B)(i)(b) such that the amended provides, in part, that the Exchange will consider
filed with the Securities and Exchange provisions would apply only to the index the suspension of trading in and will initiate
Commission (‘‘Commission’’), pursuant underlying a series of Index Fund Shares; (2) delisting proceedings for a series of Index Fund
to Section 19(b)(1) of the Securities represented that, to the extent that the proposal Shares if the value of the index ‘‘or portfolio’’ of
Exchange Act of 1934 (‘‘Act’’) 1 and Rule results in meaningful additional costs associated securities on which the series of Index Fund Shares
with regulatory review, the Exchange either already
khammond on DSK30JT082PROD with NOTICES

19b–4 thereunder,2 a proposed rule is based is no longer calculated or available, or an
has or will dedicate sufficient additional resources
change to amend BZX Rule 14.11(c) to interruption to the dissemination of the value of the
to perform such reviews; (3) supplemented its
index ‘‘or portfolio’’ of securities persists past the
permit either the portfolio holdings of a arguments in support of the proposal; and (4) made
trading day in which it occurred, or the index ‘‘or
series of Index Fund Shares or the index technical and conforming changes. Amendment No.
1 is available at: https://www.sec.gov/comments/sr- portfolio’’ on which a series of Index Fund Shares
underlying a series of Index Fund cboebzx-2018-044/srcboebzx2018044.htm. is based is replaced with a new index ‘‘or portfolio’’
7 15 U.S.C. 78s(b)(2)(B). unless certain conditions are met. The Exchange
1 15 U.S.C. 78s(b)(1). 8 For a full description of the proposal, see proposes to delete the terms ‘‘or portfolio’’ from this
2 17 CFR 240.19b–4. Amendment No. 1, supra note 6. provision.

VerDate Sep<11>2014 19:19 Oct 11, 2018 Jkt 247001 PO 00000 Frm 00086 Fmt 4703 Sfmt 4703 E:\FR\FM\12OCN1.SGM 12OCN1
Federal Register / Vol. 83, No. 198 / Friday, October 12, 2018 / Notices 51747

thereunder. Although there do not Washington, DC 20549 on official to approve the proposed rule change,
appear to be any issues relevant to business days between the hours of disapprove the proposed rule change, or
approval or disapproval that would be 10:00 a.m. and 3:00 p.m. Copies of the institute proceedings to determine
facilitated by an oral presentation of filing also will be available for whether to disapprove the proposed
views, data, and arguments, the inspection and copying at the principal rule change.5 On August 28, 2018, the
Commission will consider, pursuant to office of the Exchange. All comments Exchange filed Amendment No. 1 to the
Rule 19b–4 under the Act,26 any request received will be posted without change. proposed rule change, which amended
for an opportunity to make an oral Persons submitting comments are and replaced the proposed rule change
presentation.27 cautioned that we do not redact or edit as originally filed. On September 24,
Interested persons are invited to personal identifying information from 2018, the Exchange filed Amendment
submit written data, views, and comment submissions. You should No. 2 to the proposed rule change,
arguments regarding whether the submit only information that you wish which amended and replaced the
proposed rule change, as modified by to make available publicly. All proposed rule change, as modified by
Amendment No. 1, should be approved submissions should refer to File Amendment No. 1.6 On October 3, 2018,
or disapproved by November 2, 2018. Number SR–CboeBZX–2018–044 and the Exchange filed and withdrew
Any person who wishes to file a rebuttal should be submitted by October 29, Amendment No. 3 to the proposed rule
to any other person’s submission must 2018. Rebuttal comments should be change and filed Amendment No. 4 to
file that rebuttal by November 16, 2018. submitted by November 16, 2018. the proposed rule change.7 The
Comments may be submitted by any Commission has received no comments
For the Commission, by the Division of
of the following methods: on the proposed rule change. The
Trading and Markets, pursuant to delegated
Electronic Comments authority.28 Commission is publishing this notice to
solicit comments on Amendment Nos. 2
• Use the Commission’s internet Eduardo A. Aleman,
and 4 from interested persons, and is
comment form (http://www.sec.gov/ Assistant Secretary.
approving the proposed rule change, as
rules/sro.shtml); or [FR Doc. 2018–22207 Filed 10–11–18; 8:45 am]
modified by Amendment Nos. 2 and 4,
• Send an email to rule-comments@ BILLING CODE 8011–01–P
on an accelerated basis.
sec.gov. Please include File Number SR–
CboeBZX–2018–044 on the subject line. II. Description of the Proposal, as
SECURITIES AND EXCHANGE Modified by Amendment Nos. 2 and 4 8
Paper Comments COMMISSION The Exchange proposes to amend
• Send paper comments in triplicate
[Release No. 34–84377; File No. SR– BZX Rule 14.8 9 to adopt listing
to Secretary, Securities and Exchange
CboeBZX–2018–047]
Commission, 100 F Street NE, 5 See Securities Exchange Act Release No. 83938,
Washington, DC 20549–1090. Self-Regulatory Organizations; Cboe 83 FR 44403 (August 30, 2018). The Commission
All submissions should refer to File designated October 9, 2018 as the date by which the
BZX Exchange, Inc.; Notice of Filing of Commission shall approve or disapprove, or
Number SR–CboeBZX–2018–044. This Amendment Nos. 2 and 4 and Order institute proceedings to determine whether to
file number should be included on the Granting Accelerated Approval of a disapprove, the proposed rule change.
subject line if email is used. To help the Proposed Rule Change, as Modified by 6 In Amendment No. 2, the Exchange: (i) Noted

Commission process and review your Amendment Nos. 2 and 4, To Amend that the proposed quantitative listing standards
comments more efficiently, please use differ from the listing standards for closed-end
BZX Rule 14.8, General Listings funds on NYSE American LLC (‘‘NYSE American’’)
only one method. The Commission will Requirements—Tier I, To Adopt Listing in two ways and described those differences; (ii)
post all comments on the Commission’s Standards for Closed-End Funds reorganized the proposed definitions of ‘‘Public
internet website (http://www.sec.gov/ Distribution’’ and ‘‘Public Shareholders;’’ (iii)
rules/sro.shtml). Copies of the October 5, 2018. specified the meaning of ‘‘market value’’ for
purposes of Closed-End Funds (as defined herein);
submission, all subsequent I. Introduction (iv) amended the proposed Market Maker
amendments, all written statements requirement; (v) proposed additional continued
with respect to the proposed rule On June 21, 2018, Cboe BZX listing standards; (vi) modified the proposed trading
change that are filed with the Exchange, Inc. (‘‘BZX’’ or ‘‘Exchange’’) hours for Closed-End Funds; (vii) noted that BZX
filed with the Securities and Exchange Rule 14.6 also provides certain conditions under
Commission, and all written which the Exchange will halt trading in a Closed-
communications relating to the Commission (‘‘Commission’’), pursuant End Fund; (viii) represented that Closed-End Funds
proposed rule change between the to Section 19(b)(1) of the Securities will be subject to the Exchange’s surveillance
Commission and any person, other than Exchange Act of 1934 (‘‘Act’’) 1 and Rule procedures for ETPs and other equity securities
19b–4 thereunder,2 a proposed rule traded on the Exchange; (ix) represented that the
those that may be withheld from the governance requirements for Closed-End Funds
public in accordance with the change to amend BZX Rule 14.8, would be substantially similar to those applicable
provisions of 5 U.S.C. 552, will be General Listings Requirements—Tier I, to closed-end funds on the Nasdaq Stock Market
available for website viewing and to adopt listing standards for Closed- LLC (‘‘Nasdaq’’); and (x) made technical and
End Funds. The proposed rule change conforming changes. Amendment No. 2 is available
printing in the Commission’s Public at: https://www.sec.gov/comments/sr-cboebzx-2018-
Reference Room, 100 F Street NE, was published for comment in the 047/srcboebzx2018047-4447313-175711.pdf.
Federal Register on July 11, 2018.3 On 7 In Amendment No. 4, the Exchange corrected
26 17 CFR 240.19b–4. August 24, 2018, pursuant to Section two typographical errors from Amendment No. 2.
27 Section 19(b)(2) of the Act, as amended by the 19(b)(2) of the Act,4 the Commission Amendment No. 4 is available at: https://
Securities Acts Amendments of 1975, Public Law designated a longer period within which www.sec.gov/comments/sr-cboebzx-2018-047/
khammond on DSK30JT082PROD with NOTICES

94–29 (June 4, 1975), grants the Commission srcboebzx2018047-4474562-175863.pdf.
8 For a full description of the proposal, see
flexibility to determine what type of proceeding— 28 17 CFR 200.30–3(a)(12); 17 CFR 200.30–
either oral or notice and opportunity for written Amendment No. 2, supra note 6 and Amendment
3(a)(57). No. 4, supra note 7.
comments—is appropriate for consideration of a 1 15 U.S.C. 78s(b)(1).
particular proposal by a self-regulatory 9 Specifically, the Exchange proposes to add new
2 17 CFR 240.19b–4.
organization. See Securities Acts Amendments of paragraphs (e) and (i) under BZX Rule 14.8 related
3 See Securities Exchange Act Release No. 83596
1975, Senate Comm. on Banking, Housing & Urban to the initial and continued listing standards,
Affairs, S. Rep. No. 75, 94th Cong., 1st Sess. 30 (July 5, 2018), 83 FR 32162. respectively, for Closed-End Funds. The Exchange
(1975). 4 15 U.S.C. 78s(b)(2). Continued

VerDate Sep<11>2014 19:19 Oct 11, 2018 Jkt 247001 PO 00000 Frm 00088 Fmt 4703 Sfmt 4703 E:\FR\FM\12OCN1.SGM 12OCN1
Document Created: 2018-10-13 10:09:38
Document Modified: 2018-10-13 10:09:38
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 51745