Notice2025-21405
Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing of Amendment No. 2 and Order Granting Accelerated Approval of a Proposed Rule Change, as Modified by Amendment No. 2, To Adopt New Rule 5.2-E(j)(9) To Permit the Generic Listing and Trading of Class Exchange-Traded Fund Shares
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
November 28, 2025
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 90 Issue 227 (Friday, November 28, 2025)</title>
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[Federal Register Volume 90, Number 227 (Friday, November 28, 2025)]
[Notices]
[Pages 54818-54828]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2025-21405]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-104251; File No. SR-NYSEARCA-2025-39]
Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing
of Amendment No. 2 and Order Granting Accelerated Approval of a
Proposed Rule Change, as Modified by Amendment No. 2, To Adopt New Rule
5.2-E(j)(9) To Permit the Generic Listing and Trading of Class
Exchange-Traded Fund Shares
November 24, 2025.
On May 28, 2025, NYSE Arca, Inc. (``NYSE Arca'' or ``Exchange'')
filed with the Securities and Exchange Commission (``Commission''),
pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ a proposed rule change to
adopt new Rule 5.2-E(j)(9) to permit the generic listing and trading of
Class Exchange-Traded Fund Shares. The proposed rule change was
published for comment in the Federal Register on June 10, 2025.\3\
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ See Securities Exchange Act Release No. 103189 (June 4,
2025), 90 FR 24463.
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On July 15, 2025, pursuant to Section 19(b)(2) of the Act,\4\ the
Commission designated a longer period within which to approve the
proposed rule change, disapprove the proposed rule change, or institute
proceedings to determine whether to disapprove the proposed rule
change.\5\ On September 4, 2025, the Exchange filed Amendment No. 1 to
the proposed rule change, and on September 5, 2025, the Commission
issued notice of filing of Amendment No. 1 to the proposed rule change
and instituted proceedings pursuant to Section 19(b)(2)(B) of the Act
\6\ to determine whether to approve or disapprove the proposed rule
change, as modified by Amendment No. 1.\7\ On November 19, 2025, the
Exchange filed Amendment No. 2, which amended and replaced the proposed
rule change, as modified by Amendment No. 1, in its entirety.\8\ The
Commission has received no comments regarding the proposed rule change.
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\4\ 15 U.S.C. 78s(b)(2).
\5\ See Securities Exchange Act Release No. 103457, 90 FR 34044
(July 18, 2025).
\6\ 15 U.S.C. 78s(b)(2)(B).
\7\ See Securities Exchange Act Release No. 103885, 90 FR 43655
(Sept. 10, 2025).
\8\ Amendment No. 2 to the proposed rule change is available on
the Commission's website at: <a href="https://www.sec.gov/comments/sr-nysearca-2025-39/srnysearca202539-677567-2074914.pdf">https://www.sec.gov/comments/sr-nysearca-2025-39/srnysearca202539-677567-2074914.pdf</a>.
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The Commission is publishing this notice and order to solicit
comments on the proposed rule change, as modified by Amendment No. 2,
from interested persons and to grant approval of the proposed rule
change, as modified by Amendment No. 2, on an accelerated basis.
I. The Exchange's Description of the Proposal, as Modified by Amendment
No. 2
The Exchange proposes to (1) adopt a new Rule 5.2-E(j)(9) to permit
the generic listing and trading of Class Exchange-Traded Fund (``ETF'')
Shares, and (2) make certain conforming changes to the Exchange's rules
to accommodate the proposed listing of Class ETF Shares. This Amendment
No. 2 to SR-NYSEARCA-2025-39 replaces SR-NYSEARCA-2025-39 and Amendment
No. 1 thereto as originally filed and supersedes such filings in their
entirety.
The proposed rule change is available on the Exchange's website at
<a href="http://www.nyse.com">www.nyse.com</a> and at the principal office of the Exchange.
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
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange proposes to (1) adopt a new Rule 5.2-E(j)(9) to permit
the generic listing and trading, or trading pursuant to unlisted
trading privileges, of Class ETF Shares; and (2) make certain
conforming changes to the Exchange's rules to accommodate the proposed
listing of Class ETF Shares.\9\
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\9\ The Exchange notes that Cboe BZX Exchange, Inc. (``BZX'')
and The Nasdaq Stock Market LLC (``Nasdaq'') have filed
substantially similar rule filings. See Securities Exchange Act
Release Nos. 103188 (June 4, 2025), 90 FR 24457 (June 10, 2025) (SR-
CboeBZX-2025-076) & 103072 (May 20, 2025), 90 FR 22373 (May 27,
2025) (SR-NASDAQ-2025-037).
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Consistent with other products (specifically, Investment Company
Units listed pursuant to Rule 5.2-E(j)(3), Managed Fund Shares listed
pursuant to Rule 8.600-E, and ETF Shares listed pursuant to Rule 5.2-
E(j)(8)), Class ETF Shares would be permitted to be listed and traded
on the Exchange without prior Commission approval order or notice of
effectiveness pursuant to Section 19(b) of the Act.\10\
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\10\ Rule 19b-4(e)(1) provides that the listing and trading of a
new derivative securities product by a self-regulatory organization
(``SRO'') is not deemed a proposed rule change, pursuant to
paragraph (c)(1) of Rule 19b-4, if the Commission has approved,
pursuant to Section 19(b) of the Act, the SRO's trading rules,
procedures and listing standards for the product class that would
include the new derivative securities product and the SRO has a
surveillance program for the product class. As contemplated by
proposed Rule 5.2-E(j)(9), the Exchange proposes to establish
generic listing standards for Class ETF Shares of the ETF Class (as
defined herein) that would be required to operate as an ETF pursuant
to the Multi-Class Fund Exemptive Relief (as defined herein) and be
in compliance with the conditions and requirements of Rule 6c-11
under the Investment Company Act of 1940 (the ``Investment Company
Act''), except as noted in the Multi-Class Fund Exemptive Relief.
Class ETF Shares listed under proposed Rule 5.2-E(j)(9) would
therefore not need a separate proposed rule change pursuant to Rule
19b-4 before it can be listed and traded on the Exchange.
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[[Page 54819]]
Background
There are numerous applications for exemptive relief for Class ETF
Shares currently before the Commission \11\ requesting exemptive relief
similar to that previously granted to other funds.\12\ The current
proposal would provide for the ``generic'' listing and/or trading of
Class ETF Shares under proposed Rule 5.2-E(j)(9) on the Exchange.
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\11\ See DFA Investment Dimensions Group Inc. and Dimensional
Investment Group Inc., (amendment filed March 31, 2025); F/m
Investments LLC (amendment filed April 10, 2025); Fidelity Hastings
Street Trust and Fidelity Management & Research Company (amendment
filed April 11, 2025); Morgan Stanley Institutional Fund Trust and
Morgan Stanley Investment Management Inc. (amendment filed April 11,
2025); BlackRock Funds (amendment filed April 15, 2025); Guinness
Atkinson Funds (amendment filed April 17, 2025); Metropolitan West
Funds, TCW ETF Trust, and TCW Funds, Inc. (amendment filed April 22,
2025); and Northern Funds and Northern Trust Investments, Inc.
(amendment filed May 2, 2025).
\12\ See note 13, infra.
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The Commission began granting limited relief for The Vanguard
Group, Inc. (``Vanguard'') in 2000 to offer certain index-based open-
end management investment companies with Class ETF Shares.\13\ After
this relief was granted, there was limited public discourse about Class
ETF Shares until 2019, when the prospect of providing blanket exemptive
relief to Class ETF Shares was addressed in the Commission's adoption
of Rule 6c-11 under the Investment Company Act (the ``ETF Rule'').\14\
The ETF Rule permits ETFs that satisfy certain conditions to operate
without the expense or delay of obtaining an exemptive order. However,
the ETF Rule did not provide blanket exemptive relief to allow for
Class ETF Shares as part of the final rule. Instead, the Commission
concluded that Class ETF Shares should request relief through the
exemptive application process so that the Commission may assess all
relevant policy considerations in the context of the facts and
circumstances of particular applicants. The Exchange adopted Rule 5.2-
E(j)(8) \15\ shortly after implementation of the ETF Rule and, because
the ETF Rule did not provide blanket relief to the Class ETF Shares
listed on the Exchange pursuant to previously granted exemptive relief
and there were no exemptive applications before the Commission at that
time, the Exchange did not propose to include any language comparable
to what is being proposed herein.
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\13\ See Vanguard Index Funds, Investment Company Act Release
Nos. 24680 (Oct. 6, 2000) (notice) and 24789 (Dec. 12, 2000)
(order). The Commission itself, as opposed to the Commission staff
acting under delegated authority, considered the original Vanguard
application and determined that the relief was appropriate in the
public interest and consistent with the protection of investors and
the purposes fairly intended by the policy and provisions of the
Investment Company Act. In the process of granting the order, the
Commission also considered and denied a hearing request on the
original application, as reflected in the final Commission order.
See also the Vanguard Group, Inc., Investment Company Act Release
Nos. 26282 (Dec. 2, 2003) (notice) and 26317 (Dec. 30, 2003)
(order); Vanguard International Equity Index Funds, Investment
Company Act Release Nos. 26246 (Nov. 3, 2003) (notice) and 26281
(Dec. 1, 2003) (order); Vanguard Bond Index Funds, Investment
Company Act Release Nos. 27750 (Mar. 9, 2007) (notice) and 27773
(April 2, 2007) (order) (collectively referred to as the ``Vanguard
Orders'').
\14\ See Securities Exchange Act Release No. 10695 (September
25, 2019), 84 FR 57162 (October 24, 2019) (the ``ETF Rule Adopting
Release'').
\15\ See Securities Exchange Act No. 88625 (April 13, 2020) 85
FR 21479 (April 17, 2020) (SR-NYSEArca-2019-81) (Notice of Filing of
Amendment No. 2 and Order Granting Accelerated Approval of a
Proposed Rule Change, as Modified by Amendment No. 2, to Adopt NYSE
Arca Rule 5.2-E(j)(8) Governing the Listing and Trading of ETF
Shares).
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As noted, a number of applications for exemptive relief to permit
the applicable fund to offer Class ETF Shares (the ``Applications'')
have been submitted to the Commission starting in early 2023. In
general, the Applications state that the ability of a fund to offer
Class ETF Shares, i.e., a fund offering both a class of mutual fund
shares and a class of shares that are exchange-traded, could be
beneficial to the fund and to shareholders of each type of class for
various reasons, including more efficient portfolio management, better
secondary market trading opportunities, and cost efficiencies, among
others.\16\ The Commission has granted, by order, specific exemptive
relief (``Multi-Class Fund Exemptive Relief'') under the Investment
Company Act on November 17, 2025, that permits, subject to certain
conditions and requirements, a Multi-Class Fund (as defined below) to
issue Class ETF Shares (as defined below) and one or more classes of
shares that are not exchange traded, among other things.\17\
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\16\ See note 11, supra.
\17\ See Investment Company Act Release No. 35786 (November 17,
2025) (In the Matter of DFA Investment Dimensions Group Inc.,
Dimensional Investment Group Inc., Dimensional ETF Trust and
Dimensional Fund Advisors LP) (File No. 812-15484).
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Proposed Rule Change
Proposed Rule 5.2-E(j)(9)
Proposed Rule 5.2-E(j)(9) is modeled on current Rule 5.2-E(j)(8).
Rule 5.2-E(j)(9)(a) would provide that the Exchange will consider
for trading, whether by listing or pursuant to unlisted trading
privileges, Class ETF Shares that meet the criteria of the proposed
rule.\18\
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\18\ To the extent that Class ETF Shares do not satisfy one or
more of the criteria in proposed Rule 5.2-E(j)(9), the Exchange may
file a separate proposal under Section 19(b) of the Act in order to
list such securities on the Exchange. Any of the statements or
representations in that proposal regarding the index composition,
the description of the portfolio or reference assets, limitations on
portfolio holdings or reference assets, dissemination and
availability of index, reference asset, and intraday indicative
values (as applicable), or the applicability of Exchange listing
rules specified in any filing to list such Class ETF Shares shall
constitute continued listing requirements for the Class ETF Shares.
Further, in the event that Class ETF Shares become listed under
proposed Rule 5.2-E(j)(9) and subsequently can no longer satisfy the
requirements of proposed Rule 5.2-E(j)(9), such Class ETF Shares may
be listed as Investment Company Units pursuant to Rule 5.2-E(j)(3)
or Managed Fund Shares under Rule 8.600-E, as applicable, as long as
the Class ETF Shares meet all listing requirements applicable under
the alternate listing rule. If the Class ETF Shares do change
listing standards, the Exchange would have to comply with all
requirements of Rule 19b-4(e) with respect to such Class ETF Shares.
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Proposed Rule 5.2-E(j)(9)(b) titled ``Applicability'' would provide
that the proposed rule would be applicable only to Class ETF Shares.
Except to the extent inconsistent with proposed Rule 5.2-E(j)(9), or
unless the context otherwise requires, the rules and procedures of the
Board of Directors shall be applicable to the trading on the Exchange
of such securities. Class ETF Shares are included within the definition
of ``security'' or ``securities'' as such terms are used in the Rules
of the Exchange.
Proposed Rule 5.2-E(j)(9)(c) titled ``Definitions'' would set forth
the meanings of terms as used in the Rule unless the context otherwise
requires.
Proposed Rule 5.2-E(j)(9)(c)(1) would provide that the term ``Class
ETF Shares'' means shares of the ETF Class issued by a Multi-Class
Fund.
Proposed Rule 5.2-E(j)(9)(c)(2) would provide that the term ``ETF
Class'' means the class of exchange-traded shares of a Multi-Class Fund
that (i) operates as an exchange-traded fund pursuant to exemptive
relief granted by order under the Investment Company Act (``Multi-Class
Fund Exemptive Relief''), and (ii) is in compliance with the
requirements of Rules 5.2-E(j)(9)(e)(1)(ii) and 5.2-
E(j)(9)(e)(2)(A)(ii) discussed below on an initial and continued
listing basis.
Proposed Rule 5.2-E(j)(9)(c)(3) would provide that the term
``Multi-Class Fund'' means a registered open-end management company
that (i) pursuant to Multi-Class Fund Exemptive Relief, issues Class
ETF Shares and one or more classes of shares that are not exchange
traded, and (ii) is in compliance with the conditions and requirements
of the Multi-Class Fund Exemptive Relief.
Proposed Rule 5.2-E(j)(9)(c)(4) would provide that the term
``Reporting
[[Page 54820]]
Authority'' in respect of a particular Multi-Class Fund means the
Exchange, an institution, or a reporting service designated by the
Exchange or by the exchange that lists Class ETF Shares (if the
Exchange is trading such securities pursuant to unlisted trading
privileges) as the official source for calculating and reporting
information relating to such Multi-Class Fund, including, but not
limited to, the amount of any dividend equivalent payment or cash
distribution to holders of Class ETF Shares, net asset value, index or
portfolio value, the current value of the portfolio of securities
required to be deposited in connection with the issuance of Class ETF
Shares, or other information relating to the issuance, redemption or
trading of Class ETF Shares. A Multi-Class Fund may have more than one
Reporting Authority, each having different functions.
Proposed Rule 5.2-E(j)(9)(d) titled ``Limitation of Exchange
Liability'' would provide that neither the Exchange, the Reporting
Authority, nor any agent of the Exchange shall have any liability for
damages, claims, losses or expenses caused by any errors, omissions, or
delays in calculating or disseminating any current index or portfolio
value; the current value of the portfolio of securities required to be
deposited to the Multi-Class Fund in connection with the issuance of
Class ETF Shares; the amount of any dividend equivalent payment or cash
distribution to holders of Class ETF Shares; net asset value; or other
information relating to the purchase, redemption, or trading of Class
ETF Shares, resulting from any negligent act or omission by the
Exchange, the Reporting Authority, or any agent of the Exchange, or any
act, condition, or cause beyond the reasonable control of the Exchange,
its agent, or the Reporting Authority, including, but not limited to,
an act of God; fire; flood; extraordinary weather conditions; war;
insurrection; riot; strike; accident; action of government;
communications or power failure; equipment or software malfunction; or
any error, omission, or delay in the reports of transactions in one or
more underlying securities.
Proposed Rule 5.2-E(j)(9)(e) would provide that the Exchange may
approve Class ETF Shares of a Multi-Class Fund for listing and/or
trading (including pursuant to unlisted trading privileges) pursuant to
Rule 19b-4(e) of the Act. For each listed Class ETF Shares, the ETF
Class and the Multi-Class Fund issuing the Class ETF Shares, as
applicable, must satisfy the requirements of Rule 5.2-E(j)(9) upon
initial listing and, except for subparagraph (1)(A) of Rule 5.2-
E(j)(9)(e), on a continuing basis. An issuer of such securities must
notify the Exchange of any failure to comply with such requirements.
Proposed Rule 5.2-E(j)(9)(e)(1) titled ``Initial and Continued
Listing'' would provide that Class ETF Shares will be listed and traded
on the Exchange provided that: (i) the Multi-Class Fund is eligible to
operate an ETF Class as an exchange-traded fund pursuant to, and is
otherwise in compliance with the terms and conditions of, the Multi-
Class Fund Exemptive Relief; (ii) the ETF Class is in compliance with
the conditions and requirements of Rule 6c-11 under the Investment
Company Act, except as noted in such Multi-Class Fund Exemptive Relief;
and (iii) the ETF Class and the Multi-Class Fund each satisfies the
requirements of this Rule, as applicable, on an initial and continued
listing basis. Proposed Rule 5.2-E(j)(9)(e)(1)(A), titled ``Initial
Shares Outstanding.'' would provide that the Exchange will establish a
minimum number of Class ETF Shares required to be outstanding at the
time of commencement of trading on the Exchange.
Proposed Rule 5.2-E(j)(9)(e)(2) titled ``Suspension of trading or
removal'' would provide that the Exchange will consider the suspension
of trading in, and will commence delisting proceedings under Rule 5.5-
E(m) of Class ETF Shares under any of the following circumstances:
<bullet> if the Exchange becomes aware that with respect to the
Class ETF Shares: (i) the Multi-Class Fund is no longer eligible to
operate an ETF Class as an exchange-traded fund pursuant to, or is
otherwise no longer in compliance with the terms and conditions of, the
Multi-Class Fund Exemptive Relief; or (ii) the ETF Class is no longer
in compliance with the conditions and requirements of Rule 6c-11 under
the Investment Company Act, except as noted in such Multi-Class Fund
Exemptive Relief;
<bullet> if any of the other listing requirements set forth in
proposed Rule 5.2-E(j)(9) are not continuously maintained (proposed
Rule 5.2-E(j)(9)(e)(2)(B));
<bullet> if, following the initial twelve-month period after
commencement of trading on the Exchange of Class ETF Shares, there are
fewer than 50 beneficial holders of Class ETF Shares (proposed Rule
5.2-E(j)(9)(e)(2)(C)); or
<bullet> if such other event shall occur or condition exists which,
in the opinion of the Exchange, makes further dealings on the Exchange
inadvisable (proposed Rule 5.2-E(j)(9)(e)(2)(D)).
Proposed Rule 5.2-E(j)(9)(f) would provide that transactions in
Class ETF Shares will occur during the trading hours specified in Rule
7.34-E(a).
Proposed Rule 5.2-E(j)(9)(g) titled ``Surveillance Procedures''
would provide that the Exchange will implement and maintain written
surveillance procedures for Class ETF Shares.
Proposed Rule 5.2-E(j)(9)(h) titled ``Termination'' would provide
that with respect to the Class ETF Shares, upon termination of the
Multi-Class Fund or the ETF Class, as the case may be, the Exchange
requires that the Class ETF Shares be removed from Exchange listing.
The Exchange proposes to add Commentary .01 to proposed Rule 5.2-
E(j)(9). Proposed Commentary .01 to Rule 5.2-E(j)(9) would provide that
the following requirements shall be met by Class ETF Shares on an
initial and continued listing basis.
Subsection (a)(1) of proposed Commentary .01 would provide that
with respect to Class ETF Shares based on an index, if the underlying
index is maintained by a broker-dealer or fund adviser, the broker-
dealer or fund adviser will erect and maintain a ``fire wall'' around
the personnel who have access to information concerning changes and
adjustments to the index and the index will be calculated by a third
party who is not a broker-dealer or fund adviser.
Subsection (a)(2) of proposed Commentary .01 would provide that any
advisory committee, supervisory board, or similar entity that advises a
Reporting Authority (as defined in the proposed rule) or that makes
decisions on the index composition, methodology and related matters,
must implement and maintain, or be subject to, procedures designed to
prevent the use and dissemination of material non-public information
regarding the applicable index.
Subsection (b) of proposed Commentary .01 would provide that with
respect to a Multi-Class Fund that is actively managed, if the
investment adviser to the Multi-Class Fund issuing Class ETF Shares is
affiliated with a broker-dealer, such investment adviser will erect and
maintain a ``fire wall'' between the investment adviser and the broker-
dealer with respect to access to information concerning the composition
and/or changes to such Multi-Class Fund's portfolio. Further, personnel
who make decisions on the portfolio composition must be subject to
procedures designed to prevent the use and dissemination of material
non-public information regarding the
[[Page 54821]]
applicable portfolio. The Reporting Authority that provides information
relating to the Multi-Class Fund's portfolio must also implement and
maintain, or be subject to, procedures designed to prevent the use and
dissemination of material non-public information regarding the actual
components of such portfolio.
Proposed Conforming Changes
The Exchange also proposes corresponding amendments to include
Class ETF Shares in other Exchange rules, which are intended to align
the treatment of the proposed products with how other open-end
management investment company shares (e.g., Investment Company Units,
Managed Fund Shares, and ETF Shares) are treated under the Exchange's
rules.
First, the Exchange proposes to add Class ETF Shares to the
definition of ``Derivative Securities Product and UTP Derivative
Securities Product'' in Rule 1.1.
Second, the Exchange proposes to amend Rule 5.3-E to exempt Class
ETF Shares from the requirements of Rule 5.3-E(d)(9) in connection with
the acquisition of the stock or assets of an affiliated registered
investment company in a transaction that complies with Rule 17a-8 under
the Investment Company Act and does not otherwise require shareholder
approval under the Investment Company Act \19\ and the rules thereunder
or any other Exchange rule.\20\ In addition, the Exchange proposes to
add proposed Rule 5.2-E(j)(9) to the last paragraph of Rule 5.3-E,
which defines derivative and special purpose securities for purposes of
Rule 5.3-E.
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\19\ The Exchange also proposes non-substantive, technical
changes to delete two extraneous words in this rule.
\20\ The Exchange notes that these proposed changes would
subject Class ETF Shares to the same corporate governance
requirements as other open-end management investment companies
listed on the Exchange.
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Discussion
Proposed Rule 5.2-E(j)(9) is based in large part on Rule 5.2-
E(j)(8) related to the listing and trading of ETF Shares, which are
issued under the Investment Company Act and qualify as ETF Shares under
Rule 6c-11 under the Investment Company Act. ETF Shares are similar to
Class ETF Shares because the ETF Class is required to operate as an ETF
pursuant to the Multi-Class Fund Exemptive Relief and be in compliance
with the conditions and requirements of Rule 6c-11 under the Investment
Company Act (except as noted in the Multi-Class Fund Exemptive
Relief).\21\ The proposed Class ETF Shares generic listing rule would
apply only to the class of shares that are exchange-traded. Because the
ETF Class would be required to comply, among other things, with the
conditions and requirements of Rule 6c-11 under the Investment Company
Act, similar to ETF Shares under Rule 5.2-E(j)(8), the Exchange
believes that using Rule 5.2-E(j)(8) as the basis for proposed Rule
5.2-E(j)(9) is appropriate.
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\21\ See note 17, supra.
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The Exchange believes that the proposal is designed to prevent
fraudulent and manipulative acts and practices because the Exchange
will perform ongoing surveillance of Class ETF Shares listed on the
Exchange in order to ensure (i) the Multi-Class Fund is, and continues
to be, eligible to operate an ETF Class as an exchange-traded fund
pursuant to, and is otherwise in compliance with, the terms and
conditions of, the Multi-Class Fund Exemptive Relief, (ii) the ETF
Class continues to be compliant with the conditions and requirements of
Rule 6c-11 under the Investment Company Act, except as noted in such
Multi-Class Fund Exemptive Relief, and (iii) the ETF Class and the
Multi-Class Fund each satisfies the requirements of the proposed Rule,
as applicable, on an initial and continuing basis. The Exchange
believes that the manipulation concerns that such standards are
intended to address are otherwise mitigated by a combination of the
Exchange's surveillance procedures, the Exchange's ability to halt
trading and to suspend trading and commence delisting proceedings under
proposed Rule 5.2-E(j)(9)(e)(2). The Exchange will also halt trading in
Class ETF Shares under the conditions specified in Rule 7.12-E,
``Trading Halts Due to Extraordinary Market Volatility.'' The Exchange
also believes that such concerns are further mitigated by enhancements
to the arbitrage mechanism that have come from Rule 6c-11 under the
Investment Company Act, specifically the additional flexibility
provided through the use of custom baskets for creations and
redemptions and the additional information made available to the public
through the additional daily website disclosure obligations applicable
under Rule 6c-11.\22\ The Exchange also notes that there are firewall
and other information barrier restrictions in place in the proposed
rule text.\23\ The Exchange believes that the combination of these
factors will act to keep Class ETF Shares trading near the value of
their underlying holdings and further mitigate concerns around
manipulation of Class ETF Shares on the Exchange.
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\22\ The Exchange notes that the Commission came to a similar
conclusion in several places in the ETF Rule Adopting Release. See
ETF Rule Adopting Release at 15-18; 60-61; 69-70; 78-79; 82-84; and
95-96.
\23\ See proposed Rule 5.2-E(j)(9), Commentary .01(a)(1) & (2).
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The Exchange will monitor for compliance to ensure that (i) the
Multi-Class Fund is, and continues to be, eligible to operate an ETF
Class as an exchange-traded fund pursuant to, and is in otherwise in
compliance with, the terms and conditions of, the Multi-Class Fund
Exemptive Relief, (ii) the ETF Class continues to be compliant with the
conditions and requirements of Rule 6c-11 under the Investment Company
Act, except as noted in such Multi-Class Fund Exemptive Relief, and
(iii) the ETF Class and the Multi-Class Fund each satisfies the
requirements of Rule 5.2-E(j)(9), as applicable, on an initial and
continuing basis. Specifically, the Exchange will review the website of
Class ETF Shares listed on the Exchange in order to ensure that the
requirements of Rule 6c-11 are being met. The Exchange will also employ
numerous intraday alerts that will notify Exchange personnel of trading
activity throughout the day that is potentially indicative of certain
disclosures not being made timely or the presence of other unusual
conditions or circumstances that could be detrimental to the
maintenance of a fair and orderly market. As a backstop to the
surveillances described above, the Exchange also notes that Rule 5.2-
E(j)(9) would require an issuer of Class ETF Shares to notify the
Exchange of any failure to comply with the requirements of the proposed
Rule, the Multi-Class Fund Exemptive Relief, or Rule 6c-11 under the
Investment Company Act.
The Exchange may suspend trading in and commence delisting
proceedings for Class ETF Shares where such securities are not in
compliance with the applicable listing standards or where the Exchange
believes that further dealings on the Exchange are inadvisable.\24\ The
Exchange also notes
[[Page 54822]]
that proposed Rule 5.2-E(j)(9)(e) requires any issuer to provide the
Exchange with prompt notification after it becomes aware that: (i) the
Multi-Class Fund is no longer eligible to operate an ETF Class as an
exchange-traded fund pursuant to, or otherwise no longer complies with,
the terms and conditions of, the Multi-Class Fund Exemptive Relief;
(ii) the ETF Class is no longer compliant with the conditions and
requirements of Rule 6c-11 under the Investment Company Act, except as
noted in such Multi-Class Fund Exemptive Relief; or (iii) the ETF Class
or the Multi-Class Fund no longer satisfies the requirements of
proposed Rule 5.2-E(j)(9), as applicable, on an initial and continuing
basis.\25\
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\24\ Specifically, proposed Rule 5.2-E(j)(9)(e)(1) provides that
Class ETF Shares will be listed and traded on the Exchange subject
to application of proposed Rule 5.2-E(j)(9)(e)(2). Proposed Rule
5.2-E(j)(9)(e)(2) provides that the Exchange will consider the
suspension of trading in, and will commence delisting proceedings
under Rule 5.5(m) for, Class ETF Shares under any of the following
circumstances: (i) if the Exchange becomes aware, with respect to
the Class ETF Shares: (1) the Multi-Class Fund is no longer eligible
to operate an ETF Class as an exchange-traded fund pursuant to, or
is otherwise no longer in compliance with the terms and conditions
of, the Multi-Class Fund Exemptive Relief; or (2) the ETF Class is
no longer in compliance with the conditions and requirements of Rule
6c-11 under the Investment Company Act, except as noted in such
Multi-Class Fund Exemptive Relief; (ii) if any of the other listing
requirements set forth in this Rule are not continuously maintained;
(iii) if, following the initial twelve-month period after
commencement of trading on the Exchange of Class ETF Shares, there
are fewer than 50 beneficial holders of such the Class ETF Shares;
or (iv) if such other event shall occur or condition exists which,
in the opinion of the Exchange, makes further dealings on the
Exchange inadvisable. Proposed Rule 5.2-E(j)(9)(h) provides that
with respect to the Class ETF Shares, upon termination of the Multi-
Class Fund or the ETF Class, as the case may be, the Exchange
requires that Class ETF Shares be removed from Exchange listing.
\25\ The Exchange notes that failure by an issuer to notify the
Exchange of non-compliance pursuant to proposed Rule 5.2-E(j)(9)(e)
would itself be considered non-compliance with the requirements of
Rule 5.2-E(j)(9) and would subject the Class ETF Shares to potential
trading halts and the delisting process under Rule 5.5(m).
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Further, the Exchange also represents that its surveillance
procedures are adequate to properly monitor the trading of the Class
ETF Shares in all trading sessions and to deter and detect violations
of Exchange rules and applicable federal securities laws. Specifically,
the Exchange intends to utilize its existing surveillance procedures
applicable to derivative products, which are currently applicable to
Investment Company Units, Managed Fund Shares, and ETF Shares, among
other product types, to monitor trading in Class ETF Shares on the
Exchange. The Exchange or the Financial Industry Regulatory Authority,
Inc. (``FINRA''), on behalf of the Exchange, will communicate as needed
regarding trading in Class ETF Shares and certain of their applicable
underlying components with other markets that are members of the
Intermarket Surveillance Group (``ISG'') or with which the Exchange has
in place a comprehensive surveillance sharing agreement. In addition,
the Exchange may obtain information regarding trading in Class ETF
Shares and certain of their applicable underlying components from
markets and other entities that are members of ISG or with which the
Exchange has in place a comprehensive surveillance sharing agreement.
Additionally, FINRA, on behalf of the Exchange, is able to access trade
information for certain fixed income securities that may be held by a
Multi-Class Fund for the Class ETF Shares reported to FINRA's Trade
Reporting and Compliance Engine (``TRACE''). FINRA also can access data
obtained from the Municipal Securities Rulemaking Board's (``MSRB'')
Electronic Municipal Market Access (``EMMA'') system relating to
municipal bond trading activity for surveillance purposes in connection
with trading in Class ETF Shares, to the extent that the Multi-Class
Fund for the Class ETF Shares holds municipal securities. Finally, the
issuer of Class ETF Shares will be required to comply with Rule 10A-3
under the Act for the initial and continued listing of Class ETF
Shares, as provided under Rule 5.3-E.\26\
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\26\ The Exchange notes that these proposed changes would
subject Class ETF Shares to the same corporate governance
requirements as other open-end management investment companies
listed on the Exchange.
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The Exchange notes that it may consider all relevant factors in
exercising its discretion to halt or suspend trading in Class ETF
Shares. Trading may be halted if the circuit breaker parameters in Rule
7.12-E have been reached, because of other market conditions, or for
reasons that, in the view of the Exchange, make trading in the Shares
inadvisable. These may include: (1) the extent to which certain
information about the Class ETF Shares that is required to be disclosed
under Rule 6c-11 under the Investment Company Act is not being made
available, including specifically where the Exchange becomes aware that
the net asset value or the daily portfolio disclosure with respect to
Class ETF Shares is not disseminated to all market participants at the
same time, it will halt trading in such securities until such time as
the net asset value or the daily portfolio disclosure is available to
all market participants; \27\ (2) if an interruption to the
dissemination to the value of the index or reference asset on which
Class ETF Shares is based persists past the trading day in which it
occurred or is no longer calculated or available; (3) trading in the
securities comprising the underlying index or portfolio has been halted
in the primary market(s); or (4) whether other unusual conditions or
circumstances detrimental to the maintenance of a fair and orderly
market are present.
---------------------------------------------------------------------------
\27\ The Exchange will obtain a representation from the issuer
of Class ETF Shares that the net asset value per share will be
calculated daily and made available to all market participants at
the same time, and the requirements pertaining to the Multi-Class
Fund Exemptive Relief and Rule 6c-11 under the Investment Company
Act in proposed Rule 5.2-E(j)(9) will be satisfied.
---------------------------------------------------------------------------
The Exchange deems Class ETF Shares to be equity securities and
therefore they would be subject to the full panoply of Exchange rules
and procedures that currently govern the trading of equity securities
on the Exchange.\28\
---------------------------------------------------------------------------
\28\ With respect to trading in Class ETF Shares, the Exchange
represents that all ETP Holder obligations relating to product
description and prospectus delivery requirements will continue to
apply in accordance with the Exchange's rules and federal securities
laws, and the Exchange will continue to monitor ETP Holders for
compliance with such requirements, which are not changing as a
result of the Multi-Class Fund Exemptive Relief order issued under
the Investment Company Act.
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2. Statutory Basis
The proposed rule change is consistent with Section 6(b) of the
Act,\29\ in general, and furthers the objectives of Section
6(b)(5),\30\ in that it is designed 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.
---------------------------------------------------------------------------
\29\ 15 U.S.C. 78f(b).
\30\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
The Exchange believes that proposed Rule 5.2-E(j)(9) is designed to
prevent fraudulent and manipulative acts and practices in that the
proposed rules relating to listing and trading Class ETF Shares on the
Exchange provide specific initial and continued listing criteria
required to be met by such securities. Proposed Rule 5.2-E(j)(9)(e)
sets forth initial and continued listing criteria applicable to Class
ETF Shares, specifically providing that the Exchange may approve Class
ETF Shares for listing and/or trading (including pursuant to unlisted
trading privileges) on the Exchange pursuant to Rule 19b-4(e) under the
Act, provided that (i) the Multi-Class Fund is eligible to operate an
ETF Class as an exchange-traded fund pursuant to, and is otherwise in
compliance with the terms and conditions of, the Multi-Class Fund
Exemptive Relief; (ii) the ETF Class is in compliance with the
conditions and requirements of Rule 6c-11 under the Investment Company
Act, except as noted in such Multi-Class Fund Exemptive Relief; and
(iii) the ETF Class and the Multi-Class Fund each satisfies the
requirements of this Rule, as
[[Page 54823]]
applicable, on an initial and continued listing basis.\31\ The Exchange
will comply with all the requirements of Rule 19b-4(e) to specifically
note that such Class ETF Shares are being listed on the Exchange
pursuant to the proposed Rule.
---------------------------------------------------------------------------
\31\ The Exchange notes that eligibility to operate in reliance
on Rule 6c-11 or any applicable exemptive relief under the
Investment Company Act does not necessarily mean that an investment
company would be listed on the Exchange pursuant to proposed Rule
5.2-E(j)(9). To this point, an investment company that operates in
reliance of exemptive relief providing for Class ETF Shares could
alternatively be listed as Investment Company Units or Managed Fund
Shares pursuant to Rules 5.2-E(j)(3) or 8.600-E, respectively, and
would be subject to all requirements under each of those rules.
Further to this point, in the event that Class ETF Shares listed on
the Exchange preferred to be listed as a series of Investment
Company Units or Managed Fund Shares (as applicable), nothing would
preclude such security from changing to be listed as Investment
Company Units or Managed Fund Shares (as applicable), as long as the
security met each of the initial and continued listing obligations
under the applicable rules.
---------------------------------------------------------------------------
Proposed Rule 5.2-E(j)(9)(e) provides that Class ETF Shares of each
Multi-Class Fund will be listed and traded on the Exchange subject to
application of proposed Rule 5.2-E(j)(9)(e)(2). Proposed Rule 5.2-
E(j)(9)(e)(2) provides that the Exchange will consider the suspension
of trading in, and will commence delisting proceedings under Rule
5.5(m) of, Class ETF Shares under any of the following circumstances:
<bullet> if the Exchange becomes aware with respect to the Class
ETF Shares: (i) the Multi-Class Fund is no longer eligible to operate
an ETF Class as an exchange-traded fund pursuant to, or is otherwise no
longer in compliance with the terms and conditions of, the Multi-Class
Fund Exemptive Relief; or (ii) the ETF Class is no longer in compliance
with the conditions and requirements of Rule 6c-11 under the Investment
Company Act, except as noted in such Multi-Class Fund Exemptive Relief;
<bullet> if any of the other listing requirements set forth in
proposed Rule 5.2-E(j)(9) are not continuously maintained;
<bullet> if, following the initial twelve-month period after
commencement of trading on the Exchange of the Class ETF Shares, there
are fewer than 50 beneficial holders of Class ETF Shares; or
<bullet> if such other event shall occur or condition exists which,
in the opinion of the Exchange, makes further dealings on the Exchange
inadvisable.
The Exchange notes that issuers are required to notify the Exchange
of any non-compliance with Rule 6c-11 under the Investment Company Act
or any applicable exemptive relief thereunder, as described in proposed
Rule 5.2-E(j)(9)(e)(1). Moreover, the Exchange may identify non-
compliance through its own monitoring process.
Proposed Rule 5.2-E(j)(9)(h) provides that with respect to the
Class ETF Shares, upon termination of the Multi-Class Fund or the ETF
Class, as the case may be, the Exchange requires that the Class ETF
Shares be removed from Exchange listing. The Exchange also notes that
it will obtain a representation from the issuer of Class ETF Shares
stating that the requirements of Rule 6c-11 and the applicable
exemptive relief under the Investment Company Act will be continuously
satisfied and that the issuer will notify the Exchange of any failure
to do so.
The Exchange further believes that proposed Rule 5.2-E(j)(9) is
designed to prevent fraudulent and manipulative acts and practices
because of the robust surveillances in place on the Exchange as
required under proposed Rule 5.2-E(j)(9)(g) along with the similarities
of proposed Rule 5.2-E(j)(9) to the rules related to other securities
that are already listed and traded on the Exchange and which would
qualify as Class ETF Shares. ETF Shares are identical to Class ETF
Shares except that Class ETF Shares have received exemptive relief to
operate an exchange-traded fund class in addition to classes of shares
that are not exchange-traded. As such, the Exchange believes because
the ETF Class would be required to comply, among other things, with the
conditions and requirements of Rule 6c-11 under the Investment Company
Act, similar to ETF Shares under Rule 5.2-E(j)(8), using Rule 5.2-
E(j)(8) as the basis for proposed Rule 5.2-E(j)(9) is appropriate.
The Exchange believes that the proposal is consistent with Section
6(b)(1) of the Act \32\ in that, in addition to being designed to
prevent fraudulent and manipulative acts and practices, the Exchange
has the capacity to enforce proposed Rule 5.2-E(j)(9) by performing
ongoing surveillance of Class ETF Shares listed on the Exchange in
order to ensure that (i) the Multi-Class Fund is, and continues to be,
eligible to operate an ETF Class as an exchange-traded fund pursuant
to, and is otherwise in compliance with the terms and conditions of,
the Multi-Class Fund Exemptive Relief, (ii) the ETF Class continues to
be compliant with the conditions and requirements of Rule 6c-11 under
the Investment Company Act, except as noted in such Multi-Class Fund
Exemptive Relief, and (iii) the ETF Class and the Multi-Class Fund each
satisfies the requirements of proposed Rule 5.2-E(j)(9), as applicable,
on an initial and continuing basis. The Exchange believes that the
manipulation concerns that such standards are intended to address are
otherwise mitigated by a combination of the Exchange's surveillance
procedures, and the Exchange's ability to halt trading and to suspend
trading and commence delisting proceedings under proposed Rule 5.2-
E(j)(9)(e)(2). The Exchange will also halt trading in Class ETF Shares
under the conditions specified in Rule 7.12-E, ``Trading Halts Due to
Extraordinary Market Volatility.'' The Exchange also believes that such
concerns are further mitigated by enhancements to the arbitrage
mechanism that have come from compliance with Rule 6c-11, specifically
the additional flexibility provided through the use of custom baskets
for creations and redemptions and the additional information made
available to the public through the additional daily website disclosure
obligations applicable under Rule 6c-11 under the Investment Company
Act.\33\ The Exchange believes that the combination of these factors
will act to keep Class ETF Shares trading near the value of their
underlying holdings and further mitigate concerns around manipulation
of Class ETF Shares on the Exchange.
---------------------------------------------------------------------------
\32\ 15 U.S.C. 78f(b)(1).
\33\ The Exchange notes that the Commission came to a similar
conclusion in several places in the ETF Rule Adopting Release. See
ETF Rule Adopting Release at 15-18; 60-61; 69-70; 78-79; 82-84; and
95-96.
---------------------------------------------------------------------------
The Exchange will monitor for compliance with Rule 6c-11 and any
applicable exemptive relief in order to ensure that the continued
listing standards are being met. Specifically, the Exchange plans to
review the website of Class ETF Shares in order to ensure that the
requirements of Rule 6c-11 are being met. The Exchange will also employ
numerous intraday alerts that will notify Exchange personnel of trading
activity throughout the day that is potentially indicative of certain
disclosures not being made accurately or the presence of other unusual
conditions or circumstances that could be detrimental to the
maintenance of a fair and orderly market. As a backstop to the
surveillances described above, the Exchange also notes that Rule 5.2-
E(j)(9) requires an issuer of Class ETF Shares to promptly notify the
Exchange of any failure to comply with Rule 6c-11 or the requirements
of the Multi-Class Fund Exemptive Relief under the Investment Company
Act.
To the extent that any of the requirements under Rule 6c-11 or the
Multi-Class Fund Exemptive Relief
[[Page 54824]]
under the Investment Company Act are not being met, the Exchange may
halt trading in Class ETF Shares as provided in proposed Rule 5.2-
E(j)(9)(e). Further, the Exchange may also suspend trading in and
commence delisting proceedings for Class ETF Shares where such
securities are not in compliance with the applicable listing standards
or where the Exchange believes that further dealings on the Exchange
are inadvisable. As discussed above, the Exchange also notes that
proposed Rule 5.2-E(j)(9) requires any issuer to provide the Exchange
with prompt notification after it becomes aware of any non-compliance
with the proposed rule, which would include any failure of the issuer
to comply with Rule 6c-11 or the Multi-Class Fund Exemptive Relief
under the Investment Company Act.
Further, the Exchange also represents that its surveillance
procedures are adequate to properly monitor the trading of the Class
ETF Shares in all trading sessions and to deter and detect violations
of Exchange rules. Specifically, the Exchange intends to utilize its
existing surveillance procedures applicable to derivative products,
which are currently applicable to Investment Company Units, Managed
Fund Shares, and ETF Shares, among other product types, to monitor
trading in Class ETF Shares. The Exchange or FINRA, on behalf of the
Exchange, will communicate as needed regarding trading in Class ETF
Shares and certain of their applicable underlying components with other
markets that are members of the ISG or with which the Exchange has in
place a comprehensive surveillance sharing agreement. In addition, the
Exchange may obtain information regarding trading in Class ETF Shares
and certain of their applicable underlying components from markets and
other entities that are members of ISG or with which the Exchange has
in place a comprehensive surveillance sharing agreement.
Additionally, FINRA, on behalf of the Exchange, is able to access
trade information for certain fixed income securities that may be held
by the Multi-Class Fund for the Class ETF Shares reported to FINRA's
TRACE. FINRA also can access data obtained from the MSRB's EMMA system
relating to municipal bond trading activity for surveillance purposes
in connection with trading in Class ETF Shares, to the extent that the
Multi-Class Fund for the Class ETF Shares holds municipal securities.
Finally, as noted above, the issuer of Class ETF Shares will be
required to comply with Rule 10A-3 under the Act for the initial and
continued listing of Class ETF Shares, as provided under Rule 5.3-E.
The Exchange believes that permitting Class ETF Shares to list on
the Exchange will help perfect the mechanism of a free and open market
and, in general, will protect investors and the public interest in that
it will permit the listing and trading of Class ETF Shares, consistent
with the applicable exemptive relief, and in a manner that will benefit
investors. Specifically, the Exchange believes that the relief proposed
in the Applications and the expected benefits of the Class ETF Shares
described above would be to the benefit of investors.
The Exchange also believes that proposed Rule 5.2-E(j)(9)
provisions which explicitly provide the initial and continued listing
standards applicable to Class ETF Shares, including the suspension of
trading or removal standards, are designed to promote transparency and
clarity in the Exchange's Rules.
The Exchange also believes that the corresponding changes to add
Class ETF Shares in the Exchange's corporate governance requirements
under Rule 1.1 and Rule 5.3-E discussed above will add clarity to the
Exchange's rulebook. Investment Company Units, Managed Fund Shares, and
ETF Shares are similarly included in these provisions. Therefore, the
Exchange believes these are non-substantive changes meant only to
subject Class ETF Shares to the same exemptions and provisions
currently applicable to Investment Company Units, Managed Fund Shares,
and ETF Shares so that the treatment of these open-end management
investment companies is consistent under the Exchange's rules.
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
proposal, by permitting the listing and trading of Class ETF Shares
under exemptive relief from the Investment Company Act and the rules
and regulations thereunder, would introduce additional competition
among various ETF products to the benefit of investors.
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. Discussion and Commission Findings
After careful review, the Commission finds that the proposed rule
change, as modified by Amendment No. 2, is consistent with the Act and
the rules and regulations thereunder applicable to a national
securities exchange.\34\ In particular, the Commission finds that the
proposed rule change, as modified by Amendment No. 2, is consistent
with Section 6(b)(5) of the Act,\35\ which requires, among other
things, that the Exchange's rules be designed to prevent fraudulent and
manipulative acts and practices, to remove impediments to and perfect
the mechanism of a free and open market, and, in general, to protect
investors and the public interest. The Commission also finds that the
proposed rule change, as modified by Amendment No. 2, is consistent
with Section 11A(a)(1)(C)(iii) of the Act, which sets forth Congress'
finding that it is in the public interest and appropriate for the
protection of investors and the maintenance of fair and orderly markets
to assure the availability to brokers, dealers, and investors of
information with respect to quotations for and transactions in
securities.\36\ In addition, the Commission finds that the proposed
rule change, as modified by Amendment No. 2, is consistent with Section
6(b)(1) of the Act,\37\ which requires, among other things, that the
Exchange is so organized and has the capacity to be able to enforce
compliance by its members and persons associated with its members with
the rules of the Exchange.
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\34\ In approving this proposed rule change, as modified by
Amendment No. 2, the Commission has considered the proposed rule's
impact on efficiency, competition, and capital formation. See 15
U.S.C. 78c(f).
\35\ 15 U.S.C. 78f(b)(5).
\36\ See 15 U.S.C. 78k-1(a)(1)(C)(iii).
\37\ 15 U.S.C. 78f(b)(1).
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The Exchange proposes to adopt new NYSE Arca Rule 5.2-E(j)(9) to
permit the generic listing and trading, or trading pursuant to unlisted
trading privileges, of Class ETF Shares in connection with the Multi-
Class Fund Exemptive Relief granted by order under the Investment
Company Act.\38\ Under the proposal and pursuant to the Multi-Class
Fund Exemptive Relief, a Multi-
[[Page 54825]]
Class Fund is permitted to issue a class of shares that are exchange-
traded (i.e., ETF Class) and one or more classes of shares that are not
exchange-traded. In accordance with the Multi-Class Fund Exemptive
Relief, the ETF Class operates as an ETF in compliance with the
conditions and requirements of Rule 6c-11 under the Investment Company
Act, except as noted in the Multi-Class Fund Exemptive Relief. The
Exchange also proposes conforming changes to the Exchange's
definitions, corporate governance requirements under NYSE Arca Rule
5.3-E, and other provisions to accommodate the proposed listing of
Class ETF Shares.
---------------------------------------------------------------------------
\38\ See supra note 17 and accompanying text.
---------------------------------------------------------------------------
A. Consistency With Section 6(b)(5) of the Act
(1) Proposed NYSE Arca Rule 5.2-E(j)(9)
Proposed NYSE Arca Rule 5.2-E(j)(9) is reasonably designed to help
prevent fraudulent and manipulative acts and practices. Proposed NYSE
Arca Rule 5.2-E(j)(9) is based on NYSE Arca Rule 5.2-E(j)(8), which
governs the generic listing and trading of ETF Shares on the
Exchange.\39\ Under current NYSE Arca Rule 5.2-E(j)(8), ETF Shares,
which must be eligible to operate in reliance on Rule 6c-11 under the
Investment Company Act and must satisfy the requirements of Rule 6c-11
under the Investment Company Act on an initial and continued listing
basis, are similar to Class ETF Shares because, under the proposal, the
ETF Class also is required to operate as an ETF and be in compliance
with the conditions and requirements of Rule 6c-11 under the Investment
Company Act (except as noted in the Multi-Class Fund Exemptive
Relief).\40\
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\39\ See NYSE Arca Rule 5.2-E(j)(8). See also supra note 15 and
accompanying text; See Securities Exchange Act No. 88625 (April 13,
2020) 85 FR 21479 (April 17, 2020) (SR-NYSEArca-2019-81) (Notice of
Filing of Amendment No. 2 and Order Granting Accelerated Approval of
a Proposed Rule Change, as Modified by Amendment No. 2, to Adopt
NYSE Arca Rule 5.2-E(j)(8) Governing the Listing and Trading of ETF
Shares) (``ETF Shares Approval Order'').
\40\ The Exchange represents that the proposed Class ETF Shares
generic listing rules apply only to the class of shares (ETF Class)
that are exchange-traded.
---------------------------------------------------------------------------
As stated in the ETF Shares Approval Order, a central qualification
for listing under the proposed rule is ongoing compliance with Rule 6c-
11 under the Investment Company Act, which requires, among other
things, ETFs to prominently disclose the portfolio holdings that will
form the basis for each calculation of net asset value per share.\41\
Because initial and ongoing compliance with Rule 6c-11 of the
Investment Company Act is a condition for listing and trading Class ETF
Shares on the Exchange,\42\ proposed NYSE Arca Rule 5.2-E(j)(9) would
permit the Exchange to list and trade shares of an investment company
with a fully transparent portfolio,\43\ and as the Commission
previously stated for ETF Shares,\44\ portfolio transparency should
equally help prevent manipulation of the price of Class ETF Shares.\45\
Additionally, proposed NYSE Arca Rule 5.2-E(j)(9) includes requirements
relating to fire walls and procedures to prevent the use and
dissemination of material, non-public information regarding the
applicable Multi-Class Fund index and portfolio,\46\ all such
requirements of which are substantively identical to those applicable
to ETF Shares under NYSE Arca Rule 5.2-E(j)(8) and are designed to
prevent fraudulent and manipulative acts and practices.\47\ Certain of
these requirements relating to such fire walls and procedures apply in
addition to what is already required under the Act and the Investment
Company Act and respective rules and regulations thereunder, and such
requirements collectively provide additional protections against the
potential misuse of material, non-public information.\48\ The
Commission concludes that the proposed requirements relating to such
fire walls and procedures, combined with Multi-Class Fund portfolio
transparency with respect to the ETF Class and the existing
requirements under the Act and Investment Company Act, should help to
protect against fraudulent and manipulative acts and
[[Page 54826]]
practices under Section 6(b)(5) of the Act.\49\
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\41\ See ETF Shares Approval Order, supra note 39, 85 FR at
21487. See also ETF Rule Adopting Release, supra note 14, 84 FR at
57180-81.
\42\ See proposed NYSE Arca Rule 5.2-E(j)(9)(e)(1) (``Class ETF
Shares will be listed and traded on the Exchange provided that . . .
the ETF Class is in compliance with the conditions and requirements
of Rule 6c-11 under the Investment Company Act of 1940, except as
noted in such Multi-Class Fund Exemptive Relief'') and NYSE Arca
Rule 5.2-E(j)(9)(e)(2) (``The Exchange will consider the suspension
of trading in, and will commence delisting proceedings under Rule
5.5-E(m) of, Class ETF Shares . . . if the Exchange becomes aware
that with respect to the Class ETF Shares . . . the ETF Class is no
longer in compliance with the conditions and requirements of Rule
6c-11 under the Investment Company Act of 1940, except as noted in
such Multi-Class Fund Exemptive Relief'').
\43\ The Commission stated that, with respect to ETF portfolio
transparency, the disclosures are designed to promote an effective
arbitrage mechanism and inform investors about the risks of
deviation between market price and net asset value when deciding
whether to invest in ETFs generally or in a particular ETF. See ETF
Rule Adopting Release, supra note 14, 84 FR at 57166.
\44\ See ETF Shares Approval Order, supra note 43, 85 FR at
21487 (concluding that because initial and ongoing compliance with
Rule 6c-11 of the Investment Company Act is a condition for listing
and trading on the Exchange, the proposed rule would permit the
listing and trading of shares of an investment company with a fully
transparent portfolio, and the Commission believes that portfolio
transparency should help prevent manipulation of the price of ETF
Shares).
\45\ See ETF Rule Adopting Release, supra note 14, 84 FR at
57169 (concluding that portfolio transparency combined with existing
requirements should be sufficient to protect against certain
abuses).
\46\ For example, proposed Commentary .01(a)(1) to NYSE Arca
Rule 5.2-E(j)(9) provides that, with respect to Class ETF Shares
that are based on an index, if the underlying index is maintained by
a broker-dealer or fund adviser, the broker-dealer or fund adviser
will erect and maintain a ``fire wall'' around the personnel who
have access to information concerning changes and adjustments to the
index, and the index will be calculated by a third party who is not
a broker-dealer or fund adviser. Proposed Commentary .01(b) to NYSE
Arca Rule 5.2-E(j)(9) further states that, with respect to a Multi-
Class Fund that is actively managed, if the investment adviser to
the Multi-Class Fund issuing Class ETF Shares is affiliated with a
broker-dealer, such investment adviser will erect and maintain a
``fire wall'' between the investment adviser and the broker-dealer
with respect to access to information concerning the composition
and/or changes to such Multi-Class Fund's portfolio. Proposed
Commentary .01(a)(2) to NYSE Arca Rule 5.2-E(j)(9) requires that any
advisory committee, supervisory board, or similar entity that
advises a Reporting Authority or that makes decisions on the index
composition, methodology, and related matters must implement and
maintain, or be subject to, procedures designed to prevent the use
and dissemination of material, non-public information regarding the
applicable index. For actively managed Multi-Class Funds, personnel
who make decisions on the portfolio composition must be subject to
procedures designed to prevent the use and dissemination of
material, non-public information regarding the applicable portfolio.
See generally Commentary .01(b) to NYSE Arca Rule 5.2-E(j)(9).
Compare proposed NYSE Arca Rule 5.2-E(j)(9)(e) (encompassing the
initial and continued listing requirements for Class ETF Shares)
with NYSE Arca Rule 5.2-E(j)(8)(e) (encompassing the initial and
continued listing requirements for ETF Shares).
\47\ In adopting Rule 6c-11 under the Investment Company Act,
the Commission stated that the safeguards in the existing regulatory
regime adequately address ``special concerns that self-indexed ETFs
present, including the potential ability of an affiliated index
provider to manipulate an underlying index to the benefit or
detriment of a self-indexed ETF.'' See ETF Rule Adopting Release,
supra note 14, 84 FR at 57168. See also ETF Shares Approval Order,
supra note 39, 85 FR at 21487 (concluding that the requirements of
NYSE Arca Rule 5.2-E(j)(8), which includes provisions relating to
fire walls and procedures to prevent the use and dissemination of
material, non-public information regarding the applicable ETF index
and portfolio for ETF Shares, are designed to prevent fraudulent and
manipulative acts and practices).
\48\ See ETF Shares Approval Order, supra note 39, 85 FR at
21487 (stating that the requirements for ETF Shares relating to fire
walls and procedures, which are substantively identical to NYSE
Arca's rules governing the listing and trading of index-based and
actively managed ETFs, apply in addition to what is already required
under the Act and the Investment Company Act and respective rules
and regulations thereunder, and that such requirements collectively
provide additional protections against the potential misuse of
material, non-public information).
\49\ See id. (``Therefore, the Commission concludes that the
proposed requirements relating to such fire walls and procedures,
combined with ETF portfolio transparency and the existing
requirements under the Act and [Investment Company Act], should help
to protect against fraudulent and manipulative acts and practices
under Section 6(b)(5) of the Act.'').
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Proposed NYSE Arca Rule 5.2-E(j)(9)(g) requires that the Exchange
implement and maintain written surveillance procedures for Class ETF
Shares. The Exchange represents that it will utilize its existing
surveillance procedures applicable to derivative products, which are
currently applicable to ETF Shares, among other product types, to
monitor trading in Class ETF Shares, and further represents that its
surveillance procedures are adequate to (a) properly monitor the
trading of the Class ETF Shares during all trading sessions and (b)
deter and detect violations of Exchange rules and the applicable
federal securities laws. The Exchange also represents that the
Exchange, or FINRA on behalf of the Exchange, will communicate as
needed regarding trading in Class ETF Shares and certain of their
applicable underlying components with other markets that are members of
the ISG or with which the Exchange has in place a comprehensive
surveillance sharing agreement. The Exchange also may obtain
information regarding trading in Class ETF Shares and certain of their
applicable underlying components from markets and other entities that
are members of ISG or with which the Exchange has in place a
comprehensive surveillance sharing agreement. Additionally, FINRA, on
behalf of the Exchange, is able to access, as needed, trade information
for certain fixed income securities that may be held by the Multi-Class
Fund for the Class ETF Shares reported to TRACE. FINRA also can access
data obtained from the EMMA system relating to municipal bond trading
activity for surveillance purposes in connection with trading in Class
ETF Shares, to the extent that the Multi-Class Fund for the Class ETF
Shares holds municipal securities. The Exchange states that NYSE Arca
Rule 5.2-E(j)(9)(e) requires any issuer to provide the Exchange with
prompt notification after it becomes aware that (i) the Multi-Class
Fund is no longer eligible to operate an ETF Class as an exchange-
traded fund pursuant to, or otherwise no longer complies with, the
terms and conditions of, the Multi-Class Fund Exemptive Relief, (ii)
the ETF Class is no longer compliant with the conditions and
requirements of Rule 6c-11 under the Investment Company Act, except as
noted in such Multi-Class Fund Exemptive Relief, or (iii) the ETF Class
or the Multi-Class Fund no longer satisfies the requirements of NYSE
Arca Rule 5.2-E(j)(9), as applicable, on an initial and continuing
basis.\50\ The Exchange further represents that it will obtain a
representation from the issuer of Class ETF Shares stating that the
requirements of Rule 6c-11 and the applicable exemptive relief under
the Investment Company Act will be continuously satisfied and that the
issuer will notify the Exchange of any failure to do so.
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\50\ See supra note 25 and accompanying text. See also NYSE Arca
Rule 5.2-E(b) (requiring, among other things, that ``[a]n issuer
with securities listed under Rule 5.2-E . . . must provide the
Exchange with prompt notification after the issuer becomes aware of
any noncompliance by the issuer with the applicable continued
listing requirements . . . .'').
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Consistent with the requirement of Section 6(b)(5) of the Act \51\
that the Exchange's rules be designed to remove impediments to and
perfect the mechanism of a free and open market, the Exchange's rules
regarding trading halts will help to ensure the maintenance of fair and
orderly markets for Class ETF Shares. Specifically, the Exchange may
consider all relevant factors in exercising its discretion to halt or
suspend trading in Class ETF Shares. The Exchange states that trading
in Class ETF Shares may be halted if the circuit breaker parameters in
NYSE Arca Rule 7.12-E have been reached, because of other market
conditions, or for reasons that, in the view of the Exchange, make
trading in the Class ETF Shares inadvisable. According to the Exchange,
the reasons to halt trading may include: (1) the extent to which
certain information about the Class ETF Shares that is required to be
disclosed pursuant to Rule 6c-11 under the Investment Company Act is
not being made available; \52\ (2) if an interruption to the
dissemination to the value of the index or reference asset on which the
Class ETF Shares is based persists past the trading day in which it
occurred or is no longer calculated or available; (3) trading in the
securities comprising the underlying index or portfolio has been halted
in the primary market(s); or (4) whether other unusual conditions or
circumstances detrimental to the maintenance of a fair and orderly
market are present. As the Exchange further represents in the proposal,
if the Exchange becomes aware that the net asset value or the daily
portfolio disclosure with respect to the Class ETF Shares is not
disseminated to all market participants at the same time, it will halt
trading in the Class ETF Shares until such time as the net asset value
or the daily portfolio disclosure is available to all market
participants.\53\ The Exchange represents that it may suspend trading
in and commence delisting proceedings for Class ETF Shares where such
securities are not in compliance with the applicable listing standards
or where the Exchange believes that further dealings on the Exchange
are inadvisable.\54\
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\51\ 15 U.S.C. 78f(b)(5).
\52\ The Exchange will obtain a representation from the issuer
of Class ETF Shares that the net asset value per share will be
calculated daily and made available to all market participants at
the same time, and the requirements pertaining to the Multi-Class
Fund Exemptive Relief and Rule 6c-11 under the Investment Company
Act in proposed NYSE Arca Rule 5.2-E(j)(9) will be satisfied. See
supra note 27 and accompanying text.
\53\ See id.
\54\ See supra note 24 and accompanying text.
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The Commission also finds that, consistent with Section
11A(a)(1)(C)(iii) of the Act,\55\ the proposed rule change, as modified
by Amendment No. 2, is reasonably designed to promote fair disclosure
of information that may be necessary to price the Class ETF Shares
appropriately, to prevent trading when a reasonable degree of
transparency cannot be assured, to safeguard material non-public
information relating to the Class ETF Shares, and to ensure fair and
orderly markets for Class ETF Shares.
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\55\ See supra note 36 and accompanying text.
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(2) Other Related Proposed Rule Changes
The Exchange also proposes changes to accommodate Class ETF Shares
in other Exchange rules. First, the Exchange proposes to add Class ETF
Shares to the definition of ``Derivative Securities Product and UTP
Derivative Securities Product'' in NYSE Arca Rule 1.1. Second, the
Exchange proposes to amend NYSE Arca Rule 5.3-E to exempt Class ETF
Shares from the requirements of Rule 5.3-E(d)(9) in connection with the
acquisition of the stock or assets of an affiliated registered
investment company in a transaction that complies with Rule 17a-8 under
the Investment Company Act and does not otherwise require shareholder
approval under the Investment Company Act \56\ and the rules thereunder
or any other Exchange rule. In addition, the Exchange proposes to add
proposed Rule 5.2-E(j)(9) to the last paragraph of Rule 5.3-E, which
defines derivative and special purpose securities for purposes of Rule
5.3-E.\57\
[[Page 54827]]
These proposed changes incorporate proposed NYSE Arca Rule 5.2-E(j)(9)
into the existing framework of the Exchange's rules, and therefore the
Commission finds that such changes are consistent with Section 6(b)(5)
of the Act.
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\56\ The Exchange also proposes non-substantive, technical
changes to delete two extraneous words in this rule. See supra note
19.
\57\ The Exchange states that these proposed changes would
subject Class ETF Shares to the same corporate governance
requirements as other open-end management investment companies
listed on the Exchange. See supra note 20 and accompanying text.
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B. Consistency With Section 6(b)(1) of the Act
The Commission also finds that the proposed rule change, as
modified by Amendment No. 2, is consistent with Section 6(b)(1) of the
Act,\58\ which requires, among other things, that the Exchange is so
organized and has the capacity to be able to enforce compliance by its
members and persons associated with its members with the rules of the
Exchange. The Exchange represents that, consistent with Section 6(b)(1)
of the Act,\59\ it has the capacity to enforce proposed NYSE Arca Rule
5.2-E(j)(9) and that it will perform ongoing surveillance of Class ETF
Shares listed on the Exchange to ensure that: (1) the Multi-Class Fund
is and continues to be eligible to operate an ETF Class as an ETF
pursuant to, and is otherwise in compliance with the terms and
conditions of, the Multi-Class Fund Exemptive Relief; (2) the ETF Class
continues to be compliant with the conditions and requirements of Rule
6c-11 under the Investment Company Act, except as noted in such Multi-
Class Fund Exemptive Relief; and (3) the ETF Class and the Multi-Class
Fund each satisfies the requirements of proposed NYSE Arca Rule 5.2-
E(j)(9), as applicable, on an initial and continued listing basis. In
addition, the Exchange represents that it will review the website of
the Class ETF Shares listed on the Exchange to ensure that the
requirements of Rule 6c-11 under the Investment Company Act are being
met and will obtain a representation from the issuer of the Class ETF
Shares that the requirements of Rule 6c-11 and the applicable exemptive
relief under the Investment Company Act will be continuously satisfied,
and that the issuer will notify the Exchange of any failure to do so.
The Exchange also represents that it will comply with all the
requirements of Rule 19b-4(e) to specifically note that such Class ETF
Shares are being listed on the Exchange pursuant to NYSE Arca Rule 5.2-
E(j)(9).\60\
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\58\ 15 U.S.C. 78f(b)(1).
\59\ Id.
\60\ Rule 19b-4(e) requires an SRO seeking to rely on Rule 19b-
4(e) to post on its publicly available internet website within five
business days after commencement of trading a new derivative
securities product the following information relating to the new
derivative securities product, using the most recent versions of the
XML schema and the associated PDF renderer as published on the
Commission's website: (A) type of issuer; (B) class; (C) name of
underlying instrument; (D) if the underlying instrument is an index,
whether it is broad-based or narrow-based; (E) ticker symbol(s); (F)
market(s) upon which securities composing the underlying instrument
trade; (G) settlement methodology; and (H) position limits (if
applicable). See 17 CFR 240.19b-4(e)(2)(ii). See also supra notes 10
and 18 and respective accompanying text.
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The Exchange states that it will employ numerous intraday alerts to
notify Exchange personnel of trading activity throughout the day that
is potentially indicative of certain disclosures not being made
accurately or the presence of other unusual conditions or circumstances
that could be detrimental to the maintenance of a fair and orderly
market. The Exchange also states that proposed NYSE Arca Rule 5.2-
E(j)(9) requires any issuer to provide the Exchange with prompt
notification after it becomes aware of any non-compliance with proposed
NYSE Arca Rule 5.2-E(j)(9),\61\ which would include any failure of the
issuer to comply with Rule 6c-11 under the Investment Company Act or
with the terms and conditions of the Multi-Class Fund Exemptive
Relief.\62\ Further, proposed NYSE Arca Rule 5.2-E(j)(9)(e)(2)(C)
requires that the Exchange consider the suspension of trading in, and
commence delisting proceedings for, Class ETF Shares if, following the
initial 12-month period after commencement of trading on the Exchange,
there are fewer than 50 beneficial holders of the Class ETF Shares.\63\
Finally, the Exchange deems Class ETF Shares to be equity securities
and represents, therefore, that such Class ETF Shares would be subject
to the full panoply of Exchange rules and procedures that currently
govern the trading of equity securities on the Exchange.\64\ The
Exchange states that Class ETF Shares will be subject to rules
governing Exchange member disclosure obligations in connection with
equities trading, and that Rule 6c-11 under the Investment Company Act
does not change the applicability of these Exchange rules with respect
to these securities.\65\
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\61\ See NYSE Arca Rule 5.2-E(b) (requiring, among other things,
that ``[a]n issuer with securities listed under Rule 5.2-E . . .
must provide the Exchange with prompt notification after the issuer
becomes aware of any noncompliance by the issuer with the applicable
continued listing requirements. . . .'').
\62\ See supra note 50 and accompanying text.
\63\ See proposed NYSE Arca Rule 5.2-E(j)(9)(e)(2)(C).
\64\ See supra note 28 and accompanying text.
\65\ With respect to trading in Class ETF Shares, the Exchange
represents that all ETP Holder obligations relating to product
description and prospectus delivery requirements will continue to
apply in accordance with the Exchange's rules and federal securities
laws, and the Exchange will continue to monitor ETP Holders for
compliance with such requirements, which are not changing as a
result of the Multi-Class Fund Exemptive Relief order issued under
the Investment Company Act. See supra note 28 and accompanying text.
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This approval order is based on all of the Exchange's
representations and descriptions in the proposed rule change, including
those set forth above and in Amendment No. 2, which the Commission has
carefully evaluated as discussed above. For the foregoing reasons, the
Commission finds that the proposed rule change, as modified by
Amendment No. 2, is consistent with Sections 6(b)(1) and 6(b)(5) of the
Act \66\ and the rules and regulations thereunder applicable to a
national securities exchange.
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\66\ 15 U.S.C. 78f(b)(1) and 15 U.S.C. 78f(b)(5), respectively.
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IV. Solicitation of Comments on Amendment No. 2 to the Proposed Rule
Change
Interested persons are invited to submit written data, views, and
arguments concerning whether the proposed rule change, as modified by
Amendment No. 2, is consistent with the Act. Comments may be submitted
by any of the following methods:
Electronic Comments
<bullet> Use the Commission's internet comment form (<a href="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>); or
<bullet> Send an email to <a href="/cdn-cgi/l/email-protection#d0a2a5bcb5fdb3bfbdbdb5bea4a390a3b5b3feb7bfa6"><span class="__cf_email__" data-cfemail="7c0e091019511f1311111912080f3c0f191f521b130a">[email protected]</span></a>. Please include
file number SR-NYSEARCA-2025-39 on the subject line.
Paper Comments
<bullet> 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-2025-39. 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 (<a href="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>). Copies of the filing will be available for inspection and
copying at the principal office of the Exchange. Do not include
personal identifiable information in submissions; you should submit
only information that you wish to make available publicly. We may
redact in part or withhold entirely from publication submitted material
that is obscene or subject to copyright protection. All submissions
should refer to file number SR-NYSEARCA-2025-39
[[Page 54828]]
and should be submitted on or before December 19, 2025.
V. Accelerated Approval of Proposed Rule Change, as Modified by
Amendment No. 2
The Commission finds good cause to approve the proposed rule
change, as modified by Amendment No. 2, prior to the 30th day after the
date of publication of Amendment No. 2 in the Federal Register.
Amendment No. 2 reflects the Commission's grant of the Multi-Class Fund
Exemptive Relief and provides additional clarity with respect to the
application of the Exchange's proposed listing standards and the
requirements of the Multi-Class Fund Exemptive Relief. Amendment No. 2
also makes certain additional corrections that are minor and technical
in nature. In addition, the proposal, as modified by Amendment No. 1,
has been subject to public comment and no comments have been received.
The Commission finds that Amendment No. 2 to the proposed rule
change raises no novel regulatory issues that have not previously been
subject to comment, and is reasonably designed, among other things, to
prevent fraudulent and manipulative acts and practices, to remove
impediments to and perfect the mechanism of a free and open market,
and, in general, to protect investors and the public interest. The
Commission also finds that Amendment No. 2 to the proposed rule change
is consistent with Section 11A(a)(1)(C)(iii) of the Act.\67\
Accordingly, pursuant to Section 19(b)(2) of the Act,\68\ the
Commission finds good cause to approve the proposed rule change, as
modified by Amendment No. 2, on an accelerated basis.
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\67\ See supra note 36 and accompanying text.
\68\ 15 U.S.C. 78s(b)(2).
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VI. Conclusion
It is therefore ordered, pursuant to Section 19(b)(2) of the
Act,\69\ that the proposed rule change (SR-NYSEARCA-2025-39), as
modified by Amendment No. 2, be, and it hereby is, approved on an
accelerated basis.
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\69\ Id.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\70\
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\70\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2025-21405 Filed 11-26-25; 8:45 am]
BILLING CODE 8011-01-P
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</html>Indexed from Federal Register on November 28, 2025.
This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.