[Federal Register Volume 83, Number 144 (Thursday, July 26, 2018)]
[Notices]
[Pages 35505-35512]
[FR Doc No: 2018-15945]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-83679; File No. SR-BatsBZX-2017-72]

Self-Regulatory Organizations; Cboe BZX Exchange, Inc.; Notice of
Filing of Amendment No. 4 and Order Granting Accelerated Approval of a
Proposed Rule Change, as Modified by Amendment No. 4 Thereto, To List
and Trade Shares of the Innovator S&P 500 Buffer ETF Series, Innovator
S&P 500 Power Buffer ETF Series, and Innovator S&P 500 Ultra Buffer ETF
Series Under Rule 14.11(i)

July 20, 2018.

I. Introduction

    On November 7, 2017, Cboe BZX Exchange, Inc. (``Exchange'' or
``BZX''), formerly known as Bats BZX Exchange, Inc., filed with the
Securities and Exchange Commission (``Commission''), pursuant to
Section 19(b)(1) \1\ of the Securities Exchange Act of 1934 (``Act'')
\2\ and Rule 19b-4 thereunder,\3\ a proposed rule change to list and
trade shares of the Innovator S&P 500 Buffer ETF Series (formerly known
both as the Innovator S&P 500 Enhance and Buffer ETF Series and
Innovator S&P 500 Enhance and 10% Shield Strategy ETF Series),
Innovator S&P 500 Power Buffer ETF Series (formerly known as both the
Innovator S&P 500 Buffer ETF Series and Innovator S&P 500 15% Shield
Strategy ETF Series), and Innovator S&P 500 Ultra Buffer ETF Series
(formerly known as both the Innovator S&P 500 Power Buffer ETF Series
and Innovator S&P 500 -5% to -35% Shield Strategy ETF Series) under BZX
Rule 14.11(i). The proposed rule change was published for comment in
the Federal Register on November 22, 2017.\4\ On December 21, 2017, the
Commission extended the time period within which to approve the
proposed rule change, disapprove the proposed rule change, or institute
proceedings to determine whether to approve or disapprove the proposed
rule change.\5\ On February 20, 2018, the Commission initiated
proceedings to determine whether to disapprove the proposed rule
change.\6\ On April 4, 2018, the Exchange filed Amendment No. 1 to the
proposed rule change, which amended and superseded the proposed rule
change as originally filed. On July 12, 2018, the Exchange filed
Amendment No. 2 to the proposed rule change, which amended and
superseded the proposed rule change as modified by Amendment No. 1, as
well as Amendment No. 3 to the proposed rule change, which amended and
superseded the proposed rule change as modified by Amendment No. 2. On
July 18, 2018, the Exchange filed Amendment No. 4 to the proposed rule
change, which amended and superseded the proposed rule change as
modified by Amendment No. 3.\7\ The Commission received no comments on
the proposed rule change. The Commission is publishing this notice to
solicit comments on Amendment No. 4 from interested persons and is
approving the proposed rule change, as modified by Amendment No. 4, on
an accelerated basis.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
    \4\ See Securities Exchange Act Release No. 82097 (November 16,
2017), 82 FR 55689.
    \5\ See Securities Exchange Act Release No. 82387, 82 FR 61613
(December 28, 2017) (extending the time period to February 20,
2018).
    \6\ See Securities Exchange Act Release No. 82739, 83 FR 8309
(February 26, 2018).
    \7\ The amendments to the proposed rule change are available at:
https://www.sec.gov/comments/sr-batsbzx-2017-72/batsbzx201772.htm.
In Amendment No. 4, the Exchange (among other things) narrowed the
scope of the proposed rule change to withdraw its request to list
and trade shares of the Innovator S&P 500 Ultra ETF Series (formerly
known as the Innovator S&P 500 Ultra Strategy ETF Series).
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II. The Exchange's Description of the Proposed Rule Change, as Modified
by Amendment No. 4

    In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The 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
    This Amendment No. 4 to SR-BatsBZX-2017-72 amends and replaces in
its entirety the third amended proposal submitted on July 12, 2018.

The Exchange submits this Amendment No. 4 in order to revise certain
details regarding the Funds.
    The Exchange proposes to list and trade shares (``Shares'') of up
to twelve monthly Innovator S&P 500 Buffer ETF Series (collectively,
the ``Buffer Funds''), Innovator S&P 500 Power Buffer ETF Series
(collectively, the ``Power Buffer Funds''), and Innovator S&P 500 Ultra
Buffer ETF Series (collectively, the ``Ultra Buffer Funds'') (each a
``Fund'' and, collectively, the ``Funds'') under Rule 14.11(i), which
governs the listing and trading of Managed Fund Shares on the
Exchange.\8\ Each Fund will be an actively managed exchange traded fund
(``ETF'').
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    \8\ The Commission originally approved BZX Rule 14.11(i) in
Securities Exchange Act Release No. 65225 (August 30, 2011), 76 FR
55148 (September 6, 2011) (SR-BATS-2011-018) and subsequently
approved generic listing standards for Managed Fund Shares under
Rule 14.11(i) in Securities Exchange Act Release No. 78396 (July 22,
2016), 81 FR 49698 (July 28, 2016) (SR-BATS-2015-100).
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    The Shares will be offered by Innovator ETFs Trust (formerly
Academy Funds Trust) (the ``Trust''), which was established as a
Delaware statutory trust on October 17, 2007. The Trust is registered
with the Commission as an investment company and has filed, for each
Fund, a registration statement on Form N-1A (``Registration
Statement'') with the Commission on behalf of the Funds.\9\ Each Fund
intends to qualify each year as a regulated investment company (a
``RIC'') under Subchapter M of the Internal Revenue Code of 1986, as
amended.\10\ Innovator Capital Management, LLC (the ``Adviser'') is the
investment adviser to the Funds and Milliman Financial Risk Management
LLC (the ``Sub-Adviser'') is the sub-adviser. Rule 14.11(i)(7) provides
that, if the investment adviser to the investment company issuing
Managed Fund Shares is affiliated with a broker-dealer, such investment
adviser shall erect 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 investment company portfolio.\11\ In
addition, Rule 14.11(i)(7) further requires that personnel who make
decisions on the investment company's portfolio composition must be
subject to procedures designed to prevent the use and dissemination of
material nonpublic information regarding the applicable investment
company portfolio. Neither the Adviser nor the Sub-Adviser is a
registered broker-dealer, and neither the Adviser nor the Sub-Adviser
are affiliated with broker-dealers. In addition, Adviser and Sub-
Adviser personnel who make decisions regarding a Fund's portfolio are
subject to procedures designed to prevent the use and dissemination of
material nonpublic information regarding the Fund's portfolio. In the
event that (a) the Adviser or Sub-Adviser becomes registered as a
broker-dealer or newly affiliated with a broker-dealer, or (b) any new
adviser or sub-adviser is a registered broker-dealer or becomes
affiliated with a broker-dealer, it will implement and maintain a fire
wall with respect to its relevant personnel or such broker-dealer
affiliate, as applicable, regarding access to information concerning
the composition and/or changes to the portfolio, and will be subject to
procedures designed to prevent the use and dissemination of material
non-public information regarding such portfolio. Similarly, to the
extent that a Fund is based on a benchmark index, in the event that the
index provider of the benchmark index (the ``Index Provider'') becomes
registered as a broker-dealer or newly affiliated with a broker-dealer,
it will implement and maintain a fire wall with respect to its relevant
personnel or such broker-dealer affiliate, as applicable, regarding
access to information concerning the composition and/or changes to the
portfolio, and will be subject to procedures designed to prevent the
use and dissemination of material non-public information regarding such
portfolio.
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    \9\ See Post-Effective Amendment Nos. 149, 150, and 151 to
Registration Statement on Form N-1A for the Trust, which were filed
with the Commission on July 12, 2018 (File Nos. 333-146827 and 811-
22135). The descriptions of the Funds and the Shares contained
herein are based on information in the Registration Statement. There
are no permissible holdings for the Funds that are not described in
this proposal. The Commission has issued an order granting certain
exemptive relief to the Trust under the Investment Company Act of
1940 (15 U.S.C. 80a-1) (``1940 Act'') (the ``Exemptive Order''). See
Investment Company Act Release No. 32854 (October 6, 2017) (File No.
812-14781).
    \10\ 26 U.S.C. 851.
    \11\ An investment adviser to an open-end fund is required to be
registered under the Investment Advisers Act of 1940 (the ``Advisers
Act''). As a result, the Adviser and its related personnel are
subject to the provisions of Rule 204A-1 under the Advisers Act
relating to codes of ethics. This Rule requires investment advisers
to adopt a code of ethics that reflects the fiduciary nature of the
relationship to clients as well as compliance with other applicable
securities laws. Accordingly, procedures designed to prevent the
communication and misuse of non-public information by an investment
adviser must be consistent with Rule 204A-1 under the Advisers Act.
In addition, Rule 206(4)-7 under the Advisers Act makes it unlawful
for an investment adviser to provide investment advice to clients
unless such investment adviser has (i) adopted and implemented
written policies and procedures reasonably designed to prevent
violation, by the investment adviser and its supervised persons, of
the Advisers Act and the Commission rules adopted thereunder; (ii)
implemented, at a minimum, an annual review regarding the adequacy
of the policies and procedures established pursuant to subparagraph
(i) above and the effectiveness of their implementation; and (iii)
designated an individual (who is a supervised person) responsible
for administering the policies and procedures adopted under
subparagraph (i) above.
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    The investment objective of the Funds is to provide investors with
returns that match those of the S&P 500 Price Return Index (the ``S&P
500 Index'') over a period of approximately one year, while providing a
level of protection from S&P 500 Index losses.
    The Funds are each actively managed funds that employ a ``defined
outcome strategy'' that:
    (1) For the Buffer Funds, seeks to provide investment returns that
match the gains of the S&P 500 Index, up to a maximized annual return
(the ``Buffer Cap Level''), while guarding against a decline in the S&P
500 Index of the first 10% (the ``Buffer Strategy'');
    (2) for the Power Buffer Funds, seeks to provide investment returns
that match the gains of the S&P 500 Index, up to a maximized annual
return (the ``Power Buffer Cap Level''), while guarding against a
decline in the S&P 500 Index of the first 15% (the ``Power Buffer
Strategy''); and
    (3) for the Ultra Buffer Funds, seeks to provide investment returns
that match the gains of the S&P 500 Index, up to a maximized annual
return (the ``Ultra Buffer Cap Level''), while guarding against a
decline in the S&P 500 Index of between 5% and 35% (the ``Ultra Buffer
Strategy'').
    Pursuant to the Strategies, each Fund will invest primarily in
exchange-traded options contracts that reference either the S&P 500
Index or ETFs that track the S&P 500 Index. Defined outcome strategies
are designed to participate in market gains and losses within pre-
determined ranges over a specified period (i.e., point to point). These
outcomes are predicated on the assumption that an investment vehicle
employing the strategy is held for the designated outcome periods. As
such, the Exchange is proposing to list up to twelve monthly series of
each of the Buffer Funds, Power Buffer Funds and Ultra Buffer Funds, as
named above.
    The Exchange submits this proposal in order to allow each Fund to
hold listed derivatives, in particular FLexible EXchange Options
(``FLEX Options'') on the S&P 500 Index, in a manner that does not
comply with Rule 14.11(i)(4)(C)(iv)(b).\12\ Otherwise, the

Funds will comply with all other listing requirements of the Generic
Listing Standards \13\ for Managed Fund Shares on an initial and
continued listing basis under Rule 14.11(i).
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    \12\ Rule 14.11(i)(4)(C)(iv)(b) provides that ``the aggregate
gross notional value of listed derivatives based on any five or
fewer underlying reference assets shall not exceed 65% of the weight
of the portfolio (including gross notional exposures), and the
aggregate gross notional value of listed derivatives based on any
single underlying reference asset shall not exceed 30% of the weight
of the portfolio (including gross notional exposures).'' The Funds
do not meet the generic listing standards because they fail to meet
the requirement of Rule 14.11(i)(4)(C)(iv)(b) that prevents the
aggregate gross notional value of listed derivatives based on any
single underlying reference asset from exceeding 30% of the weight
of the portfolio (including gross notional exposures) and the
requirement that the aggregate gross notional value of listed
derivatives based on any five or fewer underlying reference assets
shall not exceed 65% of the weight of the portfolio (including gross
notional exposures).
    \13\ For purposes of this proposal, the term ``Generic Listing
Standards'' shall mean the generic listing rules for Managed Fund
Shares under Rule 14.11(i)(4)(C).
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Innovator S&P 500 Buffer ETF Series
    Under Normal Market Conditions,\14\ each Buffer Fund will attempt
to achieve its investment objective by employing a ``defined outcome
strategy'' that will seek to provide investment returns during the
outcome period that match the gains of the S&P 500 Index, up to the
Buffer Cap Level, while shielding investors from S&P 500 Index losses
of up to 10%. Pursuant to the Buffer Strategy, each Buffer Fund will
invest primarily in FLEX Options or standardized options contracts
listed on a U.S. exchange that reference either the S&P 500 Index or
ETFs that track the S&P 500 Index.
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    \14\ As defined in Rule 14.11(i)(3)(E), the term ``Normal Market
Conditions'' includes, but is not limited to, the absence of trading
halts in the applicable financial markets generally; operational
issues causing dissemination of inaccurate market information or
system failures; or force majeure type events such as natural or
man-made disaster, act of God, armed conflict, act of terrorism,
riot or labor disruption, or any similar intervening circumstance.
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    The portfolio managers will invest in a portfolio of FLEX Options
linked to an underlying asset, the S&P 500 Index, that, when held for
the specified period, seeks to produce returns that, over the outcome
period, match the positive returns of the S&P 500 Index up to the
Buffer Cap Level. Pursuant to the Buffer Strategy, each Buffer Fund's
portfolio managers will seek to produce the following outcomes during
the outcome period:
     If the S&P 500 Index appreciates over the outcome period:
The Buffer Fund will seek to provide shareholders with a total return
that matches that of the S&P 500 Index, up to and including the Buffer
Cap Level;
     If the S&P 500 Index depreciates over the outcome period
by 10% or less: The Buffer Fund will seek to provide a total return of
zero;
     If the S&P 500 Index decreases over the outcome period by
more than 10%: The Buffer Fund will seek to provide a total return loss
that is 10% less than the percentage loss on the S&P 500 Index with a
maximum loss of approximately 90%.
    The Buffer Funds will produce these outcomes by layering purchased
and written FLEX Options. The customizable nature of FLEX Options
allows for the creation of a strategy that sets desired defined outcome
parameters. The FLEX Options comprising a Buffer Fund's portfolio have
terms that, when layered upon each other, are designed to buffer
against losses or match the gains of the S&P 500 Index. However,
another effect of the layering of FLEX Options with these terms is a
cap on the level of possible gains.
    Any FLEX Options that are written by a Buffer Fund that create an
obligation to sell or buy an asset will be offset with a position in
FLEX Options purchased by the Buffer Fund to create the right to buy or
sell the same asset such that the Buffer Fund will always be in a net
long position. That is, any obligations of a Buffer Fund created by its
writing of FLEX Options will be covered by offsetting positions in
other purchased FLEX Options. As the FLEX Options mature at the end of
each outcome period, they are replaced. By replacing FLEX Options
annually, each Buffer Fund seeks to ensure that investments made in a
given month during the current year buffer against negative returns of
the S&P 500 Index up to pre-determined levels in that same month of the
following year. The Buffer Funds do not offer any protection against
declines in the S&P 500 Index exceeding 10% on an annualized basis.
Shareholders will bear all S&P 500 Index losses exceeding 10% on a one-
to-one basis.
    The FLEX Options owned by each of the Buffer Funds will have the
same terms (i.e., same strike price and expiration) for all investors
of a Buffer Fund within an outcome period. The Buffer Cap Level will be
determined with respect to each Buffer Fund on the inception date of
the Buffer Fund and at the beginning of each outcome period and is
determined based on the price of the FLEX Options acquired by the
Buffer Fund at that time.
Innovator S&P 500 Power Buffer ETF Series
    Under Normal Market Conditions, each Power Buffer Fund will attempt
to achieve its investment objective by employing a ``defined outcome
strategy'' that will seek to provide investment returns during the
outcome period that match the gains of the S&P 500 Index, up to the
Power Buffer Cap Level, while shielding investors from S&P 500 Index
losses of up to 15%. Pursuant to the Power Buffer Strategy, each Power
Buffer Fund will invest primarily in FLEX Options or standardized
options contracts listed on a U.S. exchange that reference either the
S&P 500 Index or ETFs that track the S&P 500 Index.
    The portfolio managers will invest in a portfolio of FLEX Options
linked to an underlying asset, the S&P 500 Index, that, when held for
the specified period, seeks to produce returns that, over the outcome
period, match the positive returns of the S&P 500 Index up to the Power
Buffer Cap Level. Pursuant to the Power Buffer Strategy, each Power
Buffer Fund's portfolio managers will seek to produce the following
outcomes during the outcome period:
     If the S&P 500 Index appreciates over the outcome period:
The Power Buffer Fund will seek to provide shareholders with a total
return that matches that of the S&P 500 Index, up to and including the
Power Buffer Cap Level;
     If the S&P 500 Index depreciates over the outcome period
by 15% or less: The Power Buffer Fund will seek to provide a total
return of zero; and
     If the S&P 500 Index decreases over the outcome period by
more than 15%: The Power Buffer Fund will seek to provide a total
return loss that is 15% less than the percentage loss on the S&P 500
Index with a maximum loss of approximately 85%.
    The Power Buffer Funds will produce these outcomes by layering
purchased and written FLEX Options. The customizable nature of FLEX
Options allows for the creation of a strategy that sets desired defined
outcome parameters. The FLEX Options comprising a Power Buffer Fund's
portfolio have terms that, when layered upon each other, are designed
to buffer against losses or match the gains of the S&P 500 Index.
However, another effect of the layering of FLEX Options with these
terms is a cap on the level of possible gains.
    Any FLEX Options that are written by a Power Buffer Fund that
create an obligation to sell or buy an asset will be offset with a
position in FLEX Options purchased by the Power Buffer Fund to create
the right to buy or sell the same asset such that the Power Buffer Fund
will always be in a net long position. That is, any obligations of a
Power Buffer Fund created by its writing of

FLEX Options will be covered by offsetting positions in other purchased
FLEX Options. As the FLEX Options mature at the end of each outcome
period, they are replaced. By replacing FLEX Options annually, each
Power Buffer Fund seeks to ensure that investments made in a given
month during the current year buffer against negative returns of the
S&P 500 Index up to pre-determined levels in that same month of the
following year. The Power Buffer Funds do not offer any protection
against declines in the S&P 500 Index exceeding 15% on an annualized
basis. Shareholders will bear all S&P 500 Index losses exceeding 15% on
a one-to-one basis.
    The FLEX Options owned by each of the Power Buffer Funds will have
the same terms (i.e. same strike price and expiration) for all
investors of a Power Buffer Fund within an outcome period. The Power
Buffer Cap Level will be determined with respect to each Power Buffer
Fund on the inception date of the Power Buffer Fund and at the
beginning of each outcome period and is determined based on the price
of the FLEX Options acquired by the Power Buffer Fund at that time.
Innovator S&P 500 Ultra Buffer ETF Series
    Under Normal Market Conditions, each Ultra Buffer Fund will attempt
to achieve its investment objective by employing a ``defined outcome
strategy'' that will seek to provide investment returns during the
outcome period that match the gains of the S&P 500 Index, up to the
Ultra Buffer Cap Level, while shielding investors from S&P 500 Index
losses of between 5% and 35%. Pursuant to the Ultra Buffer Strategy,
each Ultra Buffer Fund will invest primarily in FLEX Options or
standardized options contracts listed on a U.S. exchange that reference
either the S&P 500 Index or ETFs that track the S&P 500 Index.
    The portfolio managers will invest in a portfolio of FLEX Options
linked to an underlying asset, the S&P 500 Index, that, when held for
the specified period, seeks to produce returns that, over the outcome
period, match the positive returns of the S&P 500 Index up to the Ultra
Buffer Cap Level. Pursuant to the Ultra Buffer Strategy, each Ultra
Buffer Fund's portfolio managers will seek to produce the following
outcomes during the outcome period:
     If the S&P 500 Index appreciates over the outcome period:
The Ultra Buffer Fund will seek to provide a total return that matches
the percentage increase of the S&P 500 Index, up to the Ultra Buffer
Cap Level;
     If the S&P 500 Index decreases over the outcome period by
5% or less: The Ultra Buffer Fund will seek to provide a total return
loss that is equal to the percentage loss on the S&P 500 Index;
     If the S&P 500 Index decreases over the outcome period by
5%-35%: The Ultra Buffer Fund will seek to provide a total return loss
of 5%; and
     If the S&P 500 Index depreciates over the outcome period
by greater than 35%: The Ultra Buffer Fund will seek to provide a total
return loss that is 30% less than the percentage loss on the S&P 500
Index with a maximum loss of approximately 70%.
    The Ultra Buffer Funds will produce these outcomes by layering
purchased and written FLEX Options. The customizable nature of FLEX
Options allows for the creation of a strategy that sets desired defined
outcome parameters. The FLEX Options comprising an Ultra Buffer Fund's
portfolio have terms that, when layered upon each other, are designed
to buffer against losses or match the gains of the S&P 500 Index.
However, another effect of the layering of FLEX Options with these
terms is a cap on the level of possible gains.
    Any FLEX Options that are written by an Ultra Buffer Fund that
create an obligation to sell or buy an asset will be offset with a
position in FLEX Options purchased by the Ultra Buffer Fund to create
the right to buy or sell the same asset such that the Ultra Buffer Fund
will always be in a net long position. That is, any obligations of an
Ultra Buffer Fund created by its writing of FLEX Options will be
covered by offsetting positions in other purchased FLEX Options. As the
FLEX Options mature at the end of each outcome period, they are
replaced. By replacing FLEX Options annually, each Ultra Buffer Fund
seeks to ensure that investments made in a given month during the
current year buffer against negative returns of the S&P 500 Index up to
pre-determined levels in that same month of the following year. The
Ultra Buffer Funds do not offer any protection against declines in the
S&P 500 Index exceeding 35% on an annualized basis. Shareholders will
bear all S&P 500 Index losses exceeding 35% on a one-to-one basis.
    The FLEX Options owned by each of the Ultra Buffer Funds will have
the same terms (i.e. same strike price and expiration) for all
investors of an Ultra Buffer Fund within an outcome period. The Ultra
Buffer Cap Level will be determined with respect to each Ultra Buffer
Fund on the inception date of the Ultra Buffer Fund and at the
beginning of each outcome period and is determined based on the price
of the FLEX Options acquired by the Ultra Buffer Fund at that time.
Investment Methodology for the Funds
    Under Normal Market Conditions, each Fund will invest primarily in
U.S. exchange-listed FLEX Options on the S&P 500 Index. Each of the
Funds may invest its net assets (in the aggregate) in other investments
which the Adviser or Sub-Adviser believes will help each Fund to meet
its investment objective and that will be disclosed at the end of each
trading day (``Other Assets''). Other Assets include only the
following: Cash or cash equivalents, as defined in Rule
14.11(i)(4)(C)(iii) \15\ and standardized options contracts listed on a
U.S. securities exchange that reference either the S&P 500 Index or
that reference ETFs that track the S&P 500 Index (``Reference ETFs'').
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    \15\ As defined in Rule 14.11(i)(4)(C)(iii), cash equivalents
include short-term instruments with maturities of less than three
months, including: (i) U.S. Government securities, including bills,
notes, and bonds differing as to maturity and rates of interest,
which are either issued or guaranteed by the U.S. Treasury or by
U.S. Government agencies or instrumentalities; (ii) certificates of
deposit issued against funds deposited in a bank or savings and loan
association; (iii) bankers acceptances, which are short-term credit
instruments used to finance commercial transactions; (iv) repurchase
agreements and reverse repurchase agreements; (v) bank time
deposits, which are monies kept on deposit with banks or savings and
loan associations for a stated period of time at a fixed rate of
interest; (vi) commercial paper, which are short-term unsecured
promissory notes; and (vii) money market funds.
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S&P 500 Index FLEX Options
    The market for options contracts on the S&P 500 Index traded on
Cboe Exchange, Inc. (``Cboe Options'') is among the most liquid markets
in the world. In 2017, more than 1.16 million options contracts on the
S&P 500 Index were traded per day on Cboe Options, which is more than
$250 billion in notional volume traded on a daily basis. While FLEX
Options are traded differently than standardized options contracts, the
Exchange believes that this liquidity bolsters the market for FLEX
Options, as described below. Every FLEX Option order submitted to Cboe
Options is exposed to a competitive auction process for price
discovery. The process begins with a request for quote (``RFQ'') in
which the interested party establishes the terms of the FLEX Options
contract. The RFQ solicits interested market participants, including
on-floor market makers, remote market makers trading electronically,
and member firm traders, to respond to the RFQ with bids or offers
through a competitive process. This solicitation contains all of the

contract specifications-underlying, size, type of option, expiration
date, strike price, exercise style and settlement basis. During a
specified amount of time, responses to the RFQ are received and at the
end of that time period, the initiator can decide whether to accept the
best bid or offer. The process occurs under the rules of Cboe Options
which means that customer transactions are effected according to the
principles of a fair and orderly market following trading procedures
and policies developed by Cboe Options.
    The Exchange believes that sufficient protections are in place to
protect against market manipulation of the Funds' Shares and FLEX
Options on the S&P 500 Index for several reasons: (i) The diversity,
liquidity, and market cap of the securities underlying the S&P 500
Index; (ii) the competitive quoting process for FLEX Options; (iii) the
significant liquidity in the market for options on the S&P 500 Index
results in a well-established price discovery process that provides
meaningful guideposts for FLEX Option pricing; and (iv) surveillance by
the Exchange, Cboe Options \16\ and the Financial Industry Regulatory
Authority (``FINRA'') designed to detect violations of the federal
securities laws and self-regulatory organization (``SRO'') rules. The
Exchange has in place a surveillance program for transactions in ETFs
to ensure the availability of information necessary to detect and deter
potential manipulations and other trading abuses, thereby making the
Shares less readily susceptible to manipulation. Further, the Exchange
believes that because the assets in each Fund's portfolio, which are
comprised primarily of FLEX Options on the S&P 500 Index, will be
acquired in extremely liquid and highly regulated markets,\17\ the
Shares are less readily susceptible to manipulation.
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    \16\ The Exchange notes that Cboe Options is a member of the
Option Price Regulatory Surveillance Authority, which was
established in 2006, to provide efficiencies in looking for insider
trading and serves as a central organization to facilitate
collaboration in insider trading and investigations for the U.S.
options exchanges. For more information, see http://www.cboe.com/aboutcboe/legal/departments/orsareg.aspx.
    \17\ All exchange-listed securities that the Funds may hold will
trade on a market that is a member of the Intermarket Surveillance
Group (``ISG'') and the Funds will not hold any non-exchange-listed
equities or options, however, not all of the components of the
portfolio for the Funds may trade on exchanges that are members of
the ISG or with which the Exchange has in place a comprehensive
surveillance sharing agreement. For a list of the current members of
ISG, see www.isgportal.org.
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    The Exchange believes that its surveillance procedures are adequate
to properly monitor the trading of the Shares on the Exchange during
all trading sessions and to deter and detect violations of Exchange
rules and the applicable federal securities laws. Trading of the Shares
through the Exchange will be subject to the Exchange's surveillance
procedures for derivative products, including Managed Fund Shares. All
statements and representations made in this filing regarding (a) the
description of the portfolio, reference assets, and index, (b)
limitations on portfolio holdings or reference assets, or (c) the
applicability of Exchange rules shall constitute continued listing
requirements for listing the Shares on the Exchange. The issuer has
represented to the Exchange that it will advise the Exchange of any
failure by a Fund or the related Shares to comply with the continued
listing requirements, and, pursuant to its obligations under Section
19(g)(1) of the Act, the Exchange will surveil for compliance with the
continued listing requirements. If a Fund or the related Shares are not
in compliance with the applicable listing requirements, then, with
respect to such Fund or Shares, the Exchange will commence delisting
procedures under Exchange Rule 14.12. FINRA conducts certain cross-
market surveillances on behalf of the Exchange pursuant to a regulatory
services agreement. The Exchange is responsible for FINRA's performance
under this regulatory services agreement. If a Fund is not in
compliance with the applicable listing requirements, the Exchange will
commence delisting procedures with respect to such Fund under Exchange
Rule 14.12.
    The Exchange or FINRA, on behalf of the Exchange, will communicate
as needed regarding trading in the Shares and exchange-traded options
contracts with other markets and other entities that are members of the
ISG and may obtain trading information regarding trading in the Shares
and exchange-traded options contracts from such markets and other
entities. In addition, the Exchange may obtain information regarding
trading in the Shares and exchange-traded options contracts from
markets and other entities that are members of ISG or with which the
Exchange has in place a comprehensive surveillance sharing agreement.
In addition, the Exchange also has a general policy prohibiting the
distribution of material, non-public information by its employees.
    As noted above, options on the S&P 500 Index are among the most
liquid options in the world and derive their value from the actively
traded S&P 500 Index components. The contracts are cash-settled with no
delivery of stocks or ETFs, and trade in competitive auction markets
with price and quote transparency. The Exchange believes the highly
regulated options markets and the broad base and scope of the S&P 500
Index make securities that derive their value from that index less
susceptible to market manipulation in view of market capitalization and
liquidity of the S&P 500 Index components, price and quote
transparency, and arbitrage opportunities.
    The Exchange believes that the liquidity of the markets for S&P 500
Index securities, options on the S&P 500 Index, and other related
derivatives is sufficiently great to deter fraudulent or manipulative
acts associated with the Funds' Shares price. The Exchange also
believes that such liquidity is sufficient to support the creation and
redemption mechanism. Coupled with the extensive surveillance programs
of the SROs described above, the Exchange does not believe that trading
in the Funds' Shares would present manipulation concerns.
    The Exchange represents that, except for the limitations on listed
derivatives in BZX Rule 14.11(i)(4)(C)(iv)(b), the Funds' proposed
investments will satisfy, on an initial and continued listing basis,
all of the generic listing standards under BZX Rule 14.11(i)(4)(C) and
all other applicable requirements for Managed Fund Shares under Rule
14.11(i). The Trust is required to comply with Rule 10A-3 under the Act
for the initial and continued listing of the Shares of the Funds. A
minimum of 100,000 Shares will be outstanding at the commencement of
trading on the Exchange. In addition, the Exchange represents that the
Shares of the Funds will comply with all other requirements applicable
to Managed Fund Shares, which includes the dissemination of key
information such as the Disclosed Portfolio,\18\ Net Asset Value,\19\
and the Intraday Indicative Value,\20\ suspension of trading or
removal,\21\ trading halts,\22\ surveillance,\23\ minimum price
variation for quoting and order entry,\24\ and the information
circular,\25\ as set forth in Exchange rules applicable to Managed Fund
Shares. Moreover, all of the options contracts held by the Funds will
trade on markets that are a member of ISG or affiliated with a member
of ISG or with which the Exchange has in place

a comprehensive surveillance sharing agreement. Quotation and last sale
information for U.S. exchange-listed options contracts cleared by The
Options Clearing Corporation will be available via the Options Price
Reporting Authority. RFQ information for FLEX Options will be available
directly from Cboe Options. The intra-day, closing and settlement
prices of exchange-traded options will be readily available from the
options exchanges, automated quotation systems, published or other
public sources, or online information services such as Bloomberg or
Reuters. Price information on cash equivalents is available from major
broker-dealer firms or market data vendors, as well as from automated
quotation systems, published or other public sources, or online
information services.
---------------------------------------------------------------------------

    \18\ See Rule 14.11(i)(4)(A)(ii) and 14.11(i)(4)(B)(ii).
    \19\ See Rule 14.11(i)(4)(A)(ii).
    \20\ See Rule 14.11(i)(4)(B)(i).
    \21\ See Rule 14.11(i)(4)(B)(iii).
    \22\ See Rule 14.11(i)(4)(B)(iv).
    \23\ See Rule 14.11(i)(2)(C).
    \24\ See Rule 14.11(i)(2)(B).
    \25\ See Rule 14.11(i)(6).
---------------------------------------------------------------------------

    Lastly, the issuer represents that it will provide and maintain a
publicly available web tool for each of the Funds on its website that
provides existing and prospective shareholders with important
information to help inform investment decisions. The information
provided includes the start and end dates of the current outcome
period, the time remaining in the outcome period, the Fund's current
net asset value, the Fund's cap for the outcome period and the maximum
investment gain available up to the cap for a shareholder purchasing
Shares at the current net asset value. For each of the Funds, the web
tool also provides information regarding each Fund's buffer. This
information includes the remaining buffer available for a shareholder
purchasing Shares at the current net asset value or the amount of
losses that a shareholder purchasing Shares at the current net asset
value would incur before benefitting from the protection of the buffer.
The cover of each Fund's prospectus, as well as the disclosure
contained in ``Principal Investment Strategies,'' provides the specific
web address for each Fund's web tool.
2. Statutory Basis
    The Exchange believes that the proposal is consistent with Section
6(b) of the Act \26\ in general and Section 6(b)(5) of the Act \27\ in
particular in that it is designed to prevent fraudulent and
manipulative acts and practices, to promote just and equitable
principles of trade, to foster cooperation and coordination with
persons engaged in facilitating transactions in securities, 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.
---------------------------------------------------------------------------

    \26\ 15 U.S.C. 78f.
    \27\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Exchange believes that the proposed rule change is designed to
prevent fraudulent and manipulative acts and practices, to promote just
and equitable principles of trade, to foster cooperation and
coordination with persons engaged in facilitating transactions in
securities, 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 in that the Shares will meet
each of the initial and continued listing criteria in BZX Rule 14.11(i)
with the exception of Rule 14.11(i)(4)(C)(iv)(b), which requires that
the aggregate gross notional value of listed derivatives based on any
five or fewer underlying reference assets shall not exceed 65% of the
weight of the portfolio (including gross notional exposures), and the
aggregate gross notional value of listed derivatives based on any
single underlying reference asset shall not exceed 30% of the weight of
the portfolio (including gross notional exposures).\28\ Rule
14.11(i)(4)(C)(iv)(b) is intended to ensure that a fund is not subject
to manipulation by virtue of significant exposure to a manipulable
underlying reference asset by establishing concentration limits among
the underlying reference assets for listed derivatives held by a
particular fund.
---------------------------------------------------------------------------

    \28\ As noted above, the Exchange is submitting this proposal
because the Funds would not meet the requirements of Rule
14.11(i)(4)(C)(iv)(b) which prevents the aggregate gross notional
value of listed derivatives based on any single underlying reference
asset from exceeding 30% of the weight of the portfolio (including
gross notional exposures) and the aggregate gross notional value of
listed derivatives based on any five or fewer underlying reference
assets from exceeding 65% of the weight of the portfolio (including
gross notional exposures).
---------------------------------------------------------------------------

    The Exchange believes that sufficient protections are in place to
protect against market manipulation of the Funds' Shares and FLEX
Options on the S&P 500 Index for several reasons: (i) The diversity,
liquidity, and market cap of the securities underlying the S&P 500
Index; (ii) the competitive quoting process for FLEX Options; (iii) the
significant liquidity in the market for options on the S&P 500 Index
results in a well-established price discovery process that provides
meaningful guideposts for FLEX Option pricing; and (iv) surveillance by
the Exchange, Cboe Options and FINRA designed to detect violations of
the federal securities laws and SRO rules. The Exchange has in place a
surveillance program for transactions in ETFs to ensure the
availability of information necessary to detect and deter potential
manipulations and other trading abuses, thereby making the Shares less
readily susceptible to manipulation. Further, the Exchange believes
that because the assets in each Fund's portfolio, which are comprised
primarily of FLEX Options on the S&P 500 Index, will be acquired in
extremely liquid and highly regulated markets, the Shares are less
readily susceptible to manipulation.
    The Exchange believes that its surveillance procedures are adequate
to properly monitor the trading of the Shares on the Exchange during
all trading sessions and to deter and detect violations of Exchange
rules and the applicable federal securities laws. Trading of the Shares
through the Exchange will be subject to the Exchange's surveillance
procedures for derivative products, including Managed Fund Shares. All
statements and representations made in this filing regarding (a) the
description of the portfolio, reference assets, and index, (b)
limitations on portfolio holdings or reference assets, or (c) the
applicability of Exchange rules shall constitute continued listing
requirements for listing the Shares on the Exchange. The issuer has
represented to the Exchange that it will advise the Exchange of any
failure by a Fund or the related Shares to comply with the continued
listing requirements, and, pursuant to its obligations under Section
19(g)(1) of the Act, the Exchange will surveil for compliance with the
continued listing requirements. If a Fund or the related Shares are not
in compliance with the applicable listing requirements, then, with
respect to such Fund or Shares, the Exchange will commence delisting
procedures under Exchange Rule 14.12. FINRA conducts certain cross-
market surveillances on behalf of the Exchange pursuant to a regulatory
services agreement. The Exchange is responsible for FINRA's performance
under this regulatory services agreement. If a Fund is not in
compliance with the applicable listing requirements, the Exchange will
commence delisting procedures with respect to such Fund under Exchange
Rule 14.12.
    The Exchange or FINRA, on behalf of the Exchange, will communicate
as needed regarding trading in the Shares and exchange-traded options
contracts with other markets and other entities that are members of the
ISG and may obtain trading information regarding trading in the Shares
and exchange-traded options contracts from such markets and other
entities. In addition, the Exchange may obtain information

regarding trading in the Shares and exchange-traded options contracts
from markets and other entities that are members of ISG or with which
the Exchange has in place a comprehensive surveillance sharing
agreement. In addition, the Exchange also has a general policy
prohibiting the distribution of material, non-public information by its
employees. As noted above, options on the S&P 500 Index are among the
most liquid options in the world and derive their value from the
actively traded S&P 500 Index components. The contracts are cash-
settled with no delivery of stocks or ETFs, and trade in competitive
auction markets with price and quote transparency. The Exchange
believes the highly regulated options markets and the broad base and
scope of the S&P 500 Index make securities that derive their value from
that index less susceptible to market manipulation in view of market
capitalization and liquidity of the S&P 500 Index components, price and
quote transparency, and arbitrage opportunities.
    The Exchange believes that the liquidity of the markets for S&P 500
Index securities, options on the S&P 500 Index, and other related
derivatives is sufficiently great to deter fraudulent or manipulative
acts associated with the Funds' Shares price. The Exchange also
believes that such liquidity is sufficient to support the creation and
redemption mechanism. Coupled with the extensive surveillance programs
of the SROs described above, the Exchange does not believe that trading
in the Funds' Shares would present manipulation concerns.
    The Exchange represents that, except as described above, the Funds
will meet and be subject to all other requirements of the Generic
Listing Standards and other applicable continued listing requirements
for Managed Fund Shares under Rule 14.11(i), including those
requirements regarding the Disclosed Portfolio,\29\ Intraday Indicative
Value,\30\ suspension of trading or removal,\31\ trading halts,\32\
disclosure,\33\ and firewalls.\34\ The Trust is required to comply with
Rule 10A-3 under the Act for the initial and continued listing of the
Shares of each Fund. Moreover, all of the options contracts held by the
Funds will trade on markets that are a member of ISG or affiliated with
a member of ISG or with which the Exchange has in place a comprehensive
surveillance sharing agreement.
---------------------------------------------------------------------------

    \29\ See Rule 14.11(i)(4)(B)(ii).
    \30\ See Rule 14.11(i)(4)(B)(i).
    \31\ See Rule 14.11(i)(4)(B)(iii).
    \32\ See Rule 14.11(i)(4)(B)(iv).
    \33\ See Rule 14.11(i)(6).
    \34\ See Rule 14.11(i)(7).
---------------------------------------------------------------------------

    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 purpose of the Act. The Exchange notes that the
proposed rule change will facilitate the listing and trading of an
additional type of Managed Fund Shares that will enhance competition
among market participants, to the benefit of investors and the
marketplace.

C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants or Others

    The Exchange has neither solicited nor received written comments on
the proposed rule change.

III. Discussion and Commission Findings

    After careful review, the Commission finds that the Exchange's
proposal to list and trade the Shares is consistent with the Act and
the rules and regulations thereunder applicable to a national
securities exchange.\35\ In particular, the Commission finds that the
proposed rule change, as modified by Amendment No. 4, is consistent
with Section 6(b)(5) of the Act,\36\ which requires, among other
things, that the Exchange's rules be 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. The
Commission also finds that the proposal to list and trade the Shares on
the Exchange is consistent with Section 11A(a)(1)(C)(iii) of the
Act,\37\ 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.
---------------------------------------------------------------------------

    \35\ In approving this proposed rule change, the Commission has
considered the proposed rule's impact on efficiency, competition,
and capital formation. See 15 U.S.C. 78c(f).
    \36\ 15 U.S.C. 78f(b)(5).
    \37\ 15 U.S.C. 78k-1(a)(1)(C)(iii).
---------------------------------------------------------------------------

    According to the Exchange, quotation and last-sale information for
U.S. exchange-listed options contracts cleared by The Options Clearing
Corporation will be available via the Options Price Reporting
Authority.\38\ RFQ information for FLEX Options will be available
directly from Cboe Options. The intra-day, closing and settlement
prices of exchange-traded options will be readily available from the
options exchanges, automated quotation systems, published or other
public sources, or online information services.\39\ In addition, price
information about cash equivalents will be available from major broker-
dealer firms or market data vendors, as well as from automated
quotation systems, published or other public sources, or online
information services.\40\
---------------------------------------------------------------------------

    \38\ See Amendment No. 4, supra note 7, at 20.
    \39\ See id.
    \40\ See id. at 20-21.
---------------------------------------------------------------------------

    The Commission also believes that the proposal to list and trade
the Shares is reasonably designed to promote fair disclosure of
information that may be necessary to price the Shares appropriately and
to prevent trading when a reasonable degree of transparency cannot be
assured. Under BZX Rule 14.11(i)(4)(B)(iv), if the Exchange becomes
aware that the NAV or the Disclosed Portfolio is not disseminated to
all market participants at the same time, the Exchange is required to
halt trading in such series of Managed Fund Shares. In addition, the
Exchange represents that if the Funds or the Shares are not in
compliance with the applicable listing requirements for Managed Funds
Shares under BZX Rule 14.11(i), the Exchange will commence delisting
procedures under BZX Rule 14.12 (Failure to Meet Listing
Standards).\41\ The Exchange also states that it has a general policy
prohibiting the distribution of material, non-public information by its
employees.\42\ Further, the Trust has represented that it will provide
and maintain a publicly available tool on its website that will provide
existing and prospective Fund shareholders with certain information for
each of the Funds including, among other things, current NAV, start and
end dates of the current outcome period, and the remaining buffer
available for a shareholder purchasing Shares at the current NAV or the
amount of losses that a shareholder purchasing Shares at the current
NAV would incur before benefitting from the protection of the
buffer.\43\
---------------------------------------------------------------------------

    \41\ See id. at 18.
    \42\ See id. at 19.
    \43\ See id. at 21.
---------------------------------------------------------------------------

    The Shares do not qualify for generic listing because the Funds
will not

satisfy the requirement of BZX Rule 14.11(i)(4)(C)(iv)(b) that the
aggregate gross notional value of listed derivatives based on any five
or fewer underlying reference assets shall not exceed 65% of the weight
of the portfolio and the aggregate gross notional value of listed
derivatives based on any single underlying reference asset not exceed
30% of the weight of the portfolio (including gross notional
exposures). Although the Funds will hold listed derivatives primarily
on a single reference asset, the S&P 500 Index,\44\ the Commission
believes that the prices of the Shares will be less susceptible to
manipulation. As the Exchange states, options on the S&P 500 Index are
among the most liquid options in the world, and derive their value from
the actively traded index components. Additionally, all of the options
held by the Funds will trade on markets that are a member of ISG or
affiliated with a member of ISG or with which the Exchange has in place
a comprehensive surveillance sharing agreement.\45\
---------------------------------------------------------------------------

    \44\ The Funds also may invest in options overlying Reference
ETFs.
    \45\ For a list of the current members of ISG, see
www.isgportal.org.
---------------------------------------------------------------------------

    In support of this proposal, the Exchange represented that:
    (1) The Funds and the Shares will satisfy all of the requirements
applicable to Managed Fund Shares under BZX Rule 14.11(i), as well as
the Generic Listing Standards other than BZX Rule
14.11(i)(4)(C)(iv)(b).
    (2) Trading in the Shares will be subject to the existing trading
surveillances administered by the Exchange, as well as cross-market
surveillances administered by Cboe Options and FINRA, on behalf of the
Exchange, which are designed to detect violations of Exchange rules and
applicable federal securities laws.
    (3) For initial and continued listing, the Funds will be in
compliance with Rule 10A-3 under the Act.\46\
---------------------------------------------------------------------------

    \46\ 17 CFR 240.10A-3.
---------------------------------------------------------------------------

    (4) A minimum of 100,000 Shares will be outstanding at the
commencement of trading on the Exchange.\47\
---------------------------------------------------------------------------

    \47\ See Amendment No. 4, supra note 7, at 20.
---------------------------------------------------------------------------

    This approval order is based on all of the Exchange's statements
and representations, including those set forth above and in Amendment
No. 4.
    For the foregoing reasons, the Commission finds that the proposed
rule change, as modified by Amendment No. 4 thereto, is consistent with
Section 6(b)(5) of the Act \48\ and the rules and regulations
thereunder applicable to a national securities exchange.
---------------------------------------------------------------------------

    \48\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

IV. Solicitation of Comments on Amendment No. 4 to the Proposed Rule
Change

    Interested persons are invited to submit written views, data, and
arguments concerning whether Amendment No. 4 is consistent with the
Act. Comments may be submitted by any of the following methods:

Electronic Comments

     Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include
File Number SR-BatsBZX-2017-72 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-BatsBZX-2017-72. 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 (http://www.sec.gov/rules/sro.shtml).
Copies of the submission, all subsequent amendments, all written
statements with respect to the proposed rule change that are filed with
the Commission, and all written communications relating to the proposed
rule change between the Commission and any person, other than those
that may be withheld from the public in accordance with the provisions
of 5 U.S.C. 552, will be available for website viewing and printing in
the Commission's Public Reference Room, 100 F Street NE, Washington, DC
20549 on official business days between the hours of 10:00 a.m. and
3:00 p.m. Copies of the filing also will be available for inspection
and copying at the principal office of the Exchange. All comments
received will be posted without change. Persons submitting comments are
cautioned that we do not redact or edit personal identifying
information from comment submissions. You should submit only
information that you wish to make available publicly. All submissions
should refer to File Number SR-BatsBZX-2017-72 and should be submitted
on or before August 16, 2018.

V. Accelerated Approval of Proposed Rule Change, as Modified by
Amendment No. 4

    The Commission finds good cause to approve the proposed rule
change, as modified by Amendment No. 4, prior to the 30th day after the
date of publication of notice of the filing of Amendment No. 4 in the
Federal Register. Amendment No. 4 supplements the proposal by, among
other things, representing that the issuer will provide and maintain a
publicly available web tool for each of the Funds that will offer
important information to help inform investment decisions by
prospective and existing shareholders. The amendment assisted the
Commission in evaluating the Exchange's proposal and in determining
that the listing and trading of the Shares is consistent with the Act.
Accordingly, the Commission finds good cause, pursuant to Section
19(b)(2) of the Act,\49\ to approve the proposed rule change, as
modified by Amendment No. 4, on an accelerated basis.
---------------------------------------------------------------------------

    \49\ 15 U.S.C. 78s(b)(2).
---------------------------------------------------------------------------

VI. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the
Act,\50\ that the proposed rule change (SR-BatsBZX-2017-72), as
modified by Amendment No. 4 be, and it hereby is, approved on an
accelerated basis.
---------------------------------------------------------------------------

    \50\ Id.
    \51\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\51\
Brent J. Fields,
Secretary.
[FR Doc. 2018-15945 Filed 7-25-18; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 79, Number 110 (Monday, June 9, 2014)]
[Rules and Regulations]
[Pages 32876-32878]
[FR Doc No: 2014-13283]

=======================================================================
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DEPARTMENT OF HOMELAND SECURITY

Federal Emergency Management Agency

44 CFR Part 64

[Docket ID FEMA-2014-0002; Internal Agency Docket No. FEMA-8333]

Suspension of Community Eligibility

AGENCY: Federal Emergency Management Agency, DHS.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: This rule identifies communities where the sale of flood
insurance has been authorized under the National Flood Insurance
Program (NFIP) that are scheduled for suspension on the effective dates
listed within this rule because of noncompliance with the floodplain
management requirements of the program. If the Federal Emergency
Management Agency (FEMA) receives documentation that the community has
adopted the required floodplain management measures prior to the
effective suspension date given in this rule, the suspension will not
occur and a notice of this will be provided by publication in the
Federal Register on a subsequent date. Also, information identifying
the current participation status of a community can be obtained from
FEMA's Community Status Book (CSB). The CSB is available at http://www.fema.gov/fema/csb.shtm.

DATES: Effective Dates: The effective date of each community's
scheduled suspension is the third date (``Susp.'') listed in the third
column of the following tables.

FOR FURTHER INFORMATION CONTACT: If you want to determine whether a
particular community was suspended on the suspension date or for
further information, contact David Stearrett, Federal Insurance and
Mitigation Administration, Federal Emergency Management Agency, 500 C
Street SW., Washington, DC 20472,<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION: The NFIP enables property owners to purchase
Federal flood insurance that is not otherwise generally available from
private insurers. In return, communities agree to adopt and administer
local floodplain management measures aimed at protecting lives and new
construction

from future flooding. Section 1315 of the National Flood Insurance Act
of 1968, as amended, 42 U.S.C. 4022, prohibits the sale of NFIP flood
insurance unless an appropriate public body adopts adequate floodplain
management measures with effective enforcement measures. The
communities listed in this document no longer meet that statutory
requirement for compliance with program regulations, 44 CFR Part 59.
Accordingly, the communities will be suspended on the effective date in
the third column. As of that date, flood insurance will no longer be
available in the community. We recognize that some of these communities
may adopt and submit the required documentation of legally enforceable
floodplain management measures after this rule is published but prior
to the actual suspension date. These communities will not be suspended
and will continue to be eligible for the sale of NFIP flood insurance.
A notice withdrawing the suspension of such communities will be
published in the Federal Register.
    In addition, FEMA publishes a Flood Insurance Rate Map (FIRM) that
identifies the Special Flood Hazard Areas (SFHAs) in these communities.
The date of the FIRM, if one has been published, is indicated in the
fourth column of the table. No direct Federal financial assistance
(except assistance pursuant to the Robert T. Stafford Disaster Relief
and Emergency Assistance Act not in connection with a flood) may be
provided for construction or acquisition of buildings in identified
SFHAs for communities not participating in the NFIP and identified for
more than a year on FEMA's initial FIRM for the community as having
flood-prone areas (section 202(a) of the Flood Disaster Protection Act
of 1973, 42 U.S.C. 4106(a), as amended). This prohibition against
certain types of Federal assistance becomes effective for the
communities listed on the date shown in the last column. The
Administrator finds that notice and public comment procedures under 5
U.S.C. 553(b), are impracticable and unnecessary because communities
listed in this final rule have been adequately notified.
    Each community receives 6-month, 90-day, and 30-day notification
letters addressed to the Chief Executive Officer stating that the
community will be suspended unless the required floodplain management
measures are met prior to the effective suspension date. Since these
notifications were made, this final rule may take effect within less
than 30 days.
    National Environmental Policy Act. This rule is categorically
excluded from the requirements of 44 CFR Part 10, Environmental
Considerations. No environmental impact assessment has been prepared.
    Regulatory Flexibility Act. The Administrator has determined that
this rule is exempt from the requirements of the Regulatory Flexibility
Act because the National Flood Insurance Act of 1968, as amended,
Section 1315, 42 U.S.C. 4022, prohibits flood insurance coverage unless
an appropriate public body adopts adequate floodplain management
measures with effective enforcement measures. The communities listed no
longer comply with the statutory requirements, and after the effective
date, flood insurance will no longer be available in the communities
unless remedial action takes place.
    Regulatory Classification. This final rule is not a significant
regulatory action under the criteria of section 3(f) of Executive Order
12866 of September 30, 1993, Regulatory Planning and Review, 58 FR
51735.
    Executive Order 13132, Federalism. This rule involves no policies
that have federalism implications under Executive Order 13132.
    Executive Order 12988, Civil Justice Reform. This rule meets the
applicable standards of Executive Order 12988.
    Paperwork Reduction Act. This rule does not involve any collection
of information for purposes of the Paperwork Reduction Act, 44 U.S.C.
3501 et seq.

List of Subjects in 44 CFR Part 64

    Flood insurance, Floodplains.

    Accordingly, 44 CFR part 64 is amended as follows:

PART 64--[AMENDED]

0
1. The authority citation for part 64 continues to read as follows:

    Authority:  42 U.S.C. 4001 et seq.; Reorganization Plan No. 3 of
1978, 3 CFR, 1978 Comp.; p. 329; E.O. 12127, 44 FR 19367, 3 CFR,
1979 Comp.; p. 376.

Sec.  64.6  [Amended]

0
2. The tables published under the authority of Sec.  64.6 are amended
as follows:

----------------------------------------------------------------------------------------------------------------
                                                 Effective date
                                                 authorization/
                                   Community    cancellation of    Current effective map   Date certain Federal
       State and location             No.        sale of flood             date            assistance no longer
                                                  insurance in                              available in SFHAs
                                                   community
----------------------------------------------------------------------------------------------------------------
            Region V

Indiana:
    Knox, City of, Starke              180242  April 22, 1975,    June 16, 2014.........  June 16, 2014.
     County.                                    Emerg; February
                                                1, 1994, Reg;
                                                June 16, 2014,
                                                Susp.
    Starke County,                     180240  January 6, 1992,   ......do*.............   Do.
     Unincorporated Areas.                      Emerg; April 1,
                                                1993, Reg; June
                                                16, 2014, Susp.

           Region IX
Arizona: Maricopa, City of,            040052  N/A, Emerg;        ......do..............   Do.
 Pinal County.                                  December 27,
                                                2007, Reg; June
                                                16, 2014, Susp.
----------------------------------------------------------------------------------------------------------------
* -do- = Ditto.
Code for reading third column: Emerg.--Emergency; Reg.--Regular; Susp.--Suspension.

    Dated: May 12, 2014.
David L. Miller,
Associate Administrator, Federal Insurance and Mitigation
Administration, Department of Homeland Security, Federal Emergency
Management Agency.
[FR Doc. 2014-13283 Filed 6-6-14; 8:45 am]
BILLING CODE 9110-12-P


[Federal Register Volume 87, Number 32 (Wednesday, February 16, 2022)]
[Notices]
[Pages 8929-8930]
[FR Doc No: 2022-03304]

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DEPARTMENT OF TRANSPORTATION

National Highway Traffic Safety Administration

[Docket No. NHTSA-2022-0009]

Agency Information Collection Activities; Notice and Request for
Comment; National Survey of the Use of Booster Seats

AGENCY: National Highway Traffic Safety Administration (NHTSA),
Department of Transportation (DOT).

ACTION: Notice and request for comments on extension of a currently
approved information collection.

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SUMMARY: NHTSA invites public comments about our intention to request
approval from the Office of Management and Budget (OMB) for an
extension of a currently approved information collection. Before a
Federal agency can collect certain information from the public, it must
receive approval from OMB. Under procedures established by the
Paperwork Reduction Act of 1995, before seeking OMB approval, Federal
agencies must solicit public comment on proposed collections of
information, including extensions and reinstatement of previously
approved collections. This document describes a collection of
information for which NHTSA intends to seek OMB approval on the
National Survey of the Use of Booster Seats (NSUBS).

DATES: Comments must be submitted on or before April 18, 2022.

ADDRESSES: You may submit comments identified by the Docket No. NHTSA-
2022-0009 through any of the following methods:
     Electronic Submissions: Go to the Federal eRulemaking
Portal at http://www.regulations.gov. Follow the online instructions
for submitting comments.
     Fax:<PHONE_NUMBER>.
     Mail or Hand Delivery: Docket Management, U.S. Department
of Transportation, 1200 New Jersey Avenue SE, West Building, Room W12-
140, Washington, DC 20590, between 9 a.m. and 5 p.m., Monday through
Friday, except on Federal holidays. To be sure someone is there to help
you, please call<PHONE_NUMBER> before coming.
    Instructions: All submissions must include the agency name and
docket number for this notice. Note that all comments received will be
posted without change to http://www.regulations.gov, including any
personal information provided. Please see the Privacy Act heading
below.
    Privacy Act: Anyone is able to search the electronic form of all
comments received into any of our dockets by the name of the individual
submitting the comment (or signing the comment, if submitted on behalf
of an association, business, labor union, etc.). You may review DOT's
complete Privacy Act Statement in the Federal Register published on
April 11, 2000 (65 FR 19477-78) or you may visit https://www.transportation.gov/privacy.
    Docket: For access to the docket to read background documents or
comments received, go to http://www.regulations.gov or the street
address listed above. Follow the online instructions for accessing the
dockets via internet.

FOR FURTHER INFORMATION CONTACT:
    For additional information or access to background documents,
contact Lacey L. Boyle, Office of Traffic Records and Analysis,
Mathematical Analysis Division (NSA-210),<PHONE_NUMBER>, National
Center for Statistics and Analysis, W55-207, U.S. Department of
Transportation, 1200 New Jersey Avenue SE, Washington, DC 20590. Please
identify the relevant collection of information by referring to its OMB
Control Number.

SUPPLEMENTARY INFORMATION: Under the Paperwork Reduction Act of 1995
(44 U.S.C. 3501 et seq.), before an agency submits a proposed
collection of information to OMB for approval, it must first publish a
document in the Federal Register providing a 60-day comment period and
otherwise consult with members of the public and affected agencies
concerning each proposed collection of information. The OMB has
promulgated regulations describing what must be included in such a
document. Under OMB's regulation (at 5 CFR 1320.8(d)), an agency must
ask for public comment on the following: (a) Whether the proposed
collection of information is necessary for the proper performance of
the functions of the agency, including whether the information will
have practical utility; (b) the accuracy of the agency's estimate of
the burden of the proposed collection of information, including the
validity of the methodology and assumptions used; (c) how to enhance
the quality, utility, and clarity of the information to be collected;
and (d) how to minimize the burden of the collection of information on
those who are to respond, including the use of appropriate automated,
electronic, mechanical, or other technological collection techniques or
other forms of information technology, e.g., permitting electronic
submission of responses. In compliance with these requirements, NHTSA
asks for public comments on the following proposed collection of
information for which the agency is seeking approval from OMB.
    Title: National Survey of the Use of Booster Seats.
    OMB Control Number: 2127-0644.
    Form Number(s): NHTSA Form 1010.
    Type of Request: Extension of a currently approved information
collection.
    Type of Review Requested: Regular.
    Requested Expiration Date of Approval: 3 years from date of
approval.
    Summary of the Collection of Information: The National Survey of
the Use of Booster Seats (NSUBS) is a voluntary collection of restraint
use information for children under 13. The purpose of the NSUBS is to
gather information on restraint use for all child occupants, in
particular the use of booster seats among children ages 4-7. NSUBS is a
biennial collection that involves data collectors visiting sampled gas
stations, recreation centers, day care centers, and seven specific fast
food restaurant chains (McDonald's, Taco Bell, Burger King, Wendy's,
Kentucky Fried Chicken, Dairy Queen, and Sonic), where vehicles are
most likely to have child occupants. Data collectors will observe as
many vehicles as possible that appear to have a least one child
occupant under the age of 13 in order for data collector observation of
restraint use for all occupants. For motorists who voluntarily
participate in a subsequent interview, the data collectors conduct a
brief interview with the vehicle driver or other knowledgeable adult to
determine the age, height, weight, race, and ethnicity of the child
occupants and age of the driver. The survey collects data to support
estimates of restraint use for all children under 13. The collection
includes race and ethnicity breakouts of restraint use among all
occupants in a vehicle as well as age, height, and weight of children.

    Description of the Need for the Information and Proposed Use of the
Information: The NSUBS is conducted to respond to Section 14(i) of the
Transportation Recall Enhancement, Accountability, and Documentation
(TREAD) Act of 2000. The Act directs the Department of Transportation
to reduce deaths and injuries among children in the 4- to 8-year old
age group that are caused by failure to use a booster seat by twenty-
five percent. Conducting the National Survey of the Use of Booster
Seats provides the Department with invaluable information on use and
non-use of booster seats, helping the Department to improve its
outreach programs to ensure that children are protected to the greatest
extent possible when they ride in motor vehicles. The survey data will
allow programs to better reach the caretakers whose children are
unrestrained or not using the best restraint choice for their
children's sizes. The findings may also be of interest to State
legislatures wanting to strengthen their child restraint laws by
enacting mandatory or enhanced booster seat use provisions.
    Affected Public: Motorists in passenger vehicles with children
under 13 who are approached at gas stations, fast food restaurants, day
care centers, and recreation centers frequented by children and asked
to participate in the survey.
    Estimated Number of Respondents: Based on the average number of
respondents from the last three survey years (2017, 2019, 2021), we
estimate that there will be approximately 5,300 respondents (i.e.,
5,300 adult motorists in passenger vehicles with children under 13 at
gas stations, fast food restaurants, day care centers, and recreation
centers who agree to be interviewed for the survey).
    Frequency: Biennial.
    Estimated Total Annual Burden Hours: NHTSA estimates that the data
collection will, on average, take approximately 4.25 minutes per
respondent. A respondent in this case is an adult motorist providing
information about children in their vehicle. Therefore, NHTSA estimates
the total burden for the 5,300 respondents to be 376 hours, rounded
((4.25 minutes x 5,300 respondents) / 60 min/hr = 375.42 hours). Since
NSUBS data are collected biennially, dividing the 376 total burden
hours by two yields an annual burden of 188 hours. Table 1 provides a
summary of the burden hour estimates.

                                            Table 1--Burden Estimates
----------------------------------------------------------------------------------------------------------------
                       Estimated burden  per    Total burden hours        Total annual       Total annual burden
 Responses per survey   response  (minutes)         per survey             responses                hours
----------------------------------------------------------------------------------------------------------------
            5,300                   4.25                    376                  2,650                    188
----------------------------------------------------------------------------------------------------------------

    To represent the value of the respondents' time, NHTSA uses the
average hourly wage for the United States, which is estimated to be
$27.07.\1\ Using this estimate, NHTSA estimates the total opportunity
costs to respondents to be $10,178.32 (376 x $27.07) or $5,089.16
annually.
---------------------------------------------------------------------------

    \1\ U.S. Dept. of Labor, Bureau of Labor Statistics, May 2020
National Occupational Employment and Wage Estimates, accessed June
2021, from https://www.bls.gov/oes/current/oes_nat.htm#00-0000.

                                                          Table 2--Opportunity Costs Estimates
--------------------------------------------------------------------------------------------------------------------------------------------------------
                      Estimated burden per     Average hourly     Opportunity cost per   Total burden hours     Total opportunity       Total annual
Responses per survey   response  (minutes)    opportunity cost          response         per survey  (hours)     cost per survey      opportunity cost
--------------------------------------------------------------------------------------------------------------------------------------------------------
            5,300                  4.25                $27.07                 $1.92                   376            $10,178.32             $5,089.16
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Estimated Total Annual Burden Cost: Participation in this study is
voluntary, and there are no costs to respondents beyond the time spent
taking part in the survey.
    Public Comments Invited: You are asked to comment on any aspects of
this information collection, including (a) whether the proposed
collection of information is necessary for the proper performance of
the functions of the Department, including whether the information will
have practical utility; (b) the accuracy of the Department's estimate
of the burden of the proposed information collection; (c) ways to
enhance the quality, utility and clarity of the information to be
collected; and (d) ways to minimize the burden of the collection of
information on respondents, including the use of automated collection
techniques or other forms of information technology.
    Authority: The Paperwork Reduction Act of 1995; 44 U.S.C. Chapter
35, as amended; 49 CFR 1.49; and DOT Order 1351.29.

    Issued on February 11, 2022
Chou-Lin Chen,
Associate Administrator for National Center for Statistic and Analysis.
[FR Doc. 2022-03304 Filed 2-15-22; 8:45 am]
BILLING CODE 4910-59-P


[Federal Register: October 25, 2011 (Volume 76, Number 206)]
[Rules and Regulations]
[Page 65971]
[DOCID:fr25oc11-14]

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DEPARTMENT OF TRANSPORTATION

National Highway Traffic Safety Administration

49 CFR Parts 523 and 535

[NHTSA 2010-0079; EPA-HQ-OAR-2010-0162; FRL-9455-1]
RIN 2127-AK74

Greenhouse Gas Emissions Standards and Fuel Efficiency Standards
for Medium- and Heavy-Duty Engines and Vehicles

AGENCY: National Highway Traffic Safety Administration (NHTSA),
Department of Transportation (DOT).

ACTION: Correcting amendments.

-----------------------------------------------------------------------

SUMMARY: This document contains corrections to the final rule
regulations (49 CFR parts 523 and 535), which were published in the
Federal Register of Thursday, September 15, 2011 (76 FR 57106). The
regulations established fuel efficiency standards for medium- and
heavy-duty engines and vehicles, as prescribed under the Energy
Independence and Security Act (49 U.S.C. 32902(k)(2)).

DATES: Effective Date: November 14, 2011.

FOR FURTHER INFORMATION CONTACT: Lily Smith, Office of Chief Counsel,
National Highway Traffic Safety Administration, 1200 New Jersey Avenue,
SE., Washington, DC 20590. Telephone:<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

Background

    NHTSA and EPA published in the Federal Register of September 15,
2011, final rules to establish a comprehensive Heavy-Duty National
Program that will increase fuel efficiency and reduce greenhouse gas
emissions for on-road heavy-duty vehicles, responding to the
President's directive on May 21, 2010, to take coordinated steps to
produce a new generation of clean heavy-duty vehicles.

Need for Correction

    As published, the final regulations inadvertently inserted a new
definition for ``base tire'' in 49 CFR part 523 instead of 49 CFR part
535. The new definition was intended to be applied to heavy-duty
vehicles. It was not intended to replace the definition of ``base
tire'' for light-duty vehicles, as its current location would suggest.
To correct the mistake, NHTSA is moving the definition to its original
intended location in 49 CFR part 535, and adding the words ``for heavy-
duty vehicles'' to alleviate any confusion. The previous definition for
``base tire'' for light duty vehicles will be restored, and the words
``for passenger automobiles, light trucks and medium-duty passenger
vehicles'' will be added.

List of Subjects in 49 CFR Parts 523 and 535

    Fuel efficiency.

    Accordingly, 49 CFR parts 523 and 535 are corrected by making the
following correcting amendments:

PART 523--VEHICLE CLASSIFICATION

0
1. The authority citation for part 523 continues to read as follows:

    Authority: 49 U.S.C. 32901, delegation of authority at 49 CFR
1.50.

0
2. In Sec.  523.2, revise the definition of ``Base tire'' to read as
follows:

Sec.  523.2  Definitions.

* * * * *
    Base tire for passenger automobiles, light trucks and medium-duty
passenger vehicles means the tire specified as standard equipment by a
manufacturer on each vehicle configuration of a model type.
* * * * *

PART 535--MEDIUM- AND HEAVY-DUTY VEHICLE FUEL EFFICIENCY PROGRAM

0
3. The authority citation for part 535 continues to read as follows:

    Authority: 49 U.S.C. 32902; delegation of authority at 49 CFR
1.50.

0
4. In Sec.  535.4, add a definition of ``Base tire'' to read as
follows:

Sec.  535.4  Definitions.

* * * * *
    Base tire for heavy-duty vehicles means the tire specified as
standard equipment by a manufacturer on each subconfiguration of a
model type.

    Issued: October 18, 2011.
Christopher J. Bonanti,
Associate Administrator for Rulemaking, National Highway Traffic Safety
Administration, Department of Transportation.
[FR Doc. 2011-27502 Filed 10-24-11; 8:45 am]
BILLING CODE 4910-59-P