Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Reflect a Change to the Benchmark Index of the SPDR Nuveen Bloomberg Barclays Municipal Bond ETF, 64614-64618 [2018-27207]

Download as PDF 64614 Federal Register / Vol. 83, No. 241 / Monday, December 17, 2018 / Notices be submitted on or before January 7, 2019. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.8 Eduardo A. Aleman, Deputy Secretary. [FR Doc. 2018–27202 Filed 12–14–18; 8:45 am] BILLING CODE 8011–01–P A. Self-Regulatory Organization’s Statement of the Purpose of, and the Statutory Basis for, the Proposed Rule Change SECURITIES AND EXCHANGE COMMISSION [Release No. 34–84786; File No. SR– NYSEArca-2018–88] Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Reflect a Change to the Benchmark Index of the SPDR Nuveen Bloomberg Barclays Municipal Bond ETF December 11, 2018. 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 28, 2018, 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 and II 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. amozie on DSK3GDR082PROD with NOTICES1 I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to reflect a change to the benchmark index for the SPDR Nuveen Bloomberg Barclays Municipal Bond ETF, shares of which are currently listed and traded on the Exchange pursuant to NYSE Arca Rule 5.2–E(j)(3), Commentary .02. The proposed rule change is available on the Exchange’s website 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, 8 17 CFR 200.30–3(a)(12). U.S.C.78s(b)(1). 2 15 U.S.C. 78a. 3 17 CFR 240.19b–4. 1 15 VerDate Sep<11>2014 19:17 Dec 14, 2018 Jkt 247001 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. 1. Purpose The Exchange proposes to reflect a change to the benchmark index for the SPDR Nuveen Bloomberg Barclays Municipal Bond ETF (the ‘‘Fund’’), shares (‘‘Shares’’) of which are currently listed and traded on the Exchange pursuant to NYSE Arca Rule 5.2–E(j)(3), Commentary .02, which governs the listing and trading of Investment Company Units (‘‘Units’’) 4 based on fixed income securities indexes.5 The 4 An open-end investment company that issues Units, listed and traded on the Exchange under NYSE Arca Rule 5.2–E(j)(3), seeks to provide investment results that correspond generally to the price and yield performance of a specific foreign or domestic stock index, fixed income securities index or combination thereof. 5 The Commission previously has approved a proposed rule change to facilitate listing and trading of Shares of the Fund on the Exchange in Securities Exchange Act Release No. 82295 (December 12, 2017), 82 FR 60056 (December 18, 2017) (SR–NYSEArca–2017–56) (Notice of Filing of Amendment No. 3 and Order Granting Accelerated Approval of a Proposed Rule Change, as Modified by Amendment No. 3, to List and Trade Shares of Twelve Series of Investment Company Units Pursuant to NYSE Arca Rule 5.2–E(j)(3)) (‘‘Approval Order’’). See also, Amendment 3 to SR–NYSEArca– 2017–56 at https://www.sec.gov/comments/srnysearca-2017-56/nysearca201756-2714674161523.pdf. In addition, the Commission also has approved other proposed rule changes relating to listing and trading of funds based on municipal bond indexes. See, e.g., Securities Exchange Act Release Nos. 67985 (October 4, 2012), 77 FR 61804 (October 11, 2012) (SR–NYSEArca–2012–92) (order approving proposed rule change to list and trade the iShares 2018 S&P AMT-Free Municipal Series and iShares 2019 S&P AMT-Free Municipal Series under NYSE Arca Rule 5.2(j)(3), Commentary .02); 72523 (July 2, 2014), 79 FR 39016 (July 9, 2014) (SR–NYSEArca–2014–37) (order approving proposed rule change to list and trade iShares 2020 S&P AMT-Free Municipal Series under NYSE Arca Rule 5.2(j)(3), Commentary .02); and 75468 (July 16, 2015), 80 FR 43500 (July 22, 2015) (SR–NYSEArca– 2015–25) (order approving proposed rule change to list and trade the iShares iBonds Dec 2021 AMTFree Muni Bond ETF and iShares iBonds Dec 2022 AMT-Free Muni Bond ETF under NYSE Arca Rule 5.2(j)(3), Commentary .02); 63881 (February 9, 2011), 76 FR 9065 (February 16, 2011) (SR– NYSEArca–2010–120) (order approving proposed rule change to list and trade shares of the SPDR Nuveen S&P High Yield Municipal Bond Fund under Commentary .02 of NYSE Arca Rule 5.2– E(j)(3)). The Commission has issued notices of filing and immediate effectiveness of proposed rule changes relating to certain series of Units under NYSE Arca Rule 5.2–E(j)(3) and Managed Fund PO 00000 Frm 00099 Fmt 4703 Sfmt 4703 Fund is a series of the SPDR Series Trust (‘‘Trust’’). As discussed below, the Exchange is submitting this proposed rule change to change the listing requirements applicable to the Fund as set forth in the Approval Order. Specifically, the Exchange proposes to change the benchmark index for the Fund to the ‘‘New Index’’ (as defined below). Description of the Shares and the Fund As stated in the Approval Order, the Fund seeks to provide investment results that, before fees and expenses, correspond generally to the price and yield performance of the Bloomberg Barclays Municipal Managed Money Index (‘‘Current Index’’) which tracks the U.S. municipal bond market. The Trust, in a November 6, 2018 supplement to the Fund’s prospectus (‘‘Prospectus Supplement’’), stated that, effective December 3, 2018, the new benchmark index for the Fund will be the Bloomberg Barclays Municipal Managed Money 1–25 Years Index (‘‘New Index’’).6 The New Index is the sub-set of the Current Index with effective maturities of 1–25 years. 7 The Shares under NYSE Arca Rule 8.600–E. See, e.g., Securities Exchange Act Release Nos. 83982 (August 29, 2018), 83 FR 45168 (September 5, 2018) (SR–NYSEArca–2018–62) (Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Listing and Trading of Shares of the American Century Diversified Municipal Bond ETF under NYSE Arca Rule 8.600–E); 84379 (October 5, 2018), 83 FR 51724 (October 12, 2018) (SR– NYSEArca–2018–73) (Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Listing and Trading of Shares of the First Trust Short Duration Managed Municipal ETF under NYSE Arca Rule 8.600–E); 84381 (October 5, 2018), 83 FR 51111752 (October 12, 2018) (SR– NYSEArca–2018–72) (Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Listing and Trading of Shares of the First Trust Ultra Short Duration Municipal ETF under NYSE Arca Rule 8.600–E); 84396 (October 10, 2018), 83 FR 52266 (October 16, 2018) (SR– NYSEArca–2018–70) (Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Listing and Trading of Shares of the iShares iBond Dec 2026 Term Muni Bond ETF Under Commentary .02 to NYSE Arca Rule 5.2– E(j)(3)). 6 The Trust is registered under the Investment Company Act of 1940 (15 U.S.C. 80a–1) (‘‘1940 Act’’). On October 31, 2018, the Trust filed with the Commission an amendment to its registration statement on Form N–1A under the Securities Act of 1933 (15 U.S.C. 77a) (‘‘Securities Act’’), and under the 1940 Act relating to the Fund (File Nos. 333–57793 and 811–08839) (‘‘Registration Statement’’). The description of the operation of the Trust and the Fund herein is based, in part, on the Registration Statement and the Prospectus Supplement. In addition, the Commission has issued an order granting certain exemptive relief to the Trust under the 1940 Act. See Investment Company Act Release No. 29524 (December 13, 2010) (File No. 812–13487) (‘‘Exemptive Order’’). 7 The Trust represents that it will not implement the proposed change to the index underlying the Fund until this proposed rule change is effective and operative. E:\FR\FM\17DEN1.SGM 17DEN1 Federal Register / Vol. 83, No. 241 / Monday, December 17, 2018 / Notices amozie on DSK3GDR082PROD with NOTICES1 Exchange believes it is appropriate to facilitate the continued listing and trading of Shares of the Fund because, as described below, the Fund will be based on a broad-based index of fixed income municipal bond securities that is not readily susceptible to manipulation. As noted in Amendment 3 to SR–NYSEArca–2017–56, the Fund listed on the Exchange prior to 2010. Pursuant to NYSE Arca Rule 5.2– E(j)(3), the Exchange proposed to facilitate the listing and trading of certain series of Investment Company Units that do not otherwise meet the standards set forth in Commentary.02 to Rule 5.2–E(j)(3). Specifically, the Exchange proposed to facilitate the listing and trading of the certain series of Investment Company Units, including the Fund, based on a multistate index of fixed income municipal bond securities. According to the Prospectus Supplement, under normal market conditions,8 the Fund generally will invest substantially all, but at least 80%, of its total assets in the securities comprising the New Index or in securities that the Nuveen Asset Management, LLC (the Fund’s ‘‘SubAdviser’’) determines have economic characteristics that are substantially identical to the economic characteristics of the securities that comprise the New Index. In addition, in seeking to track the New Index, the Fund may invest in debt securities that are not included in the New Index, cash and cash equivalents or money market instruments, such as repurchase agreements and money market funds (including money market funds advised by SSGA Funds Management, Inc. (‘‘SSGA FM’’ or the ‘‘Adviser’’), the investment adviser to the Fund. With respect to the remaining 20% of its assets, the Fund may invest in debt securities that are not included in the New Index, cash and cash equivalents or money market instruments, such as repurchase agreements and money market funds, commercial paper, foreign currency transactions, reverse repurchase agreements, securities of other investment companies, exchangetraded futures on Treasuries or Eurodollars (all such exchange-traded futures contracts will be traded on an exchange that is a member of the 8 The term ‘‘normal market conditions’’ includes, but is not limited to, the absence of trading halts in the applicable financial markets generally; operational issues (e.g., systems failure) causing dissemination of inaccurate market information; or force majeure type events such as natural or manmade disaster, act of God, armed conflict, act of terrorism, riot or labor disruption or any similar intervening circumstance. VerDate Sep<11>2014 19:17 Dec 14, 2018 Jkt 247001 Intermarket Surveillance Group (‘‘ISG’’) or with which the Exchange has in place a comprehensive surveillance sharing agreement), U.S. exchange-traded or over-the-counter (‘‘OTC’’) put and call options contracts and exchange-traded or OTC swap agreements (including interest rate swaps, total return swaps, excess return swaps and credit default swaps) and treasury-inflation protected securities of the U.S. Treasury as well as major governments and emerging market countries. The New Index is designed to track the U.S. fully tax-exempt bond market. The New Index includes state and local general obligation bonds, revenue bonds, pre-refunded bonds, and insured bonds. The New Index is comprised of tax-exempt municipal securities issued by states, cities, counties, districts and their respective agencies. The New Index also includes municipal lease obligations, which are securities issued by state and local governments and authorities to finance the acquisition of equipment and facilities. For informational purposes, as of November 1, 2018, there were approximately 21,478 securities in the New Index from issuers in 49 different states or U.S. territories. The most heavily weighted security in the New Index represented less than 0.11% of the total weight of the New Index and the aggregate weight of the top five most heavily weighted securities in the New Index represented approximately 0.48% of the total weight of the New Index. Approximately 10% of the weight of the components in the New Index had a minimum original principal amount outstanding of $100 million or more. In addition, the total dollar amount outstanding of issues in the New Index was approximately $505 billion and the average dollar amount outstanding of issues in the New Index was approximately $23.2 million. Requirement for New Index Constituents On a continuous basis, (1) at least 90% of the weight of the New Index will be comprised of securities that have an outstanding par value of at least $7 million and were issued as part of a transaction of at least $75 million, and (2) the New Index will include at least 500 components. The Exchange notes that, in the Approval Order, the Commission approved Exchange listing and trading of Units of the Fund for which at least 90% of the weight of Current Index will be comprised of securities that have an outstanding par value of at least $7 million and were issued as part of a PO 00000 Frm 00100 Fmt 4703 Sfmt 4703 64615 transaction of at least $75 million, and that included at least 500 components.9 In addition, the Exchange represents that: (1) Except for Commentary .02(a)(2) to Rule 5.2–E(j)(3),10 the New Index currently satisfies all of the generic listing standards under NYSE Arca Rule 5.2–E(j)(3); (2) the continued listing standards under Commentary .02 to NYSE Arca Rule 5.2–E(j)(3), as applicable to Units based on fixed income securities, will apply to the Shares of the Fund; and (3) the issuer of the Fund is required to comply with Rule 10A–3 11 under the Act for the initial and continued listing of the Shares. The Exchange represents that the Fund will comply with all other requirements applicable to Units, including, but not limited to, requirements relating to the dissemination of key information such as the value of the New Index and the Intraday Indicative Value (‘‘IIV’’),12 rules governing the trading of equity securities, trading hours, trading halts, surveillance, information barriers and the Information Bulletin, as set forth in the Exchange rules applicable to Units and prior Commission orders approving the generic listing rules applicable to the listing and trading of Units.13 Additional Information The current value of the New Index will be widely disseminated by one or more major market data vendors at least once per day, as required by Commentary .02(b)(ii) to NYSE Arca Rule 5.2–E(j)(3). The portfolio of securities held by the Fund will be disclosed daily on the Fund’s website www.spdrs.com. 9 See note 5, supra. .02(a)(2) provides that Fixed Income Security components that in aggregate account for at least 75% of the Fixed Income Securities portion of the weight of the index or portfolio each shall have a minimum original principal amount outstanding of $100 million or more. 11 17 CFR 240.10A–3. 12 The IIV will be widely disseminated by one or more major market data vendors at least every 15 seconds during the Exchange’s Core Trading Session (normally, 9:30 a.m. to 4:00 p.m., E.T. Currently, it is the Exchange’s understanding that several major market data vendors display and/or make widely available IIV taken from CTA or other data feeds. 13 See, e.g., Securities Exchange Act Release Nos. 55783 (May 17, 2007), 72 FR 29194 (May 24, 2007) (SR–NYSEArca–2007–36) (order approving NYSE Arca generic listing standards for Units based on a fixed income index); 44551 (July 12, 2001), 66 FR 37716 (July 19, 2001) (SR–PCX–2001–14) (order approving generic listing standards for Units and Portfolio Depositary Receipts); 41983 (October 6, 1999), 64 FR 56008 (October 15, 1999) (SR–PCX– 98–29) (order approving rules for listing and trading of Units). 10 Commentary E:\FR\FM\17DEN1.SGM 17DEN1 64616 Federal Register / Vol. 83, No. 241 / Monday, December 17, 2018 / Notices amozie on DSK3GDR082PROD with NOTICES1 Availability of Information On each business day, the Fund will disclose on its website (www.spdrs.com) the portfolio that will form the basis for the Fund’s calculation of NAV at the end of the business day. On a daily basis, the Fund will disclose for each portfolio security or other financial instrument of the Fund the following information on the Fund’s website: Ticker symbol (if applicable), name of security and financial instrument, a common identifier such as CUSIP or ISIN (if applicable), number of shares (if applicable), and dollar value of securities and financial instruments held in the portfolio, and percentage weighting of the security and financial instrument in the portfolio. The website information will be publicly available at no charge. The current value of the New Index will be widely disseminated by one or more major market data vendors at least once per day, as required by NYSE Arca Rule 5.2–E(j)(3), Commentary .02 (b)(ii). The IIV for Shares of the Fund will be disseminated by one or more major market data vendors, updated at least every 15 seconds during the Exchange’s Core Trading Session, as required by NYSE Arca Rule 5.2–E(j)(3), Commentary .02(c). The current value of the New Index would be widely disseminated by one or more major market data vendors at least once per day, as required by NYSE Arca Rule 5.2–(j)(3), Commentary .02 (b)(ii). In addition, the portfolio of securities held by the Fund will be disclosed daily on the Fund’s website. Investors can also obtain the Trust’s Statement of Additional Information (‘‘SAI’’), the Fund’s Shareholder Reports, and its Form N–CSR and Form N–SAR, filed twice a year. The Trust’s SAI and Shareholder Reports are available free upon request from the Trust, and those documents and the Form N–CSR and Form N–SAR may be viewed on-screen or downloaded from the Commission’s website at www.sec.gov. Information regarding market price and trading volume of the Shares will be continually available on a real-time basis throughout the day on brokers’ computer screens and other electronic services. Information regarding the previous day’s closing price and trading volume information for the Shares will be published daily in the financial section of newspapers. Quotation and last sale information for the Shares of the Fund will be available via the Consolidated Tape Association (‘‘CTA’’) high speed line. Quotation information for investment company securities may be obtained VerDate Sep<11>2014 19:17 Dec 14, 2018 Jkt 247001 through nationally recognized pricing services through subscription agreements or from brokers and dealers who make markets in such securities. Price information regarding municipal bonds is available from third party pricing services and major market data vendors. Trade price and other information relating to municipal bonds is available through the Municipal Securities Rulemaking Board’s Electronic Municipal Market Access (‘‘EMMA’’) system. Quotation information for OTC swaps agreements may be obtained from brokers and dealers who make markets in such instruments. Quotation information for exchange-traded swaps, futures and options will be available from the applicable exchange and/or major market vendors. Surveillance The Exchange represents that trading in the Shares of the Fund will be subject to the existing trading surveillances, administered by the Financial Industry Regulatory Authority (‘‘FINRA’’) on behalf of the Exchange, or by regulatory staff of the Exchange, which are designed to detect violations of Exchange rules and applicable federal securities laws. The Exchange represents that these procedures are adequate to properly monitor Exchange trading of the Shares of the Fund in all trading sessions and to deter and detect violations of Exchange rules and federal securities laws applicable to trading on the Exchange.14 The surveillances referred to above generally focus on detecting securities trading outside their normal patterns, which could be indicative of manipulative or other violative activity. When such situations are detected, surveillance analysis follows and investigations are opened, where appropriate, to review the behavior of all relevant parties for all relevant trading violations. The Exchange or FINRA, on behalf of the Exchange, or both, will communicate as needed regarding trading in the Shares, certain futures and certain options with other markets and other entities that are members of the ISG, and the Exchange or FINRA, on behalf of the Exchange, or both, may obtain trading information regarding trading in the Shares, certain futures and certain options from such markets and other entities. In addition, the Exchange may obtain information regarding trading in the Shares, certain futures and certain options from markets and other entities that are members of ISG or with which the Exchange has in place a comprehensive surveillance sharing agreement. FINRA also can access data obtained from the Municipal Securities Rulemaking Board relating to municipal bond trading activity for surveillance purposes in connection with trading in the Shares. The Exchange represents that at least 90% of the weight of Fund holdings invested in exchange-traded futures contracts and exchange-traded options will be traded on an exchange that is a member of the ISG or with which the Exchange has in place a comprehensive surveillance sharing agreement. 2. Statutory Basis The Exchange believes that the proposal is consistent with Section 6(b) of the Act 15 in general and Section 6(b)(5) of the Act 16 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, to remove impediments to and perfect the mechanism of a free and open market and a national market system and, in general, to protect investors and the public interest. The Exchange believes that the proposed rule change is designed to prevent fraudulent and manipulative acts and practices in that the Shares of the Fund will be listed and traded on the Exchange pursuant to the initial and continued listing criteria in NYSE Arca Rule 5.2–E(j)(3), except for the requirement in Commentary .02(a)(2) that the component fixed income securities, in the aggregate, account for at least 75% of the weight of the index each shall have a minimum principal amount outstanding of $100 million or more. The Exchange represents that trading in the Shares will be subject to the existing trading surveillances administered by the Exchange as well as cross-market surveillances administered by FINRA on behalf of the Exchange, which are designed to detect violations of Exchange rules and federal securities laws applicable to trading on the Exchange.17 The Exchange represents that these procedures are adequate to properly monitor Exchange trading of 15 15 U.S.C. 78f. U.S.C. 78f(b)(5). 17 FINRA conducts cross-market surveillances on behalf of the Exchange pursuant to a regulatory services agreement. The Exchange is responsible for FINRA’s performance under this regulatory services agreement. 16 15 14 FINRA conducts cross-market surveillances on behalf of the Exchange pursuant to a regulatory services agreement. The Exchange is responsible for FINRA’s performance under this regulatory services agreement. PO 00000 Frm 00101 Fmt 4703 Sfmt 4703 E:\FR\FM\17DEN1.SGM 17DEN1 Federal Register / Vol. 83, No. 241 / Monday, December 17, 2018 / Notices amozie on DSK3GDR082PROD with NOTICES1 the Shares in all trading sessions and to deter and detect violations of Exchange rules and federal securities laws applicable to trading on the Exchange. The Exchange or FINRA, on behalf of the Exchange, or both, will communicate as needed regarding trading in the Shares, certain futures and certain options with other markets that are members of the ISG. In addition, the Exchange will communicate as needed regarding trading in the Shares, certain futures and certain options with other markets that are members of the ISG or with which the Exchange has in place a comprehensive surveillance sharing agreement. FINRA also can access data obtained from the Municipal Securities Rulemaking Board relating to municipal bond trading activity for surveillance purposes in connection with trading in the Shares of the Fund. At least 90% of the weight of Fund holdings invested in exchange-traded futures contracts and exchange-traded options will be traded on an exchange that is a member of the ISG or with which the Exchange has in place a comprehensive surveillance sharing agreement. As discussed above, the Exchange believes that the New Index is sufficiently broad-based to deter potential manipulation. For informational purposes, as of November 1, 2018, there were approximately 21,478 securities in the New Index from issuers in 49 different states or U.S. territories. The most heavily weighted security in the New Index represented less than 0.11% of the total weight of the New Index and the aggregate weight of the top five most heavily weighted securities in the New Index represented approximately 0.48% of the total weight of the New index. Approximately 10% of the weight of the components in the New Index had a minimum original principal amount outstanding of $100 million or more. In addition, the total dollar amount outstanding of issues in the New Index was approximately $505 billion and the average dollar amount outstanding of issues in the New Index was approximately $23.2 million.18 Therefore, the Exchange believes that the New Index is sufficiently broadbased to deter potential manipulation, 18 Commentary .02(a)(4) to NYSE Arca Rule 5.2– E(j)(3) provides that no component fixed-income security (excluding Treasury Securities and GSE Securities, as defined therein) shall represent more than 30% of the weight of the index or portfolio, and the five most heavily weighted component fixed-income securities in the index or portfolio shall not in the aggregate account for more than 65% of the weight of the index or portfolio. VerDate Sep<11>2014 19:17 Dec 14, 2018 Jkt 247001 given that it is comprised of approximately 21,478 issues. On a continuous basis, (1) at least 90% of the weight of the New Index will be comprised of securities that have an outstanding par value of at least $7 million and were issued as part of a transaction of at least $75 million, and (2) the New Index will include at least 500 components. The Exchange notes that, in the Approval Order, the Commission approved Exchange listing and trading of Units of the Fund for which at least 90% of the weight of Current Index will be comprised of securities that have an outstanding par value of at least $7 million and were issued as part of a transaction of at least $75 million, and that included at least 500 components.19 In the Approval Order, the Commission stated that the applicable index was sufficiently designed to deter potential manipulation. The proposed rule change is designed to promote just and equitable principles of trade and to protect investors and the public interest in that a large amount of information will be publicly available regarding the Fund and the Shares, thereby promoting market transparency. The Fund’s portfolio holdings will be disclosed on the Fund’s website daily after the close of trading on the Exchange. Moreover, the IIV will be widely disseminated by one or more major market data vendors at least every 15 seconds during the Exchange’s Core Trading Session. The current value of the New Index will be disseminated by one or more major market data vendors at least once per day. Information regarding market price and trading volume of the Shares will be continually available on a real-time basis throughout the day on brokers’ computer screens and other electronic services, and quotation and last sale information will be available via the CTA high-speed line. The website for the Fund will include the prospectus for the Fund and additional data relating to NAV and other applicable quantitative information. Moreover, prior to the commencement of trading, the Exchange will inform its ETP Holders in an Information Bulletin of the special characteristics and risks associated with trading the Shares. If the Exchange becomes aware that the NAV is not being disseminated to all market participants at the same time, it will halt trading in the Shares until such time as the NAV is available to all market participants. With respect to trading halts, the Exchange may consider all relevant factors in 19 See PO 00000 note 5, supra. Frm 00102 Fmt 4703 exercising its discretion to halt or suspend trading in the Shares of the Fund. Trading also may be halted because of market conditions or for reasons that, in the view of the Exchange, make trading in the Shares inadvisable. If the IIV or the New Index values are not being disseminated as required, the Exchange may halt trading during the day in which the interruption to the dissemination of the IIV or New Index value occurs. If the interruption to the dissemination of the IIV or New Index value persists past the trading day in which it occurred, the Exchange will halt trading. Trading in Shares of the Fund will be halted if the circuit breaker parameters in NYSE Arca Rule 7.12–E have been reached or because of market conditions or for reasons that, in the view of the Exchange, make trading in the Shares inadvisable, and trading in the Shares will be subject to NYSE Arca Rule 7.34– E, which sets forth circumstances under which Shares of the Fund may be halted. In addition, investors will have ready access to information regarding the IIV, and quotation and last sale information for the Shares. 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 type of exchange-traded fund that holds municipal bonds and that will enhance competition among market participants, to the benefit of investors and the marketplace. As noted above, the Exchange has in place surveillance procedures relating to trading in the Shares and may obtain information via ISG from other exchanges that are members of ISG or with which the Exchange has entered into a comprehensive surveillance sharing agreement. In addition, investors will have ready access to information regarding the IIV and quotation and last sale information for the Shares. 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.20 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 notes that the proposed rule change will facilitate the listing and trading of an additional type of Units based on a 20 15 Sfmt 4703 64617 E:\FR\FM\17DEN1.SGM U.S.C. 78f(b)(5). 17DEN1 64618 Federal Register / Vol. 83, No. 241 / Monday, December 17, 2018 / Notices municipal bond index that will enhance competition among market participants, to the benefit of investors and the marketplace. 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 Because the foregoing proposed rule change does not: (i) Significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A) of the Act 21 and Rule 19b– 4(f)(6) thereunder.22 A proposed rule change filed under Rule 19b–4(f)(6) normally does not become operative for 30 days after the date of filing. However, Rule 19b– 4(f)(6)(iii) 23 permits the Commission to designate a shorter time if such action is consistent with the protection of investors and the public interest. In its filing with the Commission, the Exchange requests that the Commission waive the 30-day operative delay such that the proposed rule change will become operative on the date the Trust implements the New Index for the Fund. The Exchange notes that the Commission previously approved a proposed rule change to allow the continued listing and trading of Shares on the Exchange based on the Current Index.24 The Exchange represents that the New Index is the sub-set of the Current Index with effective maturities of 1–25 years. The Exchange further represents that other than the substitution of the New Index for the Current Index, the continued listing requirements of the Shares will remain the same as those approved by the Commission in the Approval Order. The Commission believes that waiving the 30-day operative delay is consistent amozie on DSK3GDR082PROD with NOTICES1 21 15 U.S.C. 78s(b)(3)(A). CFR 240.19b–4(f)(6). As required under Rule 19b–4(f)(6)(iii), the Exchange provided the Commission with written notice of its intent to file the proposed rule change, along with a brief description and the text of the proposed rule change, at least five business days prior to the date of filing of the proposed rule change, or such shorter time as designated by the Commission. 23 17 CFR 240.19b–4(f)(6)(iii). 24 See Approval Order, supra note 5. 22 17 VerDate Sep<11>2014 19:17 Dec 14, 2018 Jkt 247001 with the protection of investors and the continued listing requirements for the Shares will remain the same. Therefore, the Commission hereby waives the 30day operative delay.25 At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is: (i) Necessary or appropriate in the public interest; (ii) for the protection of investors; or (iii) otherwise in furtherance of the purposes of the Act. If the Commission takes such action, the Commission shall institute proceedings 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: printing in the Commission’s Public Reference Room, 100 F Street NE, Washington, DC 20549 on official business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of the filing also will be available for inspection and copying at the principal office of the Exchange. All comments received will be posted without change. Persons submitting comments are cautioned that we do not redact or edit personal identifying information from comment submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR–NYSEArca–2018–88 and should be submitted on or before January 7, 2019. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.26 Eduardo A. Aleman, Deputy Secretary. [FR Doc. 2018–27207 Filed 12–14–18; 8:45 am] BILLING CODE 8011–01–P 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–2018–88 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-2018–88. 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 25 For purposes only of waiving the 30-day operative delay, the Commission has considered the proposed rule’s impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). PO 00000 Frm 00103 Fmt 4703 Sfmt 4703 SECURITIES AND EXCHANGE COMMISSION [Release No. 34–84787; File No. SR–C2– 2018–024] Self-Regulatory Organizations; Cboe C2 Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Amending Provisions Related to Its Risk Monitor Mechanism December 11, 2018. 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 November 30, 2018, Cboe C2 Exchange, Inc. (the ‘‘Exchange’’ or ‘‘C2’’) filed with the Securities and Exchange Commission (the ‘‘Commission’’) the proposed rule change as described in Items I and II below, which Items have been prepared by the Exchange. The Exchange filed the proposal as a ‘‘non-controversial’’ proposed rule change pursuant to Section 19(b)(3)(A)(iii) of the Act 3 and Rule 19b–4(f)(6) thereunder.4 The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. 26 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)(iii). 4 17 CFR 240.19b–4(f)(6). 1 15 E:\FR\FM\17DEN1.SGM 17DEN1

Agencies

SECURITIES AND EXCHANGE COMMISSION

[Federal Register Volume 83, Number 241 (Monday, December 17, 2018)]
[Notices]
[Pages 64614-64618]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-27207]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-84786; File No. SR-NYSEArca-2018-88]


Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change To Reflect a Change 
to the Benchmark Index of the SPDR Nuveen Bloomberg Barclays Municipal 
Bond ETF

December 11, 2018.
    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 28, 2018, 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 and II 
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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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to reflect a change to the benchmark index 
for the SPDR Nuveen Bloomberg Barclays Municipal Bond ETF, shares of 
which are currently listed and traded on the Exchange pursuant to NYSE 
Arca Rule 5.2-E(j)(3), Commentary .02. The proposed rule change is 
available on the Exchange's website 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 the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to reflect a change to the benchmark index 
for the SPDR Nuveen Bloomberg Barclays Municipal Bond ETF (the 
``Fund''), shares (``Shares'') of which are currently listed and traded 
on the Exchange pursuant to NYSE Arca Rule 5.2-E(j)(3), Commentary .02, 
which governs the listing and trading of Investment Company Units 
(``Units'') \4\ based on fixed income securities indexes.\5\ The Fund 
is a series of the SPDR Series Trust (``Trust'').
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    \4\ An open-end investment company that issues Units, listed and 
traded on the Exchange under NYSE Arca Rule 5.2-E(j)(3), seeks to 
provide investment results that correspond generally to the price 
and yield performance of a specific foreign or domestic stock index, 
fixed income securities index or combination thereof.
    \5\ The Commission previously has approved a proposed rule 
change to facilitate listing and trading of Shares of the Fund on 
the Exchange in Securities Exchange Act Release No. 82295 (December 
12, 2017), 82 FR 60056 (December 18, 2017) (SR-NYSEArca-2017-56) 
(Notice of Filing of Amendment No. 3 and Order Granting Accelerated 
Approval of a Proposed Rule Change, as Modified by Amendment No. 3, 
to List and Trade Shares of Twelve Series of Investment Company 
Units Pursuant to NYSE Arca Rule 5.2-E(j)(3)) (``Approval Order''). 
See also, Amendment 3 to SR-NYSEArca-2017-56 at https://www.sec.gov/comments/sr-nysearca-2017-56/nysearca201756-2714674-161523.pdf. In 
addition, the Commission also has approved other proposed rule 
changes relating to listing and trading of funds based on municipal 
bond indexes. See, e.g., Securities Exchange Act Release Nos. 67985 
(October 4, 2012), 77 FR 61804 (October 11, 2012) (SR-NYSEArca-2012-
92) (order approving proposed rule change to list and trade the 
iShares 2018 S&P AMT-Free Municipal Series and iShares 2019 S&P AMT-
Free Municipal Series under NYSE Arca Rule 5.2(j)(3), Commentary 
.02); 72523 (July 2, 2014), 79 FR 39016 (July 9, 2014) (SR-NYSEArca-
2014-37) (order approving proposed rule change to list and trade 
iShares 2020 S&P AMT-Free Municipal Series under NYSE Arca Rule 
5.2(j)(3), Commentary .02); and 75468 (July 16, 2015), 80 FR 43500 
(July 22, 2015) (SR-NYSEArca-2015-25) (order approving proposed rule 
change to list and trade the iShares iBonds Dec 2021 AMT-Free Muni 
Bond ETF and iShares iBonds Dec 2022 AMT-Free Muni Bond ETF under 
NYSE Arca Rule 5.2(j)(3), Commentary .02); 63881 (February 9, 2011), 
76 FR 9065 (February 16, 2011) (SR-NYSEArca-2010-120) (order 
approving proposed rule change to list and trade shares of the SPDR 
Nuveen S&P High Yield Municipal Bond Fund under Commentary .02 of 
NYSE Arca Rule 5.2-E(j)(3)). The Commission has issued notices of 
filing and immediate effectiveness of proposed rule changes relating 
to certain series of Units under NYSE Arca Rule 5.2-E(j)(3) and 
Managed Fund Shares under NYSE Arca Rule 8.600-E. See, e.g., 
Securities Exchange Act Release Nos. 83982 (August 29, 2018), 83 FR 
45168 (September 5, 2018) (SR-NYSEArca-2018-62) (Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change Relating to 
Listing and Trading of Shares of the American Century Diversified 
Municipal Bond ETF under NYSE Arca Rule 8.600-E); 84379 (October 5, 
2018), 83 FR 51724 (October 12, 2018) (SR-NYSEArca-2018-73) (Notice 
of Filing and Immediate Effectiveness of Proposed Rule Change 
Relating to Listing and Trading of Shares of the First Trust Short 
Duration Managed Municipal ETF under NYSE Arca Rule 8.600-E); 84381 
(October 5, 2018), 83 FR 51111752 (October 12, 2018) (SR-NYSEArca-
2018-72) (Notice of Filing and Immediate Effectiveness of Proposed 
Rule Change Relating to Listing and Trading of Shares of the First 
Trust Ultra Short Duration Municipal ETF under NYSE Arca Rule 8.600-
E); 84396 (October 10, 2018), 83 FR 52266 (October 16, 2018) (SR-
NYSEArca-2018-70) (Notice of Filing and Immediate Effectiveness of 
Proposed Rule Change Relating to Listing and Trading of Shares of 
the iShares iBond Dec 2026 Term Muni Bond ETF Under Commentary .02 
to NYSE Arca Rule 5.2-E(j)(3)).
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    As discussed below, the Exchange is submitting this proposed rule 
change to change the listing requirements applicable to the Fund as set 
forth in the Approval Order. Specifically, the Exchange proposes to 
change the benchmark index for the Fund to the ``New Index'' (as 
defined below).

Description of the Shares and the Fund

    As stated in the Approval Order, the Fund seeks to provide 
investment results that, before fees and expenses, correspond generally 
to the price and yield performance of the Bloomberg Barclays Municipal 
Managed Money Index (``Current Index'') which tracks the U.S. municipal 
bond market. The Trust, in a November 6, 2018 supplement to the Fund's 
prospectus (``Prospectus Supplement''), stated that, effective December 
3, 2018, the new benchmark index for the Fund will be the Bloomberg 
Barclays Municipal Managed Money 1-25 Years Index (``New Index'').\6\ 
The New Index is the sub-set of the Current Index with effective 
maturities of 1-25 years. \7\ The

[[Page 64615]]

Exchange believes it is appropriate to facilitate the continued listing 
and trading of Shares of the Fund because, as described below, the Fund 
will be based on a broad-based index of fixed income municipal bond 
securities that is not readily susceptible to manipulation. As noted in 
Amendment 3 to SR-NYSEArca-2017-56, the Fund listed on the Exchange 
prior to 2010.
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    \6\ The Trust is registered under the Investment Company Act of 
1940 (15 U.S.C. 80a-1) (``1940 Act''). On October 31, 2018, the 
Trust filed with the Commission an amendment to its registration 
statement on Form N-1A under the Securities Act of 1933 (15 U.S.C. 
77a) (``Securities Act''), and under the 1940 Act relating to the 
Fund (File Nos. 333-57793 and 811-08839) (``Registration 
Statement''). The description of the operation of the Trust and the 
Fund herein is based, in part, on the Registration Statement and the 
Prospectus Supplement. In addition, the Commission has issued an 
order granting certain exemptive relief to the Trust under the 1940 
Act. See Investment Company Act Release No. 29524 (December 13, 
2010) (File No. 812-13487) (``Exemptive Order'').
    \7\ The Trust represents that it will not implement the proposed 
change to the index underlying the Fund until this proposed rule 
change is effective and operative.
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    Pursuant to NYSE Arca Rule 5.2-E(j)(3), the Exchange proposed to 
facilitate the listing and trading of certain series of Investment 
Company Units that do not otherwise meet the standards set forth in 
Commentary.02 to Rule 5.2-E(j)(3). Specifically, the Exchange proposed 
to facilitate the listing and trading of the certain series of 
Investment Company Units, including the Fund, based on a multistate 
index of fixed income municipal bond securities.
    According to the Prospectus Supplement, under normal market 
conditions,\8\ the Fund generally will invest substantially all, but at 
least 80%, of its total assets in the securities comprising the New 
Index or in securities that the Nuveen Asset Management, LLC (the 
Fund's ``Sub-Adviser'') determines have economic characteristics that 
are substantially identical to the economic characteristics of the 
securities that comprise the New Index. In addition, in seeking to 
track the New Index, the Fund may invest in debt securities that are 
not included in the New Index, cash and cash equivalents or money 
market instruments, such as repurchase agreements and money market 
funds (including money market funds advised by SSGA Funds Management, 
Inc. (``SSGA FM'' or the ``Adviser''), the investment adviser to the 
Fund.
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    \8\ The term ``normal market conditions'' includes, but is not 
limited to, the absence of trading halts in the applicable financial 
markets generally; operational issues (e.g., systems failure) 
causing dissemination of inaccurate market information; or force 
majeure type events such as natural or manmade disaster, act of God, 
armed conflict, act of terrorism, riot or labor disruption or any 
similar intervening circumstance.
---------------------------------------------------------------------------

    With respect to the remaining 20% of its assets, the Fund may 
invest in debt securities that are not included in the New Index, cash 
and cash equivalents or money market instruments, such as repurchase 
agreements and money market funds, commercial paper, foreign currency 
transactions, reverse repurchase agreements, securities of other 
investment companies, exchange-traded futures on Treasuries or 
Eurodollars (all such exchange-traded futures contracts will be traded 
on an exchange that is a member of the Intermarket Surveillance Group 
(``ISG'') or with which the Exchange has in place a comprehensive 
surveillance sharing agreement), U.S. exchange-traded or over-the-
counter (``OTC'') put and call options contracts and exchange-traded or 
OTC swap agreements (including interest rate swaps, total return swaps, 
excess return swaps and credit default swaps) and treasury-inflation 
protected securities of the U.S. Treasury as well as major governments 
and emerging market countries.
    The New Index is designed to track the U.S. fully tax-exempt bond 
market. The New Index includes state and local general obligation 
bonds, revenue bonds, pre-refunded bonds, and insured bonds. The New 
Index is comprised of tax-exempt municipal securities issued by states, 
cities, counties, districts and their respective agencies. The New 
Index also includes municipal lease obligations, which are securities 
issued by state and local governments and authorities to finance the 
acquisition of equipment and facilities.
    For informational purposes, as of November 1, 2018, there were 
approximately 21,478 securities in the New Index from issuers in 49 
different states or U.S. territories. The most heavily weighted 
security in the New Index represented less than 0.11% of the total 
weight of the New Index and the aggregate weight of the top five most 
heavily weighted securities in the New Index represented approximately 
0.48% of the total weight of the New Index. Approximately 10% of the 
weight of the components in the New Index had a minimum original 
principal amount outstanding of $100 million or more. In addition, the 
total dollar amount outstanding of issues in the New Index was 
approximately $505 billion and the average dollar amount outstanding of 
issues in the New Index was approximately $23.2 million.
Requirement for New Index Constituents
    On a continuous basis, (1) at least 90% of the weight of the New 
Index will be comprised of securities that have an outstanding par 
value of at least $7 million and were issued as part of a transaction 
of at least $75 million, and (2) the New Index will include at least 
500 components.
    The Exchange notes that, in the Approval Order, the Commission 
approved Exchange listing and trading of Units of the Fund for which at 
least 90% of the weight of Current Index will be comprised of 
securities that have an outstanding par value of at least $7 million 
and were issued as part of a transaction of at least $75 million, and 
that included at least 500 components.\9\
---------------------------------------------------------------------------

    \9\ See note 5, supra.
---------------------------------------------------------------------------

    In addition, the Exchange represents that: (1) Except for 
Commentary .02(a)(2) to Rule 5.2-E(j)(3),\10\ the New Index currently 
satisfies all of the generic listing standards under NYSE Arca Rule 
5.2-E(j)(3); (2) the continued listing standards under Commentary .02 
to NYSE Arca Rule 5.2-E(j)(3), as applicable to Units based on fixed 
income securities, will apply to the Shares of the Fund; and (3) the 
issuer of the Fund is required to comply with Rule 10A-3 \11\ under the 
Act for the initial and continued listing of the Shares. The Exchange 
represents that the Fund will comply with all other requirements 
applicable to Units, including, but not limited to, requirements 
relating to the dissemination of key information such as the value of 
the New Index and the Intraday Indicative Value (``IIV''),\12\ rules 
governing the trading of equity securities, trading hours, trading 
halts, surveillance, information barriers and the Information Bulletin, 
as set forth in the Exchange rules applicable to Units and prior 
Commission orders approving the generic listing rules applicable to the 
listing and trading of Units.\13\
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    \10\ Commentary .02(a)(2) provides that Fixed Income Security 
components that in aggregate account for at least 75% of the Fixed 
Income Securities portion of the weight of the index or portfolio 
each shall have a minimum original principal amount outstanding of 
$100 million or more.
    \11\ 17 CFR 240.10A-3.
    \12\ The IIV will be widely disseminated by one or more major 
market data vendors at least every 15 seconds during the Exchange's 
Core Trading Session (normally, 9:30 a.m. to 4:00 p.m., E.T. 
Currently, it is the Exchange's understanding that several major 
market data vendors display and/or make widely available IIV taken 
from CTA or other data feeds.
    \13\ See, e.g., Securities Exchange Act Release Nos. 55783 (May 
17, 2007), 72 FR 29194 (May 24, 2007) (SR-NYSEArca-2007-36) (order 
approving NYSE Arca generic listing standards for Units based on a 
fixed income index); 44551 (July 12, 2001), 66 FR 37716 (July 19, 
2001) (SR-PCX-2001-14) (order approving generic listing standards 
for Units and Portfolio Depositary Receipts); 41983 (October 6, 
1999), 64 FR 56008 (October 15, 1999) (SR-PCX-98-29) (order 
approving rules for listing and trading of Units).
---------------------------------------------------------------------------

Additional Information
    The current value of the New Index will be widely disseminated by 
one or more major market data vendors at least once per day, as 
required by Commentary .02(b)(ii) to NYSE Arca Rule 5.2-E(j)(3). The 
portfolio of securities held by the Fund will be disclosed daily on the 
Fund's website www.spdrs.com.

[[Page 64616]]

Availability of Information
    On each business day, the Fund will disclose on its website 
(www.spdrs.com) the portfolio that will form the basis for the Fund's 
calculation of NAV at the end of the business day.
    On a daily basis, the Fund will disclose for each portfolio 
security or other financial instrument of the Fund the following 
information on the Fund's website: Ticker symbol (if applicable), name 
of security and financial instrument, a common identifier such as CUSIP 
or ISIN (if applicable), number of shares (if applicable), and dollar 
value of securities and financial instruments held in the portfolio, 
and percentage weighting of the security and financial instrument in 
the portfolio. The website information will be publicly available at no 
charge. The current value of the New Index will be widely disseminated 
by one or more major market data vendors at least once per day, as 
required by NYSE Arca Rule 5.2-E(j)(3), Commentary .02 (b)(ii).
    The IIV for Shares of the Fund will be disseminated by one or more 
major market data vendors, updated at least every 15 seconds during the 
Exchange's Core Trading Session, as required by NYSE Arca Rule 5.2-
E(j)(3), Commentary .02(c). The current value of the New Index would be 
widely disseminated by one or more major market data vendors at least 
once per day, as required by NYSE Arca Rule 5.2-(j)(3), Commentary .02 
(b)(ii). In addition, the portfolio of securities held by the Fund will 
be disclosed daily on the Fund's website.
    Investors can also obtain the Trust's Statement of Additional 
Information (``SAI''), the Fund's Shareholder Reports, and its Form N-
CSR and Form N-SAR, filed twice a year. The Trust's SAI and Shareholder 
Reports are available free upon request from the Trust, and those 
documents and the Form N-CSR and Form N-SAR may be viewed on-screen or 
downloaded from the Commission's website at www.sec.gov. Information 
regarding market price and trading volume of the Shares will be 
continually available on a real-time basis throughout the day on 
brokers' computer screens and other electronic services. Information 
regarding the previous day's closing price and trading volume 
information for the Shares will be published daily in the financial 
section of newspapers.
    Quotation and last sale information for the Shares of the Fund will 
be available via the Consolidated Tape Association (``CTA'') high speed 
line. Quotation information for investment company securities may be 
obtained through nationally recognized pricing services through 
subscription agreements or from brokers and dealers who make markets in 
such securities. Price information regarding municipal bonds is 
available from third party pricing services and major market data 
vendors. Trade price and other information relating to municipal bonds 
is available through the Municipal Securities Rulemaking Board's 
Electronic Municipal Market Access (``EMMA'') system.
    Quotation information for OTC swaps agreements may be obtained from 
brokers and dealers who make markets in such instruments. Quotation 
information for exchange-traded swaps, futures and options will be 
available from the applicable exchange and/or major market vendors.
Surveillance
    The Exchange represents that trading in the Shares of the Fund will 
be subject to the existing trading surveillances, administered by the 
Financial Industry Regulatory Authority (``FINRA'') on behalf of the 
Exchange, or by regulatory staff of the Exchange, which are designed to 
detect violations of Exchange rules and applicable federal securities 
laws. The Exchange represents that these procedures are adequate to 
properly monitor Exchange trading of the Shares of the Fund in all 
trading sessions and to deter and detect violations of Exchange rules 
and federal securities laws applicable to trading on the Exchange.\14\
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    \14\ FINRA conducts cross-market surveillances on behalf of the 
Exchange pursuant to a regulatory services agreement. The Exchange 
is responsible for FINRA's performance under this regulatory 
services agreement.
---------------------------------------------------------------------------

    The surveillances referred to above generally focus on detecting 
securities trading outside their normal patterns, which could be 
indicative of manipulative or other violative activity. When such 
situations are detected, surveillance analysis follows and 
investigations are opened, where appropriate, to review the behavior of 
all relevant parties for all relevant trading violations.
    The Exchange or FINRA, on behalf of the Exchange, or both, will 
communicate as needed regarding trading in the Shares, certain futures 
and certain options with other markets and other entities that are 
members of the ISG, and the Exchange or FINRA, on behalf of the 
Exchange, or both, may obtain trading information regarding trading in 
the Shares, certain futures and certain options from such markets and 
other entities. In addition, the Exchange may obtain information 
regarding trading in the Shares, certain futures and certain options 
from markets and other entities that are members of ISG or with which 
the Exchange has in place a comprehensive surveillance sharing 
agreement. FINRA also can access data obtained from the Municipal 
Securities Rulemaking Board relating to municipal bond trading activity 
for surveillance purposes in connection with trading in the Shares.
    The Exchange represents that at least 90% of the weight of Fund 
holdings invested in exchange-traded futures contracts and exchange-
traded options will be traded on an exchange that is a member of the 
ISG or with which the Exchange has in place a comprehensive 
surveillance sharing agreement.
2. Statutory Basis
    The Exchange believes that the proposal is consistent with Section 
6(b) of the Act \15\ in general and Section 6(b)(5) of the Act \16\ 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, to remove 
impediments to and perfect the mechanism of a free and open market and 
a national market system and, in general, to protect investors and the 
public interest.
---------------------------------------------------------------------------

    \15\ 15 U.S.C. 78f.
    \16\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Exchange believes that the proposed rule change is designed to 
prevent fraudulent and manipulative acts and practices in that the 
Shares of the Fund will be listed and traded on the Exchange pursuant 
to the initial and continued listing criteria in NYSE Arca Rule 5.2-
E(j)(3), except for the requirement in Commentary .02(a)(2) that the 
component fixed income securities, in the aggregate, account for at 
least 75% of the weight of the index each shall have a minimum 
principal amount outstanding of $100 million or more. The Exchange 
represents that trading in the Shares will be subject to the existing 
trading surveillances administered by the Exchange as well as cross-
market surveillances administered by FINRA on behalf of the Exchange, 
which are designed to detect violations of Exchange rules and federal 
securities laws applicable to trading on the Exchange.\17\ The Exchange 
represents that these procedures are adequate to properly monitor 
Exchange trading of

[[Page 64617]]

the Shares in all trading sessions and to deter and detect violations 
of Exchange rules and federal securities laws applicable to trading on 
the Exchange. The Exchange or FINRA, on behalf of the Exchange, or 
both, will communicate as needed regarding trading in the Shares, 
certain futures and certain options with other markets that are members 
of the ISG. In addition, the Exchange will communicate as needed 
regarding trading in the Shares, certain futures and certain options 
with other markets that are members of the ISG or with which the 
Exchange has in place a comprehensive surveillance sharing agreement. 
FINRA also can access data obtained from the Municipal Securities 
Rulemaking Board relating to municipal bond trading activity for 
surveillance purposes in connection with trading in the Shares of the 
Fund. At least 90% of the weight of Fund holdings invested in exchange-
traded futures contracts and exchange-traded options will be traded on 
an exchange that is a member of the ISG or with which the Exchange has 
in place a comprehensive surveillance sharing agreement.
---------------------------------------------------------------------------

    \17\ FINRA conducts cross-market surveillances on behalf of the 
Exchange pursuant to a regulatory services agreement. The Exchange 
is responsible for FINRA's performance under this regulatory 
services agreement.
---------------------------------------------------------------------------

    As discussed above, the Exchange believes that the New Index is 
sufficiently broad-based to deter potential manipulation. For 
informational purposes, as of November 1, 2018, there were 
approximately 21,478 securities in the New Index from issuers in 49 
different states or U.S. territories. The most heavily weighted 
security in the New Index represented less than 0.11% of the total 
weight of the New Index and the aggregate weight of the top five most 
heavily weighted securities in the New Index represented approximately 
0.48% of the total weight of the New index. Approximately 10% of the 
weight of the components in the New Index had a minimum original 
principal amount outstanding of $100 million or more. In addition, the 
total dollar amount outstanding of issues in the New Index was 
approximately $505 billion and the average dollar amount outstanding of 
issues in the New Index was approximately $23.2 million.\18\ Therefore, 
the Exchange believes that the New Index is sufficiently broad-based to 
deter potential manipulation, given that it is comprised of 
approximately 21,478 issues.
---------------------------------------------------------------------------

    \18\ Commentary .02(a)(4) to NYSE Arca Rule 5.2-E(j)(3) provides 
that no component fixed-income security (excluding Treasury 
Securities and GSE Securities, as defined therein) shall represent 
more than 30% of the weight of the index or portfolio, and the five 
most heavily weighted component fixed-income securities in the index 
or portfolio shall not in the aggregate account for more than 65% of 
the weight of the index or portfolio.
---------------------------------------------------------------------------

    On a continuous basis, (1) at least 90% of the weight of the New 
Index will be comprised of securities that have an outstanding par 
value of at least $7 million and were issued as part of a transaction 
of at least $75 million, and (2) the New Index will include at least 
500 components.
    The Exchange notes that, in the Approval Order, the Commission 
approved Exchange listing and trading of Units of the Fund for which at 
least 90% of the weight of Current Index will be comprised of 
securities that have an outstanding par value of at least $7 million 
and were issued as part of a transaction of at least $75 million, and 
that included at least 500 components.\19\ In the Approval Order, the 
Commission stated that the applicable index was sufficiently designed 
to deter potential manipulation.
---------------------------------------------------------------------------

    \19\ See note 5, supra.
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    The proposed rule change is designed to promote just and equitable 
principles of trade and to protect investors and the public interest in 
that a large amount of information will be publicly available regarding 
the Fund and the Shares, thereby promoting market transparency. The 
Fund's portfolio holdings will be disclosed on the Fund's website daily 
after the close of trading on the Exchange. Moreover, the IIV will be 
widely disseminated by one or more major market data vendors at least 
every 15 seconds during the Exchange's Core Trading Session. The 
current value of the New Index will be disseminated by one or more 
major market data vendors at least once per day. Information regarding 
market price and trading volume of the Shares will be continually 
available on a real-time basis throughout the day on brokers' computer 
screens and other electronic services, and quotation and last sale 
information will be available via the CTA high-speed line. The website 
for the Fund will include the prospectus for the Fund and additional 
data relating to NAV and other applicable quantitative information. 
Moreover, prior to the commencement of trading, the Exchange will 
inform its ETP Holders in an Information Bulletin of the special 
characteristics and risks associated with trading the Shares.
    If the Exchange becomes aware that the NAV is not being 
disseminated to all market participants at the same time, it will halt 
trading in the Shares until such time as the NAV is available to all 
market participants. With respect to trading halts, the Exchange may 
consider all relevant factors in exercising its discretion to halt or 
suspend trading in the Shares of the Fund. Trading also may be halted 
because of market conditions or for reasons that, in the view of the 
Exchange, make trading in the Shares inadvisable. If the IIV or the New 
Index values are not being disseminated as required, the Exchange may 
halt trading during the day in which the interruption to the 
dissemination of the IIV or New Index value occurs. If the interruption 
to the dissemination of the IIV or New Index value persists past the 
trading day in which it occurred, the Exchange will halt trading. 
Trading in Shares of the Fund will be halted if the circuit breaker 
parameters in NYSE Arca Rule 7.12-E have been reached or because of 
market conditions or for reasons that, in the view of the Exchange, 
make trading in the Shares inadvisable, and trading in the Shares will 
be subject to NYSE Arca Rule 7.34-E, which sets forth circumstances 
under which Shares of the Fund may be halted. In addition, investors 
will have ready access to information regarding the IIV, and quotation 
and last sale information for the Shares.
    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 type of exchange-traded fund that holds municipal bonds 
and that will enhance competition among market participants, to the 
benefit of investors and the marketplace. As noted above, the Exchange 
has in place surveillance procedures relating to trading in the Shares 
and may obtain information via ISG from other exchanges that are 
members of ISG or with which the Exchange has entered into a 
comprehensive surveillance sharing agreement. In addition, investors 
will have ready access to information regarding the IIV and quotation 
and last sale information for the Shares.
    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.\20\
---------------------------------------------------------------------------

    \20\ 15 U.S.C. 78f(b)(5).
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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 notes that the 
proposed rule change will facilitate the listing and trading of an 
additional type of Units based on a

[[Page 64618]]

municipal bond index that will enhance competition among market 
participants, to the benefit of investors and the marketplace.

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

    Because the foregoing proposed rule change does not: (i) 
Significantly affect the protection of investors or the public 
interest; (ii) impose any significant burden on competition; and (iii) 
become operative for 30 days from the date on which it was filed, or 
such shorter time as the Commission may designate, it has become 
effective pursuant to Section 19(b)(3)(A) of the Act \21\ and Rule 19b-
4(f)(6) thereunder.\22\
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    \21\ 15 U.S.C. 78s(b)(3)(A).
    \22\ 17 CFR 240.19b-4(f)(6). As required under Rule 19b-
4(f)(6)(iii), the Exchange provided the Commission with written 
notice of its intent to file the proposed rule change, along with a 
brief description and the text of the proposed rule change, at least 
five business days prior to the date of filing of the proposed rule 
change, or such shorter time as designated by the Commission.
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    A proposed rule change filed under Rule 19b-4(f)(6) normally does 
not become operative for 30 days after the date of filing. However, 
Rule 19b-4(f)(6)(iii) \23\ permits the Commission to designate a 
shorter time if such action is consistent with the protection of 
investors and the public interest. In its filing with the Commission, 
the Exchange requests that the Commission waive the 30-day operative 
delay such that the proposed rule change will become operative on the 
date the Trust implements the New Index for the Fund.
---------------------------------------------------------------------------

    \23\ 17 CFR 240.19b-4(f)(6)(iii).
---------------------------------------------------------------------------

    The Exchange notes that the Commission previously approved a 
proposed rule change to allow the continued listing and trading of 
Shares on the Exchange based on the Current Index.\24\ The Exchange 
represents that the New Index is the sub-set of the Current Index with 
effective maturities of 1-25 years. The Exchange further represents 
that other than the substitution of the New Index for the Current 
Index, the continued listing requirements of the Shares will remain the 
same as those approved by the Commission in the Approval Order. The 
Commission believes that waiving the 30-day operative delay is 
consistent with the protection of investors and the continued listing 
requirements for the Shares will remain the same. Therefore, the 
Commission hereby waives the 30-day operative delay.\25\
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    \24\ See Approval Order, supra note 5.
    \25\ For purposes only of waiving the 30-day operative delay, 
the Commission has considered the proposed rule's impact on 
efficiency, competition, and capital formation. See 15 U.S.C. 
78c(f).
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    At any time within 60 days of the filing of the proposed rule 
change, the Commission summarily may temporarily suspend such rule 
change if it appears to the Commission that such action is: (i) 
Necessary or appropriate in the public interest; (ii) for the 
protection of investors; or (iii) otherwise in furtherance of the 
purposes of the Act. If the Commission takes such action, the 
Commission shall institute proceedings 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-2018-88 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-2018-88. 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 also will be available for inspection 
and copying at the principal office of the Exchange. All comments 
received will be posted without change. Persons submitting comments are 
cautioned that we do not redact or edit personal identifying 
information from comment submissions. You should submit only 
information that you wish to make available publicly. All submissions 
should refer to File Number SR-NYSEArca-2018-88 and should be submitted 
on or before January 7, 2019.
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    \26\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\26\
Eduardo A. Aleman,
Deputy Secretary.
[FR Doc. 2018-27207 Filed 12-14-18; 8:45 am]
 BILLING CODE 8011-01-P

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