Investment Company Act Release No. 33622; File No. 812-15031 ETFis Series Trust I, et al.; Notice of Application, 48671-48672 [2019-19979]
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Federal Register / Vol. 84, No. 179 / Monday, September 16, 2019 / Notices
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.18
Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2019–19902 Filed 9–13–19; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
Investment Company Act Release No.
33622; File No. 812–15031 ETFis Series
Trust I, et al.; Notice of Application
September 11, 2019.
Securities and Exchange
Commission (‘‘Commission’’).
ACTION: Notice.
jspears on DSK3GMQ082PROD with NOTICES
AGENCY:
Notice of an application for an order
under section 12(d)(1)(J) of the
Investment Company Act of 1940 (the
‘‘Act’’) for an exemption from sections
12(d)(1)(A), (B), and (C) of the Act and
under sections 6(c) and 17(b) of the Act
for an exemption from sections 17(a)(1)
and (2) of the Act. The requested order
would permit certain registered openend investment companies to acquire
shares of certain registered open-end
investment companies (each an
‘‘Unaffiliated Open-End Investment
Company’’), registered closed-end
investment companies and ‘‘business
development companies,’’ as defined in
section 2(a)(48) of the Act (each
registered closed-end management and
each business development company,
an ‘‘Unaffiliated Closed-End Investment
Company’’ and, together with the
Unaffiliated Open-End Investment
Companies, the ‘‘Unaffiliated
Investment Companies’’), and registered
unit investment trusts (the ‘‘Unaffiliated
Trusts,’’ and together with the
Unaffiliated Investment Companies, the
‘‘Unaffiliated Funds’’) that are within
the same group of investment
companies (collectively, the ‘‘Affiliated
Funds’’) and outside the same group of
investment companies as the acquiring
investment companies (collectively, the
Affiliated Funds and, together with the
Unaffiliated Funds, the ‘‘Underlying
Funds’’), in excess of the limits in
section 12(d)(1) of the Act.
APPLICANTS: ETFis Series Trust I and
Virtus ETF Trust II, Delaware statutory
trusts that are registered under the Act
as open-end management investment
companies and intend to introduce
multiple series, and Virtus ETF
Advisers LLC, a Delaware limited
liability company registered as an
18 17
CFR 200.30–3(a)(12).
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investment adviser under the
Investment Advisers Act of 1940.
FILING DATES: The application was filed
on May 9, 2019.
HEARING OR NOTIFICATION OF HEARING: An
order granting the requested relief will
be issued unless the Commission orders
a hearing. Interested persons may
request a hearing by writing to the
Commission’s Secretary and serving
applicants with a copy of the request,
personally or by mail. Hearing requests
should be received by the Commission
by 5:30 p.m. on October 7, 2019 and
should be accompanied by proof of
service on the applicants, in the form of
an affidavit, or, for lawyers, a certificate
of service. Pursuant to Rule 0–5 under
the Act, hearing requests should state
the nature of the writer’s interest, any
facts bearing upon the desirability of a
hearing on the matter, the reason for the
request, and the issues contested.
Persons who wish to be notified of a
hearing may request notification by
writing to the Commission’s Secretary.
ADDRESSES: Secretary, U.S. Securities
and Exchange Commission, 100 F Street
NE, Washington, DC 20549–1090.
Applicants: William J. Smalley, Virtus
ETF Advisers LLC, 1540 Broadway,
New York, NY 10036; and Michael W.
Mundt, Esq., Stradley Ronon Stevens &
Young, LLP, 1250 Connecticut Avenue
NW, Suite 500, Washington, DC 20036.
FOR FURTHER INFORMATION CONTACT:
Rochelle Kauffman Plesset, Senior
Counsel, or David J. Marcinkus, Branch
Chief, at (202) 551–6825, (Division of
Investment Management, Chief
Counsel’s Office).
SUPPLEMENTARY INFORMATION: The
following is a summary of the
application. The complete application
may be obtained via the Commission’s
website by searching for the file
number, or for an applicant using the
Company name box, at https://
www.sec.gov/search/search.htm, or by
calling (202) 551–8090.
Summary of the Application
1. Applicants request an order to
permit (a) a Fund 1 (each a ‘‘Fund of
1 Applicants request that the order apply to each
existing and future series of ETFis Series Trust I
and Virtus ETF Trust II and to each existing and
future registered open-end investment company or
series thereof that is advised by Virtus ETF
Advisers LLC or its successor or by any other
investment adviser controlling, controlled by or
under common control with Virtus ETF Advisers
LLC or its successor and is part of the same ‘‘group
of investment companies’’ as ETFis Series Trust I
and Virtus ETF Trust II (each, a ‘‘Fund’’). For
purposes of the requested order, ‘‘successor’’ is
limited to an entity that results from a
reorganization into another jurisdiction or a change
in the type of business organization. For purposes
of the request for relief, the term ‘‘group of
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48671
Funds’’) to acquire shares of Underlying
Funds 2 in excess of the limits in
sections 12(d)(1)(A) and (C) of the Act
and (b) the Underlying Funds that are
registered open-end investment
companies or series thereof, their
principal underwriters and any broker
or dealer registered under the Securities
Exchange Act of 1934 to sell shares of
the Underlying Fund to the Fund of
Funds in excess of the limits in section
12(d)(1)(B) of the Act.3 Applicants also
request an order of exemption under
sections 6(c) and 17(b) of the Act from
the prohibition on certain affiliated
transactions in section 17(a) of the Act
to the extent necessary to permit the
Underlying Funds to sell their shares to,
and redeem their shares from, the Funds
of Funds.4 Applicants state that such
transactions will be consistent with the
policies of each Fund of Funds and each
Underlying Fund and with the general
purposes of the Act and will be based
on the net asset values of the
Underlying Funds.
2. Applicants agree that any order
granting the requested relief will be
subject to the terms and conditions
stated in the application. Such terms
and conditions are designed to, among
other things, help prevent any potential
investment companies’’ means any two or more
registered investment companies, including closedend investment companies and business
development companies, that hold themselves out
to investors as related companies for purposes of
investment and investor services.
2 Certain of the Underlying Funds have obtained
exemptions from the Commission necessary to
permit their shares to be listed and traded on a
national securities exchange at negotiated prices
and, accordingly, to operate as an exchange-traded
fund (‘‘ETF’’).
3 Applicants do not request relief for Funds of
Funds to invest in reliance on the order in business
development companies and registered closed-end
investment companies that are not listed and traded
on a national securities exchange.
4 A Fund of Funds generally would purchase and
sell shares of an Underlying Fund that operates as
an ETF or closed-end fund through secondary
market transactions rather than through principal
transactions with the Underlying Fund. Applicants
nevertheless request relief from sections 17(a)(1)
and (2) to permit each ETF or Unaffiliated ClosedEnd Investment Company that is an affiliated
person, or an affiliated person of an affiliated
person, as defined in section 2(a)(3) of the 1940 Act,
of a Fund of Funds to sell shares to or redeem
shares from the Fund of Funds. This includes, in
the case of sales and redemptions of shares of ETFs,
the in-kind transactions that accompany such sales
and redemptions. The Applicants are not seeking
relief from section 17(a) for, and the requested relief
will not apply to, transactions where an ETF,
business development company, or closed-end fund
could be deemed an affiliated person, or an
affiliated person of an affiliated person, of a Fund
of Funds because an investment adviser to the ETF,
business development company, or closed-end fund
or an entity controlling, controlled by or under
common control with the investment adviser to the
ETF, business development company, or closed-end
fund, is also an investment adviser to the Fund of
Funds.
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48672
Federal Register / Vol. 84, No. 179 / Monday, September 16, 2019 / Notices
(i) undue influence over an Underlying
Fund that is not in the same ‘‘group of
investment companies’’ as the Fund of
Funds through control or voting power,
or in connection with certain services,
transactions, and underwritings, (ii)
excessive layering of fees, and (iii)
overly complex fund structures, which
are the concerns underlying the limits
in sections 12(d)(1)(A), (B), and (C) of
the Act.
3. Section 12(d)(1)(J) of the Act
provides that the Commission may
exempt any person, security, or
transaction, or any class or classes of
persons, securities, or transactions, from
any provision of section 12(d)(1) if the
exemption is consistent with the public
interest and the protection of investors.
Section 17(b) of the Act authorizes the
Commission to grant an order
permitting a transaction otherwise
prohibited by section 17(a) if it finds
that (a) the terms of the proposed
transaction are fair and reasonable and
do not involve overreaching on the part
of any person concerned; (b) the
proposed transaction is consistent with
the policies of each registered
investment company involved; and (c)
the proposed transaction is consistent
with the general purposes of the Act.
Section 6(c) of the Act permits the
Commission to exempt any persons or
transactions from any provision of the
Act if such exemption is necessary or
appropriate in the public interest and
consistent with the protection of
investors and the purposes fairly
intended by the policy and provisions of
the Act.
For the Commission, by the Division of
Investment Management, pursuant to
delegated authority.
Jill M. Peterson,
Assistant Secretary.
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
Sunshine Act Meetings
Notice is hereby given,
pursuant to the provisions of the
Government in the Sunshine Act, Public
Law 94–409, the Securities and
Exchange Commission will hold an
Open Meeting on Wednesday,
September 18, 2019 at 10:00 a.m.
PLACE: The meeting will be held in
Auditorium LL–002 at the
Commission’s headquarters, 100 F
Street NE, Washington, DC 20549.
STATUS: This meeting will begin at 10:00
a.m. (ET) and will be open to the public.
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1. The
Commission will consider whether to
adopt amendments to rules adopted
under section 13 of the Bank Holding
Company Act related to prohibitions
and restrictions on proprietary trading
and certain interests in, and
relationships with, hedge funds and
private equity funds (commonly known
as the ‘‘Volcker rule’’).
At times, changes in Commission
priorities require alterations in the
scheduling of meeting items.
MATTER TO BE CONSIDERED:
CONTACT PERSON FOR MORE INFORMATION:
For further information and to ascertain
what, if any, matters have been added,
deleted or postponed, please contact
Vanessa A. Countryman, Office of the
Secretary, at (202) 551–5400.
Dated: September 11, 2019.
Vanessa A. Countryman,
Secretary.
[FR Doc. 2019–20040 Filed 9–12–19; 11:15 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–86917; File No. SR–
NYSEAMER–2019–36]
Self-Regulatory Organizations; NYSE
American LLC; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change To Amend the NYSE
American Options Fee Schedule
September 10, 2019.
[FR Doc. 2019–19979 Filed 9–13–19; 8:45 am]
TIME AND DATE:
Seating will be on a first-come, firstserved basis. Visitors will be subject to
security checks. The meeting will be
webcast on the Commission’s website at
www.sec.gov.
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
September 3, 2019, NYSE American
LLC (‘‘NYSE American’’ or the
‘‘Exchange’’) filed with the Securities
and Exchange Commission (the
‘‘Commission’’) the proposed rule
change as described in Items I, II, and
III below, which Items have been
prepared by the self-regulatory
organization. The Commission is
publishing this notice to solicit
comments on the proposed rule change
from interested persons.
1 15
U.S.C. 78s(b)(1).
U.S.C. 78a.
3 17 CFR 240.19b–4.
2 15
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I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to amend the
NYSE American Options Fee Schedule
(‘‘Fee Schedule’’). The Exchange
proposes to implement the fee change
effective September 3, 2019. The
proposed 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 purpose of this filing is to amend
the Fee Schedule to modify the Strategy
Execution Fee Cap (‘‘Strategy Cap’’), as
set forth below.
Currently, Section I.J. of the Fee
Schedule provides that transaction fees
for ATP Holders are limited or capped
at $750 for certain options strategy
executions ‘‘on the same trading day in
the same option class’’ and such fees are
further capped at $25,000 per month per
initiating firm.4 Strategy executions that
qualify for the Strategy Cap are (a)
reversals and conversions, (b) box
spreads, (c) short stock interest spreads,
(d) merger spreads, and (e) jelly rolls,
which are described in detail in the Fee
Schedule (the ‘‘Strategy Executions’’).5
The Exchange proposes to increase
the daily Strategy Cap from $750 to
$1,000 and to include in the Cap all
Strategy Executions traded in the same
day (i.e., to eliminate the Cap
requirement that strategies be in the
4 See Fee Schedule, Section I. J. (Strategy
Execution Fee Cap), available here: https://
www.nyse.com/publicdocs/nyse/markets/americanoptions/NYSE_American_Options_Fee_
Schedule.pdf.
5 See id. Any qualifying Strategy Execution
executed as a QCC order will not be eligible for this
fee cap. See id.
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[Federal Register Volume 84, Number 179 (Monday, September 16, 2019)]
[Notices]
[Pages 48671-48672]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-19979]
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SECURITIES AND EXCHANGE COMMISSION
Investment Company Act Release No. 33622; File No. 812-15031
ETFis Series Trust I, et al.; Notice of Application
September 11, 2019.
AGENCY: Securities and Exchange Commission (``Commission'').
ACTION: Notice.
-----------------------------------------------------------------------
Notice of an application for an order under section 12(d)(1)(J) of
the Investment Company Act of 1940 (the ``Act'') for an exemption from
sections 12(d)(1)(A), (B), and (C) of the Act and under sections 6(c)
and 17(b) of the Act for an exemption from sections 17(a)(1) and (2) of
the Act. The requested order would permit certain registered open-end
investment companies to acquire shares of certain registered open-end
investment companies (each an ``Unaffiliated Open-End Investment
Company''), registered closed-end investment companies and ``business
development companies,'' as defined in section 2(a)(48) of the Act
(each registered closed-end management and each business development
company, an ``Unaffiliated Closed-End Investment Company'' and,
together with the Unaffiliated Open-End Investment Companies, the
``Unaffiliated Investment Companies''), and registered unit investment
trusts (the ``Unaffiliated Trusts,'' and together with the Unaffiliated
Investment Companies, the ``Unaffiliated Funds'') that are within the
same group of investment companies (collectively, the ``Affiliated
Funds'') and outside the same group of investment companies as the
acquiring investment companies (collectively, the Affiliated Funds and,
together with the Unaffiliated Funds, the ``Underlying Funds''), in
excess of the limits in section 12(d)(1) of the Act.
APPLICANTS: ETFis Series Trust I and Virtus ETF Trust II, Delaware
statutory trusts that are registered under the Act as open-end
management investment companies and intend to introduce multiple
series, and Virtus ETF Advisers LLC, a Delaware limited liability
company registered as an investment adviser under the Investment
Advisers Act of 1940.
FILING DATES: The application was filed on May 9, 2019.
HEARING OR NOTIFICATION OF HEARING: An order granting the requested
relief will be issued unless the Commission orders a hearing.
Interested persons may request a hearing by writing to the Commission's
Secretary and serving applicants with a copy of the request, personally
or by mail. Hearing requests should be received by the Commission by
5:30 p.m. on October 7, 2019 and should be accompanied by proof of
service on the applicants, in the form of an affidavit, or, for
lawyers, a certificate of service. Pursuant to Rule 0-5 under the Act,
hearing requests should state the nature of the writer's interest, any
facts bearing upon the desirability of a hearing on the matter, the
reason for the request, and the issues contested. Persons who wish to
be notified of a hearing may request notification by writing to the
Commission's Secretary.
ADDRESSES: Secretary, U.S. Securities and Exchange Commission, 100 F
Street NE, Washington, DC 20549-1090. Applicants: William J. Smalley,
Virtus ETF Advisers LLC, 1540 Broadway, New York, NY 10036; and Michael
W. Mundt, Esq., Stradley Ronon Stevens & Young, LLP, 1250 Connecticut
Avenue NW, Suite 500, Washington, DC 20036.
FOR FURTHER INFORMATION CONTACT: Rochelle Kauffman Plesset, Senior
Counsel, or David J. Marcinkus, Branch Chief, at (202) 551-6825,
(Division of Investment Management, Chief Counsel's Office).
SUPPLEMENTARY INFORMATION: The following is a summary of the
application. The complete application may be obtained via the
Commission's website by searching for the file number, or for an
applicant using the Company name box, at https://www.sec.gov/search/search.htm, or by calling (202) 551-8090.
Summary of the Application
1. Applicants request an order to permit (a) a Fund \1\ (each a
``Fund of Funds'') to acquire shares of Underlying Funds \2\ in excess
of the limits in sections 12(d)(1)(A) and (C) of the Act and (b) the
Underlying Funds that are registered open-end investment companies or
series thereof, their principal underwriters and any broker or dealer
registered under the Securities Exchange Act of 1934 to sell shares of
the Underlying Fund to the Fund of Funds in excess of the limits in
section 12(d)(1)(B) of the Act.\3\ Applicants also request an order of
exemption under sections 6(c) and 17(b) of the Act from the prohibition
on certain affiliated transactions in section 17(a) of the Act to the
extent necessary to permit the Underlying Funds to sell their shares
to, and redeem their shares from, the Funds of Funds.\4\ Applicants
state that such transactions will be consistent with the policies of
each Fund of Funds and each Underlying Fund and with the general
purposes of the Act and will be based on the net asset values of the
Underlying Funds.
---------------------------------------------------------------------------
\1\ Applicants request that the order apply to each existing and
future series of ETFis Series Trust I and Virtus ETF Trust II and to
each existing and future registered open-end investment company or
series thereof that is advised by Virtus ETF Advisers LLC or its
successor or by any other investment adviser controlling, controlled
by or under common control with Virtus ETF Advisers LLC or its
successor and is part of the same ``group of investment companies''
as ETFis Series Trust I and Virtus ETF Trust II (each, a ``Fund'').
For purposes of the requested order, ``successor'' is limited to an
entity that results from a reorganization into another jurisdiction
or a change in the type of business organization. For purposes of
the request for relief, the term ``group of investment companies''
means any two or more registered investment companies, including
closed-end investment companies and business development companies,
that hold themselves out to investors as related companies for
purposes of investment and investor services.
\2\ Certain of the Underlying Funds have obtained exemptions
from the Commission necessary to permit their shares to be listed
and traded on a national securities exchange at negotiated prices
and, accordingly, to operate as an exchange-traded fund (``ETF'').
\3\ Applicants do not request relief for Funds of Funds to
invest in reliance on the order in business development companies
and registered closed-end investment companies that are not listed
and traded on a national securities exchange.
\4\ A Fund of Funds generally would purchase and sell shares of
an Underlying Fund that operates as an ETF or closed-end fund
through secondary market transactions rather than through principal
transactions with the Underlying Fund. Applicants nevertheless
request relief from sections 17(a)(1) and (2) to permit each ETF or
Unaffiliated Closed-End Investment Company that is an affiliated
person, or an affiliated person of an affiliated person, as defined
in section 2(a)(3) of the 1940 Act, of a Fund of Funds to sell
shares to or redeem shares from the Fund of Funds. This includes, in
the case of sales and redemptions of shares of ETFs, the in-kind
transactions that accompany such sales and redemptions. The
Applicants are not seeking relief from section 17(a) for, and the
requested relief will not apply to, transactions where an ETF,
business development company, or closed-end fund could be deemed an
affiliated person, or an affiliated person of an affiliated person,
of a Fund of Funds because an investment adviser to the ETF,
business development company, or closed-end fund or an entity
controlling, controlled by or under common control with the
investment adviser to the ETF, business development company, or
closed-end fund, is also an investment adviser to the Fund of Funds.
---------------------------------------------------------------------------
2. Applicants agree that any order granting the requested relief
will be subject to the terms and conditions stated in the application.
Such terms and conditions are designed to, among other things, help
prevent any potential
[[Page 48672]]
(i) undue influence over an Underlying Fund that is not in the same
``group of investment companies'' as the Fund of Funds through control
or voting power, or in connection with certain services, transactions,
and underwritings, (ii) excessive layering of fees, and (iii) overly
complex fund structures, which are the concerns underlying the limits
in sections 12(d)(1)(A), (B), and (C) of the Act.
3. Section 12(d)(1)(J) of the Act provides that the Commission may
exempt any person, security, or transaction, or any class or classes of
persons, securities, or transactions, from any provision of section
12(d)(1) if the exemption is consistent with the public interest and
the protection of investors. Section 17(b) of the Act authorizes the
Commission to grant an order permitting a transaction otherwise
prohibited by section 17(a) if it finds that (a) the terms of the
proposed transaction are fair and reasonable and do not involve
overreaching on the part of any person concerned; (b) the proposed
transaction is consistent with the policies of each registered
investment company involved; and (c) the proposed transaction is
consistent with the general purposes of the Act. Section 6(c) of the
Act permits the Commission to exempt any persons or transactions from
any provision of the Act if such exemption is necessary or appropriate
in the public interest and consistent with the protection of investors
and the purposes fairly intended by the policy and provisions of the
Act.
For the Commission, by the Division of Investment Management,
pursuant to delegated authority.
Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2019-19979 Filed 9-13-19; 8:45 am]
BILLING CODE 8011-01-P
