VanEck Russia ETF and VanEck Russia Small-Cap ETF, Series of VanEck ETF Trust, and Van Eck Associates Corporation; Notice of Application and Temporary Order, 393-396 [2022-28538]
Download as PDF
<![CDATA[
Federal Register / Vol. 88, No. 2 / Wednesday, January 4, 2023 / Notices
to all Members who transact NonPriority Customer Complex Orders that
take liquidity from the Complex Order
Book, including Exposure Complex
Orders and Exposure Only Complex
Orders, when executed against Priority
Customer Complex Orders, excluding
Complex Orders executed in the
Facilitation Mechanism, Solicited Order
Mechanism, and Price Improvement
Mechanism. Additionally, the criteria
for assessing the surcharge would be
uniformly applied to all Members for
Taker Fees in both Select and NonSelect Symbols. Continuing to exclude
Complex Orders executed in the
Facilitation Mechanism, Solicited Order
Mechanism, and Price Improvement
Mechanism from the proposed NonPriority Customer Complex Order
surcharge is equitable and not unfairly
discriminatory because those auction
mechanisms are subject to separate
pricing. The Exchange desires to
continue to encourage participation
within those auction mechanisms.
Subjecting Exposure Complex Orders
and Exposure Only Complex Orders
pursuant to Options 3, Section 14(b)(13)
and (14) to the note 8 surcharge is
equitable and not unfairly
discriminatory because there is no
separate pricing for these order types
that are entered into Complex Exposure
within Supplementary .01 to Options 3,
Section 14. These order types are
exposed upon entry and may not be
entered on the Complex Order Book.
The Exchange believes it is equitable
and not unfairly discriminatory to
subject Exposure Complex Orders and
Exposure Only Complex Orders to the
same pricing as other orders entered
into the Complex Order Book which
would include the Non-Priority
Customer Complex Order surcharge.
Any Member may utilize the
Facilitation Mechanism, the Solicited
Order Mechanism, and the Price
Improvement Mechanism 34 as well as
Exposure Complex Orders and Exposure
Only Complex Orders.
khammond on DSKJM1Z7X2PROD with NOTICES
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
No written comments were either
solicited or received.
34 The Exchange notes that with respect to the
Price Improvement Mechanism, an Initiating Order
may not be a solicited order for the account of any
Exchange Lead Market Maker, SQT, RSQT or nonstreaming Market Maker assigned in the affected
series. See Options 3, Section 13(a)(8).
VerDate Sep<11>2014
16:55 Jan 03, 2023
Jkt 259001
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become
effective pursuant to Section
19(b)(3)(A)(ii) of the Act 35 and Rule
19b–4(f)(2) 36 thereunder. At any time
within 60 days of the filing of the
proposed rule change, the Commission
summarily may temporarily suspend
such rule change if it appears to the
Commission that such action is: (i)
necessary or appropriate in the public
interest; (ii) for the protection of
investors; or (iii) otherwise in
furtherance of the purposes of the Act.
If the Commission takes such action, the
Commission shall institute proceedings
to determine whether the proposed rule
should be approved or disapproved.
IV. Solicitation of Comments
Interested persons are invited to
submit written data, views, and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
Comments may be submitted by any of
the following methods:
Electronic Comments
• Use the Commission’s internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an email to rule-comments@
sec.gov. Please include File Number SR–
ISE–2022–29 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–ISE–2022–29. This file
number should be included on the
subject line if email is used. To help the
Commission process and review your
comments more efficiently, please use
only one method. The Commission will
post all comments on the Commission’s
internet website (https://www.sec.gov/
rules/sro.shtml). Copies of the
submission, all subsequent
amendments, all written statements
with respect to the proposed rule
change that are filed with the
Commission, and all written
communications relating to the
proposed rule change between the
Commission and any person, other than
those that may be withheld from the
public in accordance with the
provisions of 5 U.S.C. 552, will be
available for website viewing and
printing in the Commission’s Public
35 15
36 17
PO 00000
U.S.C. 78s(b)(3)(A)(ii).
CFR 240.19b–4(f)(2).
Frm 00056
Fmt 4703
Sfmt 4703
393
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–ISE–2022–29 and should be
submitted on or before January 25, 2023.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.37
J. Matthew DeLesDernier,
Deputy Secretary.
[FR Doc. 2022–28544 Filed 1–3–23; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Investment Company Act Release No.
34793; File No. 812–15420]
VanEck Russia ETF and VanEck
Russia Small-Cap ETF, Series of
VanEck ETF Trust, and Van Eck
Associates Corporation; Notice of
Application and Temporary Order
December 28, 2022.
Securities and Exchange
Commission (‘‘Commission’’).
ACTION: Notice of application and a
temporary order under section 22(e)(3)
of the Investment Company Act of 1940
(the ‘‘Act’’).
AGENCY:
Applicants
request a temporary order to permit
each of VanEck Russia ETF and VanEck
Russia Small-Cap ETF (each, a ‘‘Fund,’’
and collectively, the ‘‘Funds’’), series of
VanEck ETF Trust (the ‘‘Trust’’), to
suspend the right of redemption of its
outstanding redeemable securities and
postpone the date of payment of
redemption proceeds with respect to
redemption orders received but not yet
paid.
APPLICANTS: The Trust, on behalf of the
Funds, and Van Eck Associates
Corporation, the Funds’ investment
adviser (‘‘Adviser’’ and together with
the Trust, the ‘‘Applicants’’).
FILING DATE: The application was filed
on December 28, 2022.
HEARING OR NOTIFICATION OF HEARING:
Interested persons may request a
SUMMARY OF APPLICATION:
37 17
E:\FR\FM\04JAN1.SGM
CFR 200.30–3(a)(12).
04JAN1
394
Federal Register / Vol. 88, No. 2 / Wednesday, January 4, 2023 / Notices
khammond on DSKJM1Z7X2PROD with NOTICES
hearing by emailing to the
Commission’s Secretary at SecretarysOffice@sec.gov and serving Applicants
with a copy of the request by email, if
an email address is listed for the
relevant Applicant below, or personally
or by mail, if a physical address is listed
for the relevant Applicant below.
Hearing requests should be received by
the Commission by 5:30 p.m. on January
24, 2023, and should be accompanied
by proof of service on Applicants, in the
form of an affidavit or, for lawyers, a
certificate of service. Pursuant to rule 0–
5 under the Act, hearing requests should
state the nature of the writer’s interest,
any facts bearing upon the desirability
of a hearing on the matter, the reason for
the request, and the issues contested.
Persons who wish to be notified of a
hearing may request notification by
writing to the Commission’s Secretary at
Secretarys-Office@sec.gov.
ADDRESSES: The Commission:
Secretarys-Office@sec.gov. Applicants:
Allison M. Fumai, Esq., Dechert LLP,
1095 Avenue of the Americas, New
York, New York 10036–6797, with
copies to Jonathan R. Simon, Esq.,
VanEck ETF Trust, 666 Third Avenue,
9th Floor, New York, New York 10017.
FOR FURTHER INFORMATION CONTACT:
Christopher D. Carlson, Senior Counsel,
Trace W. Rakestraw, Branch Chief, or
Daniele Marchesani, Assistant Chief
Counsel, at (202) 551–6825 (Division of
Investment Management, Chief
Counsel’s Office).
SUPPLEMENTARY INFORMATION: For
Applicants’ representations, legal
analysis, and conditions, please refer to
Applicants’ application, dated
December 28, 2022, which may be
obtained via the Commission’s website
by searching for the file number at the
top of this document, or for an
Applicant using the Company name
search field, on the SEC’s EDGAR
system. The SEC’s EDGAR system may
be searched at https://www.sec.gov/
edgar/searchedgar/legacy/
companysearch.html. You may also call
the SEC’s Public Reference Room at
(202) 551–8090.
Background
1. The Trust is registered under the
Act as an open-end series management
investment company. Adviser is the
investment adviser to the Funds, each of
which is a series of the Trust. Adviser
is registered as an investment adviser
under the Investment Advisers Act of
1940.
2. Each Fund is a non-diversified
exchange-traded fund (‘‘ETF’’) that
operates pursuant to Rule 6c–11 under
the Act, which provides that shares of
VerDate Sep<11>2014
16:55 Jan 03, 2023
Jkt 259001
an ETF can be purchased or redeemed
directly from the ETF at net asset value
solely by authorized participants
(‘‘APs’’) and only in aggregations of a
specified number of shares. Shares of
each Fund are listed on Cboe BZX
Exchange, Inc. (‘‘Cboe’’).
3. VanEck Russia ETF’s investment
objective is to seek to replicate as
closely as possible, before fees and
expenses, the price and yield
performance of the MVIS® Russia Index
(the ‘‘Russia Index’’). VanEck Russia
Small-Cap ETF’s investment objective is
to seek to replicate as closely as
possible, before fees and expenses, the
price and yield performance of the
MVIS® Russia Small-Cap Index
(together with the Russia Index, the
‘‘Underlying Indexes’’). MarketVector
Indexes GmbH suspended future
rebalances of the Underlying Indexes on
March 1, 2022.
4. Applicants state that the request for
relief arises from the effect of
geopolitical affairs on transactions in
the Russian equity markets and on the
relevant markets for Russian equity
securities generally, and on related
clearance and payment systems. As a
result of these geopolitical affairs,
virtually all of each Fund’s direct and
indirect holdings of Russian equity
securities have become illiquid and are
fair valued at or near zero.
5. Effective March 3, 2022 and March
2, 2022, RSX and RSXJ, respectively,
temporarily suspended new creations of
their shares until further notice due to
concerns about newly imposed
restrictions impacting the ability of U.S.
investors to transact in securities in the
applicable Underlying Index, among
other reasons.1 Prior to market open on
March 4, 2022, Cboe halted trading of
each Fund’s shares in light of ongoing
issues related to Russia’s invasion of
Ukraine.
6. Applicants anticipate that each
Fund’s shares will be delisted by Cboe
on a date 15 days after the requested
relief is granted and coinciding with the
payment of the initial liquidating
distribution by the Fund (or an earlier
date if Cboe determines in its discretion
to delist shares of the Fund, which may
occur even if the requested relief is not
granted). If shares of a Fund are delisted
by Cboe, the Fund will not be able to
continue to operate as an ETF, pursuant
to Rule 6c–11.
1 See Exchange-Traded Funds, Investment
Company Act Release Number 33646 (Sept. 25,
2019) (‘‘[A]n ETF generally may suspend the
issuance of creation units only for a limited time
and only due to extraordinary circumstances, such
as when the markets on which the ETF’s portfolio
holdings are traded are closed for a limited period
of time.’’).
PO 00000
Frm 00057
Fmt 4703
Sfmt 4703
7. If the order requested in the
Application is granted, pursuant to the
Plan of Liquidation and Termination of
Series (the ‘‘Plan of Liquidation’’)
approved by the Board of Trustees of the
Trust (the ‘‘Board’’), each Fund will
distribute in liquidation all of its assets
to shareholders, less a reserve in an
amount estimated to meet the Fund’s
outstanding liabilities, the costs of the
liquidation, taking into account the
political and market uncertainties
impacting the sale of Russian securities,
and the expenses necessary for the
continued limited operation of the Fund
through its final termination. Following
that distribution, each Fund will have
no assets of realizable value (other than
the amount so held in reserve), and the
Fund’s positions in Russian securities
will not be transferable by the Fund. If
some or all of those Russian securities
were at some point before each Fund’s
final termination determined to have a
greater value, it is possible that they
would continue not to be transferable at
that time. In addition, it is possible that
even if Russian securities were able to
be sold, local regulations may not
permit the proceeds of any such sale(s)
to be converted to U.S. dollars which
are freely available to a Fund. Each
Fund’s remaining portfolio assets—the
Russian equity securities—will therefore
remain in the Fund until they can be
sold and converted into U.S. dollars
(with the proceeds distributed to the
Fund’s shareholders) or are permanently
written off, in each case as determined
by the Adviser and approved by the
Board.
8. Applicants believe the requested
relief will permit each Fund to liquidate
its holdings in the manner described
above without the risk that it might be
required to meet redemption requests
submitted potentially out of the reserve
or otherwise when the Fund would have
no or few assets to meet the redemption
requests. In addition, applicants state
that suspension of redemptions prior to
the initial distribution in liquidation
will ensure that shareholders submitting
such redemption requests will
participate in the liquidation and also
will be entitled to share both in the
January 2023 liquidating distribution
and any subsequent liquidating
distributions. Notwithstanding the
present inability to dispose of Russian
securities held by each Fund,
Applicants have determined to seek the
requested order at this time because
Applicants believe that liquidation of
the Fund is in the best interests of the
Fund’s shareholders. Without the
requested relief, each Fund will be
required to satisfy redemption requests
E:\FR\FM\04JAN1.SGM
04JAN1
Federal Register / Vol. 88, No. 2 / Wednesday, January 4, 2023 / Notices
from APs, while other investors would
be unable to trade the Fund’s shares.
Although the Funds have received no
redemption orders since the invasion
began, it is possible that redemption
orders could be received at any time.
9. In addition, as noted above, the
Cboe may determine in its discretion to
delist shares of the Funds if the
requested relief is not granted. A Fund
will not be eligible to rely on Rule 6c–
11 once the Fund’s shares are delisted
by Cboe. As a consequence, to the extent
that a Fund is obligated to satisfy any
individual redemption requests received
from non-AP shareholders of the Fund,
the Fund would be unable to accept or
process such redemption requests from
an operational perspective because the
Fund and its service providers do not
have the operational infrastructure to
enable the Fund to engage in non-AP
primary market transactions. Each Fund
therefore would not, for its part, initiate
delisting of the Fund’s shares with Cboe
until after the requested relief is
granted.2
2. Section 22(e)(3) of the Act provides
that redemptions may be suspended by
a registered investment company for
such other periods as the Commission
may by order permit for the protection
of security holders of the registered
investment company.
3. Applicants submit that granting the
requested relief would be for the
protection of the shareholders of each
Fund, as provided in section 22(e)(3) of
the Act. Applicants assert that, in
requesting an order by the Commission,
the Applicants’ goal is to ensure that all
of each Fund’s shareholders will be
treated appropriately and fairly in view
of the otherwise detrimental effect on
the Fund of the illiquidity of the Fund’s
investments and the ongoing
uncertainty surrounding the Russian
equity markets. The requested relief is
intended to permit an orderly
liquidation of each Fund’s portfolio and
ensure that all of the Fund’s
shareholders are protected in the
process.
Relief Requested
1. Section 22(e)(1) of the Act provides
that a registered investment company
may not suspend the right of
redemption or postpone the date of
payment or satisfaction upon
redemption of any redeemable security
in accordance with its terms for more
than seven days after the tender of such
security to the company or its
designated agent except for any period
during which the New York Stock
Exchange (‘‘NYSE’’) is closed other than
customary week-end and holiday
closings, or during which trading on the
NYSE is restricted.
Applicants agree that any order of the
Commission granting the requested
relief will be subject to the following
conditions:
1. The Board, including a majority of
the Independent Trustees,3 will adopt or
has adopted the Plan of Liquidation for
the orderly liquidation of each Fund’s
assets and distribution of appropriate
payments to the Fund’s shareholders.
2. Pending liquidating distributions,
each Fund will invest proceeds of cash
dispositions of portfolio securities
solely in U.S. government securities,
money market funds that are registered
under the Act and comply with the
requirements of Rule 2a–7 under that
Act, cash equivalents, securities eligible
for purchase by a registered money
market fund meeting the requirements
of Rule 2a–7 under the Act with legal
maturities not in excess of 90 days and,
if determined to be necessary to protect
the value of a portfolio position in a
rights offering or other dilutive
transaction, additional securities of the
affected issuer.
3. Each Fund’s assets will be
distributed to the Fund’s shareholders
solely in accordance with the Plan of
Liquidation.
4. Each Fund and the Adviser will
make and keep true, accurate, and
current all appropriate records,
including but not limited to those
surrounding the events leading to the
requested relief, the Plan of Liquidation,
2 It is not anticipated that Cboe will delist a
Fund’s shares before the Fund’s requested relief is
granted by the SEC.
3 ‘‘Independent Trustees’’ means trustees who are
not ‘‘interested persons’’ of the Trust, as such term
is defined in section 2(a)(19) of the Act.
1. Applicants request an order
pursuant to section 22(e) of the Act to
suspend the right of redemption with
respect to shares of each Fund effective
December 28, 2022, and postpone the
date of payment of redemption proceeds
with respect to redemption orders
received on or after December 23, 2022
but not yet paid as of December 28,
2022, for more than seven days after the
tender of securities to the Fund, until
the Fund completes the liquidation of
its portfolio and distributes all its assets
to the shareholders, or until the
Commission rescinds the order granted
herein. Applicants believe that the relief
requested is appropriate for the
protection of shareholders of the Fund.
khammond on DSKJM1Z7X2PROD with NOTICES
Applicants’ Legal Analysis
VerDate Sep<11>2014
16:55 Jan 03, 2023
Jkt 259001
Applicants’ Conditions
PO 00000
Frm 00058
Fmt 4703
Sfmt 4703
395
the sale of Fund portfolio securities, the
distribution of Fund assets, and
communications with shareholders
(including any complaints from
shareholders and responses thereto).
5. Each Fund and the Adviser will
promptly make available to Commission
staff all files, books, records and
personnel, as requested, relating to the
Fund.
6. Each Fund and the Adviser will
provide periodic reporting to
Commission staff regarding their
activities carried out pursuant to the
Plan of Liquidation.
7. The Adviser, its affiliates, and its
and their associated persons will not
receive any fee for managing the Funds.
8. Each Fund will be in liquidation
and will not be engaged and does not
propose to engage in any business
activities other than those necessary for
the protection of its assets, the
protection of shareholders, and the
winding-up of its affairs, as
contemplated by the Plan of
Liquidation.
9. Each Fund and the Adviser will
appropriately convey accurate and
timely information to shareholders of
the Fund, before or promptly following
the effective date of the liquidation,
with regard to the status of the Fund
and its liquidation (including posting
such information on the Fund’s
website), and will thereafter from time
to time do so to reflect material
developments relating to the Fund or its
status, including, without limitation,
information concerning the dates and
amounts of distributions, and press
releases and periodic reports, and will
maintain a toll-free number to respond
to shareholder inquiries.
10. Each Fund and the Adviser shall
consult with Commission staff prior to
making any material amendments to the
Plan of Liquidation.
Commission Finding
Based on the representations and
conditions in the application, the
Commission permits the temporary
suspension of the right of redemption
for the protection of each Fund’s
shareholders. Under the circumstances
described in the application, which
require immediate action to protect the
Funds’ shareholders, the Commission
concludes that it is not practicable to
give notice or an opportunity to request
a hearing before issuing the order.
Accordingly, in the matter of VanEck
Russia ETF and VanEck Russia SmallCap ETF, series of VanEck ETF Trust,
and Van Eck Associates Corporation
(File No. 812–15420),
It is ordered, pursuant to section
22(e)(3) of the Act, that the requested
E:\FR\FM\04JAN1.SGM
04JAN1
396
Federal Register / Vol. 88, No. 2 / Wednesday, January 4, 2023 / Notices
relief from section 22(e) of the Act is
granted with respect to each Fund until
it has liquidated, or until the
Commission rescinds the order granted
herein. This order shall be in effect as
of December 28, 2022, with suspension
of redemption rights as requested by the
Applicants to be effective as of
December 28, 2022 and the
postponement of payment of
redemption proceeds to apply to
redemption orders received on or after
December 23, 2022 but not yet paid as
of December 28, 2022.
By the Commission.
J. Matthew DeLesDernier,
Deputy Secretary.
[FR Doc. 2022–28538 Filed 1–3–23; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Investment Company Act Release
No.34792; File No. 812–15247]
Monachil Credit Income Fund, et al.
December 28, 2022.
Securities and Exchange
Commission (‘‘Commission’’ or ‘‘SEC’’).
ACTION: Notice.
khammond on DSKJM1Z7X2PROD with NOTICES
AGENCY:
Notice of an application for an order
pursuant to section 6(c) of the
Investment Company Act of 1940 (the
‘‘Act’’) for an exemption from sections
18(a)(2), 18(c), and 18(i) of the Act,
pursuant to sections 6(c) and 23(c) of
the Act for certain exemptions from rule
23c–3 under the Act, and pursuant to
section 17(d) of the Act and rule 17d–
1 thereunder.
SUMMARY OF APPLICATION: Applicants
request an order to permit certain
registered closed-end management
investment companies to issue multiple
classes of shares and to impose early
withdrawal charges and asset-based
distribution and/or service fees.
APPLICANTS: Monachil Credit Income
Fund, Monachil Capital Partners LP,
and Foreside Financial Services, LLC.
FILING DATES: The application was filed
on July 20, 2021, and amended on
February 10, 2022, June 9, 2022, and
October 6, 2022.
HEARING OR NOTIFICATION OF HEARING: An
order granting the requested relief will
be issued unless the Commission orders
a hearing. Interested persons may
request a hearing on any application by
emailing the SEC’s Secretary at
Secretarys-Office@sec.gov and serving
the Applicants with a copy of the
request by email, if an email address is
listed for the relevant Applicant below,
VerDate Sep<11>2014
16:55 Jan 03, 2023
Jkt 259001
or personally or by mail, if a physical
address is listed for the relevant
Applicant below. Hearing requests
should be received by the Commission
by 5:30 p.m. on January 23, 2023, and
should be accompanied by proof of
service on applicants, in the form of an
affidavit or, for lawyers, a certificate of
service. Pursuant to rule 0–5 under the
Act, hearing requests should state the
nature of the writer’s interest, any facts
bearing upon the desirability of a
hearing on the matter, the reason for the
request, and the issues contested.
Persons who wish to be notified of a
hearing may request notification by
emailing the Commission’s Secretary at
Secretarys-Office@sec.gov.
ADDRESSES: The Commission:
Secretarys-Office@sec.gov. Applicants:
David Baum, Esq., David.Baum@
alston.com.
FOR FURTHER INFORMATION CONTACT:
Christine Y. Greenlees, Senior Counsel,
or Lisa Reid Ragen, Branch Chief, at
(202) 551–6825 (Division of Investment
Management, Chief Counsel’s Office).
SUPPLEMENTARY INFORMATION: For
Applicants’ representations, legal
analysis, and conditions, please refer to
Applicants’ third amended and restated
application, dated October 6, 2022,
which may be obtained via the
Commission’s website by searching for
the file number at the top of this
document, or for an Applicant using the
Company name search field, on the
SEC’s EDGAR system. The SEC’s
EDGAR system may be searched at, at
https://www.sec.gov/edgar/searchedgar/
legacy/companysearch.html. You may
also call the SEC’s Public Reference
Room at (202) 551–8090.
For the Commission, by the Division of
Investment Management, under delegated
authority.
J. Matthew DeLesDernier,
Deputy Secretary.
[FR Doc. 2022–28543 Filed 1–3–23; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[SEC File No. 270–496, OMB Control No.
3235–0554]
Submission for OMB Review;
Comment Request; Extension: Rule
6a–4, Form 1–N
Upon Written Request, Copies Available
From: Securities and Exchange
Commission, Office of FOIA Services,
100 F Street NE, Washington, DC
20549–2736
Notice is hereby given that pursuant
to the Paperwork Reduction Act of 1995
PO 00000
Frm 00059
Fmt 4703
Sfmt 4703
(44 U.S.C. 3501 et seq.), the Securities
and Exchange Commission
(‘‘Commission’’) has submitted to the
Office of Management and Budget
(‘‘OMB’’) a request for extension of the
previously approved collection of
information provided for in Rule 6a–4
and Form 1–N, as discussed below. The
Code of Federal Regulation citation to
this collection of information is 17 CFR
240.6a–4 and 17 CFR 249.10 under the
Securities Exchange Act of 1934 (15
U.S.C. 78a et seq.) (the ‘‘Act’’).
Section 6 of the Act 1 sets out a
framework for the registration and
regulation of national securities
exchanges. Under the Commodity
Futures Modernization Act of 2000, a
futures market may trade security
futures products by registering as a
national securities exchange. Rule 6a–
4 2 sets forth these registration
procedures and directs futures markets
to submit a notice registration on Form
1–N.3 Form 1–N calls for information
regarding how the futures market
operates, its rules and procedures,
corporate governance, its criteria for
membership, its subsidiaries and
affiliates, and the security futures
products it intends to trade. Rule 6a–4
also requires entities that have
submitted an initial Form 1–N to file: (1)
amendments to Form 1–N in the event
of material changes to the information
provided in the initial Form 1–N; (2)
periodic updates of certain information
provided in the initial Form 1–N; (3)
certain information that is provided to
the futures market’s members; and (4) a
monthly report summarizing the futures
market’s trading of security futures
products. The information required to
be filed with the Commission pursuant
to Rule 6a–4 is designed to enable the
Commission to carry out its statutorily
mandated oversight functions and to
ensure that registered and exempt
exchanges continue to be in compliance
with the Act.
The respondents to the collection of
information are futures markets.
The Commission estimates that the
total annual burden for all respondents
to provide periodic amendments 4 to
keep the Form 1–N accurate and up to
date as required under Rule 6a–4(b)(1)
would be 30 hours (15 hours/
respondent per year × 2 respondents 5)
and $200 of miscellaneous clerical
expenses. The Commission estimates
that the total annual burden for all
1 15
U.S.C. 78f.
CFR 240.6a–4.
CFR 249.10.
4 17 CFR 240.6a–4(b)(1).
5 The Commission estimates that four exchanges
will file amendments with the Commission in order
to keep their Form 1–N current.
2 17
3 17
E:\FR\FM\04JAN1.SGM
04JAN1
]]>Agencies
[Federal Register Volume 88, Number 2 (Wednesday, January 4, 2023)]
[Notices]
[Pages 393-396]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-28538]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Investment Company Act Release No. 34793; File No. 812-15420]
VanEck Russia ETF and VanEck Russia Small-Cap ETF, Series of
VanEck ETF Trust, and Van Eck Associates Corporation; Notice of
Application and Temporary Order
December 28, 2022.
AGENCY: Securities and Exchange Commission (``Commission'').
ACTION: Notice of application and a temporary order under section
22(e)(3) of the Investment Company Act of 1940 (the ``Act'').
-----------------------------------------------------------------------
Summary of Application: Applicants request a temporary order to permit
each of VanEck Russia ETF and VanEck Russia Small-Cap ETF (each, a
``Fund,'' and collectively, the ``Funds''), series of VanEck ETF Trust
(the ``Trust''), to suspend the right of redemption of its outstanding
redeemable securities and postpone the date of payment of redemption
proceeds with respect to redemption orders received but not yet paid.
Applicants: The Trust, on behalf of the Funds, and Van Eck Associates
Corporation, the Funds' investment adviser (``Adviser'' and together
with the Trust, the ``Applicants'').
Filing Date: The application was filed on December 28, 2022.
Hearing or Notification of Hearing: Interested persons may request a
[[Page 394]]
hearing by emailing to the Commission's Secretary at [email protected] and serving Applicants with a copy of the request by
email, if an email address is listed for the relevant Applicant below,
or personally or by mail, if a physical address is listed for the
relevant Applicant below. Hearing requests should be received by the
Commission by 5:30 p.m. on January 24, 2023, and should be accompanied
by proof of service on Applicants, in the form of an affidavit or, for
lawyers, a certificate of service. Pursuant to rule 0-5 under the Act,
hearing requests should state the nature of the writer's interest, any
facts bearing upon the desirability of a hearing on the matter, the
reason for the request, and the issues contested. Persons who wish to
be notified of a hearing may request notification by writing to the
Commission's Secretary at [email protected].
ADDRESSES: The Commission: [email protected]. Applicants:
Allison M. Fumai, Esq., Dechert LLP, 1095 Avenue of the Americas, New
York, New York 10036-6797, with copies to Jonathan R. Simon, Esq.,
VanEck ETF Trust, 666 Third Avenue, 9th Floor, New York, New York
10017.
FOR FURTHER INFORMATION CONTACT: Christopher D. Carlson, Senior
Counsel, Trace W. Rakestraw, Branch Chief, or Daniele Marchesani,
Assistant Chief Counsel, at (202) 551-6825 (Division of Investment
Management, Chief Counsel's Office).
SUPPLEMENTARY INFORMATION: For Applicants' representations, legal
analysis, and conditions, please refer to Applicants' application,
dated December 28, 2022, which may be obtained via the Commission's
website by searching for the file number at the top of this document,
or for an Applicant using the Company name search field, on the SEC's
EDGAR system. The SEC's EDGAR system may be searched at https://www.sec.gov/edgar/searchedgar/legacy/companysearch.html. You may also
call the SEC's Public Reference Room at (202) 551-8090.
Background
1. The Trust is registered under the Act as an open-end series
management investment company. Adviser is the investment adviser to the
Funds, each of which is a series of the Trust. Adviser is registered as
an investment adviser under the Investment Advisers Act of 1940.
2. Each Fund is a non-diversified exchange-traded fund (``ETF'')
that operates pursuant to Rule 6c-11 under the Act, which provides that
shares of an ETF can be purchased or redeemed directly from the ETF at
net asset value solely by authorized participants (``APs'') and only in
aggregations of a specified number of shares. Shares of each Fund are
listed on Cboe BZX Exchange, Inc. (``Cboe'').
3. VanEck Russia ETF's investment objective is to seek to replicate
as closely as possible, before fees and expenses, the price and yield
performance of the MVIS[supreg] Russia Index (the ``Russia Index'').
VanEck Russia Small-Cap ETF's investment objective is to seek to
replicate as closely as possible, before fees and expenses, the price
and yield performance of the MVIS[supreg] Russia Small-Cap Index
(together with the Russia Index, the ``Underlying Indexes'').
MarketVector Indexes GmbH suspended future rebalances of the Underlying
Indexes on March 1, 2022.
4. Applicants state that the request for relief arises from the
effect of geopolitical affairs on transactions in the Russian equity
markets and on the relevant markets for Russian equity securities
generally, and on related clearance and payment systems. As a result of
these geopolitical affairs, virtually all of each Fund's direct and
indirect holdings of Russian equity securities have become illiquid and
are fair valued at or near zero.
5. Effective March 3, 2022 and March 2, 2022, RSX and RSXJ,
respectively, temporarily suspended new creations of their shares until
further notice due to concerns about newly imposed restrictions
impacting the ability of U.S. investors to transact in securities in
the applicable Underlying Index, among other reasons.\1\ Prior to
market open on March 4, 2022, Cboe halted trading of each Fund's shares
in light of ongoing issues related to Russia's invasion of Ukraine.
---------------------------------------------------------------------------
\1\ See Exchange-Traded Funds, Investment Company Act Release
Number 33646 (Sept. 25, 2019) (``[A]n ETF generally may suspend the
issuance of creation units only for a limited time and only due to
extraordinary circumstances, such as when the markets on which the
ETF's portfolio holdings are traded are closed for a limited period
of time.'').
---------------------------------------------------------------------------
6. Applicants anticipate that each Fund's shares will be delisted
by Cboe on a date 15 days after the requested relief is granted and
coinciding with the payment of the initial liquidating distribution by
the Fund (or an earlier date if Cboe determines in its discretion to
delist shares of the Fund, which may occur even if the requested relief
is not granted). If shares of a Fund are delisted by Cboe, the Fund
will not be able to continue to operate as an ETF, pursuant to Rule 6c-
11.
7. If the order requested in the Application is granted, pursuant
to the Plan of Liquidation and Termination of Series (the ``Plan of
Liquidation'') approved by the Board of Trustees of the Trust (the
``Board''), each Fund will distribute in liquidation all of its assets
to shareholders, less a reserve in an amount estimated to meet the
Fund's outstanding liabilities, the costs of the liquidation, taking
into account the political and market uncertainties impacting the sale
of Russian securities, and the expenses necessary for the continued
limited operation of the Fund through its final termination. Following
that distribution, each Fund will have no assets of realizable value
(other than the amount so held in reserve), and the Fund's positions in
Russian securities will not be transferable by the Fund. If some or all
of those Russian securities were at some point before each Fund's final
termination determined to have a greater value, it is possible that
they would continue not to be transferable at that time. In addition,
it is possible that even if Russian securities were able to be sold,
local regulations may not permit the proceeds of any such sale(s) to be
converted to U.S. dollars which are freely available to a Fund. Each
Fund's remaining portfolio assets--the Russian equity securities--will
therefore remain in the Fund until they can be sold and converted into
U.S. dollars (with the proceeds distributed to the Fund's shareholders)
or are permanently written off, in each case as determined by the
Adviser and approved by the Board.
8. Applicants believe the requested relief will permit each Fund to
liquidate its holdings in the manner described above without the risk
that it might be required to meet redemption requests submitted
potentially out of the reserve or otherwise when the Fund would have no
or few assets to meet the redemption requests. In addition, applicants
state that suspension of redemptions prior to the initial distribution
in liquidation will ensure that shareholders submitting such redemption
requests will participate in the liquidation and also will be entitled
to share both in the January 2023 liquidating distribution and any
subsequent liquidating distributions. Notwithstanding the present
inability to dispose of Russian securities held by each Fund,
Applicants have determined to seek the requested order at this time
because Applicants believe that liquidation of the Fund is in the best
interests of the Fund's shareholders. Without the requested relief,
each Fund will be required to satisfy redemption requests
[[Page 395]]
from APs, while other investors would be unable to trade the Fund's
shares. Although the Funds have received no redemption orders since the
invasion began, it is possible that redemption orders could be received
at any time.
9. In addition, as noted above, the Cboe may determine in its
discretion to delist shares of the Funds if the requested relief is not
granted. A Fund will not be eligible to rely on Rule 6c-11 once the
Fund's shares are delisted by Cboe. As a consequence, to the extent
that a Fund is obligated to satisfy any individual redemption requests
received from non-AP shareholders of the Fund, the Fund would be unable
to accept or process such redemption requests from an operational
perspective because the Fund and its service providers do not have the
operational infrastructure to enable the Fund to engage in non-AP
primary market transactions. Each Fund therefore would not, for its
part, initiate delisting of the Fund's shares with Cboe until after the
requested relief is granted.\2\
---------------------------------------------------------------------------
\2\ It is not anticipated that Cboe will delist a Fund's shares
before the Fund's requested relief is granted by the SEC.
---------------------------------------------------------------------------
Relief Requested
1. Applicants request an order pursuant to section 22(e) of the Act
to suspend the right of redemption with respect to shares of each Fund
effective December 28, 2022, and postpone the date of payment of
redemption proceeds with respect to redemption orders received on or
after December 23, 2022 but not yet paid as of December 28, 2022, for
more than seven days after the tender of securities to the Fund, until
the Fund completes the liquidation of its portfolio and distributes all
its assets to the shareholders, or until the Commission rescinds the
order granted herein. Applicants believe that the relief requested is
appropriate for the protection of shareholders of the Fund.
Applicants' Legal Analysis
1. Section 22(e)(1) of the Act provides that a registered
investment company may not suspend the right of redemption or postpone
the date of payment or satisfaction upon redemption of any redeemable
security in accordance with its terms for more than seven days after
the tender of such security to the company or its designated agent
except for any period during which the New York Stock Exchange
(``NYSE'') is closed other than customary week-end and holiday
closings, or during which trading on the NYSE is restricted.
2. Section 22(e)(3) of the Act provides that redemptions may be
suspended by a registered investment company for such other periods as
the Commission may by order permit for the protection of security
holders of the registered investment company.
3. Applicants submit that granting the requested relief would be
for the protection of the shareholders of each Fund, as provided in
section 22(e)(3) of the Act. Applicants assert that, in requesting an
order by the Commission, the Applicants' goal is to ensure that all of
each Fund's shareholders will be treated appropriately and fairly in
view of the otherwise detrimental effect on the Fund of the illiquidity
of the Fund's investments and the ongoing uncertainty surrounding the
Russian equity markets. The requested relief is intended to permit an
orderly liquidation of each Fund's portfolio and ensure that all of the
Fund's shareholders are protected in the process.
Applicants' Conditions
Applicants agree that any order of the Commission granting the
requested relief will be subject to the following conditions:
1. The Board, including a majority of the Independent Trustees,\3\
will adopt or has adopted the Plan of Liquidation for the orderly
liquidation of each Fund's assets and distribution of appropriate
payments to the Fund's shareholders.
---------------------------------------------------------------------------
\3\ ``Independent Trustees'' means trustees who are not
``interested persons'' of the Trust, as such term is defined in
section 2(a)(19) of the Act.
---------------------------------------------------------------------------
2. Pending liquidating distributions, each Fund will invest
proceeds of cash dispositions of portfolio securities solely in U.S.
government securities, money market funds that are registered under the
Act and comply with the requirements of Rule 2a-7 under that Act, cash
equivalents, securities eligible for purchase by a registered money
market fund meeting the requirements of Rule 2a-7 under the Act with
legal maturities not in excess of 90 days and, if determined to be
necessary to protect the value of a portfolio position in a rights
offering or other dilutive transaction, additional securities of the
affected issuer.
3. Each Fund's assets will be distributed to the Fund's
shareholders solely in accordance with the Plan of Liquidation.
4. Each Fund and the Adviser will make and keep true, accurate, and
current all appropriate records, including but not limited to those
surrounding the events leading to the requested relief, the Plan of
Liquidation, the sale of Fund portfolio securities, the distribution of
Fund assets, and communications with shareholders (including any
complaints from shareholders and responses thereto).
5. Each Fund and the Adviser will promptly make available to
Commission staff all files, books, records and personnel, as requested,
relating to the Fund.
6. Each Fund and the Adviser will provide periodic reporting to
Commission staff regarding their activities carried out pursuant to the
Plan of Liquidation.
7. The Adviser, its affiliates, and its and their associated
persons will not receive any fee for managing the Funds.
8. Each Fund will be in liquidation and will not be engaged and
does not propose to engage in any business activities other than those
necessary for the protection of its assets, the protection of
shareholders, and the winding-up of its affairs, as contemplated by the
Plan of Liquidation.
9. Each Fund and the Adviser will appropriately convey accurate and
timely information to shareholders of the Fund, before or promptly
following the effective date of the liquidation, with regard to the
status of the Fund and its liquidation (including posting such
information on the Fund's website), and will thereafter from time to
time do so to reflect material developments relating to the Fund or its
status, including, without limitation, information concerning the dates
and amounts of distributions, and press releases and periodic reports,
and will maintain a toll-free number to respond to shareholder
inquiries.
10. Each Fund and the Adviser shall consult with Commission staff
prior to making any material amendments to the Plan of Liquidation.
Commission Finding
Based on the representations and conditions in the application, the
Commission permits the temporary suspension of the right of redemption
for the protection of each Fund's shareholders. Under the circumstances
described in the application, which require immediate action to protect
the Funds' shareholders, the Commission concludes that it is not
practicable to give notice or an opportunity to request a hearing
before issuing the order.
Accordingly, in the matter of VanEck Russia ETF and VanEck Russia
Small-Cap ETF, series of VanEck ETF Trust, and Van Eck Associates
Corporation (File No. 812-15420),
It is ordered, pursuant to section 22(e)(3) of the Act, that the
requested
[[Page 396]]
relief from section 22(e) of the Act is granted with respect to each
Fund until it has liquidated, or until the Commission rescinds the
order granted herein. This order shall be in effect as of December 28,
2022, with suspension of redemption rights as requested by the
Applicants to be effective as of December 28, 2022 and the postponement
of payment of redemption proceeds to apply to redemption orders
received on or after December 23, 2022 but not yet paid as of December
28, 2022.
By the Commission.
J. Matthew DeLesDernier,
Deputy Secretary.
[FR Doc. 2022-28538 Filed 1-3-23; 8:45 am]
BILLING CODE 8011-01-P
