Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To List and Trade Shares of the Cambiar Large Cap ETF, Cambiar Small Cap ETF and Cambiar SMID ETF, 39084-39092 [2021-15655]

Download as PDF 39084 Federal Register / Vol. 86, No. 139 / Friday, July 23, 2021 / Notices proper performance of the functions of the agency, including whether the information will have practical utility; 2. Evaluate the accuracy of the agency’s estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used; 3. Enhance the quality, utility, and clarity of the information to be collected; and 4. Minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submissions of responses. The Establishment Information Form, the Wage Data Collection Form, and the Wage Data Collection Continuation Form are wage survey forms developed by OPM for use by the Department of Defense to establish prevailing wage rates for Federal Wage System employees. Analysis Agency: Employee Services, Office of Personnel Management. Title: Establishment Information Form (DD 1918), Wage Data Collection Form (DD 1919), and Wage Data Collection Continuation Form (DD 1919C). OMB Number: 3260–0036. Frequency: Annually. Affected Public: Private Sector Establishments. Number of Respondents: 21,760. Estimated Time per Respondent: 1.5 hours. Total Burden Hours: 32,640. Office of Personnel Management. Alexys Stanley, Regulatory Affairs Analyst. [FR Doc. 2021–15638 Filed 7–22–21; 8:45 am] BILLING CODE 6325–39–P POSTAL REGULATORY COMMISSION [Docket Nos. MC2021–114 and CP2021–116] New Postal Products Postal Regulatory Commission. Notice. AGENCY: ACTION: The Commission is noticing a recent Postal Service filing for the Commission’s consideration concerning a negotiated service agreement. This notice informs the public of the filing, invites public comment, and takes other administrative steps. DATES: Comments are due: July 27, 2021. khammond on DSKJM1Z7X2PROD with NOTICES SUMMARY: Submit comments electronically via the Commission’s Filing Online system at http:// ADDRESSES: VerDate Sep<11>2014 16:49 Jul 22, 2021 Jkt 253001 www.prc.gov. Those who cannot submit comments electronically should contact the person identified in the FOR FURTHER INFORMATION CONTACT section by telephone for advice on filing alternatives. FOR FURTHER INFORMATION CONTACT: David A. Trissell, General Counsel, at 202–789–6820. SUPPLEMENTARY INFORMATION: Table of Contents I. Introduction II. Docketed Proceeding(s) I. Introduction The Commission gives notice that the Postal Service filed request(s) for the Commission to consider matters related to negotiated service agreement(s). The request(s) may propose the addition or removal of a negotiated service agreement from the market dominant or the competitive product list, or the modification of an existing product currently appearing on the market dominant or the competitive product list. Section II identifies the docket number(s) associated with each Postal Service request, the title of each Postal Service request, the request’s acceptance date, and the authority cited by the Postal Service for each request. For each request, the Commission appoints an officer of the Commission to represent the interests of the general public in the proceeding, pursuant to 39 U.S.C. 505 (Public Representative). Section II also establishes comment deadline(s) pertaining to each request. The public portions of the Postal Service’s request(s) can be accessed via the Commission’s website (http:// www.prc.gov). Non-public portions of the Postal Service’s request(s), if any, can be accessed through compliance with the requirements of 39 CFR 3011.301.1 The Commission invites comments on whether the Postal Service’s request(s) in the captioned docket(s) are consistent with the policies of title 39. For request(s) that the Postal Service states concern market dominant product(s), applicable statutory and regulatory requirements include 39 U.S.C. 3622, 39 U.S.C. 3642, 39 CFR part 3030, and 39 CFR part 3040, subpart B. For request(s) that the Postal Service states concern competitive product(s), applicable statutory and regulatory requirements include 39 U.S.C. 3632, 39 U.S.C. 3633, 39 U.S.C. 3642, 39 CFR part 3035, and 1 See Docket No. RM2018–3, Order Adopting Final Rules Relating to Non-Public Information, June 27, 2018, Attachment A at 19–22 (Order No. 4679). PO 00000 Frm 00115 Fmt 4703 Sfmt 4703 39 CFR part 3040, subpart B. Comment deadline(s) for each request appear in section II. II. Docketed Proceeding(s) 1. Docket No(s).: MC2021–114 and CP2021–116; Filing Title: USPS Request to Add Priority Mail Contract 713 to Competitive Product List and Notice of Filing Materials Under Seal; Filing Acceptance Date: July 19, 2021; Filing Authority: 39 U.S.C. 3642, 39 CFR 3040.130 through 3040.135, and 39 CFR 3035.105; Public Representative: Kenneth R. Moeller; Comments Due: July 27, 2021. This Notice will be published in the Federal Register. Erica A. Barker, Secretary. [FR Doc. 2021–15703 Filed 7–22–21; 8:45 am] BILLING CODE 7710–FW–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–92439; File No. SR– NYSEArca–2021–54] Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To List and Trade Shares of the Cambiar Large Cap ETF, Cambiar Small Cap ETF and Cambiar SMID ETF July 19, 2021. Pursuant to Section 19(b)(1) 1 of the Securities Exchange Act of 1934 (‘‘Act’’) 2 and Rule 19b–4 thereunder,3 notice is hereby given that, on July 9, 2021, NYSE Arca, Inc. (‘‘NYSE Arca’’ or ‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change as described in Items I and II below, which Items have been prepared by the 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 to list and trade shares of the following under Rule 8.900–E (Managed Portfolio Shares): Cambiar Large Cap ETF, Cambiar Small Cap ETF and Cambiar SMID ETF. The proposed rule change is available on the Exchange’s website at www.nyse.com, at the principal office of the Exchange, and 1 15 U.S.C. 78s(b)(1). U.S.C. 78a. 3 17 CFR 240.19b–4. 2 15 E:\FR\FM\23JYN1.SGM 23JYN1 Federal Register / Vol. 86, No. 139 / Friday, July 23, 2021 / Notices at the Commission’s Public Reference Room. Exchange of Managed Portfolio Shares under NYSE Arca Rule 8.900–E.5 II. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change Description of the Funds and the Trust The shares of each Fund (the ‘‘Shares’’) will be issued by The Advisors’ Inner Circle Fund (the ‘‘Trust’’), a statutory trust organized under the laws of the State of Massachusetts and registered with the Commission as an open-end management investment company.6 The investment adviser to each Fund will be Cambiar Investors, LLC (the ‘‘Adviser’’). SEI Investments Distribution Company (the ‘‘Distributor’’) will serve as the distributor of each of the Funds’ Shares. All statements and representations made in this filing regarding (a) the description of the portfolio or reference assets, (b) limitations on portfolio holdings or reference assets, or (c) the applicability of Exchange rules shall constitute continued listing requirements for listing the Shares on the Exchange, as provided under Rule 8.900–E(b)(1). Rule 8.900–E(b)(4) provides that, if the investment adviser to the Investment Company issuing Managed Portfolio Shares is registered as a broker-dealer or is affiliated with a broker-dealer, such investment adviser will erect and maintain a ‘‘fire wall’’ between the investment adviser and personnel of the broker-dealer or brokerdealer affiliate, as applicable, with respect to access to information concerning the composition of and/or changes to such Investment Company 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 khammond on DSKJM1Z7X2PROD with NOTICES NYSE Arca Rule 8.900–E permits the listing and trading, or trading pursuant to unlisted trading privileges (‘‘UTP’’), of Managed Portfolio Shares, which are securities issued by an actively managed open-end investment management company.4 Rule 8.900–E(b)(1) requires the Exchange to file separate proposals under Section 19(b) of the Act before listing and trading any series of Managed Portfolio Shares on the Exchange. Therefore, the Exchange is submitting this proposal in order to list and trade Managed Portfolio Shares of the Cambiar Large Cap ETF, Cambiar Small Cap ETF and Cambiar SMID ETF (each a ‘‘Fund’’ and, collectively, the ‘‘Funds’’) under Rule 8.900–E. The Commission has previously approved listing and trading on the 4 Rule 8.900–E(c)(1) provides that the term ‘‘Managed Portfolio Share’’ means a security that (a) represents an interest in an investment company registered under the Investment Company Act of 1940 (‘‘Investment Company’’) organized as an open-end management investment company that invests in a portfolio of securities selected by the Investment Company’s investment adviser consistent with the Investment Company’s investment objectives and policies; (b) is issued in a Creation Unit, or multiples thereof, in return for a designated portfolio of instruments (and/or an amount of cash) with a value equal to the next determined net asset value and delivered to the Authorized Participant (as defined in the Investment Company’s Form N–1A filed with the Commission) through a Confidential Account; (c) when aggregated into a Redemption Unit, or multiples thereof, may be redeemed for a designated portfolio of instruments (and/or an amount of cash) with a value equal to the next determined net asset value delivered to the Confidential Account for the benefit of the Authorized Participant; and (d) the portfolio holdings for which are disclosed within at least 60 days following the end of every fiscal quarter. VerDate Sep<11>2014 16:49 Jul 22, 2021 Jkt 253001 5 See Securities Exchange Act Release Nos. 89663 (August 25, 2020), 85 FR 53868 (August 31, 2020) (Sr–NYSEArca–2020–48) (Order Approving a Proposed Rule Change, as Modified by Amendment No. 1, To List and Trade Shares of Gabelli ETFs Under Rule 8.900–E, Managed Portfolio Shares); 90528 (November 30, 2020), 85 FR 78389 (December 4, 2020) (SR–NYSEArca–2020–80) (Order Approving a Proposed Rule Change, as Modified by Amendment No. 2, To List and Trade Shares of Alger Mid Cap 40 ETF and Alger 25 ETF Under Rule 8.900–E); and 90683 (December 16, 2020), 85 FR 83665 (December 22, 2020) (SR– NYSEArca–2020–94) (Order Approving a Proposed Rule Change, as Modified by Amendments No. 1 and No. 2, To List and Trade Shares of the AdvisorShares Q Portfolio Blended Allocation ETF and AdvisorShares Q Dynamic Growth ETF Under NYSE Arca Rule 8.900–E). 6 The Trust is registered under the 1940 Act. On May 10, 2021, the Trust filed a registration statement on Form N–1A under the Securities Act of 1933 (the ‘‘1933 Act’’) and the 1940 Act for the Funds (File No. 811–06400) (‘‘Registration Statement’’). The Commission issued an order granting exemptive relief to the Trust (‘‘Exemptive Order’’) under the 1940 Act on May 11, 2021 (Investment Company Act Release No. 34268). The Exemptive Order was granted in response to the Trust’s application for exemptive relief (the ‘‘Exemptive Application’’) (File No. 812–15191). The description of the operation of the Trust and the Funds herein is based, in part, on the Registration Statement. PO 00000 Frm 00116 Fmt 4703 Sfmt 4703 39085 portfolio and/or the Creation Basket.7 Any person related to the investment adviser or Investment Company who makes decisions pertaining to the Investment Company’s portfolio composition or has access to information regarding the Investment Company’s portfolio composition or changes thereto or the Creation Basket must be subject to procedures designed to prevent the use and dissemination of material non-public information regarding the applicable Investment Company portfolio or changes thereto or the Creation Basket. Rule 8.900–E(b)(4) is similar to Commentary .03(a)(i) and (iii) to Rule 5.2–E(j)(3); however, Commentary .03(a) in connection with the establishment of a ‘‘fire wall’’ between the investment adviser and the broker-dealer reflects the applicable open-end fund’s portfolio, not an underlying benchmark index, as is the case with index-based funds.8 Rule 8.900–E(b)(4) is also similar to Commentary .06 to Rule 8.600–E related to Managed Fund Shares, except that Rule 8.900–E(b)(4) relates to establishment and maintenance of a ‘‘fire wall’’ between the investment adviser and personnel of 7 Rule 8.900–E(c)(5) provides that the term ‘‘Creation Basket’’ means, on any given business day, the names and quantities of the specified instruments (and/or an amount of cash) that are required for an AP Representative to deposit inkind on behalf of an Authorized Participant in exchange for a Creation Unit and the names and quantities of the specified instruments (and/or an amount of cash) that will be transferred in-kind to an AP Representative on behalf of an Authorized Participant in exchange for a Redemption Unit, which will be identical and will be transmitted to each AP Representative before the commencement of trading. 8 An investment adviser to an open-end fund is required to be registered under the Investment Advisers Act of 1940 (the ‘‘Advisers Act’’). As a result, the Adviser and its related personnel will be subject to the provisions of Rule 204A–1 under the Advisers Act relating to codes of ethics. This Rule requires investment advisers to adopt a code of ethics that reflects the fiduciary nature of the relationship to clients as well as compliance with other applicable securities laws. Accordingly, procedures designed to prevent the communication and misuse of non-public information by an investment adviser must be consistent with Rule 204A–1 under the Advisers Act. In addition, Rule 206(4)–7 under the Advisers Act makes it unlawful for an investment adviser to provide investment advice to clients unless such investment adviser has (i) adopted and implemented written policies and procedures reasonably designed to prevent violations, by the investment adviser and its supervised persons, of the Advisers Act and the Commission rules adopted thereunder; (ii) implemented, at a minimum, an annual review regarding the adequacy of the policies and procedures established pursuant to subparagraph (i) above and the effectiveness of their implementation; and (iii) designated an individual (who is a supervised person) responsible for administering the policies and procedures adopted under subparagraph (i) above. The Funds will also be required to comply with Exchange rules relating to disclosure, including Rule 5.3–E(i). E:\FR\FM\23JYN1.SGM 23JYN1 39086 Federal Register / Vol. 86, No. 139 / Friday, July 23, 2021 / Notices the broker-dealer or broker-dealer affiliate, as applicable, with respect to an Investment Company’s portfolio and Creation Basket, and not just to the underlying portfolio, as is the case with Managed Fund Shares. The Adviser is not registered as a broker-dealer and is not affiliated with any broker-dealer. In the event (a) the Adviser or any sub-adviser becomes registered as a broker-dealer or becomes newly affiliated with a broker-dealer, or (b) any new adviser or sub-adviser is a registered broker-dealer, or becomes affiliated with a broker-dealer, it will implement and maintain a fire wall with respect to personnel of the broker-dealer or broker-dealer affiliate regarding access to information concerning the composition and/or changes to the portfolio and/or Creation Basket. Any person related to the Adviser or the Trust who makes decisions pertaining to a Fund’s portfolio composition or that has access to information regarding a Fund’s portfolio composition or that has access to information regarding a Fund’s portfolio or changes thereto or the Creation Basket will be subject to procedures designed to prevent the use and dissemination of material nonpublic information regarding such portfolio or changes thereto and the Creation Basket. Further, Rule 8.900–E(b)(5) requires that any person or entity, including an AP Representative (as defined below), custodian, Reporting Authority, distributor, or administrator, who has access to non-public information regarding the Investment Company’s portfolio composition or changes thereto or the Creation Basket, must be subject to procedures reasonably designed to prevent the use and dissemination of material non-public information regarding the applicable Investment Company portfolio or changes thereto or the Creation Basket. Moreover, if any such person or entity is registered as a broker-dealer or affiliated with a brokerdealer, such person or entity will erect and maintain a ‘‘fire wall’’ between the person or entity and the broker-dealer with respect to access to information concerning the composition and/or changes to such Investment Company portfolio or Creation Basket. khammond on DSKJM1Z7X2PROD with NOTICES Description of the Funds 9 Each Fund’s holdings will conform to the permissible investments as set forth in the Exemptive Application and Exemptive Order and the holdings will 9 The Exchange represents that, for initial and continued listing, each Fund will be in compliance with Rule 10A–3 under the Act. See 17 CFR 240.10A–3. VerDate Sep<11>2014 16:49 Jul 22, 2021 Jkt 253001 be consistent with all requirements in the Exemptive Application and Exemptive Order.10 Cambiar Large Cap ETF The Fund’s investment objective is to seek total return and capital preservation. Under normal circumstances, the Fund will invest at least 80% of its net assets in common stocks of large-cap companies. The Fund generally considers large-cap companies to be companies with a market capitalization in excess of $10 billion at time of purchase. Cambiar Small Cap ETF The Fund’s investment objective is to seek long-term capital appreciation. Under normal circumstances, the Fund will invest at least 80% of its net assets in common stocks of small-cap companies. The Fund generally considers small-cap companies to be companies with market capitalizations not greater than either that of the largest company in the Russell 2000® Value Index or $3.5 billion, whichever is greater at the time of initial purchase. Cambiar SMID ETF The Fund’s investment objective is to seek long-term capital appreciation. Under normal circumstances, the Fund will invest at least 80% of its net assets in common stocks of small- to mid-sized companies. The Fund generally considers small- and mid-sized companies to be companies with market capitalizations not greater than either that of the largest company in the Russell 2500® Value Index or $12 billion, whichever is greater at the time of initial purchase. Investment Restrictions Each Fund’s holdings will be consistent with all requirements described in the Exemptive Application and Exemptive Order.11 10 Pursuant to the Exemptive Order, the only permissible investments for a Fund are the following that trade on a U.S. exchange contemporaneously with the Funds’ Shares: Exchange-traded funds (‘‘ETFs’’), exchange-traded notes, exchange-listed common stocks, exchangetraded preferred stocks, exchange-traded American Depositary Receipts, exchange-traded real estate investment trusts, exchange-traded commodity pools, exchange-traded metals trusts, exchangetraded currency trusts and exchange-traded futures, as well as cash and cash equivalents (short-term U.S. Treasury securities, government money market funds, and repurchase agreements). All of the equity instruments or futures held by a Fund will be traded on an exchange that is a member of the Intermarket Surveillance Group (‘‘ISG’’) or affiliated with a member of ISG or with which the Exchange has in place a comprehensive surveillance sharing agreement. 11 See id. PO 00000 Frm 00117 Fmt 4703 Sfmt 4703 Each Fund’s investments, including derivatives, will be consistent with its investment objective and will not be used to enhance leverage (although certain derivatives and other investments may result in leverage). That is, for each Fund, the Fund’s investments will not be used to seek performance that is the multiple or inverse multiple (e.g., 2X or ¥3X) of the Fund’s benchmark. Creations and Redemptions of Shares Creations and redemptions of Shares will take place as described in Rule 8.900–E. Specifically, in connection with the creation and redemption of Creation Units 12 and Redemption Units,13 the delivery or receipt of any portfolio securities in-kind will be required to be effected through a separate confidential brokerage account (a ‘‘Confidential Account’’).14 Authorized Participants (‘‘AP’’), as defined in the applicable Form N–1A filed with the Commission, will sign an agreement with an AP Representative 15 establishing the Confidential Account for the benefit of the AP. AP Representatives will be broker-dealers. An AP must be a depository trust company participant that has executed an authorized participant agreement (‘‘Participant Agreement’’) with the Distributor with respect to the creation and redemption of Creation Units and Redemption Units and formed a Confidential Account with an AP 12 Rule 8.900–E(c)(6) provides that the term ‘‘Creation Unit’’ means a specified minimum number of Managed Portfolio Shares issued by an Investment Company at the request of an Authorized Participant in return for a designated portfolio of instruments and/or cash. 13 Rule 8.900–E(c)(7) provides that the term ‘‘Redemption Unit’’ means a specified minimum number of Managed Portfolio Shares that may be redeemed to an Investment Company at the request of an Authorized Participant in return for a portfolio of instruments and/or cash. 14 Rule 8.900–E(c)(4) provides that the term ‘‘Confidential Account’’ means an account owned by an Authorized Participant and held with an AP Representative on behalf of the Authorized Participant. The account will be established and governed by contractual agreement between the AP Representative and the Authorized Participant solely for the purposes of creation and redemption, while keeping confidential the Creation Basket constituents of each series of Managed Portfolio Shares, including from the Authorized Participant. The books and records of the Confidential Account will be maintained by the AP Representative on behalf of the Authorized Participant. 15 Rule 8.900–E(c)(3) provides that the term ‘‘AP Representative’’ means an unaffiliated brokerdealer, with which an Authorized Participant has signed an agreement to establish a Confidential Account for the benefit of such Authorized Participant, that will deliver or receive, on behalf of the Authorized Participant, all consideration to or from the Investment Company in a creation or redemption. An AP Representative will not be permitted to disclose the Creation Basket to any person, including the Authorized Participants. E:\FR\FM\23JYN1.SGM 23JYN1 khammond on DSKJM1Z7X2PROD with NOTICES Federal Register / Vol. 86, No. 139 / Friday, July 23, 2021 / Notices Representative for its benefit in accordance with the terms of the Participant Agreement. For purposes of creations or redemptions, all transactions will be effected through the respective AP’s Confidential Account, for the benefit of the AP, without disclosing the identity of such securities to the AP. Each AP Representative will be given, before the commencement of trading each Business Day (as defined below), the Creation Basket (as described below) for that day. This information will permit an AP that has established a Confidential Account with an AP Representative to instruct the AP Representative to buy and sell positions in the portfolio securities to permit creation and redemption of Creation Units and Redemption Units. Shares of each Fund will be issued and redeemed in Creation Units and Redemption Units. A Creation Unit and Redemption Unit consists of 10,000 shares. The size of Creation Units and Redemption Units is subject to change. The Funds will offer and redeem Creation Units and Redemption Units on a continuous basis at the net asset value (‘‘NAV’’) per Share next determined after receipt of an order in proper form. The NAV per Share of each Fund will be determined as of the close of regular trading on the Exchange on each day that the Exchange is open (a ‘‘Business Day’’). The Funds will sell and redeem Creation Units and Redemption Units only on Business Days. In order to keep costs low and permit each Fund to be as fully invested as possible, Shares will be purchased and redeemed from the respective Fund in Creation Units and Redemption Units and generally on an in-kind basis. Accordingly, except where the purchase or redemption is exclusively made in cash under the circumstances permitted in the Exemptive Application, APs will be required to purchase Creation Units by accepting an in-kind deposit of a designated portfolio of securities (‘‘Deposit Securities’’), and APs redeeming their Shares will receive from the Fund an in-kind transfer of a designated portfolio of securities (‘‘Fund Securities’’) through the AP Representative into their Confidential Account.16 On any given Business Day, the names and quantities of the instruments that constitute the Deposit Securities and the names and quantities 16 According to the Registration Statement, the Funds must comply with the federal securities laws in accepting Deposit Securities and satisfying redemptions with Fund Securities, including that the Deposit Securities and Fund Securities are sold in transactions that would be exempt from registration under the 1933 Act. VerDate Sep<11>2014 16:49 Jul 22, 2021 Jkt 253001 of the instruments that constitute the Fund Securities will be identical, and these instruments may be referred to, in the case of either a purchase or a redemption, as the ‘‘Creation Basket.’’ Placement of Purchase Orders Each Fund will issue Shares through the Distributor on a continuous basis at NAV. The Exchange represents that the issuance of Shares will operate in a manner substantially similar to that of other ETFs. Each Fund will issue Shares only at the NAV per Share next determined after an order in proper form is received. The Distributor will furnish acknowledgements to those placing such orders that the orders have been accepted, but the Distributor may reject any order which is not submitted in proper form, as described in each Fund’s prospectus or Statement of Additional Information (‘‘SAI’’). The NAV of each Fund is expected to be determined once each Business Day as of the close of the regular trading session on the NYSE (normally 4:00 p.m. E.T.) (the ‘‘Valuation Time’’). To initiate a purchase of Shares, an AP must submit to the Distributor an irrevocable order to purchase such Shares after the most recent prior Valuation Time. In purchasing the necessary securities, the AP Representative will use methods, such as breaking the transaction into multiple transactions and transacting in multiple marketplaces, to avoid revealing the composition of the Creation Basket. Each Fund will establish a cut-off time (‘‘Order Cut-Off Time’’) for purchase orders in proper form. Generally, all orders to purchase Creation Units must be received by the Distributor no later than the Order CutOff Time on the date such order is placed (‘‘Transmittal Date’’) in order for the purchaser to receive the NAV per Share determined on the Transmittal Date. As with all existing ETFs, if there is a difference between the NAV attributable to a Creation Unit and the aggregate market value of the Creation Basket exchanged for the Creation Unit, the party conveying instruments with the lower value will also pay to the other an amount in cash equal to that difference (the ‘‘Balancing Amount’’). Purchases of Shares will be settled inkind and/or cash for an amount equal to the applicable NAV per Share purchased plus applicable transaction fees.17 Other than the Balancing Amount, a Fund will substitute cash 17 To the extent that a Fund allows creations or redemptions to be conducted in cash, such transactions will be effected in the same manner for all APs transacting in cash. PO 00000 Frm 00118 Fmt 4703 Sfmt 4703 39087 only under exceptional circumstances and as set forth under the Fund’s policies and procedures governing the composition of Creation Baskets. Authorized Participant Redemption The Shares may be redeemed to a Fund in Redemption Unit size or multiples thereof as described below. Redemption orders of Redemption Units must be placed by or through an AP (‘‘AP Redemption Order’’) in proper form. Redemption Units of a Fund will be redeemable at their NAV per Share next determined after receipt of a request for redemption by the Trust in the manner specified below before the Order Cut-Off Time. To initiate an AP Redemption Order, an AP must submit to the Distributor an irrevocable order to redeem such Redemption Unit no later than the Order Cut-Off Time on the Transmittal Date. A transaction fee may be imposed to offset costs associated with redemption orders. In the case of a redemption, the AP would enter into an irrevocable redemption order, and then the applicable Fund would instruct its custodian to deliver the Fund Securities to the appropriate Confidential Account. The Authorized Participant would direct the AP Representative on when that day to liquidate those securities. As with the purchase of securities, the AP Representative will use methods, such as breaking the transaction into multiple transactions and transacting in multiple marketplaces, to avoid revealing the composition of the Creation Basket. Redemptions will occur primarily inkind, although redemption payments may also be made partly or wholly in cash. The Participant Agreement signed by each AP will require establishment of a Confidential Account to receive distributions of securities in-kind upon redemption. Each AP will be required to open a Confidential Account with an AP Representative in order to facilitate orderly processing of redemptions. Net Asset Value Each Fund calculates its NAV once each business day as of the regularly scheduled close of trading on the New York Stock Exchange, normally 4:00 p.m. Eastern Time. The NAV of each Fund is computed by (i) taking the current market value of its total assets, (ii) subtracting any liabilities, and (iii) dividing the result by the total number of shares outstanding. In computing each Fund’s NAV, the Fund’s securities holdings are valued based on their last readily available market price. Securities for which such information is readily available are generally valued at the last reported E:\FR\FM\23JYN1.SGM 23JYN1 39088 Federal Register / Vol. 86, No. 139 / Friday, July 23, 2021 / Notices khammond on DSKJM1Z7X2PROD with NOTICES sales price, the official closing price as reported by an independent pricing service on the primary market or exchange on which they are traded, or, in the absence of reported sales, at the most recent bid price. If market prices are unavailable or a Fund thinks that they are unreliable, or when the value of a security has been materially affected by events occurring after the relevant market closes, the Fund will price those securities at fair value as determined in good faith using methods approved by the Fund’s Board. More information about the valuation of each Fund’s holdings can be found in the SAI. Information showing the number of days that the market price of each Fund’s Shares was greater than the Fund’s NAV (i.e., at a premium) or less than the Fund’s NAV (i.e., at a discount) for various time periods will be available on the Funds’ website at www.cambiar.com. Availability of Information The Funds’ website, www.cambiar.com, will include a form of the prospectus for each Fund that may be downloaded. The Funds’ website will include additional quantitative information updated on a daily basis, including, on a per share basis for each Fund, the prior Business Day’s NAV, market closing price, the bid/ask spreads at the time of calculation of such NAV (the ‘‘Bid/Ask Price’’),18 and a calculation of the premium or discount of the market closing price or Bid/Ask Price against the NAV. The website and information will be publicly available at no charge. Form N–PORT requires reporting of a Fund’s complete portfolio holdings on a position-by-position basis on a quarterly basis within 60 days after fiscal quarter end. Investors can obtain a Fund’s SAI, its shareholder reports, its Form N–CSR, filed twice a year, and its Form N–CEN, filed annually. Each Fund’s SAI and shareholder reports are available free upon request from the Investment Company, and those documents and the Form N–PORT, Form N–CSR, and Form N–CEN may be viewed onscreen 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 to market participants on a real-time basis throughout the day on brokers’ 18 The Bid/Ask Price of a Fund’s Shares is determined using the mid-point between the current national best bid and offer at the time of calculation of such Fund’s NAV. The records relating to Bid/Ask Prices will be retained by the Funds or their service providers. VerDate Sep<11>2014 16:49 Jul 22, 2021 Jkt 253001 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 will be available via the Consolidated Tape Association (‘‘CTA’’) high-speed line. In addition, the Verified Intraday Indicative Value (‘‘VIIV’’), as defined in Rule 8.900–E(c)(2),19 will be widely disseminated by the Reporting Authority 20 and/or one or more major market data vendors in one second intervals during the Exchange’s Core Trading Session. Dissemination of the VIIV With respect to trading of the Shares, the ability of market participants to buy and sell Shares at prices near the VIIV is dependent upon their assessment that the VIIV is a reliable, indicative realtime value for a Fund’s underlying holdings. Market participants are expected to accept the VIIV as a reliable, indicative real-time value because (1) the VIIV will be calculated and disseminated based on a Fund’s actual portfolio holdings, (2) the securities in which a Fund plans to invest are generally highly liquid and actively traded and trade at the same time as the Fund and therefore generally have accurate real time pricing available, and (3) market participants will have a daily opportunity to evaluate whether the VIIV at or near the close of trading is indeed predictive of the actual NAV. The VIIV will be widely disseminated by the Reporting Authority and/or by one or more major market data vendors in one second intervals during the Core Trading Session and will be disseminated to all market participants at the same time. The VIIV is based on the current market value of the 19 Rule 8.900–E(c)(2) provides that the term ‘‘Verified Intraday Indicative Value’’ is the indicative value of a Managed Portfolio Share based on all of the holdings of a series of Managed Portfolio Shares as of the close of business on the prior business day and, for corporate actions, based on the applicable holdings as of the opening of business on the current business day, priced and disseminated in one second intervals during the Core Trading Session by the Reporting Authority. 20 Rule 8.900–E(c)(8) provides that the term ‘‘Reporting Authority’’ in respect of a particular series of Managed Portfolio Shares means the Exchange, an institution, or a reporting service designated by the Exchange or by the exchange that lists a particular series of Managed Portfolio Shares (if the Exchange is trading such series pursuant to unlisted trading privileges), as the official source for calculating and reporting information relating to such series, including, but not limited to, the NAV, the VIIV, or other information relating to the issuance, redemption, or trading of Managed Portfolio Shares. A series of Managed Portfolio Shares may have more than one Reporting Authority, each having different functions. PO 00000 Frm 00119 Fmt 4703 Sfmt 4703 securities in a Fund’s portfolio that day. The methodology for calculating the VIIV will be available on the Funds’ website. The VIIV is intended to provide investors and other market participants with a highly correlated per Share value of the underlying portfolio that can be compared to the current market price. Therefore, under normal circumstances the VIIV would be effectively a near real time approximation of each Fund’s NAV, which is computed only once a day, and is available free of charge from one or more market data vendors. Trading Halts 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 a Fund.21 Trading in Shares of a Fund will be halted if the circuit breaker parameters in Rule 7.12–E have been reached. 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. Trading in the Shares will be subject to Rule 8.900–E(d)(2)(C), which sets forth circumstances under which Shares of a Fund will be halted. Specifically, Rule 8.900–E(d)(2)(C)(i) provides that the Exchange may consider all relevant factors in exercising its discretion to halt trading in a series of Managed Portfolio Shares. Trading may be halted because of market conditions or for reasons that, in the view of the Exchange, make trading in the series of Managed Portfolio Shares inadvisable. These may include: (a) The extent to which trading is not occurring in the securities and/or the financial instruments composing the portfolio; or (b) whether other unusual conditions or circumstances detrimental to the maintenance of a fair and orderly market are present.22 Rule 8.900–E(d)(2)(C)(ii) provides that, if the Exchange becomes aware 21 See Rule 7.12–E. Exemptive Application provides that the Investment Company or their agent will request that the Exchange halt trading in the applicable series of Managed Portfolio Shares where: (i) The intraday indicative values calculated by the calculation engines differ by more than 25 basis points for 60 seconds in connection with pricing of the VIIV; or (ii) holdings representing 10% or more of a series of Managed Portfolio Shares’ portfolio have become subject to a trading halt or otherwise do not have readily available market quotations. Any such requests will be one of many factors considered in order to determine whether to halt trading in a series of Managed Portfolio Shares, and the Exchange retains sole discretion in determining whether trading should be halted. As provided in the Exemptive Application, each series of Managed Portfolio Shares would employ a pricing verification agent to continuously compare two intraday indicative values during regular trading hours in order to ensure the accuracy of the VIIV. 22 The E:\FR\FM\23JYN1.SGM 23JYN1 Federal Register / Vol. 86, No. 139 / Friday, July 23, 2021 / Notices that: (i) The VIIV of a series of Managed Portfolio Shares is not being calculated or disseminated in one second intervals, as required; (ii) the NAV with respect to a series of Managed Portfolio Shares is not disseminated to all market participants at the same time; (iii) the holdings of a series of Managed Portfolio Shares are not made available on at least a quarterly basis as required under the 1940 Act; or (iv) such holdings are not made available to all market participants at the same time (except as otherwise permitted under the currently applicable exemptive order or no-action relief granted by the Commission or Commission staff to the Investment Company with respect to the series of Managed Portfolio Shares), it will halt trading in such series until such time as the VIIV, the net asset value, or the holdings are available, as required. khammond on DSKJM1Z7X2PROD with NOTICES Trading Rules The Exchange deems the Shares to be equity securities, thus rendering trading in the Shares subject to the Exchange’s existing rules governing the trading of equity securities. Shares will trade on the Exchange in all trading sessions in accordance with Rule 7.34–E(a). As provided in Rule 7.6–E, the minimum price variation (‘‘MPV’’) for quoting and entry of orders in equity securities traded on the NYSE Arca Marketplace is $0.01, with the exception of securities that are priced less than $1.00, for which the MPV for order entry is $0.0001. A minimum of 100,000 Shares of each Fund will be outstanding at the commencement of trading on the Exchange. The Shares will conform to the initial and continued listing criteria under Rule 8.900–E, as well as all terms in the Exemptive Order. The Exchange will obtain a representation from the issuer of the Shares of each Fund that the NAV per Share of each Fund will be calculated daily and will be made available to all market participants at the same time. Surveillance The Exchange believes that its surveillance procedures are adequate to properly monitor the trading of Shares on the Exchange during all trading sessions and to deter and detect violations of Exchange rules and the applicable federal securities laws. Trading of Shares through the Exchange will be subject to the Exchange’s surveillance procedures for derivative products. As part of these surveillance procedures and consistent with Rule 8.900–E(b)(3) and 8.900–E(d)(2)(B), the Adviser will upon request make VerDate Sep<11>2014 16:49 Jul 22, 2021 Jkt 253001 available to the Exchange and/or FINRA, on behalf of the Exchange, the daily portfolio holdings of a Fund. The issuer of the Shares of each Fund will be required to represent to the Exchange that it will advise the Exchange of any failure by a Fund to comply with the continued listing requirements, and, pursuant to its obligations under Section 19(g)(1) of the Act, the Exchange will surveil for compliance with the continued listing requirements. If a Fund is not in compliance with the applicable listing requirements, the Exchange will commence delisting procedures under Exchange Rule 5.5– E(m). FINRA, on behalf of the Exchange, or the regulatory staff of the Exchange, or both, will communicate as needed regarding trading in the Shares and certain exchange-traded instruments with other markets and other entities that are members of the ISG, and FINRA, on behalf of the Exchange, or the regulatory staff of the Exchange, or both, may obtain trading information regarding trading such securities from such markets and other entities. In addition, the Exchange may obtain information regarding trading in the Shares and certain exchange-traded instruments from markets and other entities that are members of ISG or with which the Exchange has in place a comprehensive surveillance sharing agreement. In addition, the Exchange also has a general policy prohibiting the distribution of material, non-public information by its employees. FINRA also generally prohibits its employees from disseminating or disclosing any non-public information obtained in the course of his or her employment.23 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with Section 6(b) of the Act,24 in general, and furthers the objectives of Section 6(b)(5) of the Act,25 in particular, in that it is 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 a national market system, and, in general, to protect investors and the public interest. 23 See Securities Exchange Act Release No. 89663 (August 25, 2020), 85 FR 53868 (August 31, 2020) (SR–NYSEArca–2020–48) (Order Approving a Proposed Rule Change, as Modified by Amendment No. 1, To List and Trade Shares of Gabelli ETFs Under Rule 8.900–E, Managed Portfolio Shares). 24 15 U.S.C. 78f(b). 25 15 U.S.C. 78f(b)(5). PO 00000 Frm 00120 Fmt 4703 Sfmt 4703 39089 The Exchange believes that this proposed rule change is designed to prevent fraudulent and manipulative acts and practices in that the Funds would meet each of the rules relating to listing and trading of Managed Portfolio Shares. To the extent that a Fund is not in compliance with such rules, the Exchange would either prevent the Fund from listing and trading on the Exchange or commence delisting procedures under Rule 8.900–E(d)(2)(B). Specifically, the Exchange would consider the suspension of trading, and commence delisting proceedings under Rule 8.900–E(d)(2)(B), of a Fund under any of the following circumstances: (a) If, following the initial twelve-month period after commencement of trading on the Exchange, there are fewer than 50 beneficial holders of the Fund; (b) if the Exchange has halted trading in a Fund because the VIIV is interrupted pursuant to Rule 8.900–E(d)(2)(C)(ii) and such interruption persists past the trading day in which it occurred or is no longer available; (c) if the Exchange has halted trading in a Fund because the net asset value with respect to such Fund is not disseminated to all market participants at the same time, the holdings of such Fund are not made available on at least a quarterly basis as required under the 1940 Act, or such holdings are not made available to all market participants at the same time pursuant to Rule 8.900– E(d)(2)(C)(ii) and such issue persists past the trading day in which it occurred; (d) if the Exchange has halted trading in Shares of a Fund pursuant to Rule 8.900–E(d)(2)(C)(i) and such issue persists past the trading day in which it occurred; (e) if a Fund has failed to file any filings required by the Commission or if the Exchange is aware that a Fund is not in compliance with the conditions of any currently applicable exemptive order or no-action relief granted by the Commission or Commission staff with respect to the Fund; (f) if any of the continued listing requirements set forth in Rule 8.900–E are not continuously maintained; (g) if any of the statements of representations regarding (a) the description of the portfolio, (b) limitations on portfolio holdings, or (c) the applicability of Exchange listing rules as specified herein to permit the listing and trading of a Fund, are not continuously maintained; or (h) if such other event shall occur or condition exists which, in the opinion of the Exchange, makes further dealings on the Exchange inadvisable. As discussed above, the Adviser is not registered as a broker-dealer and is not affiliated with any broker-dealer In the event that (a) the Adviser or sub-adviser E:\FR\FM\23JYN1.SGM 23JYN1 khammond on DSKJM1Z7X2PROD with NOTICES 39090 Federal Register / Vol. 86, No. 139 / Friday, July 23, 2021 / Notices becomes registered as a broker-dealer or becomes newly affiliated with a brokerdealer, or (b) any new adviser or subadviser is a registered broker-dealer or becomes affiliated with a broker-dealer, the Adviser will implement and maintain a fire wall with respect to personnel of the broker-dealer or brokerdealer affiliate regarding access to information concerning the composition and/or changes to the portfolio and/or Creation Basket. Any person related to the Adviser or the Trust who makes decisions pertaining to a Fund’s portfolio composition or that has access to information regarding a Fund’s portfolio or changes thereto or the Creation Basket will be subject to procedures designed to prevent the use and dissemination of material nonpublic information regarding such portfolio or changes thereto and the Creation Basket. In addition, Rule 8.900–E(b)(5) requires that any person or entity, including an AP Representative, custodian, Reporting Authority, distributor, or administrator, who has access to non-public information regarding the Investment Company’s portfolio composition or changes thereto or the Creation Basket, must be subject to procedures designed to prevent the use and dissemination of material nonpublic information regarding the applicable Investment Company portfolio or changes thereto or the Creation Basket. Moreover, if any such person or entity is registered as a brokerdealer or affiliated with a broker-dealer, such person or entity will erect and maintain a ‘‘fire wall’’ between the person or entity and the broker-dealer with respect to access to information concerning the composition and/or changes to such Investment Company portfolio or Creation Basket. Any person or entity who has access to information regarding a Fund’s portfolio composition or changes thereto or the Creation Basket will be subject to procedures designed to prevent the use and dissemination of material nonpublic information regarding the portfolio or changes thereto or the Creation Basket. The Exchange further believes that Rule 8.900–E is designed to prevent fraudulent and manipulative acts and practices related to the listing and trading of Shares of the Funds because it provides meaningful requirements about both the data that will be made publicly available about the Shares, as well as the information that will only be available to certain parties and the controls on such information. Specifically, the Exchange believes that the requirements related to information VerDate Sep<11>2014 16:49 Jul 22, 2021 Jkt 253001 protection set forth in Rule 8.900– E(b)(5) will act as a safeguard against misuse and improper dissemination of information related to a Fund’s portfolio composition, the Creation Basket, or changes thereto. The requirement that any person or entity implement procedures to prevent the use and dissemination of material non-public information regarding the portfolio or Creation Basket will act to prevent any individual or entity from sharing such information externally and the internal ‘‘fire wall’’ requirements applicable where an entity is a registered brokerdealer or affiliated with a broker-dealer will act to make sure that no entity will be able to misuse the data for their own purposes. Accordingly, the Exchange believes that this proposal is designed to prevent fraudulent and manipulative acts and practices. The Exchange further believes that the proposal is designed to prevent fraudulent and manipulative acts and practices related to the listing and trading of Shares of the Funds and to promote just and equitable principles of trade and to protect investors and the public interest because the Exchange would halt trading under certain circumstances under which trading in the Shares of a Fund may be inadvisable. Specifically, trading in the Shares will be subject to Rule 8.900– E(d)(2)(C)(i), which provides that the Exchange may consider all relevant factors in exercising its discretion to halt trading in a Fund. Trading may be halted because of market conditions or for reasons that, in the view of the Exchange, make trading in the series of Managed Portfolio Shares inadvisable. These may include: (a) The extent to which trading is not occurring in the securities and/or the financial instruments composing the portfolio; or (b) whether other unusual conditions or circumstances detrimental to the maintenance of a fair and orderly market are present.26 Additionally, trading in the Shares will be subject to Rule 8.900–E(d)(2)(C)(ii), which provides that the Exchange would halt trading where the Exchange becomes aware that: (a) The VIIV of a series of Managed Portfolio Shares is not being calculated or disseminated in one second intervals, as required; (b) the net asset value with respect to a series of Managed Portfolio Shares is not disseminated to all market participants at the same time; (c) the holdings of a series of Managed Portfolio Shares are not made available on at least a quarterly basis as required under the 1940 Act; or (d) such holdings are not PO 00000 26 See supra note 22. Frm 00121 Fmt 4703 Sfmt 4703 made available to all market participants at the same time (except as otherwise permitted under the currently applicable exemptive order or no-action relief granted by the Commission or Commission staff to the Investment Company with respect to the series of Managed Portfolio Shares). The Exchange would halt trading in such Shares until such time as the VIIV, the NAV, or the holdings are available, as required. With respect to the proposed listing and trading of Shares of the Funds, the Exchange believes that the proposed rule change is designed to prevent fraudulent and manipulative acts and practices in that the Shares will be listed and traded on the Exchange pursuant to the initial and continued listing criteria in Rule 8.900–E.27 Each Fund’s holdings will conform to the permissible investments as set forth in the Exemptive Application and Exemptive Order.28 As noted above, FINRA, on behalf of the Exchange, or the regulatory staff of the Exchange, or both, will communicate as needed regarding trading in the Shares and the underlying exchange-traded instruments with other markets and other entities that are members of the ISG, and FINRA, on behalf of the Exchange, or the regulatory staff of the Exchange, or both, may obtain trading information regarding trading such instruments from such markets and other entities. In addition, the Exchange may obtain information regarding trading in the Shares and the underlying exchangetraded instruments from markets and other entities that are members of ISG or with which the Exchange has in place a comprehensive surveillance sharing agreement. With respect to trading of Shares of the Funds, the ability of market participants to buy and sell Shares at prices near the VIIV is dependent upon their assessment that the VIIV is a reliable, indicative real-time value for a Fund’s underlying holdings. Market participants are expected to accept the VIIV as a reliable, indicative real-time value because (1) the VIIV will be calculated and disseminated based on a Fund’s actual portfolio holdings, (2) the securities in which the Funds plan to invest are generally highly liquid and actively traded and trade at the same time as the Funds and therefore generally have accurate real time pricing available, and (3) market participants 27 The Exchange represents that, for initial and continued listing, each Fund will be in compliance with Rule 10A–3 under the Act. See 17 CFR 240.10A–3. 28 See supra note 10. E:\FR\FM\23JYN1.SGM 23JYN1 khammond on DSKJM1Z7X2PROD with NOTICES Federal Register / Vol. 86, No. 139 / Friday, July 23, 2021 / Notices will have a daily opportunity to evaluate whether the VIIV at or near the close of trading is indeed predictive of the actual NAV. The proposed rule change is designed to promote just and equitable principles of trade and to protect investors and the public interest in that the Exchange will obtain a representation that the NAV per Share of the Funds will be calculated daily and that the NAV will be made available to all market participants at the same time. Investors can also obtain a Fund’s SAI, its shareholder reports, its Form N–CSR (filed twice a year), and its Form N–CEN (filed annually). A Fund’s SAI and shareholder reports will be available free upon request from the applicable Fund, and those documents and the Form N–PORT, Form N–CSR, and Form N–CEN may be viewed onscreen or downloaded from the Commission’s website at www.sec.gov. In addition, a large amount of information will be publicly available regarding the Funds and the Shares, thereby promoting market transparency. Quotation and last sale information for the Shares will be available via the CTA high-speed line. Information regarding the VIIV will be widely disseminated in one second intervals throughout the Core Trading Session by the Reporting Authority and/or one or more major market data vendors. The website for the Funds will include a prospectus for the Funds that may be downloaded, and additional data relating to NAV and other applicable quantitative information, updated on a daily basis. Moreover, prior to the commencement of trading, the Exchange will inform its members in an Information Bulletin of the special characteristics and risks associated with trading the Shares. In addition, as noted above, investors will have ready access to the VIIV, and quotation and last sale information for the Shares. The Shares will conform to the initial and continued listing criteria under Rule 8.900–E. Each Fund’s investments, including derivatives, will be consistent with its investment objective and will not be used to enhance leverage (although certain derivatives and other investments may result in leverage). That is, a Fund’s investments will not be used to seek performance that is the multiple or inverse multiple (e.g., 2X or ¥3X) of the Fund’s benchmark. The Exchange also believes that 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 actively-managed exchange-traded products that will enhance competition VerDate Sep<11>2014 16:49 Jul 22, 2021 Jkt 253001 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, as noted above, investors will have ready access to information regarding the VIIV 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. 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 purposes of the Act. The Exchange believes the proposed rule change would permit the listing and trading of additional actively-managed exchange-traded products, thereby promoting competition among exchange-traded products 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 29 and Rule 19b– 4(f)(6) thereunder.30 A proposed rule change filed pursuant to Rule 19b–4(f)(6) under the Act normally does not become operative for 30 days after the date of its filing. U.S.C. 78s(b)(3)(A). CFR 240.19b–4(f)(6). In addition, Rule 19b– 4(f)(6) requires a self-regulatory organization to give the Commission written notice of its intent to file 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. PO 00000 29 15 30 17 Frm 00122 Fmt 4703 Sfmt 4703 39091 However, Rule 19b–4(f)(6)(iii) 31 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 requested that the Commission waive the 30-day operative delay so that the proposal may become operative immediately upon filing. The Exchange states that the Commission has approved proposed rule changes to permit listing and trading on the Exchange of Managed Portfolio Shares similar to the Funds.32 The proposed listing rule for the Funds raises no novel legal or regulatory issues. For this reason, the Commission believes that waiver of the 30-day operative delay is consistent with the protection of investors and the public interest. Accordingly, the Commission hereby waives the 30-day operative delay and designates the proposed rule change operative upon filing.33 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. 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 (http://www.sec.gov/ rules/sro.shtml); or • Send an email to rule-comments@ sec.gov. Please include File Number SR– NYSEArca–2021–54 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–2021–54. 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 31 17 CFR 240.19b–4(f)(6)(iii). supra note 5. 33 For purposes only of waiving the 30-day operative delay, the Commission has also considered the proposed rule’s impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). 32 See E:\FR\FM\23JYN1.SGM 23JYN1 39092 Federal Register / Vol. 86, No. 139 / Friday, July 23, 2021 / Notices post all comments on the Commission’s internet website (http://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–2021–54 and should be submitted on or before August 13, 2021. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.34 J. Matthew DeLesDernier, Assistant Secretary. [FR Doc. 2021–15655 Filed 7–22–21; 8:45 am] SECURITIES AND EXCHANGE COMMISSION [Release No. 34–92437; File No. SR–NSCC– 2021–009] Self-Regulatory Organizations; National Securities Clearing Corporation; Notice of Filing of a Proposed Rule Change To Modify the Rules & Procedures of National Securities Clearing Corporation in Connection With the Implementation of Section 1446(f) of the Internal Revenue Code of 1986 khammond on DSKJM1Z7X2PROD with NOTICES July 19, 2021. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 notice is hereby given that on July 14, 2021, National Securities Clearing Corporation (‘‘NSCC’’) filed with the CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 1 15 VerDate Sep<11>2014 16:49 Jul 22, 2021 Jkt 253001 I. Clearing Agency’s Statement of the Terms of Substance of the Proposed Rule Change The proposed rule change consists of modifications to the Rules & Procedures (‘‘Rules’’) 3 of NSCC in connection with the implementation of section 1446(f) of the Internal Revenue Code of 1986, as amended, that was enacted as part of the Tax Cuts and Jobs Act of 2017,4 and the Treasury Regulations or other official interpretations thereunder, as in effect from time to time (collectively ‘‘Section 1446(f)’’), as described in greater detail below. II. Clearing Agency’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, the clearing agency included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The clearing agency has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements. (A) Clearing Agency’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change BILLING CODE 8011–01–P 34 17 Securities and Exchange Commission (‘‘Commission’’) the proposed rule change as described in Items I, II and III below, which Items have been prepared by the clearing agency. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. 1. Purpose The purpose of this proposed rule change is to amend the Rules in connection with the implementation of Section 1446(f). The proposed rule change also includes technical changes. (i) Background Section 1446(f) and Section 1446(f) Withholding Section 1446(f) was enacted on December 22, 2017, as part of the Tax Cuts and Jobs Act of 2017,5 and the U.S. Treasury Department (‘‘Treasury Department’’) finalized and issued various implementing regulations on October 7, 2020,6 including the tax 3 Capitalized terms not defined herein are defined in the Rules, available at http://www.dtcc.com/∼/ media/Files/Downloads/legal/rules/nscc_rules.pdf. 4 Public Law 115–97 (2017), section 864(c)(8). 5 Id. 6 Withholding of Tax and Information Reporting With Respect to Interests in Partnerships Engaged PO 00000 Frm 00123 Fmt 4703 Sfmt 4703 withholding required pursuant to Treasury Regulation Section 1.1446(f)– 4(a) 7 upon the transfer of an interest in a publicly traded partnership (‘‘Section 1446(f) Withholding’’). It is NSCC’s understanding that Section 1446(f) Withholding is designed to ensure any non-U.S. person (either individual or entity) appropriately files a U.S. federal income tax return following the sale or disposition of its interest in certain partnerships. Section 1446(f) generally imposes a ten percent (10%) withholding tax on the payment of gross proceeds arising from the sale or other disposition by a non-U.S. person of an interest in certain partnerships that are engaged in a U.S. trade or business.8 In such a case, a tax withholding obligation is imposed on the buyer of the partnership interest, who is required to remit the withheld tax amount to the U.S. Internal Revenue Service (‘‘IRS’’), unless or to the extent an applicable exception applies.9 The buyer obligated to withhold the 10% tax is liable for any amount that it underwithheld, plus associated interest and penalties.10 On October 7, 2020, the IRS and Treasury Department issued final regulations under Section 1446(f) (the ‘‘Final Regulations’’),11 which require Section 1446(f) Withholding on partnerships that are publicly traded on exchanges (‘‘PTPs’’) in respect of transfers that occur on or after January 1, 2022. The Final Regulations provided U.S. clearing organizations, such as NSCC, an exemption from the obligation to perform the Section 1446(f) Withholding at this time.12 This exemption is premised in part on the IRS and Treasury Department’s understanding that all of NSCC’s nonU.S. Members are of the types of entities that are permitted to perform the Section 1446(f) Withholding themselves.13 14 NSCC currently clears and settles all transactions on a netted basis. If NSCC were required to perform Section 1446(f) Withholding, NSCC would have to clear and settle transfers in a U.S. Trade or Business, 85 FR 76910 (Nov. 30, 2020). 7 26 CFR 1.1446–4(a). 8 I.R.C. Section 1446(f). 9 Id. 10 Id. 11 See note 6. 12 See note 6, at 76922. 13 Id. 14 The Final Regulations provided that if a direct clearing member of a U.S. clearing organization is not of a type of entity permitted to perform Section 1446(f) Withholding, the IRS and Treasury Department will issue proposed guidance that would revise the Final Regulations to require Section 1446(f) Withholding by U.S. clearing organization on such direct clearing member. Id. E:\FR\FM\23JYN1.SGM 23JYN1

Agencies

[Federal Register Volume 86, Number 139 (Friday, July 23, 2021)]
[Notices]
[Pages 39084-39092]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-15655]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-92439; File No. SR-NYSEArca-2021-54]


Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change To List and Trade 
Shares of the Cambiar Large Cap ETF, Cambiar Small Cap ETF and Cambiar 
SMID ETF

July 19, 2021.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby given 
that, on July 9, 2021, NYSE Arca, Inc. (``NYSE Arca'' or ``Exchange'') 
filed with the Securities and Exchange Commission (``Commission'') the 
proposed rule change as described in Items I and II below, which Items 
have been prepared by the 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 list and trade shares of the following 
under Rule 8.900-E (Managed Portfolio Shares): Cambiar Large Cap ETF, 
Cambiar Small Cap ETF and Cambiar SMID ETF. The proposed rule change is 
available on the Exchange's website at www.nyse.com, at the principal 
office of the Exchange, and

[[Page 39085]]

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
    NYSE Arca Rule 8.900-E permits the listing and trading, or trading 
pursuant to unlisted trading privileges (``UTP''), of Managed Portfolio 
Shares, which are securities issued by an actively managed open-end 
investment management company.\4\ Rule 8.900-E(b)(1) requires the 
Exchange to file separate proposals under Section 19(b) of the Act 
before listing and trading any series of Managed Portfolio Shares on 
the Exchange. Therefore, the Exchange is submitting this proposal in 
order to list and trade Managed Portfolio Shares of the Cambiar Large 
Cap ETF, Cambiar Small Cap ETF and Cambiar SMID ETF (each a ``Fund'' 
and, collectively, the ``Funds'') under Rule 8.900-E.
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    \4\ Rule 8.900-E(c)(1) provides that the term ``Managed 
Portfolio Share'' means a security that (a) represents an interest 
in an investment company registered under the Investment Company Act 
of 1940 (``Investment Company'') organized as an open-end management 
investment company that invests in a portfolio of securities 
selected by the Investment Company's investment adviser consistent 
with the Investment Company's investment objectives and policies; 
(b) is issued in a Creation Unit, or multiples thereof, in return 
for a designated portfolio of instruments (and/or an amount of cash) 
with a value equal to the next determined net asset value and 
delivered to the Authorized Participant (as defined in the 
Investment Company's Form N-1A filed with the Commission) through a 
Confidential Account; (c) when aggregated into a Redemption Unit, or 
multiples thereof, may be redeemed for a designated portfolio of 
instruments (and/or an amount of cash) with a value equal to the 
next determined net asset value delivered to the Confidential 
Account for the benefit of the Authorized Participant; and (d) the 
portfolio holdings for which are disclosed within at least 60 days 
following the end of every fiscal quarter.
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    The Commission has previously approved listing and trading on the 
Exchange of Managed Portfolio Shares under NYSE Arca Rule 8.900-E.\5\
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    \5\ See Securities Exchange Act Release Nos. 89663 (August 25, 
2020), 85 FR 53868 (August 31, 2020) (Sr-NYSEArca-2020-48) (Order 
Approving a Proposed Rule Change, as Modified by Amendment No. 1, To 
List and Trade Shares of Gabelli ETFs Under Rule 8.900-E, Managed 
Portfolio Shares); 90528 (November 30, 2020), 85 FR 78389 (December 
4, 2020) (SR-NYSEArca-2020-80) (Order Approving a Proposed Rule 
Change, as Modified by Amendment No. 2, To List and Trade Shares of 
Alger Mid Cap 40 ETF and Alger 25 ETF Under Rule 8.900-E); and 90683 
(December 16, 2020), 85 FR 83665 (December 22, 2020) (SR-NYSEArca-
2020-94) (Order Approving a Proposed Rule Change, as Modified by 
Amendments No. 1 and No. 2, To List and Trade Shares of the 
AdvisorShares Q Portfolio Blended Allocation ETF and AdvisorShares Q 
Dynamic Growth ETF Under NYSE Arca Rule 8.900-E).
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Description of the Funds and the Trust
    The shares of each Fund (the ``Shares'') will be issued by The 
Advisors' Inner Circle Fund (the ``Trust''), a statutory trust 
organized under the laws of the State of Massachusetts and registered 
with the Commission as an open-end management investment company.\6\ 
The investment adviser to each Fund will be Cambiar Investors, LLC (the 
``Adviser''). SEI Investments Distribution Company (the 
``Distributor'') will serve as the distributor of each of the Funds' 
Shares. All statements and representations made in this filing 
regarding (a) the description of the portfolio or reference assets, (b) 
limitations on portfolio holdings or reference assets, or (c) the 
applicability of Exchange rules shall constitute continued listing 
requirements for listing the Shares on the Exchange, as provided under 
Rule 8.900-E(b)(1).
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    \6\ The Trust is registered under the 1940 Act. On May 10, 2021, 
the Trust filed a registration statement on Form N-1A under the 
Securities Act of 1933 (the ``1933 Act'') and the 1940 Act for the 
Funds (File No. 811-06400) (``Registration Statement''). The 
Commission issued an order granting exemptive relief to the Trust 
(``Exemptive Order'') under the 1940 Act on May 11, 2021 (Investment 
Company Act Release No. 34268). The Exemptive Order was granted in 
response to the Trust's application for exemptive relief (the 
``Exemptive Application'') (File No. 812-15191). The description of 
the operation of the Trust and the Funds herein is based, in part, 
on the Registration Statement.
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    Rule 8.900-E(b)(4) provides that, if the investment adviser to the 
Investment Company issuing Managed Portfolio Shares is registered as a 
broker-dealer or is affiliated with a broker-dealer, such investment 
adviser will erect and maintain a ``fire wall'' between the investment 
adviser and personnel of the broker-dealer or broker-dealer affiliate, 
as applicable, with respect to access to information concerning the 
composition of and/or changes to such Investment Company portfolio and/
or the Creation Basket.\7\ Any person related to the investment adviser 
or Investment Company who makes decisions pertaining to the Investment 
Company's portfolio composition or has access to information regarding 
the Investment Company's portfolio composition or changes thereto or 
the Creation Basket must be subject to procedures designed to prevent 
the use and dissemination of material non-public information regarding 
the applicable Investment Company portfolio or changes thereto or the 
Creation Basket.
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    \7\ Rule 8.900-E(c)(5) provides that the term ``Creation 
Basket'' means, on any given business day, the names and quantities 
of the specified instruments (and/or an amount of cash) that are 
required for an AP Representative to deposit in-kind on behalf of an 
Authorized Participant in exchange for a Creation Unit and the names 
and quantities of the specified instruments (and/or an amount of 
cash) that will be transferred in-kind to an AP Representative on 
behalf of an Authorized Participant in exchange for a Redemption 
Unit, which will be identical and will be transmitted to each AP 
Representative before the commencement of trading.
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    Rule 8.900-E(b)(4) is similar to Commentary .03(a)(i) and (iii) to 
Rule 5.2-E(j)(3); however, Commentary .03(a) in connection with the 
establishment of a ``fire wall'' between the investment adviser and the 
broker-dealer reflects the applicable open-end fund's portfolio, not an 
underlying benchmark index, as is the case with index-based funds.\8\ 
Rule 8.900-E(b)(4) is also similar to Commentary .06 to Rule 8.600-E 
related to Managed Fund Shares, except that Rule 8.900-E(b)(4) relates 
to establishment and maintenance of a ``fire wall'' between the 
investment adviser and personnel of

[[Page 39086]]

the broker-dealer or broker-dealer affiliate, as applicable, with 
respect to an Investment Company's portfolio and Creation Basket, and 
not just to the underlying portfolio, as is the case with Managed Fund 
Shares.
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    \8\ An investment adviser to an open-end fund is required to be 
registered under the Investment Advisers Act of 1940 (the ``Advisers 
Act''). As a result, the Adviser and its related personnel will be 
subject to the provisions of Rule 204A-1 under the Advisers Act 
relating to codes of ethics. This Rule requires investment advisers 
to adopt a code of ethics that reflects the fiduciary nature of the 
relationship to clients as well as compliance with other applicable 
securities laws. Accordingly, procedures designed to prevent the 
communication and misuse of non-public information by an investment 
adviser must be consistent with Rule 204A-1 under the Advisers Act. 
In addition, Rule 206(4)-7 under the Advisers Act makes it unlawful 
for an investment adviser to provide investment advice to clients 
unless such investment adviser has (i) adopted and implemented 
written policies and procedures reasonably designed to prevent 
violations, by the investment adviser and its supervised persons, of 
the Advisers Act and the Commission rules adopted thereunder; (ii) 
implemented, at a minimum, an annual review regarding the adequacy 
of the policies and procedures established pursuant to subparagraph 
(i) above and the effectiveness of their implementation; and (iii) 
designated an individual (who is a supervised person) responsible 
for administering the policies and procedures adopted under 
subparagraph (i) above. The Funds will also be required to comply 
with Exchange rules relating to disclosure, including Rule 5.3-E(i).
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    The Adviser is not registered as a broker-dealer and is not 
affiliated with any broker-dealer. In the event (a) the Adviser or any 
sub-adviser becomes registered as a broker-dealer or becomes newly 
affiliated with a broker-dealer, or (b) any new adviser or sub-adviser 
is a registered broker-dealer, or becomes affiliated with a broker-
dealer, it will implement and maintain a fire wall with respect to 
personnel of the broker-dealer or broker-dealer affiliate regarding 
access to information concerning the composition and/or changes to the 
portfolio and/or Creation Basket. Any person related to the Adviser or 
the Trust who makes decisions pertaining to a Fund's portfolio 
composition or that has access to information regarding a Fund's 
portfolio composition or that has access to information regarding a 
Fund's portfolio or changes thereto or the Creation Basket will be 
subject to procedures designed to prevent the use and dissemination of 
material non-public information regarding such portfolio or changes 
thereto and the Creation Basket.
    Further, Rule 8.900-E(b)(5) requires that any person or entity, 
including an AP Representative (as defined below), custodian, Reporting 
Authority, distributor, or administrator, who has access to non-public 
information regarding the Investment Company's portfolio composition or 
changes thereto or the Creation Basket, must be subject to procedures 
reasonably designed to prevent the use and dissemination of material 
non-public information regarding the applicable Investment Company 
portfolio or changes thereto or the Creation Basket. Moreover, if any 
such person or entity is registered as a broker-dealer or affiliated 
with a broker-dealer, such person or entity will erect and maintain a 
``fire wall'' between the person or entity and the broker-dealer with 
respect to access to information concerning the composition and/or 
changes to such Investment Company portfolio or Creation Basket.
Description of the Funds \9\
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    \9\ The Exchange represents that, for initial and continued 
listing, each Fund will be in compliance with Rule 10A-3 under the 
Act. See 17 CFR 240.10A-3.
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    Each Fund's holdings will conform to the permissible investments as 
set forth in the Exemptive Application and Exemptive Order and the 
holdings will be consistent with all requirements in the Exemptive 
Application and Exemptive Order.\10\
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    \10\ Pursuant to the Exemptive Order, the only permissible 
investments for a Fund are the following that trade on a U.S. 
exchange contemporaneously with the Funds' Shares: Exchange-traded 
funds (``ETFs''), exchange-traded notes, exchange-listed common 
stocks, exchange-traded preferred stocks, exchange-traded American 
Depositary Receipts, exchange-traded real estate investment trusts, 
exchange-traded commodity pools, exchange-traded metals trusts, 
exchange-traded currency trusts and exchange-traded futures, as well 
as cash and cash equivalents (short-term U.S. Treasury securities, 
government money market funds, and repurchase agreements). All of 
the equity instruments or futures held by a Fund will be traded on 
an exchange that is a member of the Intermarket Surveillance Group 
(``ISG'') or affiliated with a member of ISG or with which the 
Exchange has in place a comprehensive surveillance sharing 
agreement.
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Cambiar Large Cap ETF
    The Fund's investment objective is to seek total return and capital 
preservation. Under normal circumstances, the Fund will invest at least 
80% of its net assets in common stocks of large-cap companies. The Fund 
generally considers large-cap companies to be companies with a market 
capitalization in excess of $10 billion at time of purchase.
Cambiar Small Cap ETF
    The Fund's investment objective is to seek long-term capital 
appreciation. Under normal circumstances, the Fund will invest at least 
80% of its net assets in common stocks of small-cap companies. The Fund 
generally considers small-cap companies to be companies with market 
capitalizations not greater than either that of the largest company in 
the Russell 2000[supreg] Value Index or $3.5 billion, whichever is 
greater at the time of initial purchase.
Cambiar SMID ETF
    The Fund's investment objective is to seek long-term capital 
appreciation. Under normal circumstances, the Fund will invest at least 
80% of its net assets in common stocks of small- to mid-sized 
companies. The Fund generally considers small- and mid-sized companies 
to be companies with market capitalizations not greater than either 
that of the largest company in the Russell 2500[supreg] Value Index or 
$12 billion, whichever is greater at the time of initial purchase.
Investment Restrictions
    Each Fund's holdings will be consistent with all requirements 
described in the Exemptive Application and Exemptive Order.\11\
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    \11\ See id.
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    Each Fund's investments, including derivatives, will be consistent 
with its investment objective and will not be used to enhance leverage 
(although certain derivatives and other investments may result in 
leverage). That is, for each Fund, the Fund's investments will not be 
used to seek performance that is the multiple or inverse multiple 
(e.g., 2X or -3X) of the Fund's benchmark.
Creations and Redemptions of Shares
    Creations and redemptions of Shares will take place as described in 
Rule 8.900-E. Specifically, in connection with the creation and 
redemption of Creation Units \12\ and Redemption Units,\13\ the 
delivery or receipt of any portfolio securities in-kind will be 
required to be effected through a separate confidential brokerage 
account (a ``Confidential Account'').\14\ Authorized Participants 
(``AP''), as defined in the applicable Form N-1A filed with the 
Commission, will sign an agreement with an AP Representative \15\ 
establishing the Confidential Account for the benefit of the AP. AP 
Representatives will be broker-dealers. An AP must be a depository 
trust company participant that has executed an authorized participant 
agreement (``Participant Agreement'') with the Distributor with respect 
to the creation and redemption of Creation Units and Redemption Units 
and formed a Confidential Account with an AP

[[Page 39087]]

Representative for its benefit in accordance with the terms of the 
Participant Agreement. For purposes of creations or redemptions, all 
transactions will be effected through the respective AP's Confidential 
Account, for the benefit of the AP, without disclosing the identity of 
such securities to the AP.
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    \12\ Rule 8.900-E(c)(6) provides that the term ``Creation Unit'' 
means a specified minimum number of Managed Portfolio Shares issued 
by an Investment Company at the request of an Authorized Participant 
in return for a designated portfolio of instruments and/or cash.
    \13\ Rule 8.900-E(c)(7) provides that the term ``Redemption 
Unit'' means a specified minimum number of Managed Portfolio Shares 
that may be redeemed to an Investment Company at the request of an 
Authorized Participant in return for a portfolio of instruments and/
or cash.
    \14\ Rule 8.900-E(c)(4) provides that the term ``Confidential 
Account'' means an account owned by an Authorized Participant and 
held with an AP Representative on behalf of the Authorized 
Participant. The account will be established and governed by 
contractual agreement between the AP Representative and the 
Authorized Participant solely for the purposes of creation and 
redemption, while keeping confidential the Creation Basket 
constituents of each series of Managed Portfolio Shares, including 
from the Authorized Participant. The books and records of the 
Confidential Account will be maintained by the AP Representative on 
behalf of the Authorized Participant.
    \15\ Rule 8.900-E(c)(3) provides that the term ``AP 
Representative'' means an unaffiliated broker-dealer, with which an 
Authorized Participant has signed an agreement to establish a 
Confidential Account for the benefit of such Authorized Participant, 
that will deliver or receive, on behalf of the Authorized 
Participant, all consideration to or from the Investment Company in 
a creation or redemption. An AP Representative will not be permitted 
to disclose the Creation Basket to any person, including the 
Authorized Participants.
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    Each AP Representative will be given, before the commencement of 
trading each Business Day (as defined below), the Creation Basket (as 
described below) for that day. This information will permit an AP that 
has established a Confidential Account with an AP Representative to 
instruct the AP Representative to buy and sell positions in the 
portfolio securities to permit creation and redemption of Creation 
Units and Redemption Units. Shares of each Fund will be issued and 
redeemed in Creation Units and Redemption Units. A Creation Unit and 
Redemption Unit consists of 10,000 shares. The size of Creation Units 
and Redemption Units is subject to change. The Funds will offer and 
redeem Creation Units and Redemption Units on a continuous basis at the 
net asset value (``NAV'') per Share next determined after receipt of an 
order in proper form. The NAV per Share of each Fund will be determined 
as of the close of regular trading on the Exchange on each day that the 
Exchange is open (a ``Business Day''). The Funds will sell and redeem 
Creation Units and Redemption Units only on Business Days.
    In order to keep costs low and permit each Fund to be as fully 
invested as possible, Shares will be purchased and redeemed from the 
respective Fund in Creation Units and Redemption Units and generally on 
an in-kind basis. Accordingly, except where the purchase or redemption 
is exclusively made in cash under the circumstances permitted in the 
Exemptive Application, APs will be required to purchase Creation Units 
by accepting an in-kind deposit of a designated portfolio of securities 
(``Deposit Securities''), and APs redeeming their Shares will receive 
from the Fund an in-kind transfer of a designated portfolio of 
securities (``Fund Securities'') through the AP Representative into 
their Confidential Account.\16\ On any given Business Day, the names 
and quantities of the instruments that constitute the Deposit 
Securities and the names and quantities of the instruments that 
constitute the Fund Securities will be identical, and these instruments 
may be referred to, in the case of either a purchase or a redemption, 
as the ``Creation Basket.''
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    \16\ According to the Registration Statement, the Funds must 
comply with the federal securities laws in accepting Deposit 
Securities and satisfying redemptions with Fund Securities, 
including that the Deposit Securities and Fund Securities are sold 
in transactions that would be exempt from registration under the 
1933 Act.
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Placement of Purchase Orders
    Each Fund will issue Shares through the Distributor on a continuous 
basis at NAV. The Exchange represents that the issuance of Shares will 
operate in a manner substantially similar to that of other ETFs. Each 
Fund will issue Shares only at the NAV per Share next determined after 
an order in proper form is received. The Distributor will furnish 
acknowledgements to those placing such orders that the orders have been 
accepted, but the Distributor may reject any order which is not 
submitted in proper form, as described in each Fund's prospectus or 
Statement of Additional Information (``SAI'').
    The NAV of each Fund is expected to be determined once each 
Business Day as of the close of the regular trading session on the NYSE 
(normally 4:00 p.m. E.T.) (the ``Valuation Time''). To initiate a 
purchase of Shares, an AP must submit to the Distributor an irrevocable 
order to purchase such Shares after the most recent prior Valuation 
Time. In purchasing the necessary securities, the AP Representative 
will use methods, such as breaking the transaction into multiple 
transactions and transacting in multiple marketplaces, to avoid 
revealing the composition of the Creation Basket.
    Each Fund will establish a cut-off time (``Order Cut-Off Time'') 
for purchase orders in proper form. Generally, all orders to purchase 
Creation Units must be received by the Distributor no later than the 
Order Cut-Off Time on the date such order is placed (``Transmittal 
Date'') in order for the purchaser to receive the NAV per Share 
determined on the Transmittal Date. As with all existing ETFs, if there 
is a difference between the NAV attributable to a Creation Unit and the 
aggregate market value of the Creation Basket exchanged for the 
Creation Unit, the party conveying instruments with the lower value 
will also pay to the other an amount in cash equal to that difference 
(the ``Balancing Amount'').
    Purchases of Shares will be settled in-kind and/or cash for an 
amount equal to the applicable NAV per Share purchased plus applicable 
transaction fees.\17\ Other than the Balancing Amount, a Fund will 
substitute cash only under exceptional circumstances and as set forth 
under the Fund's policies and procedures governing the composition of 
Creation Baskets.
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    \17\ To the extent that a Fund allows creations or redemptions 
to be conducted in cash, such transactions will be effected in the 
same manner for all APs transacting in cash.
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Authorized Participant Redemption
    The Shares may be redeemed to a Fund in Redemption Unit size or 
multiples thereof as described below. Redemption orders of Redemption 
Units must be placed by or through an AP (``AP Redemption Order'') in 
proper form. Redemption Units of a Fund will be redeemable at their NAV 
per Share next determined after receipt of a request for redemption by 
the Trust in the manner specified below before the Order Cut-Off Time. 
To initiate an AP Redemption Order, an AP must submit to the 
Distributor an irrevocable order to redeem such Redemption Unit no 
later than the Order Cut-Off Time on the Transmittal Date. A 
transaction fee may be imposed to offset costs associated with 
redemption orders.
    In the case of a redemption, the AP would enter into an irrevocable 
redemption order, and then the applicable Fund would instruct its 
custodian to deliver the Fund Securities to the appropriate 
Confidential Account. The Authorized Participant would direct the AP 
Representative on when that day to liquidate those securities. As with 
the purchase of securities, the AP Representative will use methods, 
such as breaking the transaction into multiple transactions and 
transacting in multiple marketplaces, to avoid revealing the 
composition of the Creation Basket.
    Redemptions will occur primarily in-kind, although redemption 
payments may also be made partly or wholly in cash. The Participant 
Agreement signed by each AP will require establishment of a 
Confidential Account to receive distributions of securities in-kind 
upon redemption. Each AP will be required to open a Confidential 
Account with an AP Representative in order to facilitate orderly 
processing of redemptions.
Net Asset Value
    Each Fund calculates its NAV once each business day as of the 
regularly scheduled close of trading on the New York Stock Exchange, 
normally 4:00 p.m. Eastern Time. The NAV of each Fund is computed by 
(i) taking the current market value of its total assets, (ii) 
subtracting any liabilities, and (iii) dividing the result by the total 
number of shares outstanding.
    In computing each Fund's NAV, the Fund's securities holdings are 
valued based on their last readily available market price. Securities 
for which such information is readily available are generally valued at 
the last reported

[[Page 39088]]

sales price, the official closing price as reported by an independent 
pricing service on the primary market or exchange on which they are 
traded, or, in the absence of reported sales, at the most recent bid 
price. If market prices are unavailable or a Fund thinks that they are 
unreliable, or when the value of a security has been materially 
affected by events occurring after the relevant market closes, the Fund 
will price those securities at fair value as determined in good faith 
using methods approved by the Fund's Board.
    More information about the valuation of each Fund's holdings can be 
found in the SAI.
    Information showing the number of days that the market price of 
each Fund's Shares was greater than the Fund's NAV (i.e., at a premium) 
or less than the Fund's NAV (i.e., at a discount) for various time 
periods will be available on the Funds' website at www.cambiar.com.
Availability of Information
    The Funds' website, www.cambiar.com, will include a form of the 
prospectus for each Fund that may be downloaded. The Funds' website 
will include additional quantitative information updated on a daily 
basis, including, on a per share basis for each Fund, the prior 
Business Day's NAV, market closing price, the bid/ask spreads at the 
time of calculation of such NAV (the ``Bid/Ask Price''),\18\ and a 
calculation of the premium or discount of the market closing price or 
Bid/Ask Price against the NAV. The website and information will be 
publicly available at no charge.
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    \18\ The Bid/Ask Price of a Fund's Shares is determined using 
the mid-point between the current national best bid and offer at the 
time of calculation of such Fund's NAV. The records relating to Bid/
Ask Prices will be retained by the Funds or their service providers.
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    Form N-PORT requires reporting of a Fund's complete portfolio 
holdings on a position-by-position basis on a quarterly basis within 60 
days after fiscal quarter end. Investors can obtain a Fund's SAI, its 
shareholder reports, its Form N-CSR, filed twice a year, and its Form 
N-CEN, filed annually. Each Fund's SAI and shareholder reports are 
available free upon request from the Investment Company, and those 
documents and the Form N-PORT, Form N-CSR, and Form N-CEN may be viewed 
onscreen 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 to market participants 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 will be available via the Consolidated Tape 
Association (``CTA'') high-speed line. In addition, the Verified 
Intraday Indicative Value (``VIIV''), as defined in Rule 8.900-
E(c)(2),\19\ will be widely disseminated by the Reporting Authority 
\20\ and/or one or more major market data vendors in one second 
intervals during the Exchange's Core Trading Session.
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    \19\ Rule 8.900-E(c)(2) provides that the term ``Verified 
Intraday Indicative Value'' is the indicative value of a Managed 
Portfolio Share based on all of the holdings of a series of Managed 
Portfolio Shares as of the close of business on the prior business 
day and, for corporate actions, based on the applicable holdings as 
of the opening of business on the current business day, priced and 
disseminated in one second intervals during the Core Trading Session 
by the Reporting Authority.
    \20\ Rule 8.900-E(c)(8) provides that the term ``Reporting 
Authority'' in respect of a particular series of Managed Portfolio 
Shares means the Exchange, an institution, or a reporting service 
designated by the Exchange or by the exchange that lists a 
particular series of Managed Portfolio Shares (if the Exchange is 
trading such series pursuant to unlisted trading privileges), as the 
official source for calculating and reporting information relating 
to such series, including, but not limited to, the NAV, the VIIV, or 
other information relating to the issuance, redemption, or trading 
of Managed Portfolio Shares. A series of Managed Portfolio Shares 
may have more than one Reporting Authority, each having different 
functions.
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Dissemination of the VIIV
    With respect to trading of the Shares, the ability of market 
participants to buy and sell Shares at prices near the VIIV is 
dependent upon their assessment that the VIIV is a reliable, indicative 
real-time value for a Fund's underlying holdings. Market participants 
are expected to accept the VIIV as a reliable, indicative real-time 
value because (1) the VIIV will be calculated and disseminated based on 
a Fund's actual portfolio holdings, (2) the securities in which a Fund 
plans to invest are generally highly liquid and actively traded and 
trade at the same time as the Fund and therefore generally have 
accurate real time pricing available, and (3) market participants will 
have a daily opportunity to evaluate whether the VIIV at or near the 
close of trading is indeed predictive of the actual NAV.
    The VIIV will be widely disseminated by the Reporting Authority 
and/or by one or more major market data vendors in one second intervals 
during the Core Trading Session and will be disseminated to all market 
participants at the same time. The VIIV is based on the current market 
value of the securities in a Fund's portfolio that day. The methodology 
for calculating the VIIV will be available on the Funds' website. The 
VIIV is intended to provide investors and other market participants 
with a highly correlated per Share value of the underlying portfolio 
that can be compared to the current market price. Therefore, under 
normal circumstances the VIIV would be effectively a near real time 
approximation of each Fund's NAV, which is computed only once a day, 
and is available free of charge from one or more market data vendors.
Trading Halts
    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 a Fund.\21\ Trading in Shares of a Fund will 
be halted if the circuit breaker parameters in Rule 7.12-E have been 
reached. 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. Trading in the Shares will be subject to Rule 8.900-
E(d)(2)(C), which sets forth circumstances under which Shares of a Fund 
will be halted.
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    \21\ See Rule 7.12-E.
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    Specifically, Rule 8.900-E(d)(2)(C)(i) provides that the Exchange 
may consider all relevant factors in exercising its discretion to halt 
trading in a series of Managed Portfolio Shares. Trading may be halted 
because of market conditions or for reasons that, in the view of the 
Exchange, make trading in the series of Managed Portfolio Shares 
inadvisable. These may include: (a) The extent to which trading is not 
occurring in the securities and/or the financial instruments composing 
the portfolio; or (b) whether other unusual conditions or circumstances 
detrimental to the maintenance of a fair and orderly market are 
present.\22\
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    \22\ The Exemptive Application provides that the Investment 
Company or their agent will request that the Exchange halt trading 
in the applicable series of Managed Portfolio Shares where: (i) The 
intraday indicative values calculated by the calculation engines 
differ by more than 25 basis points for 60 seconds in connection 
with pricing of the VIIV; or (ii) holdings representing 10% or more 
of a series of Managed Portfolio Shares' portfolio have become 
subject to a trading halt or otherwise do not have readily available 
market quotations. Any such requests will be one of many factors 
considered in order to determine whether to halt trading in a series 
of Managed Portfolio Shares, and the Exchange retains sole 
discretion in determining whether trading should be halted. As 
provided in the Exemptive Application, each series of Managed 
Portfolio Shares would employ a pricing verification agent to 
continuously compare two intraday indicative values during regular 
trading hours in order to ensure the accuracy of the VIIV.
---------------------------------------------------------------------------

    Rule 8.900-E(d)(2)(C)(ii) provides that, if the Exchange becomes 
aware

[[Page 39089]]

that: (i) The VIIV of a series of Managed Portfolio Shares is not being 
calculated or disseminated in one second intervals, as required; (ii) 
the NAV with respect to a series of Managed Portfolio Shares is not 
disseminated to all market participants at the same time; (iii) the 
holdings of a series of Managed Portfolio Shares are not made available 
on at least a quarterly basis as required under the 1940 Act; or (iv) 
such holdings are not made available to all market participants at the 
same time (except as otherwise permitted under the currently applicable 
exemptive order or no-action relief granted by the Commission or 
Commission staff to the Investment Company with respect to the series 
of Managed Portfolio Shares), it will halt trading in such series until 
such time as the VIIV, the net asset value, or the holdings are 
available, as required.
Trading Rules
    The Exchange deems the Shares to be equity securities, thus 
rendering trading in the Shares subject to the Exchange's existing 
rules governing the trading of equity securities. Shares will trade on 
the Exchange in all trading sessions in accordance with Rule 7.34-E(a). 
As provided in Rule 7.6-E, the minimum price variation (``MPV'') for 
quoting and entry of orders in equity securities traded on the NYSE 
Arca Marketplace is $0.01, with the exception of securities that are 
priced less than $1.00, for which the MPV for order entry is $0.0001. A 
minimum of 100,000 Shares of each Fund will be outstanding at the 
commencement of trading on the Exchange.
    The Shares will conform to the initial and continued listing 
criteria under Rule 8.900-E, as well as all terms in the Exemptive 
Order. The Exchange will obtain a representation from the issuer of the 
Shares of each Fund that the NAV per Share of each Fund will be 
calculated daily and will be made available to all market participants 
at the same time.
Surveillance
    The Exchange believes that its surveillance procedures are adequate 
to properly monitor the trading of Shares on the Exchange during all 
trading sessions and to deter and detect violations of Exchange rules 
and the applicable federal securities laws. Trading of Shares through 
the Exchange will be subject to the Exchange's surveillance procedures 
for derivative products. As part of these surveillance procedures and 
consistent with Rule 8.900-E(b)(3) and 8.900-E(d)(2)(B), the Adviser 
will upon request make available to the Exchange and/or FINRA, on 
behalf of the Exchange, the daily portfolio holdings of a Fund. The 
issuer of the Shares of each Fund will be required to represent to the 
Exchange that it will advise the Exchange of any failure by a Fund to 
comply with the continued listing requirements, and, pursuant to its 
obligations under Section 19(g)(1) of the Act, the Exchange will 
surveil for compliance with the continued listing requirements. If a 
Fund is not in compliance with the applicable listing requirements, the 
Exchange will commence delisting procedures under Exchange Rule 5.5-
E(m).
    FINRA, on behalf of the Exchange, or the regulatory staff of the 
Exchange, or both, will communicate as needed regarding trading in the 
Shares and certain exchange-traded instruments with other markets and 
other entities that are members of the ISG, and FINRA, on behalf of the 
Exchange, or the regulatory staff of the Exchange, or both, may obtain 
trading information regarding trading such securities from such markets 
and other entities. In addition, the Exchange may obtain information 
regarding trading in the Shares and certain exchange-traded instruments 
from markets and other entities that are members of ISG or with which 
the Exchange has in place a comprehensive surveillance sharing 
agreement.
    In addition, the Exchange also has a general policy prohibiting the 
distribution of material, non-public information by its employees. 
FINRA also generally prohibits its employees from disseminating or 
disclosing any non-public information obtained in the course of his or 
her employment.\23\
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    \23\ See Securities Exchange Act Release No. 89663 (August 25, 
2020), 85 FR 53868 (August 31, 2020) (SR-NYSEArca-2020-48) (Order 
Approving a Proposed Rule Change, as Modified by Amendment No. 1, To 
List and Trade Shares of Gabelli ETFs Under Rule 8.900-E, Managed 
Portfolio Shares).
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2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act,\24\ in general, and furthers the 
objectives of Section 6(b)(5) of the Act,\25\ in particular, in that it 
is 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 
a national market system, and, in general, to protect investors and the 
public interest.
---------------------------------------------------------------------------

    \24\ 15 U.S.C. 78f(b).
    \25\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Exchange believes that this proposed rule change is designed to 
prevent fraudulent and manipulative acts and practices in that the 
Funds would meet each of the rules relating to listing and trading of 
Managed Portfolio Shares. To the extent that a Fund is not in 
compliance with such rules, the Exchange would either prevent the Fund 
from listing and trading on the Exchange or commence delisting 
procedures under Rule 8.900-E(d)(2)(B). Specifically, the Exchange 
would consider the suspension of trading, and commence delisting 
proceedings under Rule 8.900-E(d)(2)(B), of a Fund under any of the 
following circumstances: (a) If, following the initial twelve-month 
period after commencement of trading on the Exchange, there are fewer 
than 50 beneficial holders of the Fund; (b) if the Exchange has halted 
trading in a Fund because the VIIV is interrupted pursuant to Rule 
8.900-E(d)(2)(C)(ii) and such interruption persists past the trading 
day in which it occurred or is no longer available; (c) if the Exchange 
has halted trading in a Fund because the net asset value with respect 
to such Fund is not disseminated to all market participants at the same 
time, the holdings of such Fund are not made available on at least a 
quarterly basis as required under the 1940 Act, or such holdings are 
not made available to all market participants at the same time pursuant 
to Rule 8.900-E(d)(2)(C)(ii) and such issue persists past the trading 
day in which it occurred; (d) if the Exchange has halted trading in 
Shares of a Fund pursuant to Rule 8.900-E(d)(2)(C)(i) and such issue 
persists past the trading day in which it occurred; (e) if a Fund has 
failed to file any filings required by the Commission or if the 
Exchange is aware that a Fund is not in compliance with the conditions 
of any currently applicable exemptive order or no-action relief granted 
by the Commission or Commission staff with respect to the Fund; (f) if 
any of the continued listing requirements set forth in Rule 8.900-E are 
not continuously maintained; (g) if any of the statements of 
representations regarding (a) the description of the portfolio, (b) 
limitations on portfolio holdings, or (c) the applicability of Exchange 
listing rules as specified herein to permit the listing and trading of 
a Fund, are not continuously maintained; or (h) if such other event 
shall occur or condition exists which, in the opinion of the Exchange, 
makes further dealings on the Exchange inadvisable.
    As discussed above, the Adviser is not registered as a broker-
dealer and is not affiliated with any broker-dealer In the event that 
(a) the Adviser or sub-adviser

[[Page 39090]]

becomes registered as a broker-dealer or becomes newly affiliated with 
a broker-dealer, or (b) any new adviser or sub-adviser is a registered 
broker-dealer or becomes affiliated with a broker-dealer, the Adviser 
will implement and maintain a fire wall with respect to personnel of 
the broker-dealer or broker-dealer affiliate regarding access to 
information concerning the composition and/or changes to the portfolio 
and/or Creation Basket. Any person related to the Adviser or the Trust 
who makes decisions pertaining to a Fund's portfolio composition or 
that has access to information regarding a Fund's portfolio or changes 
thereto or the Creation Basket will be subject to procedures designed 
to prevent the use and dissemination of material non-public information 
regarding such portfolio or changes thereto and the Creation Basket.
    In addition, Rule 8.900-E(b)(5) requires that any person or entity, 
including an AP Representative, custodian, Reporting Authority, 
distributor, or administrator, who has access to non-public information 
regarding the Investment Company's portfolio composition or changes 
thereto or the Creation Basket, must be subject to procedures designed 
to prevent the use and dissemination of material non-public information 
regarding the applicable Investment Company portfolio or changes 
thereto or the Creation Basket. Moreover, if any such person or entity 
is registered as a broker-dealer or affiliated with a broker-dealer, 
such person or entity will erect and maintain a ``fire wall'' between 
the person or entity and the broker-dealer with respect to access to 
information concerning the composition and/or changes to such 
Investment Company portfolio or Creation Basket. Any person or entity 
who has access to information regarding a Fund's portfolio composition 
or changes thereto or the Creation Basket will be subject to procedures 
designed to prevent the use and dissemination of material non-public 
information regarding the portfolio or changes thereto or the Creation 
Basket.
    The Exchange further believes that Rule 8.900-E is designed to 
prevent fraudulent and manipulative acts and practices related to the 
listing and trading of Shares of the Funds because it provides 
meaningful requirements about both the data that will be made publicly 
available about the Shares, as well as the information that will only 
be available to certain parties and the controls on such information. 
Specifically, the Exchange believes that the requirements related to 
information protection set forth in Rule 8.900-E(b)(5) will act as a 
safeguard against misuse and improper dissemination of information 
related to a Fund's portfolio composition, the Creation Basket, or 
changes thereto. The requirement that any person or entity implement 
procedures to prevent the use and dissemination of material non-public 
information regarding the portfolio or Creation Basket will act to 
prevent any individual or entity from sharing such information 
externally and the internal ``fire wall'' requirements applicable where 
an entity is a registered broker-dealer or affiliated with a broker-
dealer will act to make sure that no entity will be able to misuse the 
data for their own purposes. Accordingly, the Exchange believes that 
this proposal is designed to prevent fraudulent and manipulative acts 
and practices.
    The Exchange further believes that the proposal is designed to 
prevent fraudulent and manipulative acts and practices related to the 
listing and trading of Shares of the Funds and to promote just and 
equitable principles of trade and to protect investors and the public 
interest because the Exchange would halt trading under certain 
circumstances under which trading in the Shares of a Fund may be 
inadvisable. Specifically, trading in the Shares will be subject to 
Rule 8.900-E(d)(2)(C)(i), which provides that the Exchange may consider 
all relevant factors in exercising its discretion to halt trading in a 
Fund. Trading may be halted because of market conditions or for reasons 
that, in the view of the Exchange, make trading in the series of 
Managed Portfolio Shares inadvisable. These may include: (a) The extent 
to which trading is not occurring in the securities and/or the 
financial instruments composing the portfolio; or (b) whether other 
unusual conditions or circumstances detrimental to the maintenance of a 
fair and orderly market are present.\26\ Additionally, trading in the 
Shares will be subject to Rule 8.900-E(d)(2)(C)(ii), which provides 
that the Exchange would halt trading where the Exchange becomes aware 
that: (a) The VIIV of a series of Managed Portfolio Shares is not being 
calculated or disseminated in one second intervals, as required; (b) 
the net asset value with respect to a series of Managed Portfolio 
Shares is not disseminated to all market participants at the same time; 
(c) the holdings of a series of Managed Portfolio Shares are not made 
available on at least a quarterly basis as required under the 1940 Act; 
or (d) such holdings are not made available to all market participants 
at the same time (except as otherwise permitted under the currently 
applicable exemptive order or no-action relief granted by the 
Commission or Commission staff to the Investment Company with respect 
to the series of Managed Portfolio Shares). The Exchange would halt 
trading in such Shares until such time as the VIIV, the NAV, or the 
holdings are available, as required.
---------------------------------------------------------------------------

    \26\ See supra note 22.
---------------------------------------------------------------------------

    With respect to the proposed listing and trading of Shares of the 
Funds, the Exchange believes that the proposed rule change is designed 
to prevent fraudulent and manipulative acts and practices in that the 
Shares will be listed and traded on the Exchange pursuant to the 
initial and continued listing criteria in Rule 8.900-E.\27\ Each Fund's 
holdings will conform to the permissible investments as set forth in 
the Exemptive Application and Exemptive Order.\28\ As noted above, 
FINRA, on behalf of the Exchange, or the regulatory staff of the 
Exchange, or both, will communicate as needed regarding trading in the 
Shares and the underlying exchange-traded instruments with other 
markets and other entities that are members of the ISG, and FINRA, on 
behalf of the Exchange, or the regulatory staff of the Exchange, or 
both, may obtain trading information regarding trading such instruments 
from such markets and other entities. In addition, the Exchange may 
obtain information regarding trading in the Shares and the underlying 
exchange-traded instruments from markets and other entities that are 
members of ISG or with which the Exchange has in place a comprehensive 
surveillance sharing agreement.
---------------------------------------------------------------------------

    \27\ The Exchange represents that, for initial and continued 
listing, each Fund will be in compliance with Rule 10A-3 under the 
Act. See 17 CFR 240.10A-3.
    \28\ See supra note 10.
---------------------------------------------------------------------------

    With respect to trading of Shares of the Funds, the ability of 
market participants to buy and sell Shares at prices near the VIIV is 
dependent upon their assessment that the VIIV is a reliable, indicative 
real-time value for a Fund's underlying holdings. Market participants 
are expected to accept the VIIV as a reliable, indicative real-time 
value because (1) the VIIV will be calculated and disseminated based on 
a Fund's actual portfolio holdings, (2) the securities in which the 
Funds plan to invest are generally highly liquid and actively traded 
and trade at the same time as the Funds and therefore generally have 
accurate real time pricing available, and (3) market participants

[[Page 39091]]

will have a daily opportunity to evaluate whether the VIIV at or near 
the close of trading is indeed predictive of the actual NAV.
    The proposed rule change is designed to promote just and equitable 
principles of trade and to protect investors and the public interest in 
that the Exchange will obtain a representation that the NAV per Share 
of the Funds will be calculated daily and that the NAV will be made 
available to all market participants at the same time. Investors can 
also obtain a Fund's SAI, its shareholder reports, its Form N-CSR 
(filed twice a year), and its Form N-CEN (filed annually). A Fund's SAI 
and shareholder reports will be available free upon request from the 
applicable Fund, and those documents and the Form N-PORT, Form N-CSR, 
and Form N-CEN may be viewed on-screen or downloaded from the 
Commission's website at www.sec.gov. In addition, a large amount of 
information will be publicly available regarding the Funds and the 
Shares, thereby promoting market transparency. Quotation and last sale 
information for the Shares will be available via the CTA high-speed 
line. Information regarding the VIIV will be widely disseminated in one 
second intervals throughout the Core Trading Session by the Reporting 
Authority and/or one or more major market data vendors. The website for 
the Funds will include a prospectus for the Funds that may be 
downloaded, and additional data relating to NAV and other applicable 
quantitative information, updated on a daily basis. Moreover, prior to 
the commencement of trading, the Exchange will inform its members in an 
Information Bulletin of the special characteristics and risks 
associated with trading the Shares.
    In addition, as noted above, investors will have ready access to 
the VIIV, and quotation and last sale information for the Shares. The 
Shares will conform to the initial and continued listing criteria under 
Rule 8.900-E. Each Fund's investments, including derivatives, will be 
consistent with its investment objective and will not be used to 
enhance leverage (although certain derivatives and other investments 
may result in leverage). That is, a Fund's investments will not be used 
to seek performance that is the multiple or inverse multiple (e.g., 2X 
or -3X) of the Fund's benchmark.
    The Exchange also believes that 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 actively-managed exchange-traded 
products 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, as noted 
above, investors will have ready access to information regarding the 
VIIV 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.

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 purposes of the Act. The Exchange believes the 
proposed rule change would permit the listing and trading of additional 
actively-managed exchange-traded products, thereby promoting 
competition among exchange-traded products 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 \29\ and Rule 19b-
4(f)(6) thereunder.\30\
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    \29\ 15 U.S.C. 78s(b)(3)(A).
    \30\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6) 
requires a self-regulatory organization to give the Commission 
written notice of its intent to file 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.
---------------------------------------------------------------------------

    A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the 
Act normally does not become operative for 30 days after the date of 
its filing. However, Rule 19b-4(f)(6)(iii) \31\ 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 
requested that the Commission waive the 30-day operative delay so that 
the proposal may become operative immediately upon filing. The Exchange 
states that the Commission has approved proposed rule changes to permit 
listing and trading on the Exchange of Managed Portfolio Shares similar 
to the Funds.\32\ The proposed listing rule for the Funds raises no 
novel legal or regulatory issues. For this reason, the Commission 
believes that waiver of the 30-day operative delay is consistent with 
the protection of investors and the public interest. Accordingly, the 
Commission hereby waives the 30-day operative delay and designates the 
proposed rule change operative upon filing.\33\
---------------------------------------------------------------------------

    \31\ 17 CFR 240.19b-4(f)(6)(iii).
    \32\ See supra note 5.
    \33\ For purposes only of waiving the 30-day operative delay, 
the Commission has also considered the proposed rule's impact on 
efficiency, competition, and capital formation. See 15 U.S.C. 
78c(f).
---------------------------------------------------------------------------

    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.

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 (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
File Number SR-NYSEArca-2021-54 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-2021-54. 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

[[Page 39092]]

post all comments on the Commission's internet website (http://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-2021-54 and should be submitted on or before August 13, 2021.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\34\
---------------------------------------------------------------------------

    \34\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2021-15655 Filed 7-22-21; 8:45 am]
BILLING CODE 8011-01-P