Self-Regulatory Organizations; Cboe BZX Exchange, Inc.; Notice of Filing of a Proposed Rule Change To Amend BZX Rule 14.8, General Listings Requirements-Tier I, 32162-32164 [2018-14788]

Download as PDF 32162 Federal Register / Vol. 83, No. 133 / Wednesday, July 11, 2018 / Notices The agenda for the meeting will include updates and presentations from the FIMSAC subcommittees. CONTACT PERSON FOR MORE INFORMATION: For further information, please contact Brent J. Fields from the Office of the Secretary at (202) 551–5400. Dated: July 9, 2018. Brent J. Fields, Secretary. [FR Doc. 2018–14960 Filed 7–9–18; 4:15 pm] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–83596; File No. SR– CboeBZX–2018–047] Self-Regulatory Organizations; Cboe BZX Exchange, Inc.; Notice of Filing of a Proposed Rule Change To Amend BZX Rule 14.8, General Listings Requirements—Tier I July 5, 2018. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’),1 and Rule 19b–4 thereunder,2 notice is hereby given that on June 21, 2018, Cboe BZX Exchange, Inc. (‘‘Exchange’’ or ‘‘BZX’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change as described in Items I and II below, which Items have been prepared by the Exchange. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange filed a proposal to amend the listing rules under Rule 14.8, titled ‘‘General Listing Requirements— Tier I,’’ in order to adopt listing standards for closed-end funds. The text of the proposed rule change is available at the Exchange’s website at www.markets.cboe.com, at the principal office of the Exchange, and at the Commission’s Public Reference Room. daltland on DSKBBV9HB2PROD with NOTICES 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 Exchange 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 these 1 15 2 17 U.S.C. 78s(b)(1). CFR 240.19b–4. VerDate Sep<11>2014 16:26 Jul 10, 2018 Jkt 244001 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 its listing rules in Rule 14.8 in order to add listing standards applicable to ClosedEnd Funds 3 based on existing criteria applicable to Closed-End Funds listed on NYSE American LLC (‘‘NYSE American’’).4 Specifically, the Exchange is proposing to add new paragraphs (e) and (i) under Rule 14.8 related to the initial and continued listing requirements for Closed-End Funds, respectively, as well as to make certain corresponding changes. Initial Listing As proposed, a Closed-End Fund must meet the initial listing requirements for either an individual Closed-End Fund (the ‘‘Individual CEF Standard’’) or a Group 5 of Closed-End Funds (the ‘‘Group CEF Standard’’), as provided below, before being listed on the Exchange. The Individual CEF Standard requires: (a) A public distribution (which includes both shareholders of record and beneficial holders, but 3 As defined in proposed Rule 14.8(a), the term Closed-End Fund means a Closed-End Management Investment Company registered under the Investment Company Act of 1940. 4 The Exchange notes that the proposed quantitative rules are substantively identical to the listing standards applicable to Closed-End Funds on NYSE American. Specifically, the proposed quantitative rules are substantively identical to the following sections in the NYSE American Company Guide: 101(g), 102(a), and 1003(b)(v). 5 As defined in proposed Rule 14.8(e)(2), a ‘‘Group’’ is a group of Closed-End Funds which are or will be listed on the Exchange, and which are managed by a common investment adviser or investment advisers who are ‘‘affiliated persons’’ as defined in Section 2(a)(3) of the Investment Company Act of 1940 as amended. Section 2(a)(3) of the Investment Company Act of 1940 defines affiliated person of another person as ‘‘(A) any person directly or indirectly owning, controlling, or holding with power to vote, 5 per centum or more of the outstanding voting securities of such other person; (B) any person 5 per centum or more of whose outstanding voting securities are directly or indirectly owned, controlled, or held with power to vote, by such other person; (C) any person directly or indirectly controlling, controlled by, or under common control with, such other person; (D) any officer, director, partner, copartner, or employee of such other person; (E) if such other person is an investment company, any investment adviser thereof or any member of an advisory board thereof; and (F) if such other person is an unincorporated investment company not having a board of directors, the depositor thereof.’’ PO 00000 Frm 00091 Fmt 4703 Sfmt 4703 excludes the holdings of officers, directors, controlling shareholders, and other concentrated (i.e. 10% or greater), affiliated or family holdings (‘‘Public Shareholders’’)) (a ‘‘Public Distribution’’) of (i) at least 500,000 shares where there are at least 800 Public Shareholders, except that companies that are not banks whose securities are concentrated in a limited geographical area, or whose securities are largely held in block by institutional investors, are normally not considered eligible for listing unless the Public Distribution appreciably exceeds 500,000 shares; 6 or (ii) at least 1,000,000 shares where there are at least 400 Public Shareholders; (b) a Public Distribution with a Market Value or net assets of at least $20 million; (c) a minimum bid price of at least $4 per share; and (d) at least three registered and active Market Makers. The Group CEF Standard requires that a ClosedEnd Fund which is part of a Group be subject to the following criteria: (a) The Group has a Public Distribution with a Market Value or net assets of at least $75 million; (b) the Closed-End Funds in the Group have a Public Distribution with an average Market Value or average net assets of at least $15 million; (c) each Closed-End Fund in the Group has a Public Distribution with a Market Value or net assets of at least $10 million; and (d) each Closed-End Fund in the Group has: (i) A Public Distribution of: (a) At least 500,000 shares where there are at least 800 Public Shareholders, except that companies that are not banks whose securities are concentrated in a limited geographical area, or whose securities are largely held in block by institutional investors, are normally not considered eligible for listing unless the Public Distribution appreciably exceeds 500,000 shares; or (b) at least 1,000,000 shares where there are at least 400 Public Shareholders; (ii) a minimum bid price of at least $4 per share; and (iii) at least three registered and active Market Makers. Continued Listing As proposed, The Exchange will consider the suspension of trading in and will initiate delisting proceedings (and are not eligible to follow the cure procedures outlined in Rule 14.12) for a Closed-End Fund where: (a) The Market Value of the Public Distribution and net assets each are less than $5,000,000 for 6 The Exchange notes that where the Public Distribution appreciably exceeds 500,000 shares for companies that are not banks whose securities are concentrated in a limited geographical area, or whose securities are largely held in block by institutional investors, the 800 Public Shareholders requirement would also apply. E:\FR\FM\11JYN1.SGM 11JYN1 Federal Register / Vol. 83, No. 133 / Wednesday, July 11, 2018 / Notices more than 60 consecutive days; (b) the Closed-End Fund no longer qualifies as a closed-end fund under the Investment Company Act of 1940 (unless the resultant entity otherwise qualifies for listing); or (c) it appears that the extent of Public Distribution, the Market Value of such Public Distribution, or net assets of such Public Distribution has become so reduced as to make further dealings on the Exchange inadvisable. Any failure to meet any of the continued listing requirements will subject the applicable Closed-End Fund to delisting proceedings in accordance with the provisions set forth in Rule 14.12. Trading Rules Closed-End Funds are equity securities, thus rendering trading in Closed-End Funds subject to the Exchange’s existing rules governing the trading of equity securities. The Exchange will allow trading in ClosedEnd Funds from 8:00 a.m. until 5:00 p.m. Eastern Time and the Exchange has appropriate rules to facilitate such transactions during all trading sessions. As provided in Rule 11.11(a), the minimum price variation for quoting and entry of orders in Closed-End Funds traded on the Exchange will be $0.01, with the exception of securities that are priced less than $1.00, for which the minimum price variation for quoting and order entry will be $0.0001. daltland on DSKBBV9HB2PROD with NOTICES Trading Halts With respect to trading halts, the Exchange may consider all relevant factors in exercising its discretion to halt or suspend trading in a Closed-End Fund. The Exchange will halt trading in a Closed-End Fund under the conditions specified in Rule 11.18. Trading may be halted because of market conditions or for reasons that, in the view of the Exchange, make trading in the Shares inadvisable. These include whether unusual conditions or circumstances detrimental to the maintenance of a fair and orderly market are present. Surveillance The Exchange believes that its surveillance procedures are adequate to properly monitor the trading of ClosedEnd Funds on the Exchange during all trading sessions and to deter and detect violations of Exchange rules and the applicable federal securities laws. Trading of Closed-End Funds through the Exchange will be subject to the Exchange’s surveillance procedures for ETPs. Governance Any Closed-End Funds listed on the Exchange will be subject to the VerDate Sep<11>2014 16:26 Jul 10, 2018 Jkt 244001 governance requirements in Rule 14.10 applicable to all management investment companies listed on the Exchange, including Closed-End Funds, except as provided in the exceptions to certain governance requirements for management investment companies as provided under Rule 14.10(e)(1)(E) and Interpretation and Policy .13 of Rule 14.10(e). The Exchange notes that its governance requirements for Closed-End Funds are substantially similar to those applicable to Closed-End Funds listed on NYSE American. Other Changes The Exchange is also proposing to make certain renumbering changes to Rule 14.8 in order to accommodate the other proposed rule changes described herein. Listing Fees The Exchange plans to separately submit a proposal to amend Rule 14.13 related to listing fees in order to implement fees applicable to ClosedEnd Funds prior to this proposal becoming operational. 2. Statutory Basis The Exchange believes that the proposal is consistent with Section 6(b) of the Act 7 in general and Section 6(b)(5) of the Act 8 in particular in that it is 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 facilitating transactions in securities, and to remove impediments to and perfect the mechanism of a free and open market and a national market system. The Exchange believes that the proposed rules will facilitate the listing and trading of additional types of exchange-traded products on the Exchange that will enhance competition among market participants, to the benefit of investors and the marketplace. In addition, the listing and trading criteria set forth in the proposed rules are intended to protect investors and the public interest. As noted above, the Exchange’s proposed quantitative and qualitative listing requirements related to ClosedEnd Funds are substantively identical to those of NYSE American and, as such, the proposed rule change is consistent with the protection of investors and the public interest. Additionally, the proposal is designed to prevent fraudulent and manipulative acts and practices, as any Closed-End Funds PO 00000 7 15 8 15 listed on the Exchange will be required to meet these proposed new rules related to initial and continued listing and will be subject to existing Exchange trading rules, trading halts, governance, and surveillance procedures, as set forth above. The proposal is also designed to promote just and equitable principles of trade by way of the proposed initial and continued listing standards, which is further bolstered by the requirement that any failure to meet any of the continued listing requirements will subject the applicable Closed-End Fund to delisting proceedings in accordance with the provisions set forth in Rule 14.12. These requirements, together with the applicable Exchange equity trading rules (which will apply to Closed-End Funds listed under the proposed criteria), ensure that no investor would have an unfair advantage over another respecting the trading of Closed-End Funds. On the contrary, all investors will have the same access to trading in Closed-End Funds listed on the Exchange, as is the case for all other products listed and/or traded on the Exchange, all to the benefit of public customers and the marketplace as a whole. On the whole, the proposed rule change is designed to perfect the mechanism of a free and open market and, in general, to protect investors and the public interest in that it will facilitate the listing and trading of an additional product type on the Exchange that will enhance competition among market participants, to the benefit of investors and the marketplace. For the above reasons, the Exchange believes that the proposed rule change is consistent with the requirements of Section 6(b)(5) of the Act. (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 not necessary or appropriate in furtherance of the purposes of the Act, as amended. Instead, the proposal is a competitive one which would facilitate the listing and trading of Closed-End Funds on the Exchange, which the Exchange believes will enhance competition among exchanges that list Closed-End Funds, to the benefit of investors, issuers, and the marketplace generally. U.S.C. 78f. U.S.C. 78f(b)(5). Frm 00092 Fmt 4703 Sfmt 4703 32163 E:\FR\FM\11JYN1.SGM 11JYN1 32164 Federal Register / Vol. 83, No. 133 / Wednesday, July 11, 2018 / Notices (C) Self-Regulatory Organization’s Statement on Comments on the Proposed Rule Change Received From Members, Participants or Others The Exchange has neither solicited nor received written comments on the proposed rule change. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Within 45 days of the date of publication of this notice in the Federal Register or within such longer period up to 90 days (i) as the Commission may designate if it finds such longer period to be appropriate and publishes its reasons for so finding or (ii) as to which the self-regulatory organization consents, the Commission will: (A) By order approve or disapprove such proposed rule change, or (B) institute proceedings to determine whether the proposed rule change should be 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 provisions of 5 U.S.C. 552, will be available for website viewing and printing in the Commission’s Public Reference Room, 100 F Street NE, Washington, DC 20549, on official business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of the filing will also be available for inspection and copying at the principal office of the Exchange. All comments received will be posted without change. Persons submitting comments are cautioned that we do not redact or edit personal identifying information from comment submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR–CboeBZX–2018–047 and should be submitted on or before August 1, 2018. solicit comments on the proposed rule change from interested persons. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.9 Eduardo A. Aleman, Assistant Secretary. In its filing with the Commission, the Exchange 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 these 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. [FR Doc. 2018–14788 Filed 7–10–18; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–83597; File No. SR– CboeBZX–2018–046] Self-Regulatory Organizations; Cboe BZX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend BZX Rule 14.13, Company Listing Fees Paper Comments daltland on DSKBBV9HB2PROD with NOTICES • 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– CboeBZX–2018–047 on the subject line. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the ‘‘Act’’),1 and Rule 19b–4 thereunder,2 notice is hereby given that on June 21, 2018, Cboe BZX Exchange, Inc. (the ‘‘Exchange’’ or ‘‘BZX’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change as described in Items I, II and III below, which Items have been prepared by the Exchange. The Exchange has designated the proposed rule change as one establishing or changing a member due, fee, or other charge imposed by the Exchange under Section 19(b)(3)(A)(ii) of the Act 3 and Rule 19b–4(f)(2) thereunder,4 which renders the proposed rule change effective upon filing with the Commission. The Commission is publishing this notice to • Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549–1090. All submissions should refer to File Number SR–CboeBZX–2018–047. This file number should be included on the subject line if email is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission’s internet website (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 VerDate Sep<11>2014 16:26 Jul 10, 2018 Jkt 244001 July 5, 2018. PO 00000 9 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 15 U.S.C. 78s(b)(3)(A)(ii). 4 17 CFR 240.19b–4(f)(2). 1 15 Frm 00093 Fmt 4703 Sfmt 4703 I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange filed a proposal to amend the fees applicable to securities listed on the Exchange, which are set forth in BZX Rule 14.13. The text of the proposed rule change is available at the Exchange’s website at www.markets.cboe.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 (A) Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose On August 30, 2011, the Exchange received approval of rules applicable to the qualification, listing, and delisting of companies on the Exchange,5 which it modified on February 8, 2012 in order to adopt pricing for the listing of exchange traded products (‘‘ETPs’’) 6 on the Exchange.7 On July 3, 2017, the Exchange made certain changes to Rule 14.13 such that there were no entry fees or annual fees for ETPs listed on the Exchange.8 The Exchange is proposing to amend Rule 14.13 in order to charge an entry fee for ETPs that are not Generically-Listed ETPs, as defined below and to add annual listing fees for ETPs listed on the Exchange. 5 See Securities Exchange Act Release No. 65225 (August 30, 2011), 76 FR 55148 (September 6, 2011) (SR–BATS–2011–018). 6 As defined in Rule 11.8(e)(1)(A), the term ‘‘ETP’’ means any security listed pursuant to Exchange Rule 14.11. 7 See Securities Exchange Act Release No. 66422 (February 17, 2012), 77 FR 11179 (February 24, 2012) (SR–BATS–2012–010). 8 See Securities Exchange Act Release No. 81152 (July 14, 2017), 82 FR 33525 (July 20, 2017) (SR– BatsBZX–2017–45). E:\FR\FM\11JYN1.SGM 11JYN1

Agencies

SECURITIES AND EXCHANGE COMMISSION

[Federal Register Volume 83, Number 133 (Wednesday, July 11, 2018)]
[Notices]
[Pages 32162-32164]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-14788]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-83596; File No. SR-CboeBZX-2018-047]


Self-Regulatory Organizations; Cboe BZX Exchange, Inc.; Notice of 
Filing of a Proposed Rule Change To Amend BZX Rule 14.8, General 
Listings Requirements--Tier I

July 5, 2018.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on June 21, 2018, Cboe BZX Exchange, Inc. (``Exchange'' or ``BZX'') 
filed with the Securities and Exchange Commission (``Commission'') the 
proposed rule change as described in Items I and II below, which Items 
have been prepared by the Exchange. 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\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange filed a proposal to amend the listing rules under Rule 
14.8, titled ``General Listing Requirements--Tier I,'' in order to 
adopt listing standards for closed-end funds.
    The text of the proposed rule change is available at the Exchange's 
website at www.markets.cboe.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 Exchange 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 these 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 its listing rules in Rule 14.8 in 
order to add listing standards applicable to Closed-End Funds \3\ based 
on existing criteria applicable to Closed-End Funds listed on NYSE 
American LLC (``NYSE American'').\4\ Specifically, the Exchange is 
proposing to add new paragraphs (e) and (i) under Rule 14.8 related to 
the initial and continued listing requirements for Closed-End Funds, 
respectively, as well as to make certain corresponding changes.
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    \3\ As defined in proposed Rule 14.8(a), the term Closed-End 
Fund means a Closed-End Management Investment Company registered 
under the Investment Company Act of 1940.
    \4\ The Exchange notes that the proposed quantitative rules are 
substantively identical to the listing standards applicable to 
Closed-End Funds on NYSE American. Specifically, the proposed 
quantitative rules are substantively identical to the following 
sections in the NYSE American Company Guide: 101(g), 102(a), and 
1003(b)(v).
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Initial Listing
    As proposed, a Closed-End Fund must meet the initial listing 
requirements for either an individual Closed-End Fund (the ``Individual 
CEF Standard'') or a Group \5\ of Closed-End Funds (the ``Group CEF 
Standard''), as provided below, before being listed on the Exchange. 
The Individual CEF Standard requires: (a) A public distribution (which 
includes both shareholders of record and beneficial holders, but 
excludes the holdings of officers, directors, controlling shareholders, 
and other concentrated (i.e. 10% or greater), affiliated or family 
holdings (``Public Shareholders'')) (a ``Public Distribution'') of (i) 
at least 500,000 shares where there are at least 800 Public 
Shareholders, except that companies that are not banks whose securities 
are concentrated in a limited geographical area, or whose securities 
are largely held in block by institutional investors, are normally not 
considered eligible for listing unless the Public Distribution 
appreciably exceeds 500,000 shares; \6\ or (ii) at least 1,000,000 
shares where there are at least 400 Public Shareholders; (b) a Public 
Distribution with a Market Value or net assets of at least $20 million; 
(c) a minimum bid price of at least $4 per share; and (d) at least 
three registered and active Market Makers. The Group CEF Standard 
requires that a Closed-End Fund which is part of a Group be subject to 
the following criteria: (a) The Group has a Public Distribution with a 
Market Value or net assets of at least $75 million; (b) the Closed-End 
Funds in the Group have a Public Distribution with an average Market 
Value or average net assets of at least $15 million; (c) each Closed-
End Fund in the Group has a Public Distribution with a Market Value or 
net assets of at least $10 million; and (d) each Closed-End Fund in the 
Group has: (i) A Public Distribution of: (a) At least 500,000 shares 
where there are at least 800 Public Shareholders, except that companies 
that are not banks whose securities are concentrated in a limited 
geographical area, or whose securities are largely held in block by 
institutional investors, are normally not considered eligible for 
listing unless the Public Distribution appreciably exceeds 500,000 
shares; or (b) at least 1,000,000 shares where there are at least 400 
Public Shareholders; (ii) a minimum bid price of at least $4 per share; 
and (iii) at least three registered and active Market Makers.
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    \5\ As defined in proposed Rule 14.8(e)(2), a ``Group'' is a 
group of Closed-End Funds which are or will be listed on the 
Exchange, and which are managed by a common investment adviser or 
investment advisers who are ``affiliated persons'' as defined in 
Section 2(a)(3) of the Investment Company Act of 1940 as amended. 
Section 2(a)(3) of the Investment Company Act of 1940 defines 
affiliated person of another person as ``(A) any person directly or 
indirectly owning, controlling, or holding with power to vote, 5 per 
centum or more of the outstanding voting securities of such other 
person; (B) any person 5 per centum or more of whose outstanding 
voting securities are directly or indirectly owned, controlled, or 
held with power to vote, by such other person; (C) any person 
directly or indirectly controlling, controlled by, or under common 
control with, such other person; (D) any officer, director, partner, 
copartner, or employee of such other person; (E) if such other 
person is an investment company, any investment adviser thereof or 
any member of an advisory board thereof; and (F) if such other 
person is an unincorporated investment company not having a board of 
directors, the depositor thereof.''
    \6\ The Exchange notes that where the Public Distribution 
appreciably exceeds 500,000 shares for companies that are not banks 
whose securities are concentrated in a limited geographical area, or 
whose securities are largely held in block by institutional 
investors, the 800 Public Shareholders requirement would also apply.
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Continued Listing
    As proposed, The Exchange will consider the suspension of trading 
in and will initiate delisting proceedings (and are not eligible to 
follow the cure procedures outlined in Rule 14.12) for a Closed-End 
Fund where: (a) The Market Value of the Public Distribution and net 
assets each are less than $5,000,000 for

[[Page 32163]]

more than 60 consecutive days; (b) the Closed-End Fund no longer 
qualifies as a closed-end fund under the Investment Company Act of 1940 
(unless the resultant entity otherwise qualifies for listing); or (c) 
it appears that the extent of Public Distribution, the Market Value of 
such Public Distribution, or net assets of such Public Distribution has 
become so reduced as to make further dealings on the Exchange 
inadvisable. Any failure to meet any of the continued listing 
requirements will subject the applicable Closed-End Fund to delisting 
proceedings in accordance with the provisions set forth in Rule 14.12.
Trading Rules
    Closed-End Funds are equity securities, thus rendering trading in 
Closed-End Funds subject to the Exchange's existing rules governing the 
trading of equity securities. The Exchange will allow trading in 
Closed-End Funds from 8:00 a.m. until 5:00 p.m. Eastern Time and the 
Exchange has appropriate rules to facilitate such transactions during 
all trading sessions. As provided in Rule 11.11(a), the minimum price 
variation for quoting and entry of orders in Closed-End Funds traded on 
the Exchange will be $0.01, with the exception of securities that are 
priced less than $1.00, for which the minimum price variation for 
quoting and order entry will be $0.0001.
Trading Halts
    With respect to trading halts, the Exchange may consider all 
relevant factors in exercising its discretion to halt or suspend 
trading in a Closed-End Fund. The Exchange will halt trading in a 
Closed-End Fund under the conditions specified in Rule 11.18. Trading 
may be halted because of market conditions or for reasons that, in the 
view of the Exchange, make trading in the Shares inadvisable. These 
include whether unusual conditions or circumstances detrimental to the 
maintenance of a fair and orderly market are present.
Surveillance
    The Exchange believes that its surveillance procedures are adequate 
to properly monitor the trading of Closed-End Funds on the Exchange 
during all trading sessions and to deter and detect violations of 
Exchange rules and the applicable federal securities laws. Trading of 
Closed-End Funds through the Exchange will be subject to the Exchange's 
surveillance procedures for ETPs.
Governance
    Any Closed-End Funds listed on the Exchange will be subject to the 
governance requirements in Rule 14.10 applicable to all management 
investment companies listed on the Exchange, including Closed-End 
Funds, except as provided in the exceptions to certain governance 
requirements for management investment companies as provided under Rule 
14.10(e)(1)(E) and Interpretation and Policy .13 of Rule 14.10(e). The 
Exchange notes that its governance requirements for Closed-End Funds 
are substantially similar to those applicable to Closed-End Funds 
listed on NYSE American.
Other Changes
    The Exchange is also proposing to make certain renumbering changes 
to Rule 14.8 in order to accommodate the other proposed rule changes 
described herein.
Listing Fees
    The Exchange plans to separately submit a proposal to amend Rule 
14.13 related to listing fees in order to implement fees applicable to 
Closed-End Funds prior to this proposal becoming operational.
2. Statutory Basis
    The Exchange believes that the proposal is consistent with Section 
6(b) of the Act \7\ in general and Section 6(b)(5) of the Act \8\ in 
particular in that it is 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 facilitating transactions in securities, and to 
remove impediments to and perfect the mechanism of a free and open 
market and a national market system. The Exchange believes that the 
proposed rules will facilitate the listing and trading of additional 
types of exchange-traded products on the Exchange that will enhance 
competition among market participants, to the benefit of investors and 
the marketplace. In addition, the listing and trading criteria set 
forth in the proposed rules are intended to protect investors and the 
public interest.
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    \7\ 15 U.S.C. 78f.
    \8\ 15 U.S.C. 78f(b)(5).
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    As noted above, the Exchange's proposed quantitative and 
qualitative listing requirements related to Closed-End Funds are 
substantively identical to those of NYSE American and, as such, the 
proposed rule change is consistent with the protection of investors and 
the public interest. Additionally, the proposal is designed to prevent 
fraudulent and manipulative acts and practices, as any Closed-End Funds 
listed on the Exchange will be required to meet these proposed new 
rules related to initial and continued listing and will be subject to 
existing Exchange trading rules, trading halts, governance, and 
surveillance procedures, as set forth above.
    The proposal is also designed to promote just and equitable 
principles of trade by way of the proposed initial and continued 
listing standards, which is further bolstered by the requirement that 
any failure to meet any of the continued listing requirements will 
subject the applicable Closed-End Fund to delisting proceedings in 
accordance with the provisions set forth in Rule 14.12. These 
requirements, together with the applicable Exchange equity trading 
rules (which will apply to Closed-End Funds listed under the proposed 
criteria), ensure that no investor would have an unfair advantage over 
another respecting the trading of Closed-End Funds. On the contrary, 
all investors will have the same access to trading in Closed-End Funds 
listed on the Exchange, as is the case for all other products listed 
and/or traded on the Exchange, all to the benefit of public customers 
and the marketplace as a whole.
    On the whole, the proposed rule change is designed to perfect the 
mechanism of a free and open market and, in general, to protect 
investors and the public interest in that it will facilitate the 
listing and trading of an additional product type on the Exchange that 
will enhance competition among market participants, to the benefit of 
investors and the marketplace.
    For the above reasons, the Exchange believes that the proposed rule 
change is consistent with the requirements of Section 6(b)(5) of the 
Act.

(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 not necessary or appropriate in 
furtherance of the purposes of the Act, as amended. Instead, the 
proposal is a competitive one which would facilitate the listing and 
trading of Closed-End Funds on the Exchange, which the Exchange 
believes will enhance competition among exchanges that list Closed-End 
Funds, to the benefit of investors, issuers, and the marketplace 
generally.

[[Page 32164]]

(C) Self-Regulatory Organization's Statement on Comments on the 
Proposed Rule Change Received From Members, Participants or Others

    The Exchange has neither solicited nor received written comments on 
the proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    Within 45 days of the date of publication of this notice in the 
Federal Register or within such longer period up to 90 days (i) as the 
Commission may designate if it finds such longer period to be 
appropriate and publishes its reasons for so finding or (ii) as to 
which the self-regulatory organization consents, the Commission will:
    (A) By order approve or disapprove such proposed rule change, or
    (B) institute proceedings to determine whether the proposed rule 
change should be 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 [email protected]. Please include 
File Number SR-CboeBZX-2018-047 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities 
and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.

All submissions should refer to File Number SR-CboeBZX-2018-047. This 
file number should be included on the subject line if email is used. To 
help the Commission process and review your comments more efficiently, 
please use only one method. The Commission will post all comments on 
the Commission's internet website (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 website viewing and printing in 
the Commission's Public Reference Room, 100 F Street NE, Washington, DC 
20549, on official business days between the hours of 10:00 a.m. and 
3:00 p.m. Copies of the filing will also be available for inspection 
and copying at the principal office of the Exchange. All comments 
received will be posted without change. Persons submitting comments are 
cautioned that we do not redact or edit personal identifying 
information from comment submissions. You should submit only 
information that you wish to make available publicly. All submissions 
should refer to File Number SR-CboeBZX-2018-047 and should be submitted 
on or before August 1, 2018.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\9\
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    \9\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-14788 Filed 7-10-18; 8:45 am]
 BILLING CODE 8011-01-P

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