Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Regarding the Description of the “Indicative Partnership Value” Disseminated in Connection With Trading of “Units” of the United States Oil Fund, LP, 84021-84025 [2020-28303]
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Federal Register / Vol. 85, No. 247 / Wednesday, December 23, 2020 / Notices
POSTAL SERVICE
Product Change—Priority Mail
Negotiated Service Agreement
AGENCY:
ACTION:
Postal ServiceTM.
Notice.
SUMMARY: The Postal Service gives
notice of filing a request with the Postal
Regulatory Commission to add a
domestic shipping services contract to
the list of Negotiated Service
Agreements in the Mail Classification
Schedule’s Competitive Products List.
Date of required notice:
December 23, 2020.
DATES:
FOR FURTHER INFORMATION CONTACT:
Sean Robinson, 202–268–8405.
The
United States Postal Service® hereby
gives notice that, pursuant to 39 U.S.C.
3642 and 3632(b)(3), on December 11,
2020, it filed with the Postal Regulatory
Commission a USPS Request to Add
Priority Mail Contract 683 to
Competitive Product List. Documents
are available at www.prc.gov, Docket
Nos. MC2021–44, CP2021–45.
SUPPLEMENTARY INFORMATION:
Sean Robinson,
Attorney, Corporate and Postal Business Law.
[FR Doc. 2020–28446 Filed 12–22–20; 8:45 am]
BILLING CODE 7710–12–P
SECURITIES AND EXCHANGE
COMMISSION
[SEC File No. 270–625, OMB Control No.
3235–0686]
Proposed Collection; Comment
Request
Upon Written Request, Copies Available
From: Securities and Exchange
Commission, Office of FOIA Services,
100 F Street NE,, Washington, DC
20549–2736
jbell on DSKJLSW7X2PROD with NOTICES
Extension:
Implementing the Whistleblower
Provisions of Section 21F of the
Securities Exchange Act of 1934—Form
TCR and Form WB–APP
Notice is hereby given that, pursuant
to the Paperwork Reduction Act of 1995
(44 U.S.C. 3501 et seq.) (‘‘PRA’’), the
Securities and Exchange Commission
(‘‘Commission’’) is soliciting comments
on the collection of information
summarized below. The Commission
plans to submit an extension for this
current collection of information to the
Office of Management and Budget for
approval.
VerDate Sep<11>2014
21:21 Dec 22, 2020
Jkt 253001
In Release No. 34–64545,1 the
Commission adopted rules (‘‘Rules’’)
and forms to implement Section 21F of
the Securities Exchange Act of 1934
entitled ‘‘Securities Whistleblower
Incentives and Protection,’’ which was
created by Section 922 of the DoddFrank Wall Street Reform and Consumer
Protection Act (‘‘Dodd-Frank Act’’).2
The Rules describe the whistleblower
program that the Commission has
established pursuant to the Dodd-Frank
Act which requires the Commission to
pay an award, subject to certain
limitations and conditions, to
whistleblowers who voluntarily provide
the Commission with original
information about a violation of the
federal securities laws that leads to the
successful enforcement of a covered
judicial or administrative action, or of a
related action. The Rules define certain
terms critical to the operation of the
whistleblower program, outline the
procedures for applying for awards and
the Commission’s procedures for
making decisions on claims, and
generally explain the scope of the
whistleblower program to the public
and to potential whistleblowers.
Form TCR is a form submitted by
whistleblowers who wish to provide
information to the Commission and its
staff regarding potential violations of the
securities laws. Form TCR is required
for submission of information under the
Rules. The Commission estimates that it
takes a whistleblower, on average, one
and one-half hours to complete Form
TCR. Based on the receipt of
approximately 560 annual responses on
average for the past three fiscal years,
the Commission estimates that the
annual PRA burden of Form TCR is 840
hours.
Form WB–APP is a form that is
submitted by whistleblowers filing a
claim for a whistleblower award. Form
WB–APP is required for application for
an award under the Rules. On December
4, 2020, the Commission approved an
updated version of the WB–APP in
accordance with its newly amended
rules.3 The updated WB–APP removes
the requirement for the filer to submit
their Social Security Number and
modified the order of the questions on
the form. No substantive changes were
made to the WB–APP. The Commission
estimates that it takes a whistleblower,
on average, two hours to complete Form
1 Implementation
of the Whistleblower Provisions
of Section 21F of the Securities Exchange Act of
1934, Release No. 34–64545; File No. S7–33–10
(adopted May 25, 2011).
2 Public Law 111–203, 922(a), 124 Stat 1841
(2010).
3 Whistleblower Program Rules, 85 FR 70898
(Nov. 5, 2020).
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WB–APP. The completion time depends
largely on the complexity of the alleged
violation and the amount of information
the whistleblower possesses in support
of his or her application for an award.
Based on the receipt of approximately
215 annual responses on average for the
past three fiscal years, the Commission
estimates that the annual PRA burden of
Form WB–APP is 430 hours. The total
estimated annual reporting burden for
Form TCR and Form WB–APP is 1,270
hours.
Written comments are invited on: (a)
Whether this collection of information
is necessary for the proper performance
of the functions of the agency, including
whether the information will have
practical utility; (b) the accuracy of the
agency’s estimate of the burden imposed
by the collection of information; (c)
ways to enhance the quality, utility, and
clarity of the information collected; and
(d) ways to minimize the burden of the
collection of information on
respondents, including through the use
of automated collection techniques or
other forms of information technology.
Consideration will be given to
comments and suggestions submitted in
writing within 60 days of this
publication. Please direct your written
comments to David Bottom, Director/
Chief Information Officer, Securities
and Exchange Commission, c/o Cynthia
Roscoe, 100 F St. NE, Washington DC
20549; or send an email to: PRA_
Mailbox@sec.gov.
Dated: December 18, 2020.
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020–28425 Filed 12–22–20; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–90695; File No. SR–
NYSEArca–2020–110]
Self-Regulatory Organizations; NYSE
Arca, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change Regarding the
Description of the ‘‘Indicative
Partnership Value’’ Disseminated in
Connection With Trading of ‘‘Units’’ of
the United States Oil Fund, LP
December 17, 2020.
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 December
1 15
U.S.C. 78s(b)(1).
U.S.C. 78a.
3 17 CFR 240.19b–4.
2 15
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Federal Register / Vol. 85, No. 247 / Wednesday, December 23, 2020 / Notices
9, 2020, NYSE Arca, Inc. (‘‘NYSE Arca’’
or the ‘‘Exchange’’) 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.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes certain
changes regarding the description of the
‘‘Indicative Partnership Value’’
disseminated in connection with trading
of ‘‘Units’’ of the United States Oil
Fund, LP, which are currently listed and
traded on the Exchange under NYSE
Arca Rule 8.300–E (Partnership Units).
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
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1. Purpose
The Exchange currently lists and
trades Units of the United States Oil
Fund, LP (the ‘‘Fund’’ or ‘‘USO’’) under
NYSE Arca Rule 8.300–E (Partnership
Units). The Exchange proposes certain
changes regarding the description of the
‘‘Indicative Partnership Value’’
disseminated in connection with trading
of Units of the Fund on the Exchange.
Background
Units of the Fund initially were
approved for listing on the American
Stock Exchange LLC (‘‘Amex’’) in 2006,4
4 See Securities Exchange Act Release Nos. 53324
(February 16, 2006), 71 FR 9614 (February 24, 2006)
(SR–Amex–2005–127) (Notice of Filing of a
Proposed Rule Change, and Amendment Nos. 1 and
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21:21 Dec 22, 2020
Jkt 253001
and were subsequently approved for
trading on the Exchange pursuant to
unlisted trading privileges.5 Units of the
Fund were approved for listing and
trading on the Exchange in 2008.6
On April 20, 2020, the Fund filed its
latest registration statement
(‘‘Registration Statement’’) under the
Securities Act of 1933 that was declared
effective by the Commission on June 12,
2020.7 The prospectus (‘‘Prospectus’’)
under the Registration Statement
describes the investment objective of
USO, which has not changed from the
description of the investment objective
of USO as described in the Amex Prior
Releases. Specifically, the Prospectus
describes the investment objective of
USO to be for the daily changes in
percentage terms of its shares’ per share
net asset value (‘‘NAV’’) to reflect the
daily changes in percentage terms of the
spot price of light, sweet crude oil
delivered to Cushing, Oklahoma, as
measured by the daily changes in the
price of the ‘‘Benchmark Oil Futures
Contract,’’ plus interest earned on
USO’s collateral holdings, less USO’s
expenses. The Benchmark Oil Futures
Contract is the futures contract on light,
sweet crude oil as traded on the New
York Mercantile Exchange (the
‘‘NYMEX’’) that is the near month
contract to expire. The Prospectus
supplements the statements in the Prior
Amex Releases in a manner consistent
with the previously-approved
investment objective of the Fund in
stating further that the Benchmark Oil
Futures Contract will not be the near
month contract to expire when the near
month contract is within two weeks of
2 Thereto, Relating to the Listing and Trading of
Units of the United States Oil Fund, LP) (‘‘Prior
Amex Notice’’); 53582 (March 31, 2006), 71 FR
17510 (April 6, 2006) (SR–Amex–2005–127) (order
approving listing and trading of shares of United
States Oil Fund, LP) (‘‘Prior Amex Order’’ and,
together with the Prior Amex Notice, the ‘‘Prior
Amex Releases’’). The Prior Amex Releases set forth
the current listing representations for the Fund.
5 See Securities Exchange Act Release No. 53875
(May 25, 2006), 71 FR 32164 (June 2, 2006) (SR–
NYSEArca–2006–11) (Notice of Filing and Order
Granting Accelerated Approval of Proposed Rule
Change Relating to the Trading of the United States
Oil Fund, LP Pursuant to Unlisted Trading
Privileges).
6 See Securities Exchange Act Release No. 58965
(November 17, 2008), 73 FR 71078 (November 24,
2008) (SR–NYSEArca–2008–127) (Notice of Filing
and Order Granting Accelerated Approval of
Proposed Rule Change Relating to the Listing and
Trading of Units of the United States Oil Fund,
United States Heating Oil Fund, United States
Gasoline Fund, United States 12 Month Oil Fund,
United States 12 Month Natural Gas Fund, and the
United States Natural Gas Fund).
7 See the Registration Statement on Form S–3
under the Securities Act of 1933, dated April 20,
2020 (File No. 333–237750) declared effective, as
amended, on June 12, 2020. The Fund filed a
supplement (‘‘Supplement’’) to the Registration
Statement on December 7, 2020.
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expiration, in which case it will be
measured by the futures contract that is
the next month contract to expire.
As stated in the Prior Amex Releases,
USO seeks to achieve its investment
objective by investing so that the
average daily percentage change in
USO’s NAV for any period of 30
successive valuation days will be within
plus/minus ten percent (10%) of the
average daily percentage change in the
price of the Benchmark Oil Futures
Contract over the same period.
The Prospectus, which is consistent
with the Prior Amex Releases, states
that USO seeks to achieve this
investment objective by investing
primarily in futures contracts for light,
sweet crude oil, other types of crude oil,
diesel heating oil, gasoline, natural gas,
and other petroleum-based fuels that are
traded on the NYMEX, ICE Futures
Europe, and ICE Futures U.S. (ICE
Futures Europe and ICE Futures U.S.,
referred to together as ‘‘ICE Futures’’), or
other U.S. and foreign exchanges
(collectively, ‘‘Oil Futures Contracts’’)
and to a lesser extent, in order to
comply with regulatory requirements or
in view of market conditions, other oilrelated investments such as cash-settled
options on Oil Futures Contracts,
forward contracts for oil, cleared swap
contracts and non-exchange traded
(‘‘over-the-counter’’ or ‘‘OTC’’)
transactions that are based on the price
of oil, other petroleum-based fuels, Oil
Futures Contracts and indices based on
the foregoing (collectively, ‘‘Other OilRelated Investments’’).8 The Prospectus
supplements the statements in the Prior
Amex Releases in a manner consistent
with the previously-approved
investment objective of the Fund in
stating further that market conditions
that the Fund currently anticipates
could cause USO to invest in Other OilRelated Investments include those
allowing USO to obtain greater liquidity
or to execute transactions with more
favorable pricing. (Oil Futures Contracts
and Other Oil-Related Investments
collectively are referred to as ‘‘Oil
Interests’’.)
As stated in the Prior Amex Releases,
the Fund also holds cash and invests in
short-term obligations of the United
States Government (‘‘Treasuries’’) and
other cash equivalents to be used to
satisfy its current or future margin and
collateral requirements and to otherwise
satisfy its obligations with respect to its
investments in Oil Interests.
ICE Data Indices, LLC currently
disseminates through the facilities of the
8 Other Oil-Related Investments as referenced in
the Registration Statement are referred to as ‘‘Other
Oil Interests’’ in the Prior Amex Releases.
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Federal Register / Vol. 85, No. 247 / Wednesday, December 23, 2020 / Notices
jbell on DSKJLSW7X2PROD with NOTICES
Consolidated Tape Association (‘‘CTA’’)
an updated ‘‘Indicative Partnership
Value’’ during the NYSE Arca Core
Trading Session (normally 9:30 a.m. to
4:00 p.m., Eastern Time). The current
Exchange listing representations for
Units of the Fund, as stated in the Prior
Amex Notice, require that the Indicative
Partnership Value (also referred to
below as the ‘‘indicative fund value’’ or
‘‘IFV’’) be calculated based on the
Treasuries and cash required for
creations and redemptions adjusted to
reflect the price changes of the current
Benchmark Oil Futures Contract (‘‘Prior
IFV’’).9
Proposed Rule Change
The Prospectus and the Supplement
describe a change to the method of
calculating the IFV (the ‘‘Proposed
IFV’’) for the Fund, which differs from
the method of calculating the IFV as set
forth in the Prior Amex Notice.10
Accordingly, the Exchange proposes to
amend the current listing
representations for the Fund relating to
the change to the method of calculating
the IFV for the Fund.
As stated in the Prospectus, in order
to provide updated information relating
to USO for use by investors and market
professionals, ICE Data Indices, LLC
calculates and disseminates throughout
the Core Trading Session on each
trading day the Proposed IFV. The
Proposed IFV, which is currently being
utilized in connection with trading of
Units, is calculated by using the prior
day’s closing per share NAV of USO as
a base and updating that value
throughout the trading day to reflect
changes in the most recently reported
trade prices for the Oil Futures
Contracts and Other Oil-Related
Investments held by USO. This
representation differs from that in the
Prior Amex Notice regarding the Prior
IFV, which stated that the IFV reflects
only price changes of the current
Benchmark Oil Futures Contract. The
Proposed IFV disseminated during
NYSE Arca Core Trading Session should
not be viewed as an actual real-time
update of the per share NAV, because
the per share NAV is calculated only
once at the end of each trading day
based upon the relevant end of day
values of USO’s investments.
The Proposed IFV is disseminated on
a per share basis at least every 15
seconds during the regular NYSE Arca
Core Trading Session. As stated in the
9 Units of the Fund are issued and redeemed in
‘‘baskets’’ of 100,000 Units or multiples thereof.
10 For purposes of this filing, the IFV referenced
in the Prospectus and the Supplement is the
‘‘Indicative Partnership Value’’ referenced in NYSE
Arca Rule 8.300–E(d)(2)(iii).
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21:21 Dec 22, 2020
Jkt 253001
Supplement, the normal trading hours
for Oil Futures Contracts traded on the
NYMEX are 6:00 p.m. Eastern Time to
5:00 p.m. Eastern Time the next day and
its closing settlement price is set as of
2:30 p.m. Eastern Time. ICE Futures
normal trading hours for its Oil Futures
Contracts are 8:00 p.m. until 6:00 p.m.
Eastern Time the next day. It also sets
its settlement price as of 2:30 p.m.
Eastern Time each trading day. The
Proposed IFV during the Core Trading
Session includes the real-time prices of
the Fund’s holdings of Oil Futures
Contracts traded on the NYMEX and ICE
Futures up until approximately 2:30
p.m. Eastern Time, and, thereafter, to
the close of the NYSE Arca Core Trading
Session, is based on the 2:30 p.m.
settlement prices of Oil Futures
Contracts traded on the NYMEX and ICE
Futures, which are the same prices used
for valuing such contracts in
determining USO’s official end of day
NAV. Therefore, a static Proposed IFV is
disseminated between the time the
settlement price is published (at
approximately 2:30 p.m. Eastern Time)
for NYMEX and ICE Futures and the
close of the NYSE Arca Core Trading
Session.11
In addition, the Proposed IFV
calculation includes the other Oil
Futures Contracts (i.e., other than Oil
Futures Contracts traded on NYMEX or
ICE Futures) and Other Oil-Related
Investments held by USO by using the
prices of the Oil Futures Contracts
traded on NYMEX or ICE Futures
referenced in, or used as the basis for,
the prices of these other Oil Futures
Contracts and Other Oil-Related
Investments. Such other Oil Futures
Contracts and Other Oil-Related
Investments, like Oil Futures Contracts
traded on the NYMEX and ICE Futures
referenced above, also are valued using
the real-time prices of Oil Futures
11 The Commission has previously approved
listing and trading of exchange-traded products for
which a static indicative value is disseminated after
the close of the applicable futures exchange and
before the close of the Exchange’s Core Trading
Session. See, e.g., Securities Exchange Act Release
Nos. 65601 (October 20, 2022), 76 FR 66339
(October 26, 2011) (order approving listing and
trading of shares of the United States Metals Index
Fund, the United States Agriculture Index Fund
and the United States Copper Index Fund Under
NYSE Arca Equities Rule 8.200 (SR–NYSEArca–
2011–63); United States Commodity Index Fund
(SR–NYSE Arca–2010–44); 80296 (March 22, 2017),
82 FR 15400 (March 28, 2017) (SR–NYSEArca–
2017–07) (order approving listing and trading of
shares of ProShares UltraPro 3x Crude Oil ETF and
ProShares UltraPro 3x Short Crude Oil ETF; 65344
(September 15, 2011), 76 FR 58549 (September 21,
2011) (SR–NYSEArca–2011–48) (order approving
listing and trading of shares of the Teucrium Wheat
Fund, the Teucrium Soybean Fund and the
Teucrium Sugar Fund under Rule 8.200,
Commentary .02).
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84023
Contracts traded on the NYMEX and ICE
Futures up until approximately 2:30
p.m. Eastern Time, and, thereafter, to
the close of the NYSE Arca Core Trading
Session, based on the 2:30 p.m.
settlement prices of Oil Futures
Contracts traded on the NYMEX and ICE
Futures. Therefore, the prices in the
Proposed IFV relating to such other Oil
Futures Contracts and Other Oil-Related
Investments are static between the time
the settlement price is published for
NYMEX and ICE Futures and the close
of the NYSE Arca Core Trading Session.
While the end of day value of
Treasuries, cash and cash equivalents
are included in USO’s prior end of day
NAV, to which changes in the value of
Oil Futures Contracts and Other OilRelated Investments are applied in
calculating the Proposed IFV, intraday
changes in the value of Treasuries, cash
and cash equivalents are not applied in
calculating the Proposed IFV.
ICE Data Indices, LLC disseminates
the Proposed IFV through the facilities
of CTA. In addition, the Proposed IFV
is available through on-line information
services such as Bloomberg and
Refinitiv.
As stated in the Prospectus, and
consistent with the current listing
representations applicable to the Units
as described in the Prior Amex Releases,
the Fund has invested increasingly in
Oil Futures Contracts other than
Benchmark Oil Futures Contracts.12
Accordingly, because of the Fund’s
ability to invest in other Oil Futures
Contracts in addition to the Benchmark
Oil Futures Contracts as well as Other
Oil-Related Investments, the Proposed
IFV better reflects the intraday value of
Units because it incorporates price
changes of Oil Futures Contracts held by
the Fund other than Benchmark Oil
Futures Contracts as well as Other OilRelated Investments referenced in the
Prior Amex Releases and in the
Prospectus.
The Exchange believes that the
Proposed IFV may be useful to market
participants in providing information
regarding the intraday value of Units. As
such, it is necessary and appropriate
that the Proposed IFV reflect prices of
12 Descriptions of the Fund’s investment changes
have been filed with the Commission on Form 8–
K. See, e.g., the Fund’s Current Report Pursuant to
Section 13 or 15(d) of the Securities Exchange Act
of 1934, dated April 30, 2020. In this regard, the
Prospectus states that, ‘‘as a result of market and
regulatory conditions, including significant market
volatility, large numbers of USO shares purchased
during a short period of time, and applicable
regulatory accountability levels and position limits
on oil futures contracts that were imposed on USO
in 2020, including as a result of the COVID–19
pandemic and the state of crude oil markets, USO
has invested in Oil Futures Contracts in months
other than the Benchmark Oil Futures Contract.’’
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Federal Register / Vol. 85, No. 247 / Wednesday, December 23, 2020 / Notices
Oil Futures Contracts and Other OilRelated Investments, as described in the
Prospectus and the Supplement, rather
than price changes of the current
Benchmark Oil Futures Contract, except
to the extent the Fund holds Benchmark
Oil Futures Contracts.
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.
2. Statutory Basis
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 14 and Rule 19b–
4(f)(6) thereunder.15
A proposed rule change filed
pursuant to Rule 19b–4(f)(6) under the
Act 16 normally does not become
operative for 30 days after the date of its
filing. However, Rule 19b–4(f)(6)(iii) 17
permits the Commission to designate a
shorter time if such action is consistent
with the protection of investors and the
public interest. The Exchange has asked
the Commission to waive the 30-day
operative delay. The Exchange states
that waiver of the 30-day operative
delay would permit the Fund’s IFV to
better reflect prices of the Fund’s actual
holdings, including Oil Futures
Contracts and Other Oil-Related
Investments, as described in the
Prospectus and Supplement, rather than
price changes of the current Benchmark
Oil Futures Contracts, except to the
extent the Fund holds Benchmark Oil
Futures Contracts. The proposed rule
change does not raise any novel
regulatory issues, and the Commission
believes that waiver of the 30-day
operative delay is consistent with the
protection of investors and the public
interest. Therefore, the Commission
hereby waives the operative delay and
designates the proposal as operative
upon filing.18
The basis under the Act for this
proposed rule change is the requirement
under Section 6(b)(5) 13 that an
exchange have rules that are designed to
prevent fraudulent and manipulative
acts and practices, to promote just and
equitable principles of trade, to remove
impediments to, and perfect the
mechanism of a free and open market
and, in general, to protect investors and
the public interest.
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. The
Exchange believes that the Proposed IFV
is useful to market participants in
providing information regarding the
intraday value of Units. As such, it is
necessary and appropriate that the
Proposed IFV reflect prices of Oil
Futures Contracts and Other Oil-Related
Investments, as described in the Prior
Amex Notice, rather than price changes
to the current Benchmark Oil Futures
Contract. The Exchange believes this
change facilitates fair and orderly
trading of Units because the Proposed
IFV better reflects the intraday value of
Units by incorporating price changes of
all Oil Futures Contracts held by the
Fund, including Benchmark Oil Futures
Contracts, as well as Other Oil-Related
Investments referenced in the Prior
Amex Releases and in the Prospectus.
As noted above, ICE Data Indices, LLC
disseminates the Proposed IFV through
facilities of CTA. In addition, the
Proposed IFV is available through online information services such as
Bloomberg and Refinitiv.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
14 15
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6). In addition, Rule 19b–
4(f)(6)(iii) requires a self-regulatory organization to
give the Commission written notice of its intent to
file the proposed rule change, along with a brief
description and 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. The Exchange
has satisfied this requirement.
16 17 CFR 240.19b–4(f)(6).
17 17 CFR 240.19b–4(f)(6)(iii).
18 For purposes only of waiving the 30-day
operative delay, the Commission also has
considered the proposed rule’s impact on
efficiency, competition, and capital formation. See
15 U.S.C. 78c(f).
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15 17
The Exchange does not believe that
the proposed rule change will impose
any burden on competition that is not
necessary or appropriate in furtherance
of the purpose of the Act. The Exchange
believes that the proposed rule change
facilitates fair and orderly trading of
Units that will enhance competition
among market participants, to the
benefit of investors and the marketplace.
13 15
U.S.C. 78f(b)(5).
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21:21 Dec 22, 2020
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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 necessary or appropriate in the
public interest, for the protection of
investors, or otherwise in furtherance of
the purposes of the Act. If the
Commission takes such action, the
Commission shall institute proceedings
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–2020–110 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–2020–110. 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.
E:\FR\FM\23DEN1.SGM
23DEN1
Federal Register / Vol. 85, No. 247 / Wednesday, December 23, 2020 / Notices
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–2020–110, and
should be submitted on or before
January 13, 2021.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.19
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020–28303 Filed 12–22–20; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–90717; File No. SR–
NASDAQ–2020–057]
Self-Regulatory Organizations; The
Nasdaq Stock Market LLC; Order
Instituting Proceedings To Determine
Whether To Approve or Disapprove a
Proposed Rule Change To Allow
Companies To List in Connection With
a Direct Listing With a Primary Offering
In Which the Company Will Sell Shares
Itself In the Opening Auction on the
First Day of Trading on Nasdaq and To
Explain How the Opening Transaction
for Such a Listing Will Be Effected
December 17, 2020.
I. Introduction
On September 4, 2020, The Nasdaq
Stock Market LLC (‘‘Nasdaq’’ or the
‘‘Exchange’’) filed with the Securities
and Exchange Commission
(‘‘Commission’’), pursuant to Section
19(b)(1) of the Securities Exchange Act
of 1934 (‘‘Exchange Act’’) 1 and Rule
19b–4 thereunder,2 a proposed rule
change to allow companies to list in
connection with a primary offering in
which the company will sell shares
itself in the opening auction on the first
day of trading on the Exchange and to
explain how the opening transaction for
such a listing will be effected. The
proposed rule change was published for
comment in the Federal Register on
September 21, 2020.3 On November 4,
2020, pursuant to Section 19(b(2) of the
jbell on DSKJLSW7X2PROD with NOTICES
19 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 See Securities Exchange Act Release No. 89878
(September 15, 2020), 85 FR 59349 (September 21,
2020) (‘‘Notice’’). Comments received on the
proposal are available on the Commission’s website
at: https://www.sec.gov/comments/sr-nasdaq-2020057/srnasdaq2020057.htm.
1 15
VerDate Sep<11>2014
21:21 Dec 22, 2020
Jkt 253001
Exchange Act,4 the Commission
designated a longer period within which
to either approve the proposed rule
change, disapprove the proposed rule
change, or institute proceedings to
determine whether to disapprove the
proposed rule change.5 This order
institutes proceedings under Section
19(b)(2)(B) of the Exchange Act 6 to
determine whether to approve or
disapprove the proposed rule change.
II. Description of the Proposal
Listing Rule IM–5315–1 provides
additional listing requirements for
listing a company that has not
previously had its common equity
securities registered under the Exchange
Act on the Nasdaq Global Select Market
at the time of effectiveness of a
registration statement 7 filed solely for
the purpose of allowing existing
shareholders to sell their shares (a
‘‘Selling Shareholder Direct Listing’’).
To allow a company to also sell shares
on its own behalf in connection with its
initial listing upon effectiveness of a
registration statement, without a
traditional underwritten public offering,
the Exchange has proposed to adopt
Listing Rule IM–5315–2. This proposed
rule would allow a company that has
not previously had its common equity
securities registered under the Exchange
Act, to list its common equity securities
on the Nasdaq Global Select Market at
the time of effectiveness of a registration
statement pursuant to which the
company itself will sell shares in the
opening auction on the first day of
trading on the Exchange (a ‘‘Direct
Listing with a Capital Raise’’).8
In considering a Selling Shareholder
Direct Listing, Listing Rule IM–5315–1
currently provides that the Exchange
will determine that such company has
met the applicable Market Value of
4 15
U.S.C. 78s(b)(2).
Securities Exchange Act Release No. 90331
(November 4, 2020), 85 FR 71708 (November 10,
2020). The Commission designated December 20,
2020, as the date by which it should approve,
disapprove, or institute proceedings to determine
whether to disapprove the proposed rule change.
6 15 U.S.C. 78s(b)(2)(B).
7 The reference to a registration statement refers
to a registration statement effective under the
Securities Act of 1933 (‘‘Securities Act’’).
8 See proposed IM–5315–2. A Direct Listing with
a Capital Raise would include listings where either:
(i) Only the company itself is selling shares in the
opening auction on the first day of trading; or (ii)
the company is selling shares and selling
shareholders may also sell shares in such opening
auction. See id. The Commission notes that while
the Exchange’s current rules also permit Selling
Shareholder Direct Listings on the Nasdaq Global
Market and Nasdaq Capital Market (see IM–5405–
1 and IM–5505–1), the current proposal would only
provide for a Direct Listing with a Capital Raise on
the Nasdaq Global Select Market.
5 See
PO 00000
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Fmt 4703
Sfmt 4703
84025
Unrestricted Publicly Held Shares 9
requirements based on the lesser of: (i)
An independent third party valuation of
the company (a ‘‘Valuation’’); 10 and (ii)
the most recent trading price for the
company’s common stock in a Private
Placement Market 11 where there has
been sustained recent trading. For a
security that has not had sustained
trading in a Private Placement Market
prior to listing, the Exchange will
determine that such company has met
the Market Value of Unrestricted
Publicly Held Shares requirement if the
company satisfies the applicable Market
Value of Unrestricted Publicly Held
Shares requirement and provides a
Valuation evidencing a Market Value of
Publicly Held Shares of at least
$250,000,000.
With respect to a Direct Listing with
a Capital Raise, the Exchange has
proposed that, in determining whether a
company satisfies the Market Value of
Unrestricted Publicly Held Shares
requirement for initial listing on the
Nasdaq Global Select Market, the
Exchange will deem such company to
have met the applicable requirement if
the amount of the company’s
Unrestricted Publicly Held Shares
before the offering, along with the
market value of the shares to be sold in
the Exchange’s opening auction in the
Direct Listing with a Capital Raise, is at
least $110 million (or $100 million, if
the company has stockholders’ equity of
at least $110 million).12 The Exchange
has proposed to calculate the Market
Value of Unrestricted Publicly Held
Shares, for this purpose, using a price
per share equal to the price that is 20%
below the lowest price of the price range
disclosed by the issuer in its registration
9 ‘‘Restricted Securities’’ means securities that are
subject to resale restrictions for any reason,
including, but not limited to, securities: (1)
Acquired directly or indirectly from the issuer or
an affiliate of the issuer in unregistered offerings
such as private placements or Regulation D
offerings; (2) acquired through an employee stock
benefit plan or as compensation for professional
services; (3) acquired in reliance on Regulation S,
which cannot be resold within the United States; (4)
subject to a lockup agreement or a similar
contractual restriction; or (5) considered ‘‘restricted
securities’’ under Rule 144. See Rule 5005(a)(37).
‘‘Unrestricted Securities’’ means securities that are
not Restricted Securities. See Rule 5005(a)(46).
‘‘Unrestricted Publicly Held Shares’’ means the
Publicly Held Shares that are Unrestricted
Securities. See Rule 5005(a)(45). See also Rule
5005(a)(23) and (35) for definitions of ‘‘Market
Value’’ and ‘‘Publicly Held Shares.’’
10 IM–5315–1 describes the requirement for a
Valuation, including the experience and
independence of the entity providing the Valuation.
11 The Exchange defines ‘‘Private Placement
Market’’ in Listing Rule 5005(a)(34) as a trading
system for unregistered securities operated by a
national securities exchange or a registered brokerdealer.
12 See proposed IM–5315–2.
E:\FR\FM\23DEN1.SGM
23DEN1
]]>Agencies
[Federal Register Volume 85, Number 247 (Wednesday, December 23, 2020)]
[Notices]
[Pages 84021-84025]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-28303]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-90695; File No. SR-NYSEArca-2020-110]
Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing
and Immediate Effectiveness of Proposed Rule Change Regarding the
Description of the ``Indicative Partnership Value'' Disseminated in
Connection With Trading of ``Units'' of the United States Oil Fund, LP
December 17, 2020.
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 December
[[Page 84022]]
9, 2020, NYSE Arca, Inc. (``NYSE Arca'' or the ``Exchange'') 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.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 15 U.S.C. 78a.
\3\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes certain changes regarding the description of
the ``Indicative Partnership Value'' disseminated in connection with
trading of ``Units'' of the United States Oil Fund, LP, which are
currently listed and traded on the Exchange under NYSE Arca Rule 8.300-
E (Partnership Units). 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 currently lists and trades Units of the United States
Oil Fund, LP (the ``Fund'' or ``USO'') under NYSE Arca Rule 8.300-E
(Partnership Units). The Exchange proposes certain changes regarding
the description of the ``Indicative Partnership Value'' disseminated in
connection with trading of Units of the Fund on the Exchange.
Background
Units of the Fund initially were approved for listing on the
American Stock Exchange LLC (``Amex'') in 2006,\4\ and were
subsequently approved for trading on the Exchange pursuant to unlisted
trading privileges.\5\ Units of the Fund were approved for listing and
trading on the Exchange in 2008.\6\
---------------------------------------------------------------------------
\4\ See Securities Exchange Act Release Nos. 53324 (February 16,
2006), 71 FR 9614 (February 24, 2006) (SR-Amex-2005-127) (Notice of
Filing of a Proposed Rule Change, and Amendment Nos. 1 and 2
Thereto, Relating to the Listing and Trading of Units of the United
States Oil Fund, LP) (``Prior Amex Notice''); 53582 (March 31,
2006), 71 FR 17510 (April 6, 2006) (SR-Amex-2005-127) (order
approving listing and trading of shares of United States Oil Fund,
LP) (``Prior Amex Order'' and, together with the Prior Amex Notice,
the ``Prior Amex Releases''). The Prior Amex Releases set forth the
current listing representations for the Fund.
\5\ See Securities Exchange Act Release No. 53875 (May 25,
2006), 71 FR 32164 (June 2, 2006) (SR-NYSEArca-2006-11) (Notice of
Filing and Order Granting Accelerated Approval of Proposed Rule
Change Relating to the Trading of the United States Oil Fund, LP
Pursuant to Unlisted Trading Privileges).
\6\ See Securities Exchange Act Release No. 58965 (November 17,
2008), 73 FR 71078 (November 24, 2008) (SR-NYSEArca-2008-127)
(Notice of Filing and Order Granting Accelerated Approval of
Proposed Rule Change Relating to the Listing and Trading of Units of
the United States Oil Fund, United States Heating Oil Fund, United
States Gasoline Fund, United States 12 Month Oil Fund, United States
12 Month Natural Gas Fund, and the United States Natural Gas Fund).
---------------------------------------------------------------------------
On April 20, 2020, the Fund filed its latest registration statement
(``Registration Statement'') under the Securities Act of 1933 that was
declared effective by the Commission on June 12, 2020.\7\ The
prospectus (``Prospectus'') under the Registration Statement describes
the investment objective of USO, which has not changed from the
description of the investment objective of USO as described in the Amex
Prior Releases. Specifically, the Prospectus describes the investment
objective of USO to be for the daily changes in percentage terms of its
shares' per share net asset value (``NAV'') to reflect the daily
changes in percentage terms of the spot price of light, sweet crude oil
delivered to Cushing, Oklahoma, as measured by the daily changes in the
price of the ``Benchmark Oil Futures Contract,'' plus interest earned
on USO's collateral holdings, less USO's expenses. The Benchmark Oil
Futures Contract is the futures contract on light, sweet crude oil as
traded on the New York Mercantile Exchange (the ``NYMEX'') that is the
near month contract to expire. The Prospectus supplements the
statements in the Prior Amex Releases in a manner consistent with the
previously-approved investment objective of the Fund in stating further
that the Benchmark Oil Futures Contract will not be the near month
contract to expire when the near month contract is within two weeks of
expiration, in which case it will be measured by the futures contract
that is the next month contract to expire.
---------------------------------------------------------------------------
\7\ See the Registration Statement on Form S-3 under the
Securities Act of 1933, dated April 20, 2020 (File No. 333-237750)
declared effective, as amended, on June 12, 2020. The Fund filed a
supplement (``Supplement'') to the Registration Statement on
December 7, 2020.
---------------------------------------------------------------------------
As stated in the Prior Amex Releases, USO seeks to achieve its
investment objective by investing so that the average daily percentage
change in USO's NAV for any period of 30 successive valuation days will
be within plus/minus ten percent (10%) of the average daily percentage
change in the price of the Benchmark Oil Futures Contract over the same
period.
The Prospectus, which is consistent with the Prior Amex Releases,
states that USO seeks to achieve this investment objective by investing
primarily in futures contracts for light, sweet crude oil, other types
of crude oil, diesel heating oil, gasoline, natural gas, and other
petroleum-based fuels that are traded on the NYMEX, ICE Futures Europe,
and ICE Futures U.S. (ICE Futures Europe and ICE Futures U.S., referred
to together as ``ICE Futures''), or other U.S. and foreign exchanges
(collectively, ``Oil Futures Contracts'') and to a lesser extent, in
order to comply with regulatory requirements or in view of market
conditions, other oil-related investments such as cash-settled options
on Oil Futures Contracts, forward contracts for oil, cleared swap
contracts and non-exchange traded (``over-the-counter'' or ``OTC'')
transactions that are based on the price of oil, other petroleum-based
fuels, Oil Futures Contracts and indices based on the foregoing
(collectively, ``Other Oil-Related Investments'').\8\ The Prospectus
supplements the statements in the Prior Amex Releases in a manner
consistent with the previously-approved investment objective of the
Fund in stating further that market conditions that the Fund currently
anticipates could cause USO to invest in Other Oil-Related Investments
include those allowing USO to obtain greater liquidity or to execute
transactions with more favorable pricing. (Oil Futures Contracts and
Other Oil-Related Investments collectively are referred to as ``Oil
Interests''.)
---------------------------------------------------------------------------
\8\ Other Oil-Related Investments as referenced in the
Registration Statement are referred to as ``Other Oil Interests'' in
the Prior Amex Releases.
---------------------------------------------------------------------------
As stated in the Prior Amex Releases, the Fund also holds cash and
invests in short-term obligations of the United States Government
(``Treasuries'') and other cash equivalents to be used to satisfy its
current or future margin and collateral requirements and to otherwise
satisfy its obligations with respect to its investments in Oil
Interests.
ICE Data Indices, LLC currently disseminates through the facilities
of the
[[Page 84023]]
Consolidated Tape Association (``CTA'') an updated ``Indicative
Partnership Value'' during the NYSE Arca Core Trading Session (normally
9:30 a.m. to 4:00 p.m., Eastern Time). The current Exchange listing
representations for Units of the Fund, as stated in the Prior Amex
Notice, require that the Indicative Partnership Value (also referred to
below as the ``indicative fund value'' or ``IFV'') be calculated based
on the Treasuries and cash required for creations and redemptions
adjusted to reflect the price changes of the current Benchmark Oil
Futures Contract (``Prior IFV'').\9\
---------------------------------------------------------------------------
\9\ Units of the Fund are issued and redeemed in ``baskets'' of
100,000 Units or multiples thereof.
---------------------------------------------------------------------------
Proposed Rule Change
The Prospectus and the Supplement describe a change to the method
of calculating the IFV (the ``Proposed IFV'') for the Fund, which
differs from the method of calculating the IFV as set forth in the
Prior Amex Notice.\10\ Accordingly, the Exchange proposes to amend the
current listing representations for the Fund relating to the change to
the method of calculating the IFV for the Fund.
---------------------------------------------------------------------------
\10\ For purposes of this filing, the IFV referenced in the
Prospectus and the Supplement is the ``Indicative Partnership
Value'' referenced in NYSE Arca Rule 8.300-E(d)(2)(iii).
---------------------------------------------------------------------------
As stated in the Prospectus, in order to provide updated
information relating to USO for use by investors and market
professionals, ICE Data Indices, LLC calculates and disseminates
throughout the Core Trading Session on each trading day the Proposed
IFV. The Proposed IFV, which is currently being utilized in connection
with trading of Units, is calculated by using the prior day's closing
per share NAV of USO as a base and updating that value throughout the
trading day to reflect changes in the most recently reported trade
prices for the Oil Futures Contracts and Other Oil-Related Investments
held by USO. This representation differs from that in the Prior Amex
Notice regarding the Prior IFV, which stated that the IFV reflects only
price changes of the current Benchmark Oil Futures Contract. The
Proposed IFV disseminated during NYSE Arca Core Trading Session should
not be viewed as an actual real-time update of the per share NAV,
because the per share NAV is calculated only once at the end of each
trading day based upon the relevant end of day values of USO's
investments.
The Proposed IFV is disseminated on a per share basis at least
every 15 seconds during the regular NYSE Arca Core Trading Session. As
stated in the Supplement, the normal trading hours for Oil Futures
Contracts traded on the NYMEX are 6:00 p.m. Eastern Time to 5:00 p.m.
Eastern Time the next day and its closing settlement price is set as of
2:30 p.m. Eastern Time. ICE Futures normal trading hours for its Oil
Futures Contracts are 8:00 p.m. until 6:00 p.m. Eastern Time the next
day. It also sets its settlement price as of 2:30 p.m. Eastern Time
each trading day. The Proposed IFV during the Core Trading Session
includes the real-time prices of the Fund's holdings of Oil Futures
Contracts traded on the NYMEX and ICE Futures up until approximately
2:30 p.m. Eastern Time, and, thereafter, to the close of the NYSE Arca
Core Trading Session, is based on the 2:30 p.m. settlement prices of
Oil Futures Contracts traded on the NYMEX and ICE Futures, which are
the same prices used for valuing such contracts in determining USO's
official end of day NAV. Therefore, a static Proposed IFV is
disseminated between the time the settlement price is published (at
approximately 2:30 p.m. Eastern Time) for NYMEX and ICE Futures and the
close of the NYSE Arca Core Trading Session.\11\
---------------------------------------------------------------------------
\11\ The Commission has previously approved listing and trading
of exchange-traded products for which a static indicative value is
disseminated after the close of the applicable futures exchange and
before the close of the Exchange's Core Trading Session. See, e.g.,
Securities Exchange Act Release Nos. 65601 (October 20, 2022), 76 FR
66339 (October 26, 2011) (order approving listing and trading of
shares of the United States Metals Index Fund, the United States
Agriculture Index Fund and the United States Copper Index Fund Under
NYSE Arca Equities Rule 8.200 (SR-NYSEArca-2011-63); United States
Commodity Index Fund (SR-NYSE Arca-2010-44); 80296 (March 22, 2017),
82 FR 15400 (March 28, 2017) (SR-NYSEArca-2017-07) (order approving
listing and trading of shares of ProShares UltraPro 3x Crude Oil ETF
and ProShares UltraPro 3x Short Crude Oil ETF; 65344 (September 15,
2011), 76 FR 58549 (September 21, 2011) (SR-NYSEArca-2011-48) (order
approving listing and trading of shares of the Teucrium Wheat Fund,
the Teucrium Soybean Fund and the Teucrium Sugar Fund under Rule
8.200, Commentary .02).
---------------------------------------------------------------------------
In addition, the Proposed IFV calculation includes the other Oil
Futures Contracts (i.e., other than Oil Futures Contracts traded on
NYMEX or ICE Futures) and Other Oil-Related Investments held by USO by
using the prices of the Oil Futures Contracts traded on NYMEX or ICE
Futures referenced in, or used as the basis for, the prices of these
other Oil Futures Contracts and Other Oil-Related Investments. Such
other Oil Futures Contracts and Other Oil-Related Investments, like Oil
Futures Contracts traded on the NYMEX and ICE Futures referenced above,
also are valued using the real-time prices of Oil Futures Contracts
traded on the NYMEX and ICE Futures up until approximately 2:30 p.m.
Eastern Time, and, thereafter, to the close of the NYSE Arca Core
Trading Session, based on the 2:30 p.m. settlement prices of Oil
Futures Contracts traded on the NYMEX and ICE Futures. Therefore, the
prices in the Proposed IFV relating to such other Oil Futures Contracts
and Other Oil-Related Investments are static between the time the
settlement price is published for NYMEX and ICE Futures and the close
of the NYSE Arca Core Trading Session. While the end of day value of
Treasuries, cash and cash equivalents are included in USO's prior end
of day NAV, to which changes in the value of Oil Futures Contracts and
Other Oil-Related Investments are applied in calculating the Proposed
IFV, intraday changes in the value of Treasuries, cash and cash
equivalents are not applied in calculating the Proposed IFV.
ICE Data Indices, LLC disseminates the Proposed IFV through the
facilities of CTA. In addition, the Proposed IFV is available through
on-line information services such as Bloomberg and Refinitiv.
As stated in the Prospectus, and consistent with the current
listing representations applicable to the Units as described in the
Prior Amex Releases, the Fund has invested increasingly in Oil Futures
Contracts other than Benchmark Oil Futures Contracts.\12\ Accordingly,
because of the Fund's ability to invest in other Oil Futures Contracts
in addition to the Benchmark Oil Futures Contracts as well as Other
Oil-Related Investments, the Proposed IFV better reflects the intraday
value of Units because it incorporates price changes of Oil Futures
Contracts held by the Fund other than Benchmark Oil Futures Contracts
as well as Other Oil-Related Investments referenced in the Prior Amex
Releases and in the Prospectus.
---------------------------------------------------------------------------
\12\ Descriptions of the Fund's investment changes have been
filed with the Commission on Form 8-K. See, e.g., the Fund's Current
Report Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934, dated April 30, 2020. In this regard, the Prospectus
states that, ``as a result of market and regulatory conditions,
including significant market volatility, large numbers of USO shares
purchased during a short period of time, and applicable regulatory
accountability levels and position limits on oil futures contracts
that were imposed on USO in 2020, including as a result of the
COVID-19 pandemic and the state of crude oil markets, USO has
invested in Oil Futures Contracts in months other than the Benchmark
Oil Futures Contract.''
---------------------------------------------------------------------------
The Exchange believes that the Proposed IFV may be useful to market
participants in providing information regarding the intraday value of
Units. As such, it is necessary and appropriate that the Proposed IFV
reflect prices of
[[Page 84024]]
Oil Futures Contracts and Other Oil-Related Investments, as described
in the Prospectus and the Supplement, rather than price changes of the
current Benchmark Oil Futures Contract, except to the extent the Fund
holds Benchmark Oil Futures Contracts.
2. Statutory Basis
The basis under the Act for this proposed rule change is the
requirement under Section 6(b)(5) \13\ that an exchange have rules that
are designed to prevent fraudulent and manipulative acts and practices,
to promote just and equitable principles of trade, to remove
impediments to, and perfect the mechanism of a free and open market
and, in general, to protect investors and the public interest.
---------------------------------------------------------------------------
\13\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
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. The Exchange believes that the Proposed IFV is useful
to market participants in providing information regarding the intraday
value of Units. As such, it is necessary and appropriate that the
Proposed IFV reflect prices of Oil Futures Contracts and Other Oil-
Related Investments, as described in the Prior Amex Notice, rather than
price changes to the current Benchmark Oil Futures Contract. The
Exchange believes this change facilitates fair and orderly trading of
Units because the Proposed IFV better reflects the intraday value of
Units by incorporating price changes of all Oil Futures Contracts held
by the Fund, including Benchmark Oil Futures Contracts, as well as
Other Oil-Related Investments referenced in the Prior Amex Releases and
in the Prospectus.
As noted above, ICE Data Indices, LLC disseminates the Proposed IFV
through facilities of CTA. In addition, the Proposed IFV is available
through on-line information services such as Bloomberg and Refinitiv.
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
impose any burden on competition that is not necessary or appropriate
in furtherance of the purpose of the Act. The Exchange believes that
the proposed rule change facilitates fair and orderly trading of Units
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 \14\ and Rule 19b-
4(f)(6) thereunder.\15\
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\14\ 15 U.S.C. 78s(b)(3)(A).
\15\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii)
requires a self-regulatory organization to give the Commission
written notice of its intent to file the proposed rule change, along
with a brief description and 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.
The Exchange has satisfied this requirement.
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A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the
Act \16\ normally does not become operative for 30 days after the date
of its filing. However, Rule 19b-4(f)(6)(iii) \17\ permits the
Commission to designate a shorter time if such action is consistent
with the protection of investors and the public interest. The Exchange
has asked the Commission to waive the 30-day operative delay. The
Exchange states that waiver of the 30-day operative delay would permit
the Fund's IFV to better reflect prices of the Fund's actual holdings,
including Oil Futures Contracts and Other Oil-Related Investments, as
described in the Prospectus and Supplement, rather than price changes
of the current Benchmark Oil Futures Contracts, except to the extent
the Fund holds Benchmark Oil Futures Contracts. The proposed rule
change does not raise any novel regulatory issues, and the Commission
believes that waiver of the 30-day operative delay is consistent with
the protection of investors and the public interest. Therefore, the
Commission hereby waives the operative delay and designates the
proposal as operative upon filing.\18\
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\16\ 17 CFR 240.19b-4(f)(6).
\17\ 17 CFR 240.19b-4(f)(6)(iii).
\18\ For purposes only of waiving the 30-day operative delay,
the Commission also 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 necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act. If the Commission
takes such action, the Commission shall institute proceedings 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 [email protected]. Please include
File Number SR-NYSEArca-2020-110 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-2020-110. 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.
[[Page 84025]]
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-2020-110, and
should be submitted on or before January 13, 2021.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\19\
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\19\ 17 CFR 200.30-3(a)(12).
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J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020-28303 Filed 12-22-20; 8:45 am]
BILLING CODE 8011-01-P
