Transamerica Advisors Life Insurance Company, et al., 15771-15774 [2017-06246]

Download as PDF Federal Register / Vol. 82, No. 60 / Thursday, March 30, 2017 / Notices asabaliauskas on DSK3SPTVN1PROD with NOTICES 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 20549–1090, on official business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of such filing will also 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– NYSEArca–2016–89 and should be submitted on or before April 20, 2017. VI. Accelerated Approval of Proposed Rule Change, as Modified by Amendment Nos. 1–4 The Commission finds good cause to approve the proposed rule change, as modified by Amendment Nos 1–4, prior to the thirtieth day after the date of publication of notice of the amended proposal in the Federal Register. The revisions made to the proposal in partial Amendment No. 4 142 (1) removed reference to the National Stock Exchange (NSX) from its list of Third Party Systems, (2) added three additional Third Party Data Feeds—ICE Data Services Consolidated Feed, ICE Data Services PRD, and ICE Data Services PRD CEP, (3) added connectivity fees for each of the newly added Third Party Data feeds. With respect to NSX, the Exchange represents that NSX was acquired by the NYSE Group on January 31, 2017, making it no longer a Third Party System. The Commission believes this characterization is consistent with the NYSE Group’s similarly situated affiliated exchanges, NYSEMKT and NYSE, which, like NSX are solely within the NYSE Group’s control. Regarding the ICE Data Services feeds, the Exchange notes that it has an indirect interest in these feeds because ICE Data Services is owned by the Exchange’s ultimate parent, Intercontinental Exchange, Inc. As represented in partial Amendment No. 4, the Exchange considers the ICE Data Services Consolidated Feed (like the NYSE Global Index feed), a Third Party Data Feed because it includes third party market data rather than exclusively the proprietary market data of the Exchange and its affiliated SROs, NYSE and NYSE MKT.143 The Commission believes that partial Amendment No. 4 does not raise issues not previously raised in the proposed rule change, as modified Amendment Nos. 1–3, and addressed in Exchange Response Letters I, II, and III. Accordingly, the Commission finds good cause, pursuant to Section 19(b)(2) of the Act,144 to approve the proposed rule change, as modified by Amendment Nos. 1–4, on an accelerated basis. VII. Conclusion It is therefore ordered, pursuant to Section 19(b)(2) of the Act,145 that the proposed rule change (SR–NYSEArca– 2016–89) be, and hereby is, approved on an accelerated basis. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.146 Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2017–06257 Filed 3–29–17; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Investment Company Act Release No. 32573; File No. 812–14489] Transamerica Advisors Life Insurance Company, et al. March 24, 2017. Securities and Exchange Commission (‘‘SEC’’ or ‘‘Commission’’). ACTION: Notice. AGENCY: 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 (the ‘‘1940 Act’’ or ‘‘Act’’). Transamerica Advisors Life Insurance Company (‘‘TALIC’’) and Transamerica Financial Life Insurance Company (‘‘TFLIC’’) (each a ‘‘Company’’ and together, the ‘‘Companies’’), Merrill Lynch Life Variable Annuity Separate Account A (‘‘Merrill Lynch A’’) and ML of New York Variable Annuity Separate Account A (‘‘ML of New York A’’) (each, an ‘‘Account’’ and together, the ‘‘Accounts’’). The Companies and the Accounts are collectively referred to herein as the ‘‘Applicants.’’ APPLICANTS: Applicants seek an order pursuant to Section 26(c) of the 1940 Act, approving the substitution of shares issued by certain SUMMARY OF APPLICATION: 144 15 142 See partial Amendment No. 4, supra note 13. 143 See id. VerDate Sep<11>2014 19:09 Mar 29, 2017 Jkt 241001 U.S.C. 78s(b)(2). id. 146 17 CFR 200.30–3(a)(12). 145 See PO 00000 Frm 00087 Fmt 4703 Sfmt 4703 15771 series of Transamerica Series Trust (the ‘‘Replacement Funds’’) for shares of certain registered investment companies currently held by sub-accounts of the Accounts (the ‘‘Existing Funds’’), to support certain variable annuity contracts (collectively, the ‘‘Contracts’’) issued by the Companies. The application was filed on June 15, 2015, and was amended and restated on December 8, 2015; July 1, 2016; and November 14, 2016. FILING DATE: 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 Secretary of the Commission and serving the 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 April 18, 2017 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: Commission: Secretary, SEC, 100 F Street NE., Washington, DC 20549–1090. Applicants: Alison C. Ryan, Associate General Counsel, Transamerica, 1150 South Olive Street, T–27–01, Los Angeles, CA 90015. FOR FURTHER INFORMATION CONTACT: Stephan N. Packs, Senior Counsel, at (202) 551–6853, or David J. Marcinkus, Branch Chief at (202) 551–6821 (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 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. TALIC is the depositor of Merrill Lynch A. TFLIC is the depositor of ML of New York A. Each Company is an indirect, wholly-owned subsidiary of AEGON, N.V. 2. Each Account is a ‘‘separate account’’ as defined by Rule 0–1(e) under the 1940 Act and each is E:\FR\FM\30MRN1.SGM 30MRN1 15772 Federal Register / Vol. 82, No. 60 / Thursday, March 30, 2017 / Notices registered under the 1940 Act as a unit investment trust. Each Account is divided into sub-accounts, which reflect the investment performance of certain registered investment companies, including series of Transamerica Series Trust. The Accounts are administered and accounted for as part of the general business of the Companies. The application sets forth the registration statement file numbers for the security interests under the Contracts and the Accounts. 3. The Contracts are individual variable annuity contracts. Each of the prospectuses for the Contracts discloses that the issuing Company reserves the right, subject to compliance with applicable law, to substitute shares of another registered open-end management investment company for shares of a registered open-end management investment company held by a sub-account of an Account. 4. Transamerica Series Trust is an open-end management investment company of the series type that is registered with the Commission under the 1940 Act (File No. 811–04419).1 Shares of the series are registered under the Securities Act of 1933 (File No. 033– 00507), and are sold to the separate accounts of life insurance companies to fund benefits under variable life policies or variable annuity contracts and to certain affiliated asset allocation funds. Existing fund 5. Transamerica Asset Management, Inc. (‘‘TAM’’), an investment adviser that is registered with the Commission, has overall responsibility for the management of each Replacement Fund. TAM delegates to a sub-adviser the responsibility for day-to-day management of the investments of each Replacement Fund, subject to TAM’s oversight. TAM may, in the future, determine to provide the day to day management of any Replacement Fund without the use of a sub-adviser. 6. Applicants propose, as set forth below, to substitute shares of the Replacement Funds for shares of the Existing Funds (‘‘Substitutions’’) to fund the Contracts: Replacement fund American Century Investments VP International Fund (Class I) ............. Dreyfus Variable Investment Fund: Appreciation Portfolio (Service Shares). Oppenheimer Capital Appreciation Fund/VA (Service Shares) ............... Oppenheimer Main Street Small Cap Fund®/VA (Service Shares) ......... Wanger USA ............................................................................................. Columbia Variable Portfolio—Select Smaller-Cap Value Fund (Class 1) Pioneer Emerging Markets VCT Portfolio (Class II Shares) .................... Pioneer Fund VCT Portfolio (Class II Shares) ......................................... 7. The Applicants believe that the Replacement Funds have investment objectives, policies and risk profiles, as described in their prospectuses, that are substantially the same as, or sufficiently similar to, the corresponding Existing Funds to make those Replacement Funds appropriate candidates as substitutes. Applicants also state that the investment objectives and investment strategies of each Transamerica MFS International Equity VP (Initial Class). Transamerica WMC US Growth VP (Service Class). Transamerica Transamerica Transamerica Transamerica Transamerica Transamerica Jennison Growth VP (Initial Class). T. Rowe Price Small Cap VP (Initial Class). T. Rowe Price Small Cap VP (Initial Class). T. Rowe Price Small Cap VP (Initial Class). TS&W International Equity VP (Service Class). JPMorgan Enhanced Index VP (Initial Class). Replacement Fund are similar to the corresponding Existing Fund, or each Replacement Fund’s underlying portfolio construction and investment results are similar to those of the Existing Fund, and therefore the fundamental objectives, risk, and performance expectations of those Contract owners with interests in subaccounts of the Existing Funds will continue to be met after the Substitutions. 8. The investment objectives of each Existing Fund and its corresponding Replacement Fund are set out below. Additional information for each Existing Fund and Replacement Fund, including principal investment strategies, principal risks, and comparative performance history, can be found in the application. Existing fund Replacement fund American Century Investments VP International Fund (Class I) seeks capital growth. Dreyfus Variable Investment Fund: Appreciation Portfolio (Service Shares) seeks long-term capital growth consistent with the preservation of capital. The fund’s secondary goal is current income. Oppenheimer Capital Appreciation Fund/VA (Service Shares) seeks capital appreciation. Oppenheimer Main Street Small Cap Fund®/VA (Service Shares) seeks capital appreciation. Transamerica MFS International Equity VP (Initial Class) seeks capital growth. Transamerica WMC US Growth VP (Service Class) seeks to maximize long-term growth. asabaliauskas on DSK3SPTVN1PROD with NOTICES Wanger USA seeks long-term capital appreciation. Columbia Variable Portfolio—Select Smaller-Cap Value Fund (Class 1) seeks to provide shareholders with long-term capital growth. Pioneer Emerging Markets VCT Portfolio (Class II Shares) seeks longterm growth of capital. Pioneer Fund VCT Portfolio (Class II Shares) seeks reasonable income and capital growth. Transamerica Jennison Growth VP (Initial Class) seeks long-term growth of capital. Transamerica T. Rowe Price Small Cap VP (Initial Class) seeks longterm growth of capital by investing primarily in common stocks of small growth companies. Transamerica TS&W International Equity VP (Service Class) seeks maximum long-term total return, consistent with reasonable risk to principal, by investing in a diversified portfolio of common stocks of primarily non-U.S. issuers. Transamerica JPMorgan Enhanced Index VP (Initial Class) seeks to earn a total return modestly in excess of the total return performance of the S&P 500® (including the reinvestment of dividends) while maintaining a volatility of return similar to the S&P 500®. 1 Effective May 1, 2008, Transamerica Series Trust changed its name from AEGON/Transamerica Series Trust. VerDate Sep<11>2014 19:09 Mar 29, 2017 Jkt 241001 PO 00000 Frm 00088 Fmt 4703 Sfmt 4703 E:\FR\FM\30MRN1.SGM 30MRN1 Federal Register / Vol. 82, No. 60 / Thursday, March 30, 2017 / Notices asabaliauskas on DSK3SPTVN1PROD with NOTICES 9. Applicants state that the Substitutions are designed to allow Contract Owners to continue their investment in similar or better investment options without interruption and at no additional cost to them. Contract owners with sub-account balances invested through the Separate Accounts in shares of the Replacement Funds will have the same or lower total expense ratios taking into account fund expenses (including Rule 12b–1 fees, if any). With respect to all of the proposed Substitutions, the combined management fee and Rule 12b–1 fees paid by the Replacement Fund are the same or lower than those of the corresponding Existing Fund. The application sets forth the fees and expenses of each Existing Fund and its corresponding Replacement Fund in greater detail. 10. Applicants represent that as of the effective date of the Substitutions (‘‘Effective Date’’) shares of the Existing Funds will be redeemed for cash. The Companies, on behalf of each Existing Fund sub-account of each relevant Account, will simultaneously place a redemption request with each Existing Fund and a purchase order with the corresponding Replacement Fund so that the purchase of Replacement Fund shares will be for the exact amount of the redemption proceeds. Thus, Contract values will remain fully invested at all times. 11. The Substitutions will take place at relative net asset value (in accordance with Rule 22c–1 under the 1940 Act) with no change in the amount of any affected Contract owner’s contract value, cash value, accumulation value, account value or death benefit or in dollar value of his or her investment in the applicable Accounts.2 No brokerage commissions or other fees will be paid by either the Existing Funds or the Replacement Funds or by affected Contract owners in connection with the Substitutions. 12. The affected Contract owners will not incur any fees or charges as a result of the Substitutions nor will their rights or the Companies’ obligations under the 2 Applicants state that, because the Substitutions will occur at relative net asset value, and the fees and charges under the Contracts will not change as a result of the Substitutions, the benefits offered by the guarantees under the Contracts will be the same immediately before and after the Substitutions. Applicants also state that what effect the Substitutions may have on the value of the benefits offered by the Contract guarantees would depend, among other things, on the relative future performance of the Existing Funds and Replacement Funds, which Applicants cannot predict. Nevertheless, Applicants note that at the time of the Substitutions, the Contracts will offer a comparable variety of investment options with as broad a range of risk/return characteristics. VerDate Sep<11>2014 19:09 Mar 29, 2017 Jkt 241001 Contracts be altered in any way. The Companies or their affiliates will pay all expenses and transaction costs of the Substitutions, including brokerage, legal, accounting, and other fees and expenses. The Substitutions will not cause the Contract fees and charges currently being paid by affected Contract owners to be greater after the Substitutions than before the Substitutions. Moreover, the Substitutions will not impose any tax liability on affected Contract owners. 13. As described in the application, after notification of the Substitution and for 30 days after the Effective Date, affected Contract owners may reallocate the sub-account value of an Existing Fund to any other investment option available under their Contract without incurring any transfer charges. 14. All Contract owners affected by the Substitutions will be notified of this application by means of supplements to the Contract prospectuses at least 30 days prior to the Effective Date. The notice will advise Contract owners that from the date of the notice until the Effective Date, owners are permitted to make one transfer of Contract value out of the Existing Fund sub-account to one or more other sub-accounts without the transfer (or exchange) being treated as one of a limited number of transfers (or exchanges) permitted without a transfer charge. Among other information, the notice will inform affected Contract owners that the Companies will not exercise any rights reserved under any Contract to impose additional restrictions on transfers until at least 30 days after the Effective Date. 15. If affected Contract owners reallocate account value during this 60 day period, there will be no charge for the reallocation of accumulated value from the Existing Fund sub-accounts and the reallocation will not count as a transfer when imposing any applicable restriction or limit under the Contract on transfers. Additionally, all affected Contract owners will be sent prospectuses of the applicable Replacement Funds at least 30 days before the Effective Date. 16. Within five (5) business days after the Effective Date, affected Contract owners will be sent a written confirmation, which will include: (a) A confirmation that the Substitutions were carried out as previously notified; (b) a restatement of the information set forth in the pre-Substitution notice; and (c) values of the Contract owner’s position in the (i) Existing Fund before the Substitution, and (ii) Replacement Fund after the Substitution. PO 00000 Frm 00089 Fmt 4703 Sfmt 4703 15773 Legal Analysis 1. Applicants request that the Commission issue an order pursuant to Section 26(c) of the 1940 Act approving the Substitutions. Section 26(c) requires the depositor of a registered unit investment trust holding the securities of a single issuer to obtain Commission approval before substituting the securities held by the trust. Section 26(c) requires the Commission to issue such an order if the evidence establishes that the substitution is consistent with the protection of investors and the purposes fairly intended by the policy and provisions of the 1940 Act. 2. Applicants submit that the terms and conditions of the Substitutions meet the standards set forth in Section 26(c) and assert that the replacement of an Existing Fund with the corresponding Replacement Fund is consistent with the protection of investors and the purposes fairly intended by the policy and provisions of the 1940 Act. As described in the application, for a period of two years following the Effective Date, the Companies or their affiliates will reimburse any Contract owner affected by the proposed Substitutions involving Replacement Funds and whose sub-account invests in the Replacement Fund to the extent a Replacement Fund’s net annual operating expenses exceeds the net annual operating expenses of the corresponding Existing Fund. Applicants further assert that each Replacement Fund has similar investment objectives and investment strategies as the corresponding Existing Fund, or each Replacement Fund’s underlying portfolio construction and investment results are similar to those of the corresponding Existing Fund. Accordingly, Applicants believe that the fundamental investment objectives, risk, and performance expectations of the affected Contract owners will continue to be met after the Substitutions. 3. Applicants also maintain that it is in the best interests of the Contract owners to substitute the Replacement Fund for its corresponding Existing Fund. Applicants anticipate that the substitution of an Existing Fund with the corresponding Replacement Fund will result in a Contract that is administered and managed more efficiently, and one that is more competitive with other variable products. The rights of affected Contract owners and the obligations of the Companies under the Contracts will not be altered by the Substitutions. Affected Contract owners will not incur any additional tax liability or any additional E:\FR\FM\30MRN1.SGM 30MRN1 15774 Federal Register / Vol. 82, No. 60 / Thursday, March 30, 2017 / Notices asabaliauskas on DSK3SPTVN1PROD with NOTICES fees and expenses as a result of the Substitutions. 4. Each of the prospectuses for the Contracts discloses that the issuing Company reserves the right, subject to compliance with applicable law, to substitute shares of another registered open-end management investment company for shares of an open-end management investment company held by a sub-account of an Account. 5. Applicants also assert that none of the proposed Substitutions is of the type that Section 26(c) was designed to prevent. Unlike a traditional unit investment trust where a depositor could only substitute an investment security in a manner which permanently affected all the investors in the trust, the Contracts provide each Contract owner with the right to exercise his or her own judgment and transfer account values into other subaccounts. Moreover, the Contracts will offer affected Contract owners the opportunity to transfer amounts out of the affected sub-accounts into any of the remaining sub-accounts without cost or other disadvantage. The Substitution, therefore, will not result in the type of costly forced redemptions that Section 26(c) was designed to prevent. Applicants also maintain that the Substitutions are unlike the type of substitutions which Section 26(c) was designed to prevent in that by purchasing a Contract, Contract owners select much more than a particular registered management open-end investment company in which to invest their account values. They also select the specific type of insurance coverage offered by the Companies under their Contracts as well as other rights and privileges set forth in the Contract. Applicants’ Conditions Applicants agree that any order of the Commission granting the requested relief will be subject to the following conditions: 1. The proposed Substitutions will not be effected unless the Companies determine that: (a) The Contracts allow the substitution of shares of registered open-end investment companies in the manner contemplated by the application; (b) the Substitutions can be consummated as described in the application under applicable insurance laws; and (c) any regulatory requirements in each jurisdiction where the Contracts are qualified for sale have been complied with to the extent necessary to complete the Substitutions. 2. The Companies or their affiliates will pay all expenses and transaction costs of the Substitutions, including legal and accounting expenses, any VerDate Sep<11>2014 19:09 Mar 29, 2017 Jkt 241001 applicable brokerage expenses, and other fees and expenses. No fees or charges will be assessed to the Contract owners to effect the Substitutions. 3. The proposed Substitutions will be effected at the relative net asset values of the respective shares in conformity with Section 22(c) of the 1940 Act and Rule 22c–1 thereunder without the imposition of any transfer or similar charges by Applicants. The Substitutions will be effected without change in the amount or value of any Contracts held by affected Contract owners. 4. The proposed Substitutions will in no way alter the tax treatment of affected Contract owners in connection with their Contracts, and no tax liability will arise for affected Contract owners as a result of the Substitutions. 5. The rights or obligations of the Companies under the Contracts of affected Contract owners will not be altered in any way. 6. Affected Contract owners will be permitted to make at least one transfer of Contract value from the sub-account investing in the Existing Fund (before the Effective Date) or the Replacement Fund (after the Effective Date) to any other available investment option under the Contract without charge for a period beginning at least 30 days before the Effective Date through at least 30 days following the Effective Date. Except as described in any market timing/shortterm trading provisions of the relevant prospectus, the Company will not exercise any right it may have under the Contract to impose restrictions on transfers between the sub-accounts under the Contracts, including limitations on the future number of transfers, for a period beginning at least 30 days before the Effective Date through at least 30 days following the Effective Date. 7. All affected Contract owners will be notified, at least 30 days before the Effective Date about: (a) The intended substitution of Existing Funds with the Replacement Funds; (b) the intended Effective Date; and (c) information with respect to transfers as set forth in Condition 6 above. In addition, the Companies will deliver to all affected Contract owners, at least 30 days before the Effective Date, a prospectus for each applicable Replacement Fund. 8. The Companies will deliver to each affected Contract owner within five (5) business days of the Effective Date a written confirmation which will include: (a) A confirmation that the Substitutions were carried out as previously notified; (b) a restatement of the information set forth in the preSubstitution notice; and (c) values of the PO 00000 Frm 00090 Fmt 4703 Sfmt 4703 Contract owner’s position in the (i) Existing Fund before the Substitution, and (ii) Replacement Fund after the Substitution. 9. After the Effective Date, the Applicants agree not to change a Replacement Fund’s sub-adviser without obtaining shareholder approval of either (a) the sub-adviser change or (b) the parties’ continued ability to rely on their manager-of-managers exemptive order. 10. For two years following the Effective Date the net annual expenses of each Replacement Fund that is a Transamerica Series Trust Fund will not exceed the net annual expenses of the corresponding Existing Fund as of the fund’s most recent fiscal year. To achieve this limitation, the Replacement Fund’s investment adviser will waive fees or reimburse the Replacement Fund in certain amounts to maintain expenses at or below the limit. Any adjustments will be made at least on a quarterly basis. In addition, the Insurance Companies will not increase the Contract fees and charges, including asset based charges such as mortality expense risk charges deducted from the sub-accounts that would otherwise be assessed under the terms of the Contracts for a period of at least two years following the Effective Date. For the Commission, by the Division of Investment Management, under delegated authority. Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2017–06246 Filed 3–29–17; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Investment Company Act Release No. 32574; File No. 812–14490] Transamerica Life Insurance Company, et al. March 24, 2017. Securities and Exchange Commission (‘‘SEC’’ or ‘‘Commission’’). ACTION: Notice. AGENCY: 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 (the ‘‘1940 Act’’ or ‘‘Act’’). APPLICANTS: Transamerica Life Insurance Company (‘‘TLIC’’), Transamerica Financial Life Insurance Company (‘‘TFLIC’’) (each a ‘‘Company’’ and together, the ‘‘Companies’’), Separate Account VA B, and Separate E:\FR\FM\30MRN1.SGM 30MRN1

Agencies

SECURITIES AND EXCHANGE COMMISSION

[Federal Register Volume 82, Number 60 (Thursday, March 30, 2017)]
[Notices]
[Pages 15771-15774]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-06246]

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SECURITIES AND EXCHANGE COMMISSION

[Investment Company Act Release No. 32573; File No. 812-14489]

Transamerica Advisors Life Insurance Company, et al.

March 24, 2017.
AGENCY: Securities and Exchange Commission (``SEC'' or ``Commission'').

ACTION: Notice.

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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 (the ``1940 Act'' or ``Act'').

Applicants: Transamerica Advisors Life Insurance Company (``TALIC'')
and Transamerica Financial Life Insurance Company (``TFLIC'') (each a
``Company'' and together, the ``Companies''), Merrill Lynch Life
Variable Annuity Separate Account A (``Merrill Lynch A'') and ML of New
York Variable Annuity Separate Account A (``ML of New York A'') (each,
an ``Account'' and together, the ``Accounts''). The Companies and the
Accounts are collectively referred to herein as the ``Applicants.''

Summary of Application: Applicants seek an order pursuant to Section
26(c) of the 1940 Act, approving the substitution of shares issued by
certain series of Transamerica Series Trust (the ``Replacement Funds'')
for shares of certain registered investment companies currently held by
sub-accounts of the Accounts (the ``Existing Funds''), to support
certain variable annuity contracts (collectively, the ``Contracts'')
issued by the Companies.

Filing Date: The application was filed on June 15, 2015, and was
amended and restated on December 8, 2015; July 1, 2016; and November
14, 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 Secretary of
the Commission and serving the 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 April 18, 2017 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: Commission: Secretary, SEC, 100 F Street NE., Washington, DC
20549-1090. Applicants: Alison C. Ryan, Associate General Counsel,
Transamerica, 1150 South Olive Street, T-27-01, Los Angeles, CA 90015.

FOR FURTHER INFORMATION CONTACT: Stephan N. Packs, Senior Counsel, at
(202) 551-6853, or David J. Marcinkus, Branch Chief at (202) 551-6821
(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 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. TALIC is the depositor of Merrill Lynch A. TFLIC is the
depositor of ML of New York A. Each Company is an indirect, wholly-
owned subsidiary of AEGON, N.V.
2. Each Account is a ``separate account'' as defined by Rule 0-1(e)
under the 1940 Act and each is

[[Page 15772]]

registered under the 1940 Act as a unit investment trust. Each Account
is divided into sub-accounts, which reflect the investment performance
of certain registered investment companies, including series of
Transamerica Series Trust. The Accounts are administered and accounted
for as part of the general business of the Companies. The application
sets forth the registration statement file numbers for the security
interests under the Contracts and the Accounts.
3. The Contracts are individual variable annuity contracts. Each of
the prospectuses for the Contracts discloses that the issuing Company
reserves the right, subject to compliance with applicable law, to
substitute shares of another registered open-end management investment
company for shares of a registered open-end management investment
company held by a sub-account of an Account.
4. Transamerica Series Trust is an open-end management investment
company of the series type that is registered with the Commission under
the 1940 Act (File No. 811-04419).\1\ Shares of the series are
registered under the Securities Act of 1933 (File No. 033-00507), and
are sold to the separate accounts of life insurance companies to fund
benefits under variable life policies or variable annuity contracts and
to certain affiliated asset allocation funds.
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\1\ Effective May 1, 2008, Transamerica Series Trust changed its
name from AEGON/Transamerica Series Trust.
---------------------------------------------------------------------------

5. Transamerica Asset Management, Inc. (``TAM''), an investment
adviser that is registered with the Commission, has overall
responsibility for the management of each Replacement Fund. TAM
delegates to a sub-adviser the responsibility for day-to-day management
of the investments of each Replacement Fund, subject to TAM's
oversight. TAM may, in the future, determine to provide the day to day
management of any Replacement Fund without the use of a sub-adviser.
6. Applicants propose, as set forth below, to substitute shares of
the Replacement Funds for shares of the Existing Funds
(``Substitutions'') to fund the Contracts:

7. The Applicants believe that the Replacement Funds have
investment objectives, policies and risk profiles, as described in
their prospectuses, that are substantially the same as, or sufficiently
similar to, the corresponding Existing Funds to make those Replacement
Funds appropriate candidates as substitutes. Applicants also state that
the investment objectives and investment strategies of each Replacement
Fund are similar to the corresponding Existing Fund, or each
Replacement Fund's underlying portfolio construction and investment
results are similar to those of the Existing Fund, and therefore the
fundamental objectives, risk, and performance expectations of those
Contract owners with interests in sub-accounts of the Existing Funds
will continue to be met after the Substitutions.
8. The investment objectives of each Existing Fund and its
corresponding Replacement Fund are set out below. Additional
information for each Existing Fund and Replacement Fund, including
principal investment strategies, principal risks, and comparative
performance history, can be found in the application.

------------------------------------------------------------------------
Existing fund Replacement fund
------------------------------------------------------------------------
American Century Investments VP Transamerica MFS International
International Fund (Class I) seeks Equity VP (Initial Class)
capital growth. seeks capital growth.
Dreyfus Variable Investment Fund: Transamerica WMC US Growth VP
Appreciation Portfolio (Service (Service Class) seeks to
Shares) seeks long-term capital growth maximize long-term growth.
consistent with the preservation of
capital. The fund's secondary goal is
current income.
Oppenheimer Capital Appreciation Fund/ Transamerica Jennison Growth VP
VA (Service Shares) seeks capital (Initial Class) seeks long-
appreciation. term growth of capital.
Oppenheimer Main Street Small Cap Transamerica T. Rowe Price
Fund[supreg]/VA (Service Shares) seeks Small Cap VP (Initial Class)
capital appreciation. seeks long-term growth of
capital by investing primarily
in common stocks of small
growth companies.
Wanger USA seeks long-term capital
appreciation.
Columbia Variable Portfolio--Select
Smaller-Cap Value Fund (Class 1) seeks
to provide shareholders with long-term
capital growth.
Pioneer Emerging Markets VCT Portfolio Transamerica TS&W International
(Class II Shares) seeks long-term Equity VP (Service Class)
growth of capital. seeks maximum long-term total
return, consistent with
reasonable risk to principal,
by investing in a diversified
portfolio of common stocks of
primarily non-U.S. issuers.
Pioneer Fund VCT Portfolio (Class II Transamerica JPMorgan Enhanced
Shares) seeks reasonable income and Index VP (Initial Class) seeks
capital growth. to earn a total return
modestly in excess of the
total return performance of
the S&P 500[supreg] (including
the reinvestment of dividends)
while maintaining a volatility
of return similar to the S&P
500[supreg].
------------------------------------------------------------------------

[[Page 15773]]

9. Applicants state that the Substitutions are designed to allow
Contract Owners to continue their investment in similar or better
investment options without interruption and at no additional cost to
them. Contract owners with sub-account balances invested through the
Separate Accounts in shares of the Replacement Funds will have the same
or lower total expense ratios taking into account fund expenses
(including Rule 12b-1 fees, if any). With respect to all of the
proposed Substitutions, the combined management fee and Rule 12b-1 fees
paid by the Replacement Fund are the same or lower than those of the
corresponding Existing Fund. The application sets forth the fees and
expenses of each Existing Fund and its corresponding Replacement Fund
in greater detail.
10. Applicants represent that as of the effective date of the
Substitutions (``Effective Date'') shares of the Existing Funds will be
redeemed for cash. The Companies, on behalf of each Existing Fund sub-
account of each relevant Account, will simultaneously place a
redemption request with each Existing Fund and a purchase order with
the corresponding Replacement Fund so that the purchase of Replacement
Fund shares will be for the exact amount of the redemption proceeds.
Thus, Contract values will remain fully invested at all times.
11. The Substitutions will take place at relative net asset value
(in accordance with Rule 22c-1 under the 1940 Act) with no change in
the amount of any affected Contract owner's contract value, cash value,
accumulation value, account value or death benefit or in dollar value
of his or her investment in the applicable Accounts.\2\ No brokerage
commissions or other fees will be paid by either the Existing Funds or
the Replacement Funds or by affected Contract owners in connection with
the Substitutions.
---------------------------------------------------------------------------

\2\ Applicants state that, because the Substitutions will occur
at relative net asset value, and the fees and charges under the
Contracts will not change as a result of the Substitutions, the
benefits offered by the guarantees under the Contracts will be the
same immediately before and after the Substitutions. Applicants also
state that what effect the Substitutions may have on the value of
the benefits offered by the Contract guarantees would depend, among
other things, on the relative future performance of the Existing
Funds and Replacement Funds, which Applicants cannot predict.
Nevertheless, Applicants note that at the time of the Substitutions,
the Contracts will offer a comparable variety of investment options
with as broad a range of risk/return characteristics.
---------------------------------------------------------------------------

12. The affected Contract owners will not incur any fees or charges
as a result of the Substitutions nor will their rights or the
Companies' obligations under the Contracts be altered in any way. The
Companies or their affiliates will pay all expenses and transaction
costs of the Substitutions, including brokerage, legal, accounting, and
other fees and expenses. The Substitutions will not cause the Contract
fees and charges currently being paid by affected Contract owners to be
greater after the Substitutions than before the Substitutions.
Moreover, the Substitutions will not impose any tax liability on
affected Contract owners.
13. As described in the application, after notification of the
Substitution and for 30 days after the Effective Date, affected
Contract owners may reallocate the sub-account value of an Existing
Fund to any other investment option available under their Contract
without incurring any transfer charges.
14. All Contract owners affected by the Substitutions will be
notified of this application by means of supplements to the Contract
prospectuses at least 30 days prior to the Effective Date. The notice
will advise Contract owners that from the date of the notice until the
Effective Date, owners are permitted to make one transfer of Contract
value out of the Existing Fund sub-account to one or more other sub-
accounts without the transfer (or exchange) being treated as one of a
limited number of transfers (or exchanges) permitted without a transfer
charge. Among other information, the notice will inform affected
Contract owners that the Companies will not exercise any rights
reserved under any Contract to impose additional restrictions on
transfers until at least 30 days after the Effective Date.
15. If affected Contract owners reallocate account value during
this 60 day period, there will be no charge for the reallocation of
accumulated value from the Existing Fund sub-accounts and the
reallocation will not count as a transfer when imposing any applicable
restriction or limit under the Contract on transfers. Additionally, all
affected Contract owners will be sent prospectuses of the applicable
Replacement Funds at least 30 days before the Effective Date.
16. Within five (5) business days after the Effective Date,
affected Contract owners will be sent a written confirmation, which
will include: (a) A confirmation that the Substitutions were carried
out as previously notified; (b) a restatement of the information set
forth in the pre-Substitution notice; and (c) values of the Contract
owner's position in the (i) Existing Fund before the Substitution, and
(ii) Replacement Fund after the Substitution.

Legal Analysis

1. Applicants request that the Commission issue an order pursuant
to Section 26(c) of the 1940 Act approving the Substitutions. Section
26(c) requires the depositor of a registered unit investment trust
holding the securities of a single issuer to obtain Commission approval
before substituting the securities held by the trust. Section 26(c)
requires the Commission to issue such an order if the evidence
establishes that the substitution is consistent with the protection of
investors and the purposes fairly intended by the policy and provisions
of the 1940 Act.
2. Applicants submit that the terms and conditions of the
Substitutions meet the standards set forth in Section 26(c) and assert
that the replacement of an Existing Fund with the corresponding
Replacement Fund is consistent with the protection of investors and the
purposes fairly intended by the policy and provisions of the 1940 Act.
As described in the application, for a period of two years following
the Effective Date, the Companies or their affiliates will reimburse
any Contract owner affected by the proposed Substitutions involving
Replacement Funds and whose sub-account invests in the Replacement Fund
to the extent a Replacement Fund's net annual operating expenses
exceeds the net annual operating expenses of the corresponding Existing
Fund. Applicants further assert that each Replacement Fund has similar
investment objectives and investment strategies as the corresponding
Existing Fund, or each Replacement Fund's underlying portfolio
construction and investment results are similar to those of the
corresponding Existing Fund. Accordingly, Applicants believe that the
fundamental investment objectives, risk, and performance expectations
of the affected Contract owners will continue to be met after the
Substitutions.
3. Applicants also maintain that it is in the best interests of the
Contract owners to substitute the Replacement Fund for its
corresponding Existing Fund. Applicants anticipate that the
substitution of an Existing Fund with the corresponding Replacement
Fund will result in a Contract that is administered and managed more
efficiently, and one that is more competitive with other variable
products. The rights of affected Contract owners and the obligations of
the Companies under the Contracts will not be altered by the
Substitutions. Affected Contract owners will not incur any additional
tax liability or any additional

[[Page 15774]]

fees and expenses as a result of the Substitutions.
4. Each of the prospectuses for the Contracts discloses that the
issuing Company reserves the right, subject to compliance with
applicable law, to substitute shares of another registered open-end
management investment company for shares of an open-end management
investment company held by a sub-account of an Account.
5. Applicants also assert that none of the proposed Substitutions
is of the type that Section 26(c) was designed to prevent. Unlike a
traditional unit investment trust where a depositor could only
substitute an investment security in a manner which permanently
affected all the investors in the trust, the Contracts provide each
Contract owner with the right to exercise his or her own judgment and
transfer account values into other sub-accounts. Moreover, the
Contracts will offer affected Contract owners the opportunity to
transfer amounts out of the affected sub-accounts into any of the
remaining sub-accounts without cost or other disadvantage. The
Substitution, therefore, will not result in the type of costly forced
redemptions that Section 26(c) was designed to prevent. Applicants also
maintain that the Substitutions are unlike the type of substitutions
which Section 26(c) was designed to prevent in that by purchasing a
Contract, Contract owners select much more than a particular registered
management open-end investment company in which to invest their account
values. They also select the specific type of insurance coverage
offered by the Companies under their Contracts as well as other rights
and privileges set forth in the Contract.

Applicants' Conditions

Applicants agree that any order of the Commission granting the
requested relief will be subject to the following conditions:
1. The proposed Substitutions will not be effected unless the
Companies determine that: (a) The Contracts allow the substitution of
shares of registered open-end investment companies in the manner
contemplated by the application; (b) the Substitutions can be
consummated as described in the application under applicable insurance
laws; and (c) any regulatory requirements in each jurisdiction where
the Contracts are qualified for sale have been complied with to the
extent necessary to complete the Substitutions.
2. The Companies or their affiliates will pay all expenses and
transaction costs of the Substitutions, including legal and accounting
expenses, any applicable brokerage expenses, and other fees and
expenses. No fees or charges will be assessed to the Contract owners to
effect the Substitutions.
3. The proposed Substitutions will be effected at the relative net
asset values of the respective shares in conformity with Section 22(c)
of the 1940 Act and Rule 22c-1 thereunder without the imposition of any
transfer or similar charges by Applicants. The Substitutions will be
effected without change in the amount or value of any Contracts held by
affected Contract owners.
4. The proposed Substitutions will in no way alter the tax
treatment of affected Contract owners in connection with their
Contracts, and no tax liability will arise for affected Contract owners
as a result of the Substitutions.
5. The rights or obligations of the Companies under the Contracts
of affected Contract owners will not be altered in any way.
6. Affected Contract owners will be permitted to make at least one
transfer of Contract value from the sub-account investing in the
Existing Fund (before the Effective Date) or the Replacement Fund
(after the Effective Date) to any other available investment option
under the Contract without charge for a period beginning at least 30
days before the Effective Date through at least 30 days following the
Effective Date. Except as described in any market timing/short-term
trading provisions of the relevant prospectus, the Company will not
exercise any right it may have under the Contract to impose
restrictions on transfers between the sub-accounts under the Contracts,
including limitations on the future number of transfers, for a period
beginning at least 30 days before the Effective Date through at least
30 days following the Effective Date.
7. All affected Contract owners will be notified, at least 30 days
before the Effective Date about: (a) The intended substitution of
Existing Funds with the Replacement Funds; (b) the intended Effective
Date; and (c) information with respect to transfers as set forth in
Condition 6 above. In addition, the Companies will deliver to all
affected Contract owners, at least 30 days before the Effective Date, a
prospectus for each applicable Replacement Fund.
8. The Companies will deliver to each affected Contract owner
within five (5) business days of the Effective Date a written
confirmation which will include: (a) A confirmation that the
Substitutions were carried out as previously notified; (b) a
restatement of the information set forth in the pre-Substitution
notice; and (c) values of the Contract owner's position in the (i)
Existing Fund before the Substitution, and (ii) Replacement Fund after
the Substitution.
9. After the Effective Date, the Applicants agree not to change a
Replacement Fund's sub-adviser without obtaining shareholder approval
of either (a) the sub-adviser change or (b) the parties' continued
ability to rely on their manager-of-managers exemptive order.
10. For two years following the Effective Date the net annual
expenses of each Replacement Fund that is a Transamerica Series Trust
Fund will not exceed the net annual expenses of the corresponding
Existing Fund as of the fund's most recent fiscal year. To achieve this
limitation, the Replacement Fund's investment adviser will waive fees
or reimburse the Replacement Fund in certain amounts to maintain
expenses at or below the limit. Any adjustments will be made at least
on a quarterly basis. In addition, the Insurance Companies will not
increase the Contract fees and charges, including asset based charges
such as mortality expense risk charges deducted from the sub-accounts
that would otherwise be assessed under the terms of the Contracts for a
period of at least two years following the Effective Date.

For the Commission, by the Division of Investment Management,
under delegated authority.
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-06246 Filed 3-29-17; 8:45 am]
BILLING CODE 8011-01-P

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