Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Amending the Exchange's Schedule of Fees and Charges Relating to the Listing and Annual Fees Applicable to Certain Structured Products, 90391-90394 [2016-29938]
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Federal Register / Vol. 81, No. 240 / Wednesday, December 14, 2016 / Notices
Underlying Funds 2 in excess of the
limits in sections 12(d)(1)(A) and (C) of
the Act and (b) the Underlying Funds
APPLICANTS: ALAIA Market Linked
that are registered open-end investment
Trust (the ‘‘Trust’’), a UIT that is
companies, their principal underwriters
registered under the Act, and Beech Hill and any broker or dealer registered
Securities, Inc. (‘‘BHSI’’), a New York
under the Exchange Act to sell shares of
corporation registered as a broker-dealer the Underlying Funds to the Series in
under the Securities Exchange Act of
excess of the limits in section
1934 (the ‘‘Exchange Act’’).
12(d)(1)(B) of the Act.3 Applicants also
DATES: Filing Dates: The application was request an order of exemption under
filed on September 3, 2015 and
sections 6(c) and 17(b) of the Act from
amended on January 15, 2016, October
the prohibition on certain affiliated
17, 2016 and November 22, 2016.
transactions in section 17(a) of the Act
HEARING OR NOTIFICATION OF HEARING:
to the extent necessary to permit the
An order granting the requested relief
Underlying Funds to sell their shares to,
will be issued unless the Commission
and redeem their shares from, the
orders a hearing. Interested persons may Series.4 Applicants state that such
request a hearing by writing to the
transactions will be consistent with the
Commission’s Secretary and serving
policies of each Series and each
applicants with a copy of the request,
Underlying Fund and with the general
personally or by mail. Hearing requests
purposes of the Act and will be based
should be received by the Commission
on the net asset values of the
by 5:30 p.m. on January 3, 2017 and
Underlying Funds.
should be accompanied by proof of
2. Applicants agree that any order
service on the applicants, in the form of granting the requested relief will be
an affidavit, or, for lawyers, a certificate subject to the terms and conditions
of service. Pursuant to Rule 0–5 under
stated in the application. Such terms
the Act, hearing requests should state
and conditions are designed to, among
the nature of the writer’s interest, any
other things, help prevent any potential
facts bearing upon the desirability of a
(i) undue influence over an Underlying
hearing on the matter, the reason for the Fund that is not in the same ‘‘group of
request, and the issues contested.
investment companies’’ as the UIT
Persons who wish to be notified of a
through control or voting power, or in
hearing may request notification by
connection with certain services,
writing to the Commission’s Secretary.
transactions, and underwritings, (ii)
excessive layering of fees, and (iii)
ADDRESSES: Secretary, U.S. Securities
and Exchange Commission, 100 F Street overly complex fund structures, which
are the concerns underlying the limits
NE., Washington, DC 20549–1090.
in sections 12(d)(1)(A), (B), and (C) of
Applicants: ALAIA Market Linked
the Act.
Trust, 10 Corbin Drive, Darien, CT
3. Section 12(d)(1)(J) of the Act
06820, Beech Hill Securities, Inc., 880
provides that the Commission may
3rd Avenue, 16th Floor, New York, NY
exempt any person, security, or
10022–4730.
transaction, or any class or classes of
FOR FURTHER INFORMATION CONTACT:
persons, securities, or transactions, from
Deepak T. Pai, Senior Counsel, at (202)
any provision of section 12(d)(1) if the
551–6876 or Mary Kay Frech, Branch
Chief, at (202) 551–6814 (Division of
2 Certain of the Underlying Funds may be
Investment Management, Chief
registered as an open-end investment company or
Counsel’s Office).
a UIT, but have received exemptive relief from the
Commission to permit their shares to be listed and
SUPPLEMENTARY INFORMATION: The
traded on a national securities exchange at
following is a summary of the
negotiated prices and to operate as exchange-traded
application. The complete application
funds (‘‘ETFs’’).
may be obtained via the Commission’s
3 Applicants do not request relief for the Series to
Web site by searching for the file
invest in reliance on the order in closed-end
investment companies that are not listed and traded
number, or for an applicant using the
on a national securities exchange.
Company name box, at https://
4 A Series generally would purchase and sell
www.sec.gov/search/search.htm, or by
shares of an Underlying Fund that operates as an
calling (202) 551–8090.
ETF through secondary market transactions rather
sradovich on DSK3GMQ082PROD with NOTICES
UITs, in excess of the limits in section
12(d)(1) of the Act.
Summary of the Application
1. Applicants request an order to
permit (a) a Series 1 to acquire shares of
1 Applicants request that the order apply to each
existing and future series of the Trust and to any
future registered UIT and series thereof sponsored
by BHSI or an entity controlling, controlled by or
under common control with BHSI (the ‘‘Series’’).
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than through principal transactions with the
Underlying Fund. Applicants nevertheless request
relief from section 17(a) to permit a Series to
purchase or redeem shares from the ETF. A Series
will purchase and sell shares of an Underlying
Fund that is a closed-end fund 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 transactions in
shares of closed-end funds.
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90391
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.
For the Commission, by the Division of
Investment Management, pursuant to
delegated authority.
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016–29932 Filed 12–13–16; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–79506; File No. SR–
NYSEArca–2016–158]
Self-Regulatory Organizations; NYSE
Arca, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change Amending the
Exchange’s Schedule of Fees and
Charges Relating to the Listing and
Annual Fees Applicable to Certain
Structured Products
December 8, 2016
Pursuant to Section 19(b)(1)1 of the
Securities Exchange Act of 1934 (the
‘‘Act’’) 2 and Rule 19b–4 thereunder,3
notice is hereby given that, on
November 29, 2016, NYSE Arca, Inc.
(the ‘‘Exchange’’ or ‘‘NYSE Arca’’) filed
with the Securities and Exchange
Commission (the ‘‘Commission’’) the
proposed rule change as described in
Items I, II, and III below, which Items
have been prepared by the selfregulatory organization. The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
1 15
U.S.C. 78s(b)(1).
U.S.C. 78a.
3 17 CFR 240.19b–4.
2 15
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Federal Register / Vol. 81, No. 240 / Wednesday, December 14, 2016 / Notices
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to amend the
Exchange’s Schedule of Fees and
Charges (‘‘Fee Schedule’’) relating to the
Listing and Annual Fees applicable to
certain Structured Products. This
amendment to the Fee Schedule is
effective November 29, 2016. The
proposed rule change is available on the
Exchange’s Web site at www.nyse.com,
at the principal office of the Exchange,
and at the Commission’s Public
Reference Room.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
self-regulatory organization included
statements concerning the purpose of,
and basis for, the proposed rule change
and discussed any comments it received
on the proposed rule change. The text
of those statements may be examined at
the places specified in Item IV below.
The Exchange has prepared summaries,
set forth in sections A, B, and C below,
of the most significant parts of such
statements.
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
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1. Purpose
The Exchange proposes to amend the
Exchange’s Schedule of Fees and
Charges (‘‘Fee Schedule’’) relating to the
Listing Fee and the Annual Fee
applicable to certain ‘‘Structured
Products’’, as described below.4 This
amendment to the Fee Schedule is
effective November 29, 2016.
Currently, the Exchange’s Fee
Schedule provides for a ‘‘Listing Fee’’
for issues of ‘‘Structured Products’’
which ranges from $5,000 to $45,000
based on the number of shares
outstanding.
The Exchange proposes to amend the
Fee Schedule to eliminate the Listing
Fee in connection with Exchange listing
of certain Structured Products effective
November 29, 2016, as described below.
4 ‘‘Structured Products’’ are defined in Note 4 to
the Fee Schedule as securities listed under Rule
5.2(j)(1) (Other Securities), 5.2(j)(2) (Equity Linked
Notes); Rule 5.2(j)(4) (Index-Linked Exchangeable
Notes); Rule 5.2(j)(6) (Equity Index-Linked
Securities, Commodity-Linked Securities, CurrencyLinked Securities, Fixed Income Index-Linked
Securities, Futures-Linked Securities and
Multifactor Indexed-Linked Securities (collectively,
‘‘Index-Linked Securities’’)); Rule 5.2(j)(7) (Trust
Certificates); Rule 8.3 (Currency and Index
Warrants); and Rule 8.400 (Paired Trust Shares).
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Exchange rules applicable to listing of
Structured Products under NYSE Arca
Equities Rules 5.2(j)(2), 5.2(j)(4) and
5.2(j)(6) provide for listing such
products pursuant to Rule 19b–4(e)
under the Act if they satisfy all
criteria—referred to as ‘‘generic’’ listing
criteria—in such rule. If an issue of such
Structured Products does not satisfy all
applicable generic criteria, the
Commission must approve or issue a
notice of effectiveness with respect to a
proposed rule change filed by the
Exchange pursuant to Section 19(b) of
the Act prior to Exchange listing of such
issue.
The Exchange proposes to eliminate
the Listing Fee for the following
Structured Products listed on the
Exchange pursuant to Rule 19b–4(e)
under the Act, and for which a proposed
rule change pursuant to Section 19(b) of
the Act is not required to be filed with
the Commission: (i) Equity Linked Notes
(listed under Rule 5.2(j)(2)); (ii) IndexLinked Exchangeable Notes (listed
under Rule 5.2(j)(4)); and (iii) IndexLinked Securities (listed under Rule
5.2(j)(6)) (collectively, ‘‘GenericallyListed Structured Products’’). The
Exchange believes that eliminating the
Listing Fee for Generically-Listed
Structured Products would help
correlate the Listing Fee applicable to an
issue of Generically-Listed Structured
Products to the resources required to list
such securities on the Exchange. The
Exchange believes it is appropriate to
eliminate the Listing Fee for
Generically-Listed Structured Products
because such products do not require a
commitment of time and resources by
Exchange staff to prepare and review
Rule 19b–4 filings for Structured
Products other than Generically-Listed
Structured Products, and to
communicate with issuers and the
Commission staff regarding such filings.
Application of a Listing Fee for
Structured Products other than
Generically-Listed Structured Products
is appropriate because the Exchange
generally incurs increased costs in
connection with the listing
administration process, issuer services,
and consultative legal services when a
proposed rule change pursuant to
Section 19(b) of the Act is required to
be filed with the Commission.5
5 The Exchange has eliminated the Exchange
Listing Fee applicable to certain Exchange Traded
Products for which a proposed rule change
pursuant to Section 19(b) of the Act is not required
to be filed with the Commission. See Securities
Exchange Act Release No. 78633 (August 22, 2016),
81 FR 59025 (August 26, 2016) (SR–NYSEArca–
2016–114) (notice of filing and immediate
effectiveness of proposed rule change amending the
Exchange’s Schedule of Fees and Charges to
eliminate the Listing Fee in connection with
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The Exchange also proposes to amend
the Exchange’s Fee Schedule relating to
the Annual Fee payable in connection
with Exchange listing of Index-Linked
Securities.6 The issuer of a series of
Index-Linked Securities, which are
referred to as exchange-traded notes (or
‘‘ETNs’’), may issue a subsequent series
of ETNs based on the identical reference
asset (for example, stock index) as the
initially-listed securities. The Exchange
proposes to amend the Fee Schedule to
provide that multiple series of securities
listed under Rule 5.2(j)(6) that are
issued by the same issuer and are based
on an identical reference asset and
leverage factor (i.e., 1X, –1X, 2X, –2X,
3X or –3X) will receive a 30% discount
off the aggregate calculated Annual Fee
for such multiple series. Thus, for such
series, the Exchange would aggregate
the Annual Fee that would apply to the
initial and subsequently issued series,
and apply a 30% discount to the
aggregated Annual Fee amount.
Example: An issuer issues ETN Series
A based on the S&P 500 Index with a
leverage factor of 2X and subsequently
issues Series B based on the S&P 500
Index with a leverage factor of 2X.
Series A has 20 million shares
outstanding and Series B has 7 million
shares outstanding. The Annual Fee,
calculated separately, for Series A is
$25,000 and, for Series B, $12,000. The
aggregate Annual Fee for both series is
$37,000. The aggregate Annual Fee
would be reduced by 30%, and the
Annual Fee for both series combined
would be $25,900.
The Exchange believes it is
appropriate to provide a reduction in
the Annual Fee for related ETNs, as
described above, because such
reduction will facilitate the issuance of
additional ETNs series, which may
provide enhanced competition among
ETN issuers, while providing a
reduction in fees to certain issuers
listing additional ETN series. The
proposed reduction would apply
equally to all issuers issuing additional
ETN series based on the same reference
asset and leverage factor. The Exchange
believes that a discount, as described
above, is appropriate in such cases
because the Exchange would incur cost
savings relating to listing review,
ongoing regulatory compliance, issuer
services and legal services in connection
with listing of such additional related
ETNs that are commensurate with the
proposed reduction in Annual Fees.
Exchange listing of certain Exchange Traded
Products).
6 The Fee Schedule provides that Annual Fees for
Structured Products range from $10,000 to $55,000,
based on the total number of securities outstanding
per listed issue.
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Federal Register / Vol. 81, No. 240 / Wednesday, December 14, 2016 / Notices
Notwithstanding the proposed
amendments to the Listing Fee and
Annual Fee, as described above, the
Exchange will continue to be able to
fund its regulatory obligations.
sradovich on DSK3GMQ082PROD with NOTICES
2. Statutory Basis
NYSE Arca believes that the proposal
is consistent with Section 6(b) 7 of the
Act, in general, and Section 6(b)(4) 8 of
the Act in particular, in that it provides
for the equitable allocation of reasonable
dues, fees and other charges among its
issuers and other persons using its
facilities. In addition, the Exchange
believes the proposal is consistent with
the requirement under Section 6(b)(5) 9
that an exchange have rules that are
designed to prevent fraudulent and
manipulative acts and practices, to
promote just and equitable principles of
trade, to foster cooperation and
coordination with persons engaged in
regulating, clearing, settling, processing
information with respect to, and
facilitating transactions in securities, to
remove impediments to, and perfect the
mechanism of a free and open market
and, in general, to protect investors and
the public interest; and are not designed
to permit unfair discrimination between
customers, issuers, brokers, or dealers.
The proposed elimination of the
Listing Fee for certain GenericallyListed Structured Products, as described
above, is equitable and does not unfairly
discriminate between issuers because it
would apply uniformly to issues of
Structured Products that are listed
generically under Exchange rules. The
Exchange believes eliminating the
Listing Fee for such Structured
Products, as described above, listed on
the Exchange pursuant to Rule 19b–4(e)
under the Act, and for which a proposed
rule change pursuant to Section 19(b) of
the Act is not required to be filed with
the Commission, would help correlate
the Listing Fee applicable to an issue of
Structured Products to the resources
required to list such securities on the
Exchange. The Exchange believes it is
appropriate to continue to charge a
Listing Fee for Structured Products
other than Generically-Listed Structured
Products for which a proposed rule
change pursuant to Section 19(b) of the
Act is required to be filed because of the
significant additional extensive time
and legal and business resources
required by Exchange staff to prepare
and review such filings and to
communicate with issuers and the
Commission regarding such filings.
U.S.C. 78f(b).
U.S.C. 78f(b)(4).
9 15 U.S.C. 78f(b)(5).
The Exchange believes it is
appropriate to provide a reduction in
the Annual Fee for ETNs, as described
above, because such reduction will
facilitate the issuance of additional ETN
series, which may provide enhanced
competition among ETN issuers, while
providing a reduction in fees to certain
issuers listing additional ETN series.
The proposed reduction would apply
equally to all issuers issuing additional
ETNs series based on the same reference
asset and leverage factor. The Exchange
believes that a discount, as described
above, is appropriate in such cases
because the Exchange would incur cost
savings relating to listing review,
ongoing regulatory compliance, issuer
services and legal services in connection
with listing of such additional related
ETNs that are commensurate with the
proposed reduction in Annual Fees.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange does not believe that
the proposed rule change will impose
any burden on competition that is not
necessary or appropriate in furtherance
of the purpose of the Act. The Exchange
believes the proposed rule change
would promote competition because it
will eliminate the Listing Fee for certain
Structured Products and reduce the
Annual Fee for certain ETNs and will
therefore encourage issuers to develop
and list additional Structured Products
on the Exchange.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
No written comments were solicited
or received with respect to the proposed
rule change.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
The foregoing rule change is effective
upon filing pursuant to Section
19(b)(3)(A) 10 of the Act and
subparagraph (f)(2) of Rule 19b–4 11
thereunder, because it establishes a due,
fee, or other charge imposed by the
Exchange.
At any time within 60 days of the
filing of such proposed rule change, the
Commission summarily may
temporarily suspend such rule change if
it appears to the Commission that such
action is necessary or appropriate in the
public interest, for the protection of
investors, or otherwise in furtherance of
the purposes of the Act. If the
7 15
8 15
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10 15
11 17
Jkt 241001
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U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(2).
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90393
Commission takes such action, the
Commission shall institute proceedings
under Section 19(b)(2)(B)12 of the Act to
determine whether the proposed rule
change should be approved or
disapproved.
IV. Solicitation of Comments
Interested persons are invited to
submit written data, views and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
Comments may be submitted by any of
the following methods:
Electronic Comments
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an email to rule-comments@
sec.gov. Please include File Number SR–
NYSEArca–2016–158 on the subject
line.
Paper Comments
• Send paper comments in triplicate
to Secretary, Securities and Exchange
Commission, 100 F Street NE.,
Washington, DC 20549–1090.
All submissions should refer to File
Number SR–NYSEArca–2016–158. This
file number should be included on the
subject line if email is used. To help the
Commission process and review your
comments more efficiently, please use
only one method. The Commission will
post all comments on the Commission’s
Internet Web site (https://www.sec.gov/
rules/sro.shtml). Copies of the
submission, all subsequent
amendments, all written statements
with respect to the proposed rule
change that are filed with the
Commission, and all written
communications relating to the
proposed rule change between the
Commission and any person, other than
those that may be withheld from the
public in accordance with the
provisions of 5 U.S.C. 552, will be
available for Web site viewing and
printing in the Commission’s Public
Reference Room, 100 F Street NE.,
Washington, DC 20549, on official
business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the
filing also will be available for
inspection and copying at the principal
office of the Exchange. All comments
received will be posted without change;
the Commission does not edit personal
identifying information from
submissions. You should submit only
information that you wish to make
available publicly. All submissions
should refer to File Number SR–
12 15
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U.S.C. 78s(b)(2)(B).
14DEN1
90394
Federal Register / Vol. 81, No. 240 / Wednesday, December 14, 2016 / Notices
NYSEArca–2016–158 and should be
submitted on or before January 4, 2017.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.13
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2016–29938 Filed 12–13–16; 8:45 am]
BILLING CODE 8011–01–P
Separate Accounts (the
‘‘Substitutions’’). In addition, the
Section 17 Applicants also seek an order
pursuant to section 17(b) of the Act
exempting them from section 17(a) of
the Act to the extent necessary to permit
them to engage in certain in-kind
transactions (the ‘‘In-Kind
Transactions’’) in connection with the
Substitutions.
Filing Date: The application was
filed on April 21, 2015, and amended on
May 25, 2016 and August 31, 2016.
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 January 3, 2017, and
should be accompanied by proof of
service on applicants, in the form of an
affidavit, or for lawyers, a certificate of
service. Pursuant to rule 0–5 under the
Act, hearing requests should state the
nature of the writer’s interest, any facts
bearing upon the desirability of a
hearing on the matter, the reason for the
request, and the issues contested.
Persons who wish to be notified of a
hearing may request notification by
writing to the Commission’s Secretary.
ADDRESSES: Secretary, U.S. Securities
and Exchange Commission, 100 F Street
NE., Washington, DC 20549–1090.
Applicants: Hartford Life Insurance
Company, Attn: Lisa Proch, Vice
President, Assistant General Counsel,
P.O. Box 2999, Hartford, CT 06104–
2999.
DATES:
SECURITIES AND EXCHANGE
COMMISSION
[Release No. IC–32386; File No. 812–14447]
Hartford Life Insurance Company, et
al; Notice of Application
December 8, 2016.
Securities and Exchange
Commission (‘‘Commission’’).
ACTION: Notice of application for an
order approving the substitution of
certain securities pursuant to section
26(c) of the Investment Company Act of
1940, as amended (‘‘Act’’) and an order
of exemption pursuant to section 17(b)
of the Act from section 17(a) of the Act.
AGENCY:
Hartford Life Insurance
Company (‘‘Hartford Life’’), Hartford
Life and Annuity Insurance Company
(‘‘Hartford Life and Annuity,’’ and
together with Hartford Life, the
‘‘Hartford Life Insurance Companies’’);
their respective separate accounts,
Hartford Life Insurance Company
Separate Account Three (‘‘HL Separate
Account 3’’), Hartford Life and Annuity
Insurance Company Separate Account
Three (‘‘HLA Separate Account 3’’),
Hartford Life Insurance Company
Separate Account Seven (‘‘HL Separate
Account 7’’), Hartford Life and Annuity
Insurance Company Separate Account
Seven (‘‘HLA Separate Account 7’’)
(collectively, the ‘‘Separate Accounts,’’
and together with the Hartford
Insurance Companies, the ‘‘Section 26
Applicants’’); HIMCO Variable
Insurance Trust (the ‘‘Trust’’), Hartford
Investment Management Company
(‘‘HIMCO,’’ and collectively with the
Section 26 Applicants and the Trust, the
‘‘Section 17 Applicants’’).
SUMMARY OF APPLICATION: The
Applicants seek an order pursuant to
section 26(c) of the Act, approving the
substitution of shares of twenty-seven
(27) investment portfolios of registered
investment companies (the ‘‘Existing
Portfolios’’) with shares of six (6)
investment portfolios of the Trust (the
‘‘Replacement Portfolios’’), under
certain variable annuity contracts (the
‘‘Contracts’’), each funded through the
sradovich on DSK3GMQ082PROD with NOTICES
APPLICANTS:
13 17
CFR 200.30–3(a)(12).
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18:45 Dec 13, 2016
Jkt 241001
FOR FURTHER INFORMATION CONTACT:
Jessica Shin, Attorney-Adviser at (202)
551–5921 or David J. Marcinkus, Branch
Chief, at (202) 551–6821 (Chief
Counsel’s Office, Division of Investment
Management).
SUPPLEMENTARY INFORMATION: The
following is a summary of the
application. The complete application
may be obtained via the Commission’s
Web site by searching for the file
number, or for an applicant using the
Company name box, at https://
www.sec.gov/search/search.htm, or by
calling (202) 551–8090.
Applicants’ Representations
1. Hartford Life is a stock life
insurance company incorporated under
the laws of the state of Connecticut.
Hartford Life was engaged in the
business of writing individual and
group life insurance and annuity
contracts until April 30, 2013, and
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Sfmt 4703
remains authorized to do business in
every state and the District of Columbia.
Hartford Life is an indirect, whollyowned subsidiary of The Hartford
Financial Services Group, Inc. (‘‘The
Hartford’’), a Delaware corporation
whose stock is traded on the New York
Stock Exchange.
2. Hartford Life and Annuity is a stock
life insurance company incorporated
under the laws of the state of
Connecticut. Hartford Life and Annuity
was engaged in the business of writing
individual and group life insurance and
annuity contracts until April 30, 2013,
and remains authorized to do business
in every state (except New York), the
District of Columbia and Puerto Rico.
Hartford Life and Annuity is an indirect
wholly-owned subsidiary of The
Hartford.
3. Hartford Life established HL
Separate Account 3 and HL Separate
Account 7 as segregated asset accounts
under Connecticut law on June 22, 1994
and December 8, 1986, respectively.
Hartford Life and Annuity established
HLA Separate Account 3 and HLA
Separate Account 7 as segregated asset
accounts under Connecticut law on June
22, 1994 and April 1, 1999, respectively.
Each of the Separate Accounts meets the
definition of ‘‘separate account,’’ as
defined in Section 2(a)(37) of the Act.
The Separate Accounts are registered
with the Commission under the Act as
unit investment trusts. The assets of the
Separate Accounts support the
Contracts and interests in the Separate
Accounts offered through such
Contracts. The Separate Accounts are
segmented into subaccounts, and certain
of these subaccounts invest in the
Existing Portfolios. The Contracts are
individual and group deferred variable
annuity contracts, with group
participants acquiring certain
ownership rights as described in the
group contract or plan documents.
Contract owners and participants in
group contracts (each, a ‘‘Contract
owner,’’ and collectively, ‘‘Contract
owners’’) may allocate some or all of
their Contract value to one or more
subaccounts available as investment
options under their respective Contracts
and any rider(s).
4. By the terms of each Contract (and
as set forth in the prospectuses for the
Contracts), the Hartford Insurance
Companies reserve the right to
substitute shares of another registered
investment company for the shares of
any registered investment company
already purchased or to be purchased in
the future by the Separate Accounts.
5. The Trust is a Delaware statutory
trust that was established on January 13,
2012. The Trust is registered with the
E:\FR\FM\14DEN1.SGM
14DEN1
]]>Agencies
[Federal Register Volume 81, Number 240 (Wednesday, December 14, 2016)]
[Notices]
[Pages 90391-90394]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-29938]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-79506; File No. SR-NYSEArca-2016-158]
Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing
and Immediate Effectiveness of Proposed Rule Change Amending the
Exchange's Schedule of Fees and Charges Relating to the Listing and
Annual Fees Applicable to Certain Structured Products
December 8, 2016
Pursuant to Section 19(b)(1)\1\ of the Securities Exchange Act of
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby
given that, on November 29, 2016, NYSE Arca, Inc. (the ``Exchange'' or
``NYSE Arca'') filed with the Securities and Exchange Commission (the
``Commission'') the proposed rule change as described in Items I, II,
and III below, which Items have been prepared by the self-regulatory
organization. The Commission is publishing this notice to solicit
comments on the proposed rule change from interested persons.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 15 U.S.C. 78a.
\3\ 17 CFR 240.19b-4.
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[[Page 90392]]
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to amend the Exchange's Schedule of Fees and
Charges (``Fee Schedule'') relating to the Listing and Annual Fees
applicable to certain Structured Products. This amendment to the Fee
Schedule is effective November 29, 2016. The proposed rule change is
available on the Exchange's Web site at www.nyse.com, at the principal
office of the Exchange, and at the Commission's Public Reference Room.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the self-regulatory organization
included statements concerning the purpose of, and basis for, the
proposed rule change and discussed any comments it received on the
proposed rule change. The text of those statements may be examined at
the places specified in Item IV below. The Exchange has prepared
summaries, set forth in sections A, B, and C below, of the most
significant parts of such statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange proposes to amend the Exchange's Schedule of Fees and
Charges (``Fee Schedule'') relating to the Listing Fee and the Annual
Fee applicable to certain ``Structured Products'', as described
below.\4\ This amendment to the Fee Schedule is effective November 29,
2016.
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\4\ ``Structured Products'' are defined in Note 4 to the Fee
Schedule as securities listed under Rule 5.2(j)(1) (Other
Securities), 5.2(j)(2) (Equity Linked Notes); Rule 5.2(j)(4) (Index-
Linked Exchangeable Notes); Rule 5.2(j)(6) (Equity Index-Linked
Securities, Commodity-Linked Securities, Currency-Linked Securities,
Fixed Income Index-Linked Securities, Futures-Linked Securities and
Multifactor Indexed-Linked Securities (collectively, ``Index-Linked
Securities'')); Rule 5.2(j)(7) (Trust Certificates); Rule 8.3
(Currency and Index Warrants); and Rule 8.400 (Paired Trust Shares).
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Currently, the Exchange's Fee Schedule provides for a ``Listing
Fee'' for issues of ``Structured Products'' which ranges from $5,000 to
$45,000 based on the number of shares outstanding.
The Exchange proposes to amend the Fee Schedule to eliminate the
Listing Fee in connection with Exchange listing of certain Structured
Products effective November 29, 2016, as described below. Exchange
rules applicable to listing of Structured Products under NYSE Arca
Equities Rules 5.2(j)(2), 5.2(j)(4) and 5.2(j)(6) provide for listing
such products pursuant to Rule 19b-4(e) under the Act if they satisfy
all criteria--referred to as ``generic'' listing criteria--in such
rule. If an issue of such Structured Products does not satisfy all
applicable generic criteria, the Commission must approve or issue a
notice of effectiveness with respect to a proposed rule change filed by
the Exchange pursuant to Section 19(b) of the Act prior to Exchange
listing of such issue.
The Exchange proposes to eliminate the Listing Fee for the
following Structured Products listed on the Exchange pursuant to Rule
19b-4(e) under the Act, and for which a proposed rule change pursuant
to Section 19(b) of the Act is not required to be filed with the
Commission: (i) Equity Linked Notes (listed under Rule 5.2(j)(2)); (ii)
Index-Linked Exchangeable Notes (listed under Rule 5.2(j)(4)); and
(iii) Index-Linked Securities (listed under Rule 5.2(j)(6))
(collectively, ``Generically-Listed Structured Products''). The
Exchange believes that eliminating the Listing Fee for Generically-
Listed Structured Products would help correlate the Listing Fee
applicable to an issue of Generically-Listed Structured Products to the
resources required to list such securities on the Exchange. The
Exchange believes it is appropriate to eliminate the Listing Fee for
Generically-Listed Structured Products because such products do not
require a commitment of time and resources by Exchange staff to prepare
and review Rule 19b-4 filings for Structured Products other than
Generically-Listed Structured Products, and to communicate with issuers
and the Commission staff regarding such filings. Application of a
Listing Fee for Structured Products other than Generically-Listed
Structured Products is appropriate because the Exchange generally
incurs increased costs in connection with the listing administration
process, issuer services, and consultative legal services when a
proposed rule change pursuant to Section 19(b) of the Act is required
to be filed with the Commission.\5\
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\5\ The Exchange has eliminated the Exchange Listing Fee
applicable to certain Exchange Traded Products for which a proposed
rule change pursuant to Section 19(b) of the Act is not required to
be filed with the Commission. See Securities Exchange Act Release
No. 78633 (August 22, 2016), 81 FR 59025 (August 26, 2016) (SR-
NYSEArca-2016-114) (notice of filing and immediate effectiveness of
proposed rule change amending the Exchange's Schedule of Fees and
Charges to eliminate the Listing Fee in connection with Exchange
listing of certain Exchange Traded Products).
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The Exchange also proposes to amend the Exchange's Fee Schedule
relating to the Annual Fee payable in connection with Exchange listing
of Index-Linked Securities.\6\ The issuer of a series of Index-Linked
Securities, which are referred to as exchange-traded notes (or
``ETNs''), may issue a subsequent series of ETNs based on the identical
reference asset (for example, stock index) as the initially-listed
securities. The Exchange proposes to amend the Fee Schedule to provide
that multiple series of securities listed under Rule 5.2(j)(6) that are
issued by the same issuer and are based on an identical reference asset
and leverage factor (i.e., 1X, -1X, 2X, -2X, 3X or -3X) will receive a
30% discount off the aggregate calculated Annual Fee for such multiple
series. Thus, for such series, the Exchange would aggregate the Annual
Fee that would apply to the initial and subsequently issued series, and
apply a 30% discount to the aggregated Annual Fee amount.
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\6\ The Fee Schedule provides that Annual Fees for Structured
Products range from $10,000 to $55,000, based on the total number of
securities outstanding per listed issue.
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Example: An issuer issues ETN Series A based on the S&P 500 Index
with a leverage factor of 2X and subsequently issues Series B based on
the S&P 500 Index with a leverage factor of 2X. Series A has 20 million
shares outstanding and Series B has 7 million shares outstanding. The
Annual Fee, calculated separately, for Series A is $25,000 and, for
Series B, $12,000. The aggregate Annual Fee for both series is $37,000.
The aggregate Annual Fee would be reduced by 30%, and the Annual Fee
for both series combined would be $25,900.
The Exchange believes it is appropriate to provide a reduction in
the Annual Fee for related ETNs, as described above, because such
reduction will facilitate the issuance of additional ETNs series, which
may provide enhanced competition among ETN issuers, while providing a
reduction in fees to certain issuers listing additional ETN series. The
proposed reduction would apply equally to all issuers issuing
additional ETN series based on the same reference asset and leverage
factor. The Exchange believes that a discount, as described above, is
appropriate in such cases because the Exchange would incur cost savings
relating to listing review, ongoing regulatory compliance, issuer
services and legal services in connection with listing of such
additional related ETNs that are commensurate with the proposed
reduction in Annual Fees.
[[Page 90393]]
Notwithstanding the proposed amendments to the Listing Fee and
Annual Fee, as described above, the Exchange will continue to be able
to fund its regulatory obligations.
2. Statutory Basis
NYSE Arca believes that the proposal is consistent with Section
6(b) \7\ of the Act, in general, and Section 6(b)(4) \8\ of the Act in
particular, in that it provides for the equitable allocation of
reasonable dues, fees and other charges among its issuers and other
persons using its facilities. In addition, the Exchange believes the
proposal is consistent with the requirement under Section 6(b)(5) \9\
that an exchange have rules that are designed to prevent fraudulent and
manipulative acts and practices, to promote just and equitable
principles of trade, to foster cooperation and coordination with
persons engaged in regulating, clearing, settling, processing
information with respect to, and facilitating transactions in
securities, to remove impediments to, and perfect the mechanism of a
free and open market and, in general, to protect investors and the
public interest; and are not designed to permit unfair discrimination
between customers, issuers, brokers, or dealers.
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\7\ 15 U.S.C. 78f(b).
\8\ 15 U.S.C. 78f(b)(4).
\9\ 15 U.S.C. 78f(b)(5).
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The proposed elimination of the Listing Fee for certain
Generically-Listed Structured Products, as described above, is
equitable and does not unfairly discriminate between issuers because it
would apply uniformly to issues of Structured Products that are listed
generically under Exchange rules. The Exchange believes eliminating the
Listing Fee for such Structured Products, as described above, listed on
the Exchange pursuant to Rule 19b-4(e) under the Act, and for which a
proposed rule change pursuant to Section 19(b) of the Act is not
required to be filed with the Commission, would help correlate the
Listing Fee applicable to an issue of Structured Products to the
resources required to list such securities on the Exchange. The
Exchange believes it is appropriate to continue to charge a Listing Fee
for Structured Products other than Generically-Listed Structured
Products for which a proposed rule change pursuant to Section 19(b) of
the Act is required to be filed because of the significant additional
extensive time and legal and business resources required by Exchange
staff to prepare and review such filings and to communicate with
issuers and the Commission regarding such filings.
The Exchange believes it is appropriate to provide a reduction in
the Annual Fee for ETNs, as described above, because such reduction
will facilitate the issuance of additional ETN series, which may
provide enhanced competition among ETN issuers, while providing a
reduction in fees to certain issuers listing additional ETN series. The
proposed reduction would apply equally to all issuers issuing
additional ETNs series based on the same reference asset and leverage
factor. The Exchange believes that a discount, as described above, is
appropriate in such cases because the Exchange would incur cost savings
relating to listing review, ongoing regulatory compliance, issuer
services and legal services in connection with listing of such
additional related ETNs that are commensurate with the proposed
reduction in Annual Fees.
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
impose any burden on competition that is not necessary or appropriate
in furtherance of the purpose of the Act. The Exchange believes the
proposed rule change would promote competition because it will
eliminate the Listing Fee for certain Structured Products and reduce
the Annual Fee for certain ETNs and will therefore encourage issuers to
develop and list additional Structured Products on the Exchange.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
No written comments were solicited or received with respect to the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing rule change is effective upon filing pursuant to
Section 19(b)(3)(A) \10\ of the Act and subparagraph (f)(2) of Rule
19b-4 \11\ thereunder, because it establishes a due, fee, or other
charge imposed by the Exchange.
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\10\ 15 U.S.C. 78s(b)(3)(A).
\11\ 17 CFR 240.19b-4(f)(2).
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At any time within 60 days of the filing of such proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act. If the Commission
takes such action, the Commission shall institute proceedings under
Section 19(b)(2)(B)\12\ of the Act to determine whether the proposed
rule change should be approved or disapproved.
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\12\ 15 U.S.C. 78s(b)(2)(B).
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IV. Solicitation of Comments
Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
Electronic Comments
Use the Commission's Internet comment form (https://www.sec.gov/rules/sro.shtml); or
Send an email to rule-comments@sec.gov. Please include
File Number SR-NYSEArca-2016-158 on the subject line.
Paper Comments
Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
All submissions should refer to File Number SR-NYSEArca-2016-158. This
file number should be included on the subject line if email is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (https://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for Web site viewing and
printing in the Commission's Public Reference Room, 100 F Street NE.,
Washington, DC 20549, on official business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the filing also will be available
for inspection and copying at the principal office of the Exchange. All
comments received will be posted without change; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File Number SR-
[[Page 90394]]
NYSEArca-2016-158 and should be submitted on or before January 4, 2017.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\13\
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\13\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2016-29938 Filed 12-13-16; 8:45 am]
BILLING CODE 8011-01-P
