1 SF 83 SUPPORTING STATEMENT ENVIRONMENTAL PROTECTION AGENCY STANDARD OF PERFORMANCE NATIONAL EMISSION STANDARDS FOR HAZARDOUS AIR POLLUTANTS FOR VINYL CHLORIDE 1. Identification of the Information Collection 1( a) Title of the Information Collection ICR for NESHAP Subpart F Vinyl Chloride 1( b) Short Characterization/ Abstract The National Emissions Standards for Hazardous Air Pollutants ( NESHAP) for Vinyl Chloride ( VC) were proposed on December 24, 1975, promulgated on October, 21, 1976, and amended on June 7, 1977, September 30, 1986, September 23, 1988 and December 23, 1992. These standards apply to exhaust gases and oxychlorination vents at ethylene dichloride ( EDC) plants; exhaust gases at vinyl chloride monomer ( VCM) plants; and exhaust gases, reactors opening losses, manual vent valves, and stripping residuals at polyvinyl chloride ( PVC) plants. The standards also apply to relief valves and fugitive emission sources at all three types of plants. In the Administrator's judgement, vinyl chloride emissions from polyvinyl chloride ( PVC), ethylene dichloride ( EDC), and vinyl chloride monomer ( VCM) plants cause or contribute to air pollution that may reasonably be anticipated to result in an increase in mortality or an increase in serious irreversible, or incapaciting reversible illness. Vinyl chloride is a known human carcinogen which causes a rare cancer of the liver.

Establishment of a continuous monitoring program is a high priority of the Agency. The standards require continuous monitoring of the reactor pressure and temperature. The continuous monitoring system monitors VC emissions from the stack to judge compliance with the numerical limits in the standards. The parameters are used to judge the operation of the reactor so that the source and EPA will be aware of improper operation and maintenance.

Adequate recordkeeping and reporting ensures that affected facilities continue to operate control equipment and use proper work practices to achieve compliance. In addition, reporting assists EPA in identifying new facilities subject to the standards. The standards implicitly require initial reports required by the General Provisions of 40 CFR § 61.7 and § 61.9. These initial reports include application for approval of construction or modification, the notification of startup, and the notification of performance testing. The standards also require quarterly reporting of vinyl chloride emissions from stripping, reactor openings, and exhausts. Reports must be submitted within 10 days of each valve discharge and manual vent valve discharge. All reports are sent to the delegated State authority. In the event that there is no such delegated State 2 authority, the reports are sent directly to the EPA Regional Office. Facilities must also maintain records of reactor parameters and emissions as well as records related to malfunctions, calibrations, and leaks detected.

Approximately 44 sources are currently subject to the standard, and it is estimated that no additional sources will become subject to the standard in the next three years.

Following approval of the previous ICR, OMB requested that EPA undertake a review of the need for continuous area monitoring and of whether there may be other less burdensome approaches that would provide the public with equal or greater protection in the event of major chemical releases. EPA considered OMB's comment and upon review of alternative monitoring approaches has concluded that emissions of vinyl chloride, a hazardous air pollutant, should be continuously monitored to ensure adequate protection of public health. EPA considers the existing monitoring requirements to be the least burdensome on the regulated entities.

2. Need for and Use of Collection 2( a) Need/ Authority for the Collection The EPA is charged under Section 112 of the Clean Air Act, as Amended, to establish standards of performance for each category or subcategory of major sources of hazardous air pollutants. These standards are applicable to new or existing sources of hazardous air pollutants and shall require the maximum degree of emission reduction. In addition, Section 114( a) states that the Administrator may require any owner or operator subject to any requirement of this Act to:

"( A) Establish and maintain such records; ( B) make such reports; ( C) install, use, and maintain such monitoring equipment, and use audit procedures, or methods; and ( D) sample such emissions ( in accordance with such procedures or methods, at such locations, at such intervals, during such periods, and in such manner as the Administrator shall prescribe); ( E) Keep records on control equipment parameters, production variables or other indirect data when direct monitoring of emissions is impractical; ( F) submit compliance certifications in accordance with Section 114( a)( 3); and ( G) provide such other information as the Administrator may reasonably require."

In the Administrator's judgement, vinyl chloride emissions from the National Emission Standard for Vinyl Chloride can cause or contribute to air pollution that may reasonably be anticipated to endanger public health or welfare. Therefore, National Emission Standards for Hazardous Air Pollutants were promulgated for this source category at 40 CFR Part 61, Subpart F.

2( b) Practical Utility/ Users of the Data The control of emissions of vinyl chloride from plants which produce: 1) ethylene 3 dichloride by reaction of oxygen and hydrogen chloride with ethylene, 2) vinyl chloride by any process and/ or 3) one or more polymers containing any fraction of polymerized vinyl chloride requires not only the installation of properly designed equipment, but also the operation and maintenance of that equipment. Emissions of vinyl chloride from these plants result from the operation of the affected facilities. These standards rely on the reduction of vinyl chloride emissions by monitoring on a continuous basis the emissions from the sources for which emissions limits are prescribed in § § 61.62( a) and ( b), 61.63 ( a), and 61.64( a)( 1), ( b), ( c), and ( d), and for any control system to which reactor emissions are required to be ducted in § 61.64( a)( 2) or to which fugitive emissions are required to be ducted in § 61.65( b)( 1)( ii), and ( b)( 2), ( b)( 5), ( b)( 6) ( ii) and ( b)( 9)( ii). The required notifications are used to inform the Agency or delegated authority when a source becomes subject to the standard. The reviewing authority may then inspect the source to check if the standard is being met. The information generated by the monitoring, recordkeeping and reporting requirements described in this ICR is used by the Agency to ensure that facilities continue to operate in compliance with the National Emissions Standard for Vinyl Chloride. Adequate monitoring, recordkeeping, and reporting is necessary to ensure compliance with these standards, as required by the Clean Air Act. The information collected from recordkeeping and reporting requirements is also used for targeting inspections, and is of sufficient quality to be used as evidence in court.

3. Non duplication, Consultations, and Other Collection Criteria The recordkeeping and reporting is required under 40 CFR Part 61, Subpart F.

3( a) Non duplication If the standard has not been delegated, the information is sent to the appropriate EPA Regional Office. Otherwise, the information is sent directly to the delegated State or Local Agency. If a State or Local Agency has adopted their own similar regulation to implement the Federal Regulation, a copy of the report submitted to the State or Local Agency can be sent to the Administrator in lieu of the report required by the Federal Standard. Therefore, no duplication exits.

3( b) Public Notice Required Prior to ICR Submission to OMB An announcement of a public comment period for renewal of this ICR was published in the Federal Register on February 1, 2001.

3( c) Consultations No comments were received on the burden published in the Federal Register.

3( d) Effects of Less Frequent Collection 4 Less frequent information collection would decrease the margin of assurance that facilities are continuing to meet the required standards. Requirements for information gathering and recordkeeping are useful techniques to ensure that good operation and maintenance practices are applied and emission limitations are met. If the information required by these standards was collected less frequently, the main consequence would be that the chances of detecting poor operation and maintenance of control equipment would decrease.

3( e) General Guidelines None of the reporting or recordkeeping requirements violate any of the regulations established by OMB in 5 CFR 1320.6.

3( f) Confidentiality The required information consists of emissions data and other information that have been determined not to be private. However, any information submitted to the Agency for which a claim of confidentiality is made will be safeguarded according to the Agency policies set forth in Title 40, Chapter 1, Part 2, Subpart B  Confidentiality of Business Information ( see 40 CFR 2; 41 FR 36902, September 1, 1976; amended by 43 FR 40000, September 8, 1978; 43 FR 42251, September 20, 1978; 44 FR 17674, March 23, 1979).

3( g) Sensitive Questions None of the reporting or recordkeeping requirements contain sensitive questions.

4. The Respondents and the Information Requested 4( a) Respondents/ SIC Codes The respondents of the recordkeeping and reporting requirements are owners or operators of ethylene dichloride, vinyl chloride, and polyvinyl chloride manufacturing plants. The SIC code for the respondents affected by the standards is SIC ( U. S. Standard Industrial Classification) 2821 which corresponds to the NAICS ( The North American Industry Classification System) 325211.

4( b) INFORMATION REQUESTED ( i) Data Items All data in this ICR that is recorded and/ or reported is required by 40 CFR Part 61, Subpart F  National Emission Standard for Vinyl Chloride.

A source must make the following reports 5 Reports for NESHAP SUBPART F Notification of construction or modification application 61.07 Notification of anticipated startup 61.09( a)( 1)

Notification of actual startup 61.09( a)( 2)

Notification of emissions testing ( performance test) 61.13( c)

Emissions test ( performance test) report 61.13( f)

Notification of physical or operational change 61.15 Application for waiver of testing 61.13( i)( 1)

Application for equivalent equipment and procedures 61.66 Initial report 61.69 Quarterly report 61.70 Manual vent valve ( MVV) discharge report 61.64( a)( 3)

Relief valve discharge ( RVD) report 61.65( a)

A source must maintain the following records Recordkeeping for NESHAP SUBPART F Startups, shutdowns, malfunctions, periods where the continuous monitoring system is inoperative 61.14( f)

Emission test results and other data needed to determine emissions 61.13( g) & 61.71( a)( 3)

Records of leak detected 61.71 ( a)( 1& 2)

Performance test records, leaks detected, emissions records, and daily operating records are required to be retained on site for 3 Years. 61.67( f) & 61.71 ( ii.) Respondent Activities Respondent Activities Read instructions. Respondent Activities 6 Write the notifications listed above Perform initial performance test, Reference Method 106, 107, and/ or 601 and repeat performance tests if necessary.

Prepare reports listed above.

Enter information required to be recorded above.

Submit the required reports developing, acquiring, installing, and utilizing technology and systems for the purpose of collecting, validating, and verifying information.

Develop, acquire, install, and utilize technology and systems for the purpose of processing and maintaining information.

Develop, acquire, install, and utilize technology and systems for the purpose of disclosing and providing information.

Adjust the existing ways to comply with any previously applicable instructions and requirements.

Train personnel to be able to respond to a collection of information.

Transmit, or otherwise disclose the information.

5. The Information Collected Agency Activities, Collection Methodology, and Information Management 5( a) Agency Activities EPA conducts the following activities in connection with the acquisition, analysis, storage, and distribution of the required information.

Agency Activities Observe initial performance tests and repeat performance tests if necessary.

Review notifications and reports, including performance test reports, and excess emissions reports, required to be submitted by industry.

Audit facility records.

Input, analyze, and maintain data in the Aerometric Information Retrieval System ( AIRS) Facility Subsystem ( AFS) database.

5( b) Collection Methodology and Management 7 Following notification of start up, the reviewing authority might inspect the source to determine whether the pollution control devices are properly installed and operated. Performance test reports are used by the Agency to discern a source's initial capability to comply with the emission standard, and note the operations and maintenance of equipment and the use of proper work practices by trained operators.

Information contained in the reports is entered into AFS which is operated and maintained by EPA's Office of Air Quality Planning and Standards. AFS is EPA's database for the collection, maintenance, and retrieval of compliance and annual emission inventory data for over 100,000 industrial and government owned facilities. EPA uses AFS for tracking air pollution compliance and enforcement by Local and State regulatory agencies, and EPA Regional Offices and Headquarters. EPA and its delegated Authorities can edit, store, retrieve and analyze the data.

The records required by this regulation must be retained by the owner or operator for three ( 3) years.

5( c) Small Entity Flexibility There are no small businesses affected by this standard.

5( d) Collection Schedule The specific frequency for each information collection activity within this request is shown in Table 2: Industry Burden.

6. Estimating the Burden and Cost of the Collection Table 2 documents the computation of individual burdens for each of the recordkeeping and reporting requirements applicable to the industry subject to this Subpart. The individual burdens are expressed under standardized headings believed to be consistent with the concept of burden under the Paperwork Reduction Act. Where appropriate, specific tasks and major assumptions have been identified. Responses to this information collection are mandatory.

The Agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid OMB control number.

6( a) Estimating Respondent Burden The average annual burden to industry over the next three years from these recordkeeping and reporting requirements is estimated at 16,159 persons hours ( Column E of Table 2). These hours are based on Agency studies and background documents from the development of the standards or test methods, Agency knowledge and experience with the National Emission Standards for Hazardous Air Pollutants ( NESHAP) program, the previously approved ICR, and 8 any comments received.

6( b) Estimating Respondent Costs ( i) Estimating Labor Costs This ICR uses a Technical Labor Rate of $ 55.34 per hour. This rate is from the United States Department of Commerce Bureau of Labor Statistics, March 2000, " Table 10. Private industry, by occupational and industry group." In order to be consistent with the previous ICR, we are using the technical wage rate which was also used in the previous ICRs. This rate is from column 1, " Total Compensation." The wage rate has been increased by 110% to account for the benefit packages available to those employed by private industry.

( ii) Estimating Capital and Operations and Maintenance Costs The industry costs associated with the information collection activity in this standard are labor and the capital start up and operations and maintenance ( O& M) costs associated with continuous emissions monitoring. The capital start up costs are one time costs when a facility becomes subject to the standard. The annual O& M costs are ongoing costs to maintain the monitoring system as well as other administrative costs such as photocopying and postage.

( iii) Capital/ Start up vs. Operating and Maintenance ( O& M) Costs Capital/ Start up vs. Operating and Maintenance ( O& M) Costs ( A)

Continuous Monitoring device ( B)

Startup cost ($) for 1 affected facility ( C)

# of new affected facilities to start up ( D)

Total start up ( B X C) ( E)

Annual O& M costs ($) for 1 affected facility ( F)

# of affected facilities with O& M ( G)

Total O& M ( E X F)

Continuous Emission Monitor ( CEM) $ 150,000 0 $ 0 $ 45,000 44 $ 1,980,000 The total capital/ start up costs for this ICR are $ 0. The capital start up costs are one time costs when a facility becomes subject to this subpart. This is based on our assumption that no new sources will be subject to this subpart over the next three ( 3) years. This is the total of column D. This cost is shown on the OMB 83 I form in block 14 letter a: Total annualized capital/ startup costs. The numbers in block 14 of the OMB 83 I form are rounded to show the cost in thousands of dollars. 9 The total operating and maintenance ( O& M) costs for this ICR are $ 1,980,000. This based on 44 existing sources multiplied by $ 45,000.00 for upkeep of the monitoring devices. This is the total of column G. This cost is shown on the OMB 83 I form in block 14 letter b: Total annual costs ( O& M). The numbers in block 14 of the OMB 83 I form are rounded to show the cost in thousands of dollars.

The total respondent costs is the sum of the capital start up costs and the annual operations and maintenance costs. Thus the industry's average annual cost for capital and O& M for this subpart over the next three years is estimated to be $ 1,980,000. This cost is shown on the OMB 83 I form in block 14 letter c: Total annualized cost requested. The numbers in block 14 of the OMB 83 I form are rounded to show the cost in thousands of dollars.

6( c) Estimating Agency Burden and Cost The only Federal costs are user cost associated with analysis of the reported information. Publication and distribution of the information are part of the AFS program. Examination of records to be maintained by the respondents will occur as part of the periodic inspection of sources, which is part of EPA's overall compliance and enforcement program.

The average annual Federal Government cost during the 3 years of the ICR is estimated to be $ 142,721.92. The cost is based on an average hourly wage of a GS 10 step 1 and travel associated with compliance activities. Details upon which this estimate is based appear in Table 1: Agency Burden ( A different hourly rate was used in the past, but because the previous ICR provided no explanation for the dollar amount for salary this renewal will use the going standard fee.).

6( d) Estimating the Respondent Universe and Total Burden and Costs Respondent Universe Regulation Title ( A) # new sources per year ( B) # of initial reports for new sources ( C) # existing sources ( D) # of reports for existing sources ( E) total annual responses ( AxB.)+( CxD)

NESHAP, Subpart F 0 5 44 7 308 The number of total respondents is 44. This number is the sum of Column A and Column C of the Respondent Universe table. It is shown on the OMB 83 I form in block 13 a. This is the number of existing sources plus the number of new sources anticipated in one year.

The total annual responses is 308. This number is in column E of the Respondent Universe 10 table. It is shown on the OMB 83 I form in block 13 b. The total annual labor costs are $ 894,239.06. This number is not shown on the OMB 83 I form, only the burden hours are reflected in block 13c. Details upon which this estimate is based appear in Table 2: Industry Burden.

The total annual capital and O& M costs to the regulated entity are $ 1,980,000. This number is shown on the OMB 83 I form in block 14 c. These costs are detailed in section 6 b ( iii) Capital/ Start up vs. Operating and Maintenance ( O& M) Costs.

6( e) Bottom Line Burden Hours and Costs Tables Reference Tables 1 & 2.

6( f) Reasons for Change in Burden The increase in burden from the most recently approved ICR is due to the use of more accurate industry and EPA hourly wages supported by information from the Bureau of Labor Statistics.

6( g) Burden Statement Burden means the total time, effort, or financial resources expended by persons to generate, maintain, retain, or disclose or provide information to or for a Federal agency. This includes the time needed to review instructions; develop, acquire, install, and utilize technology and systems for the purposes of collecting, validating, and verifying information, processing and maintaining information, and disclosing and providing information; adjust the existing ways to comply with any previously applicable instructions and requirements; train personnel to be able to respond to a collection of information; search data sources; complete and review the collection of information; and transmit or otherwise disclose the information. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid OMB control number. The OMB control numbers for EPA's regulations are listed in 40 CFR Part 9 and 48 CFR Chapter 15.

Send comments on the Agency's need for this information, the accuracy of the provided burden estimates, and any suggested methods for minimizing respondent burden, including through the use of automated collection techniques to the Director, Collection Strategies Division, Office of Environmental Information ( OEI), U. S. Environmental Protection Agency , Mail code 2822, 1200 Pennsylvania Avenue, NW, Washington, DC 20460; and to the Office of Information and Regulatory Affairs, Office of Management and Budget, 725 17th Street, NW, Washington, DC 20503, Attention: Desk Officer for EPA. Include the EPA ICR number and OMB Control Number in any correspondence.

Part B of the Supporting Statement 11 This part is not applicable because no statistical methods were used in collecting this information.


[Federal Register Volume 83, Number 249 (Monday, December 31, 2018)]
[Notices]
[Pages 67741-67749]
[FR Doc No: 2018-28393]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-84931; File No. SR-NYSEArca-2018-83]

Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing
of Proposed Rule Changes Regarding Investments of the iShares Bloomberg
Roll Select Commodity Strategy ETF

December 21, 2018.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of
1934 (``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby given
that, on December 19, 2018, NYSE Arca, Inc. (``Exchange'' or ``NYSE
Arca'') filed with the Securities and Exchange Commission
(``Commission'') the proposed rule change as described in Items I, II,
and III below, which Items have been

prepared by the self-regulatory organization. The Commission is
publishing this notice to solicit comments on the proposed rule change
from interested persons.
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    \1\ 15 U.S.C.78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange proposes certain changes regarding investments of the
iShares Bloomberg Roll Select Commodity Strategy ETF, shares of which
are currently listed and traded on the Exchange under NYSE Arca Rule
8.600-E (``Managed Fund Shares''). The proposed change is available on
the Exchange's website at www.nyse.com, at the principal office of the
Exchange, and at the Commission's Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the self-regulatory organization
included statements concerning the purpose of, and basis for, the
proposed rule change and discussed any comments it received on the
proposed rule change. The text of those statements may be examined at
the places specified in Item IV below. The Exchange has prepared
summaries, set forth in sections A, B, and C below, of the most
significant parts of such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes certain changes regarding investments of the
iShares Bloomberg Roll Select Commodity Strategy ETF (``Fund''), shares
(``Shares'') of which are currently listed and traded on the Exchange
under NYSE Arca Rule 8.600-E, which governs the listing and trading of
Managed Fund Shares \4\ on the Exchange. Shares of the Fund commenced
listing and trading on the Exchange on April 5, 2018 under
Commentary.01(b) to NYSE Arca Rule 8.600-E.
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    \4\ A Managed Fund Share is a security that represents an
interest in an investment company registered under the Investment
Company Act of 1940 (15 U.S.C. 80a-1) (``1940 Act'') organized as an
open-end investment company or similar entity that invests in a
portfolio of securities selected by its investment adviser
consistent with its investment objectives and policies. In contrast,
an open-end investment company that issues Investment Company Units,
listed and traded on the Exchange under NYSE Arca Rule 5.2-E(j)(3),
seeks to provide investment results that correspond generally to the
price and yield performance of a specific foreign or domestic stock
index, fixed income securities index or combination thereof.
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    The Shares are offered by iShares U.S. ETF Trust (the ``Trust''),
which is registered with the Commission as an open-end management
investment company.\5\ The Fund is a series of the Trust.\6\
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    \5\ The Trust is registered under the 1940 Act. On February 21,
2018, the Trust filed with the Securities and Exchange Commission
(``SEC'' or Commission'') its registration statement on Form N-1A
under the Securities Act of 1933 (15 U.S.C. 77a), and under the 1940
Act relating to the Fund (File Nos. 333-179904 and 811-22649)
(``Registration Statement''). The description of the operation of
the Trust and the Fund herein is based, in part, on the Registration
Statement. In addition, the Commission has issued an order upon
which the Trust may rely, granting certain exemptive relief under
the 1940 Act. See Investment Company Act Release No. 29571 (January
24, 2011) (File No. 812-13601).
    \6\ The Fund is currently in compliance with the provisions of
Commentary.01(b) to NYSE Arca Rule 8.600-E. The Trust will not
implement the changes proposed herein until this proposed rule
change is approved by the Commission.
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    BlackRock Fund Advisors (``BFA'' or ``Adviser'') is the investment
adviser for the Fund. BlackRock Investments, LLC is the distributor
(``Distributor'') for the Fund's Shares. State Street Bank and Trust
Company serves as the administrator, custodian and transfer agent
(``Custodian'' or ``Transfer Agent'') for the Fund.
    Commentary .06 to Rule 8.600-E 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
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 investment company portfolio.\7\ In
addition, Commentary .06 further requires that personnel who make
decisions on the open-end fund's portfolio composition must be subject
to procedures designed to prevent the use and dissemination of material
nonpublic information regarding the open-end fund's portfolio. The
Adviser is not registered as a broker-dealer, but is affiliated with a
broker-dealer, and has implemented and will maintain a fire wall with
respect to its broker-dealer affiliate regarding access to information
concerning the composition and/or changes to the portfolio. In the
event (a) the 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 its broker-dealer affiliate 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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    \7\ 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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iShares Bloomberg Roll Select Commodity Strategy ETF
Fund Investments
    According to the Registration Statement, the Fund's investment
objective is to seek to provide exposure, on a total return basis, to a
diversified group of commodities. The Fund is actively managed and
seeks to achieve its investment objective in part \8\ by, under normal
market conditions,\9\ investing in listed and over-the-counter
(``OTC'') swaps referencing the Bloomberg Roll Select Commodity Index
(the ``Reference Benchmark'').\10\ In connection with investments in
swaps on the Reference Benchmark, the Fund is expected to establish new
swaps contracts on an ongoing basis and

replace expiring contracts.\11\ Swaps subsequently entered into by the
Fund may have terms that differ from the swaps the Fund currently
holds. The Fund expects generally to pay a fixed payment rate and
certain swap related fees to the swap counterparty and receive the
total return of the Reference Benchmark, including in the event of
negative performance by the Reference Benchmark, negative return (i.e.,
a payment from the Fund to the swap counterparty). In seeking total
return, the Fund additionally aims to generate interest income and
capital appreciation through a cash management strategy consisting
primarily of cash, cash equivalents,\12\ and fixed income securities
other than cash equivalents, as described below.
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    \8\ The Fund's investment objective is also achieved by
investing in cash, cash equivalents, Commodity Investments, Fixed
Income Securities and Short-Term Fixed Income Securities (each as
defined or described below).
    \9\ The term ``normal market conditions'' is defined in NYSE
Arca Rule 8.600-E(c)(5).
    \10\ The Bloomberg Roll Select Commodity Index is a version of
the Bloomberg Commodity Index (``BCOM'') that aims to mitigate the
effects of contango on index performance (as described further
below). For each commodity, the index rolls into the futures
contract showing the most backwardation or least contango, selecting
from those contracts with nine months or fewer until expiration.
(Source: Bloomberg)
    \11\ Swaps on the Reference Benchmark are included in
``Commodity Investments'' as defined below.
    \12\ For purposes of this filing, cash equivalents are the
short-term instruments enumerated in Commentary .01(c) to Rule
8.600-E.
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    The Fund's investment strategy seeks to maximize correlation with
the Reference Benchmark, which is composed of 22 futures contracts
across 20 physical agricultural, energy, precious metals and industrial
metals commodities. The Reference Benchmark reflects the returns from
these commodities and provides broad-based exposure to commodities as
an asset class by using liquidity and sector caps to avoid
overconcentration in any single commodity or commodity sector. The
Reference Benchmark employs a contract roll strategy intended to
minimize the effects of contango and maximize the effects of
backwardation.\13\
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    \13\ In order to maintain exposure to a futures contract on a
particular commodity, an investor must sell the position in the
expiring contract and buy a new position in a contract with a later
delivery month, which is referred to as ``rolling.'' If the price
for the new futures contract is less than the price of the expiring
contract, then the market for the commodity is said to be in
``backwardation.'' In these markets, roll returns are positive,
which is referred to as ``positive carry.'' The term ``contango'' is
used to describe a market in which the price for a new futures
contract is more than the price of the expiring contract. In these
markets, roll returns are negative, which is referred to as
``negative carry.'' The Reference Benchmark seeks to employ a
positive carry strategy that emphasizes commodities and futures
contract months with the greatest degree of backwardation and lowest
degree of contango, resulting in net gains through positive roll
returns.
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    The Fund will invest in financial instruments described below that
provide exposure to commodities and not in the physical commodities
themselves.
    The Fund (through its Subsidiary (as defined below)) may hold the
following listed derivative instruments: Futures, forwards, options and
swaps (including swaps referencing the Reference Benchmark) on
commodities, currencies and financial instruments (e.g., stocks, fixed
income, interest rates, U.S. Treasuries, and volatility) or a basket or
index of any of the foregoing (collectively, ``Listed
Derivatives'').\14\ Listed Derivatives will comply with the criteria in
Commentary .01(d) of NYSE Arca Rule 8.600-E.
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    \14\ Examples of Listed Derivatives the Fund may invest in
include exchange traded futures contracts similar to those found in
the Reference Benchmark, exchange traded futures contracts on the
Reference Benchmark, swaps on commodity futures contracts similar to
those found in the Reference Benchmark, as well as futures and
options that correlate to the investment returns of commodities
without investing directly in physical commodities.
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    The Fund (through its Subsidiary (as defined below)) may hold the
following over-the-counter (``OTC'') derivative instruments: Forwards,
options and swaps (including swaps referencing the Reference Benchmark)
on commodities, currencies and financial instruments (e.g., stocks,
fixed income, interest rates, and volatility) or a basket or index of
any of the foregoing (collectively, ``OTC Derivatives'',\15\ and
together with Listed Derivatives, ``Commodity Investments'').\16\
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    \15\ Examples of OTC Derivatives the Fund may invest in include
swaps on commodity futures contracts similar to those found in the
Reference Benchmark, options that correlate to the investment
returns of commodities without investing directly in physical
commodities, OTC commodity-linked instruments such as OTC commodity-
linked notes, forward contracts and OTC options.
    \16\ As discussed below under ``Application of Generic Listing
Requirements'' below, the Fund's and the Subsidiary's holdings in
OTC derivatives will not comply with the criteria in Commentary
.01(e) of NYSE Arca Rule 8.600-E.
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    The Fund's exposure to Commodity Investments is obtained by
investing through a wholly-owned subsidiary organized in the Cayman
Islands (the ``Subsidiary'').\17\ The Subsidiary is advised by BFA and
has the same investment objective as the Fund.
---------------------------------------------------------------------------

    \17\ All statements included in this application related to the
Fund's investments and restrictions are applicable to the Fund and
Subsidiary collectively.
---------------------------------------------------------------------------

    In compliance with the requirements of Sub-Chapter M of the
Internal Revenue Code of 1986, the Fund may invest up to 25% of its
total assets in the Subsidiary. The Fund's Commodity Investments held
in the Subsidiary are intended to provide the Fund with exposure to
broad commodities.
    The Fund may hold cash, cash equivalents and fixed income
securities other than cash equivalents, as described further below.
    Specifically, the Fund may invest in Short-Term Fixed Income
Securities (as defined below) other than cash equivalents on an ongoing
basis to provide liquidity or for other reasons.\18\ Short-Term Fixed
Income Securities will have a maturity of no longer than 397 days and
include the following: (i) Money market instruments; (ii) obligations
issued or guaranteed by the U.S. government, its agencies or
instrumentalities (including government-sponsored enterprises); (iii)
negotiable certificates of deposit, bankers' acceptances, fixed-time
deposits and other obligations of U.S. and non-U.S. banks (including
non-U.S. branches) and similar institutions; (iv) commercial paper; (v)
non-convertible corporate debt securities (e.g., bonds and debentures);
(vi) repurchase agreements; (vii) short-term U.S. dollar-denominated
obligations of non-U.S. banks (including U.S. branches) that, in the
opinion of BFA, are of comparable quality to obligations of U. S. banks
that may be purchased by the Fund; (viii) and sovereign obligations
(collectively, ``Short-Term Fixed Income Securities''). Any of these
securities may be purchased on a current or forward-settled basis.\19\
---------------------------------------------------------------------------

    \18\ As discussed under ``Application of Generic Listing
Requirements'' below, the Exchange proposes that such Short-Term
Fixed Income Securities be excluded from the requirements of
Commentary .01(b)(1)-(4) to NYSE Arca Rule 8.600-E.
    \19\ To the extent that the Fund and the Subsidiary invest in
cash and Short-Term Fixed Income Securities that are cash
equivalents (i.e., that have maturities of less than 3 months) as
specified in Commentary .01(c) to NYSE Arca Rule 8.600-E, such
investments will comply with Commentary .01(c) and may be held
without limitation. Non-convertible corporate debt securities and
sovereign obligations are not included as cash equivalents in
Commentary .01(c).
---------------------------------------------------------------------------

    The Fund also may invest in fixed income securities as defined in
Commentary .01(b) to NYSE Arca Rule 8.600-E, other than cash
equivalents and Short-Term Fixed Income Securities, with remaining
maturities longer than 397 days (``Fixed Income Securities''). Such
Fixed Income Securities will comply with requirements of Commentary
.01(b) to NYSE Arca Rule 8.600-E.
    The Subsidiary may hold cash and cash equivalents.
    The Fund will seek to gain exposure to swaps and other Commodity
Investments by investing in its Subsidiary. The Fund wholly owns and
controls the Subsidiary, and the Fund and the Subsidiary are managed by
BFA. The Subsidiary is not an investment company registered under the
1940 Act and is a company organized under the laws of the Cayman
Islands.
    The Trust's Board of Trustees has oversight responsibility for the
investment activities of the Fund,

including its investment in the Subsidiary and the Fund's role as sole
shareholder of the Subsidiary.
    The Fund and the Subsidiary will not invest in securities or other
financial instruments that have not been described in this proposed
rule change.
Other Restrictions
    The Fund's investments, including derivatives, will be consistent
with the Fund's investment objective and will not be used to enhance
leverage (although certain derivatives and other investments may result
in leverage). That is, the Fund's investments will not be used to seek
performance that is the multiple or inverse multiple (e.g., 2X or -3X)
of the Fund's Reference Benchmark.
Use of Derivatives by the Fund
    The Fund may invest in the types of derivatives described in the
``Principal Investments'' section above for the purposes described in
that section. Investments in derivative instruments will be made in
accordance with the Fund's investment objective and policies.
    To limit the potential risk associated with such transactions, the
Fund will enter into offsetting transactions or segregate or
``earmark'' assets determined to be liquid by the Adviser in accordance
with procedures established by the Trust's Board of Trustees (the
``Board''). In addition, the Fund has included appropriate risk
disclosure in its offering documents, including leveraging risk.
Leveraging risk is the risk that certain transactions of the Fund,
including the Fund's use of derivatives, may give rise to leverage,
causing the Fund to be more volatile than if it had not been leveraged.
Impact on Arbitrage Mechanism
    The Adviser believes there will be minimal, if any, impact to the
arbitrage mechanism as a result of the Fund's use of derivatives. The
Adviser understands that market makers and participants should be able
to value derivatives as long as the positions are disclosed with
relevant information. The Adviser believes that the price at which
Shares of the Fund trade will continue to be disciplined by arbitrage
opportunities created by the ability to purchase or redeem Shares of
the Fund at their net asset value (``NAV''), which should ensure that
Shares of the Fund will not trade at a material discount or premium in
relation to their NAV.
    The Adviser does not believe there will be any significant impacts
to the settlement or operational aspects of the Fund's arbitrage
mechanism due to the use of derivatives.
Creation and Redemption of Shares
    According to the Registration Statement, the Trust will issue and
sell Shares of the Fund only in Creation Units on a continuous basis
through the Distributor or its agent at a price based on the Fund's NAV
next determined after receipt, on any business day of an order received
by the Distributor or its agent in proper form. The size of a Creation
Unit is 50,000 Shares. The Trust may increase or decrease the number of
the Fund's Shares that constitute a Creation Unit.
    The consideration for purchase of Creation Units of the Fund is
generally cash (which may include the currency in which the underlying
securities are denominated). However, in some cases the consideration
consists of an in-kind deposit of a designated portfolio of securities
(``Deposit Securities'') and the Cash Component computed as described
below. Together, the Deposit Securities and the Cash Component
constitute the ``Fund Deposit,'' which, when combined with the Fund's
portfolio securities, is designed to generate performance that has a
collective investment profile similar to that of the Reference
Benchmark. The Fund Deposit represents the minimum initial and
subsequent investment amount for a Creation Unit of the Fund.
    The ``Cash Component'' is an amount equal to the difference between
the NAV of the shares (per Creation Unit) and the ``Deposit Amount,''
which is an amount equal to the market value of the Deposit Securities,
and serves to compensate for any differences between the NAV per
Creation Unit and the Deposit Amount.
    The Fund's current policy is to accept cash in substitution for the
Deposit Securities it might otherwise accept as in-kind consideration
for the purchase of Creation Units. The Fund may, at times, elect to
receive Deposit Securities (i.e., the in-kind deposit of a designated
portfolio of securities) and a Cash Component as consideration for the
purchase of Creation Units. If the Fund elects to accept Deposit
Securities, a purchaser's delivery of the Deposit Securities together
with the Cash Component will constitute the ``Fund Deposit,'' which
will represent the consideration for a Creation Unit of the Fund.
    The Fund reserves the right to permit or require the substitution
of a ``cash in lieu'' amount to be added to the Cash Component to
replace any Deposit Security that may not be available in sufficient
quantity for delivery or that may not be eligible for transfer through
the Depository Trust Company (``DTC'') or the clearing process (as
discussed below) or that the ``Authorized Participant'' as defined
below, is not able to trade due to a trading restriction, during times
the Fund has elected to receive Deposit Securities. The Fund also
reserves the right to permit or require a ``cash in lieu'' amount in
certain circumstances.
    To be eligible to place orders with the Distributor and to create a
Creation Unit of the Fund, an entity must be: (i) A ``Participating
Party,'' i.e., a broker-dealer or other participant in the clearing
process through the Continuous Net Settlement System of the National
Securities Clearing Corporation (``NSCC'') (the ``Clearing Process''),
a clearing agency that is registered with the SEC, or (ii) a DTC
Participant, and must have executed an agreement with the Distributor,
with respect to creations and redemptions of Creation Units
(``Authorized Participant Agreement'') (discussed below). A
Participating Party or DTC Participant who has executed an Authorized
Participant Agreement is referred to as an ``Authorized Participant.
    To initiate an order for a Creation Unit, an Authorized Participant
must submit to the Distributor or its agent an irrevocable order to
purchase shares of the Fund, in proper form, generally before 4:00
p.m., Eastern time on any business day to receive that day's NAV.
    Shares of the Fund may be redeemed by only in Creation Units at
their NAV next determined after receipt of a redemption request in
proper form by the Distributor or its agent and only on a business day.
The Fund generally redeems Creation Units solely for cash (which may
include the currency in which the underlying securities are
denominated).
    BFA makes available through the NSCC, prior to the opening of
business on the Exchange on each business day, the designated portfolio
of securities (including any portion of such securities for which cash
may be substituted) that will be applicable (subject to possible
amendment or correction) to redemption requests received in proper form
(as defined below) on that day (``Fund Securities''), and an amount of
cash (the ``Cash Amount,'' as described below). Such Fund Securities
and the corresponding Cash Amount (each subject to possible amendment
or correction) are applicable, in order to effect redemptions of
Creation Units of the Fund until such time as the next announced
composition of the Fund Securities and Cash Amount is made available.
Where redemptions are permitted in-kind, Fund Securities

received on redemption may not be identical to Deposit Securities that
are applicable to creations of Creation Units. Procedures and
requirements governing redemption transactions are set forth in the
handbook for Authorized Participants and may change from time to time.
    The Trust may, in its sole discretion, substitute a ``cash in
lieu'' amount to replace any Fund Security. The Trust also reserves the
right to permit or require a ``cash in lieu'' amount in certain
circumstances. The amount of cash paid out in such cases will be
equivalent to the value of the substituted security listed as a Fund
Security. In the event that the Fund Securities have a value greater
than the NAV of the shares, a compensating cash payment equal to the
difference is required to be made by or through an Authorized
Participant by the redeeming shareholder. The Fund generally redeems
Creation Units for cash.
    Redemption requests for Creation Units of the Fund must be
submitted to the Distributor or its agent by or through an Authorized
Participant. An Authorized Participant must submit an irrevocable
request to redeem shares of the Fund generally before 4:00 p.m.,
Eastern time on any business day in order to receive that day's NAV.
Application of Generic Listing Requirements
    The Exchange is submitting this proposed rule change because the
portfolio for the Fund will not meet all of the ``generic'' listing
requirements of Commentary .01 to NYSE Arca Rule 8.600-E applicable to
the listing of Managed Fund Shares. The Fund's portfolio will meet all
such requirements except for those set forth in Commentary .01 (b)(1)-
(4) (with respect to Short-Term Fixed Income Securities) and (e) (with
respect to OTC Derivatives), as described below.
    The Fund's Short-Term Fixed Income Securities will not comply with
the requirements set forth in Commentary .01(b)(1)-(4) to NYSE Arca
Rule 8.600-E.\20\ While the requirements set forth in Commentary
.01(b)(1)-(4) include rules intended to ensure that the fixed income
securities included in a fund's portfolio are sufficiently large and
diverse and have sufficient publicly available information regarding
the issuances, the Exchange believes that any concerns related to non-
compliance are mitigated by the types of instruments that the Fund
would hold. The Fund's Short-Term Fixed Income Securities primarily
will include those instruments that are included in the definition of
cash and cash equivalents, but are not considered cash and cash
equivalents because they have maturities of three months or longer. The
Exchange believes, however, that, because all Short-Term Fixed Income
Securities, including non-convertible corporate debt securities and
sovereign obligations (which are not cash equivalents as enumerated in
Commentary .01(c) to Rule 8.600-E), are highly liquid, they are less
susceptible than other types of fixed income instruments both to price
manipulation and volatility and that the holdings as proposed are
generally consistent with the policy concerns which Commentary
.01(b)(1)-(4) is intended to address. Because the Short-Term Fixed
Income Securities will consist of high-quality fixed income securities
described above, the Exchange believes that the policy concerns that
Commentary .01(b)(1)-(4) is intended to address are otherwise mitigated
and that the Fund should be permitted to hold these securities in a
manner that may not comply with Commentary .01(b)(1)-(4).
---------------------------------------------------------------------------

    \20\ Commentary .01(b)(1)-(4) to NYSE Arca Rule 8.600-E provides
as follows:
    ``(b) Fixed Income--Fixed income securities are debt securities
that are notes, bonds, debentures or evidence of indebtedness that
include, but are not limited to, U.S. Department of Treasury
securities (``Treasury Securities''), government-sponsored entity
securities (``GSE Securities''), municipal securities, trust
preferred securities, supranational debt and debt of a foreign
country or a subdivision thereof, investment grade and high yield
corporate debt, bank loans, mortgage and asset backed securities,
and commercial paper. To the extent that a portfolio includes
convertible securities, the fixed income security into which such
security is converted shall meet the criteria of this Commentary
.01(b) after converting. The components of the fixed income portion
of a portfolio shall meet the following criteria initially and on a
continuing basis:
    (1) Components that in the aggregate account for at least 75% of
the fixed income weight of the portfolio each shall have a minimum
original principal amount outstanding of $100 million or more;
    (2) No component fixed-income security (excluding Treasury
Securities and GSE Securities) shall represent more than 30% of the
fixed income weight of the portfolio, and the five most heavily
weighted component fixed income securities in the portfolio
(excluding Treasury Securities and GSE Securities) shall not in the
aggregate account for more than 65% of the fixed income weight of
the portfolio;
    (3) An underlying portfolio (excluding exempted securities) that
includes fixed income securities shall include a minimum of 13 non-
affiliated issuers, provided, however, that there shall be no
minimum number of non-affiliated issuers required for fixed income
securities if at least 70% of the weight of the portfolio consists
of equity securities as described in Commentary .01(a) above;
    (4) Component securities that in aggregate account for at least
90% of the fixed income weight of the portfolio must be either (a)
from issuers that are required to file reports pursuant to Sections
13 and 15(d) of the Securities Exchange Act of 1934; (b) from
issuers that have a worldwide market value of its outstanding common
equity held by non-affiliates of $700 million or more; (c) from
issuers that have outstanding securities that are notes, bonds
debentures, or evidence of indebtedness having a total remaining
principal amount of at least $1 billion; (d) exempted securities as
defined in Section 3(a)(12) of the Securities Exchange Act of 1934;
or (e) from issuers that are a government of a foreign country or a
political subdivision of a foreign country''.
---------------------------------------------------------------------------

    The Fund's portfolio also will not comply with the requirements set
forth in Commentary .01(e) (with respect to OTC Derivatives) to NYSE
Arca Rule 8.600-E.\21\ Specifically, the Fund's investments in OTC
Derivatives may exceed 20% of Fund assets, calculated as the aggregate
gross notional value of such OTC Derivatives. The Exchange proposes
that up to 60% of the Fund's assets (calculated as the aggregate gross
notional value) may be invested in OTC Derivatives. The Adviser
believes that it is important to provide the Fund with additional
flexibility to manage risk associated with its investments. Depending
on market conditions, it may be critical that the Fund be able to
utilize available OTC Derivatives to efficiently gain exposure to the
multiple commodities that underlie the Reference Benchmark, as well as
commodity futures contracts similar to those found in the Reference
Benchmark.
---------------------------------------------------------------------------

    \21\ Commentary .01(e) of NYSE Arca Rule 8.600-E provides as
follows: ``The portfolio may hold OTC derivatives, including
forwards, options and swaps on commodities, currencies and financial
instruments (e.g., stocks, fixed income, interest rates, and
volatility) or a basket or index of any of the foregoing; however,
on both an initial and continuing basis, no more than 20% of the
assets in the portfolio may be invested in OTC derivatives. For
purposes of calculating this limitation, a portfolio's investment in
OTC derivatives will be calculated as the aggregate gross notional
value of the OTC derivatives.''
---------------------------------------------------------------------------

    OTC Derivatives can be tailored to provide specific exposure to the
Fund's Reference Benchmark, as well as commodity futures contracts
similar to those found in the Reference Benchmark,, allowing the Fund
to more efficiently meet its investment objective. For example, the
Reference Benchmark is composed of 22 futures contracts across 20
physical commodities, which may not be sufficiently liquid and would
not provide the commodity exposure the Fund requires to meet its
investment objective if the Fund were to invest in the futures
directly. A total return swap can be structured to provide exposure to
the same futures contracts as exist in the Reference Benchmark, as well
as commodity futures contracts similar to those found in the Reference
Benchmark, while providing sufficient efficiency to allow the Fund to
more easily meet its investment objective.

    In addition, if the Fund were to gain commodity exposure
exclusively through the use of listed futures, the Fund's holdings in
Listed Derivatives would be subject to position limits and
accountability levels established by an exchange. Such limitations
would restrict the Fund's ability to gain efficient exposure to the
commodities in the Reference Benchmark, or futures contracts similar to
those found in the Reference Benchmark, thereby impeding the Fund's
ability to satisfy its investment objective.
    The Adviser represents that the basket or index on which much of
the Fund's OTC Derivatives will be based will satisfy the criteria
applicable to holdings in Listed Derivatives in Commentary .01(d)(2) on
an initial and continued listing basis.\22\ With respect to the Fund's
holdings in OTC Derivatives, the aggregate gross notional value of OTC
Derivatives based on any five or fewer underlying reference assets will
not exceed 65% of the weight of the portfolio (including gross notional
exposures), and the aggregate gross notional value of OTC Derivatives
based on any single underlying reference asset will not exceed 30% of
the weight of the portfolio (including gross notional exposures). In
addition, the Adviser represents that futures on all commodities in the
Reference Benchmark are traded on futures exchanges that are members of
the Intermarket Surveillance Group (``ISG'').
---------------------------------------------------------------------------

    \22\ Commentary .01(d)(2) to Rule 8.600-E provides that, with
respect to a fund's portfolio, 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 Exchange notes that, other than Commentary .01(b)(1)-(4) (with
respect to Short-Term Fixed Income Securities) and .01(e)(with respect
to OTC Derivatives) to Rule 8.600-E, as described above, the Fund's
portfolio will meet all other requirements of Rule 8.600-E.
Availability of Information
    The Fund's website (www.iShares.com) will include the prospectus
for the Fund that may be downloaded. The Fund's website will include
additional quantitative information updated on a daily basis including,
for the Fund, (1) daily trading volume, the prior business day's
reported closing price, NAV and midpoint of the bid/ask spread at the
time of calculation of such NAV (the ``Bid/Ask Price''),\23\ and a
calculation of the premium and discount of the Bid/Ask Price against
the NAV, and (2) data in chart format displaying the frequency
distribution of discounts and premiums of the daily Bid/Ask Price
against the NAV, within appropriate ranges, for each of the four
previous calendar quarters. On each business day, before commencement
of trading in Shares in the Core Trading Session on the Exchange, the
Fund will disclose on its website the Disclosed Portfolio as defined in
NYSE Arca Rule 8.600-E(c)(2) that forms the basis for the Fund's
calculation of NAV at the end of the business day.\24\
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    \23\ The Bid/Ask Price of the Fund's Shares will be determined
using the mid-point of the highest bid and the lowest offer on the
Exchange as of the time of calculation of the Fund's NAV. The
records relating to Bid/Ask Prices will be retained by the Fund and
its service providers.
    \24\ Under accounting procedures followed by the Fund, trades
made on the prior business day (``T'') will be booked and reflected
in NAV on the current business day (``T+1''). Accordingly, the Fund
will be able to disclose at the beginning of the business day the
portfolio that will form the basis for the NAV calculation at the
end of the business day.
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    On a daily basis, the Fund will disclose the information required
under NYSE Arca Rule 8.600-E(c)(2) to the extent applicable. The
website information will be publicly available at no charge.
    In addition, a basket composition file, which includes the asset
names and share quantities, if applicable, required to be delivered in
exchange for the Fund's Shares, together with estimates and actual cash
components, will be publicly disseminated daily prior to the opening of
the Exchange via the NSCC. The basket represents one Creation Unit of
the Fund. Authorized Participants may refer to the basket composition
file for information regarding financial instruments that may comprise
the Fund's basket on a given day.
    Investors can also obtain the Trust's Statement of Additional
Information (``SAI''), the Fund's Shareholder Reports, and the Fund's
Forms N-CSR and Forms N-SAR, filed twice a year. The Fund's SAI and
Shareholder Reports will be available free upon request from the Trust,
and those documents and the Form N-CSR, Form N-PX and Form N-SAR may be
viewed on-screen or downloaded from the Commission's website at
www.sec.gov.
    Intra-day and closing price information regarding futures and other
Listed Derivatives will be available from the exchange on which such
instruments are traded and from major market data vendors. Price
information regarding OTC Derivatives, cash equivalents, Commodity
Investments, Short-Term Fixed Income Securities, and Fixed Income
Securities also will be available from major market data vendors.
Additionally, the Trade Reporting and Compliance Engine (``TRACE'') of
the Financial Industry Regulatory Authority (``FINRA'') will be a
source of price information for certain fixed income securities to the
extent transactions in such securities are reported to TRACE.\25\ Price
information regarding U.S. government securities and other cash
equivalents generally may be obtained from brokers and dealers who make
markets in such securities or through nationally recognized pricing
services through subscription agreements. The BCOM index methodology,
constituent list, and index price are available via Bloomberg.
---------------------------------------------------------------------------

    \25\ Broker-dealers that are FINRA member firms have an
obligation to report transactions in specified debt securities to
TRACE to the extent required under applicable FINRA rules.
Generally, such debt securities will have at issuance a maturity
that exceeds one calendar year. For fixed income securities that are
not reported to TRACE, (i) intraday price quotations will generally
be available from broker-dealers and trading platforms (as
applicable) and (ii) price information will be available from feeds
from market data vendors, published or other public sources, or
online information services, as described above.
---------------------------------------------------------------------------

    Information regarding market price and trading volume of the Shares
will be continually available on a real-time basis throughout the day
on brokers' computer screens and other electronic services. Information
regarding the previous day's closing price and trading volume
information for the Shares will be published daily in the financial
section of newspapers.
    Quotation and last sale information for the Shares will be
available via the Consolidated Tape Association (``CTA'') high-speed
line. Exchange-traded options quotation and last sale information for
options cleared via the Options Clearing Corporation are available via
the Options Price Reporting Authority. In addition, the Portfolio
Indicative Value (``PIV''), as defined in NYSE Arca Rule 8.600-E(c)(3),
will be widely disseminated by one or more major market data vendors at
least every 15 seconds during the Core Trading Session.
Trading Halts
    With respect to trading halts, the Exchange may consider all
relevant factors in exercising its discretion to halt or suspend
trading in the Shares of the Fund.\26\ Trading in Shares of the Fund
will be halted if the circuit breaker parameters in NYSE Arca Rule
7.12-E have been reached. Trading also may be halted because of market
conditions or

for reasons that, in the view of the Exchange, make trading in the
Shares inadvisable. Trading in the Fund's Shares also will be subject
to Rule 8.600-E(d)(2)(D) (``Trading Halts'').
---------------------------------------------------------------------------

    \26\ See NYSE Arca Rule 7.12-E.
---------------------------------------------------------------------------

Trading Rules
    The Exchange deems the Shares to be equity securities, thus
rendering trading in the Shares subject to the Exchange's existing
rules governing the trading of equity securities. Shares will trade on
the NYSE Arca Marketplace from 4 a.m. to 8 p.m., E.T. in accordance
with NYSE Arca Rule 7.34-E (Early, Core, and Late Trading Sessions).
The Exchange has appropriate rules to facilitate transactions in the
Shares during all trading sessions. As provided in NYSE Arca Rule 7.6-
E, the minimum price variation (``MPV'') for quoting and entry of
orders in equity securities traded on the NYSE Arca Marketplace is
$0.01, with the exception of securities that are priced less than $1.00
for which the MPV for order entry is $0.0001.
    With the exception of the requirements of Commentary .01(b)(1)-(4)
(with respect to Short-Term Fixed Income Securities) and (e) (with
respect to OTC Derivatives) to Rule 8.600-E as described above in
``Application of Generic Listing Requirements,'' the Shares of the Fund
will conform to the initial and continued listing criteria under NYSE
Arca Rule 8.600-E. Consistent with NYSE Arca Rule 8.600-E(d)(2)(B)(ii),
the Adviser will 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 the Fund's portfolio.
The Exchange represents that, for initial and continued listing, the
Fund will be in compliance with Rule 10A-3 \27\ under the Act, as
provided by NYSE Arca Rule 5.3-E. A minimum of 100,000 Shares will be
outstanding at the commencement of trading on the Exchange. The
Exchange will obtain a representation from the issuer of the Shares
that the NAV per Share will be calculated daily and that the NAV and
the Disclosed Portfolio will be made available to all market
participants at the same time. The Fund's investments will be
consistent with its investment goal and will not be used to provide
multiple returns of a benchmark or to produce leveraged returns.
---------------------------------------------------------------------------

    \27\ 17 CFR 240.10A-3.
---------------------------------------------------------------------------

Surveillance
    The Exchange represents that trading in the Shares will be subject
to the existing trading surveillances, administered by FINRA on behalf
of the Exchange, or by regulatory staff of the Exchange, which are
designed to detect violations of Exchange rules and applicable federal
securities laws. The Exchange represents that these procedures are
adequate to properly monitor Exchange trading of the Shares in all
trading sessions and to deter and detect violations of Exchange rules
and federal securities laws applicable to trading on the Exchange.\28\
---------------------------------------------------------------------------

    \28\ FINRA conducts 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.
---------------------------------------------------------------------------

    The surveillances referred to above generally focus on detecting
securities trading outside their normal patterns, which could be
indicative of manipulative or other violative activity. When such
situations are detected, surveillance analysis follows and
investigations are opened, where appropriate, to review the behavior of
all relevant parties for all relevant trading violations.
    The Exchange or FINRA, on behalf of the Exchange, or both, will
communicate as needed regarding trading in the Shares, futures, and
certain listed options with other markets and other entities that are
members of the ISG, and the Exchange or FINRA, on behalf of the
Exchange, or both, may obtain trading information regarding trading in
such securities and financial instruments from such markets and other
entities.\29\ In addition, the Exchange may obtain information
regarding trading in such securities and financial instruments from
markets and other entities that are members of ISG or with which the
Exchange has in place a comprehensive surveillance sharing agreement.
In addition, FINRA, on behalf of the Exchange, is able to access, as
needed, trade information for certain fixed income securities held by
the Fund reported to FINRA's TRACE.
---------------------------------------------------------------------------

    \29\ For a list of the current members of ISG, see
www.isgportal.org. The Exchange notes that not all components of the
Disclosed Portfolio may trade on markets 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.
    All statements and representations made in this filing regarding
(a) the description of the portfolio or reference assets, (b)
limitations on portfolio holdings or reference assets, or (c) the
applicability of Exchange listing rules specified in this rule filing
shall constitute continued listing requirements for listing the Shares
of the Fund on the Exchange.
    The issuer must notify the Exchange of any failure by the Fund to
comply with the continued listing requirements, and, pursuant to its
obligations under Section 19(g)(1) of the Act, the Exchange will
monitor for compliance with the continued listing requirements. If the
Fund is not in compliance with the applicable listing requirements, the
Exchange will commence delisting procedures under NYSE Arca Rule 5.5-E
(m).
Information Bulletin
    Prior to the commencement of trading, the Exchange will inform its
Equity Trading Permit Holders in an Information Bulletin (``Bulletin'')
of the special characteristics and risks associated with trading the
Shares. Specifically, the Bulletin will discuss the following: (1) The
procedures for purchases and redemptions of Shares in Creation Unit
aggregations (and that Shares are not individually redeemable); (2)
NYSE Arca Rule 9.2-E(a), which imposes a duty of due diligence on its
Equity Trading Permit Holders to learn the essential facts relating to
every customer prior to trading the Shares; (3) the risks involved in
trading the Shares during the Early and Late Trading Sessions when an
updated PIV will not be calculated or publicly disseminated; (4) how
information regarding the PIV and the Disclosed Portfolio is
disseminated; (5) the requirement that Equity Trading Permit Holders
deliver a prospectus to investors purchasing newly issued Shares prior
to or concurrently with the confirmation of a transaction; and (6)
trading information.
    In addition, the Bulletin will reference that the Fund is subject
to various fees and expenses described in the Registration Statement.
The Bulletin will discuss any exemptive, no-action, and interpretive
relief granted by the Commission from any rules under the Act. The
Bulletin will also disclose that the NAV for the Shares will be
calculated after 4:00 p.m., Eastern time each trading day.
2. Statutory Basis
    The basis under the Act for this proposed rule change is the
requirement under Section 6(b)(5) \30\ that an exchange have rules that
are designed to prevent fraudulent and manipulative acts and practices,
to promote just and equitable principles of trade, to remove
impediments to, and perfect the mechanism of a free and open market
and, in general, to protect investors and the public interest.
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    \30\ 15 U.S.C. 78f(b)(5).

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    The Exchange believes that the proposed rule change is designed to
prevent fraudulent and manipulative acts and practices in that the
Shares will be listed and traded on the Exchange pursuant to the
initial and continued listing criteria in NYSE Arca Rule 8.600-E. The
Exchange has in place surveillance procedures that are adequate to
properly monitor trading in the Shares in all trading sessions and to
deter and detect violations of Exchange rules and applicable federal
securities laws. The Exchange or FINRA, on behalf of the Exchange, or
both, will communicate as needed regarding trading in the Shares,
futures, and certain listed options with other markets and other
entities that are members of the ISG, and the Exchange or FINRA, on
behalf of the Exchange, or both, may obtain trading information
regarding trading in such securities and financial instruments from
such markets and other entities. In addition, the Exchange may obtain
information regarding trading in such securities and financial
instruments from markets and other entities that are members of ISG or
with which the Exchange has in place a comprehensive surveillance
sharing agreement. In addition, FINRA, on behalf of the Exchange, is
able to access, as needed, trade information for certain fixed income
securities held by the Fund reported to FINRA's TRACE. The Adviser is
not registered as a broker-dealer, but is affiliated with affiliated
with a broker-dealer and has implemented and will maintain a fire wall
with respect to its broker-dealer affiliate regarding access to
information concerning the composition and/or changes to the portfolio.
    The Exchange notes that, other than Commentary .01(b)(1)-(4) (with
respect to Short-Term Fixed Income Securities) and .01(e) (with respect
to OTC Derivatives) to Rule 8.600-E, as described above, the Fund's
portfolio will meet all other requirements of Rule 8.600-E.
    The proposed rule change is designed to promote just and equitable
principles of trade and to protect investors and the public interest in
that the Exchange will obtain a representation from the issuer of the
Shares that the NAV per Share will be calculated daily and that the NAV
and the Disclosed Portfolio will be made available to all market
participants at the same time. In addition, a large amount of
information will be publicly available regarding the Fund and the
Shares, thereby promoting market transparency. Quotation and last sale
information for the Shares will be available via the CTA high-speed
line. Prior to the commencement of trading, the Exchange will inform
its Equity Trading Permit Holders in an Information Bulletin of the
special characteristics and risks associated with trading the Shares.
Trading in Shares of the Fund will be halted if the circuit breaker
parameters in NYSE Arca Rule 7.12-E have been reached or because of
market conditions or for reasons that, in the view of the Exchange,
make trading in the Shares inadvisable. Trading in the Shares will be
subject to NYSE Arca Rule 8.600-E (d)(2)(D), which sets forth
circumstances under which Shares of the Fund may be halted. In
addition, as noted above, investors will have ready access to
information regarding the Fund's holdings, NAV, the PIV, the Disclosed
Portfolio, and quotation and last sale information for the Shares.
    With respect to the Fund's proposed non-compliance with Commentary
.01(b)(1)-(4) (with respect to Short-Term Fixed Income Securities),\31\
Commentary.01(b) include rules intended to ensure that the fixed income
securities included in a fund's portfolio are sufficiently large and
diverse and have sufficient publicly available information regarding
the issuances, the Exchange believes that any concerns related to non-
compliance are mitigated by the types of instruments that the Fund
would hold. The Fund's Short-Term Fixed Income Securities primarily
will include those instruments that are included in the definition of
cash and cash equivalents, but are not considered cash and cash
equivalents because they have maturities of three months or longer.
Short-Term Fixed Income Securities that are cash equivalents under
Commentary .01(c) to Rule 8.600-E (that is, short-term instruments with
maturities of less than three months, as described in Commentary
.01(c)(2)) would comply with Commentary .01(c) and could be held
without limit. The Exchange believes, however, that because all Short-
Term Fixed Income Securities, including non-convertible corporate debt
securities and sovereign obligations, are high-quality instruments and
are highly liquid they are less susceptible than other types of fixed
income instruments both to price manipulation and volatility, and that
the holdings as proposed are generally consistent with the policy
concerns which Commentary .01(b) is intended to address. Because of
these factors, the Exchange believes that the policy concerns that
Commentary .01(b) is intended to address are otherwise mitigated and
that the Fund should be permitted to hold these securities in a manner
that may not comply with Commentary .01(b).
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    \31\ See note 20, supra.
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    With respect to the Fund's proposed non-compliance with the
requirements set forth in Commentary .01(e) (with respect to OTC
Derivatives) to NYSE Arca Rule 8.600-E,\32\ specifically the proposal
that up to 60% of the Fund's assets (calculated as the aggregate gross
notional value) may be invested in OTC Derivatives, the Adviser
believes that it is important to provide the Fund with additional
flexibility to manage risk associated with its investments. Depending
on market conditions, it may be critical that the Fund be able to
utilize available OTC Derivatives to efficiently gain exposure to the
multiple commodities markets that underlie the Reference Benchmark.\33\
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    \32\ See note 21, supra.
    \33\ The Commission has previously approved an exception from
requirements set forth in Commentary .01(e) relating to investments
in OTC derivatives similar to that proposed with respect to the Fund
in Securities Exchange Act Release No. 80657 (May 11, 2017), 82 FR
22702 (May 17, 2017) (SR-NYSEArca-2017-09) (Notice of Filing of
Amendment No. 2 and Order Granting Accelerated Approval of a
Proposed Rule Change, as Modified by Amendment No. 2, Regarding
Investments of the Janus Short Duration Income ETF Listed Under NYSE
Arca Equities Rule 8.600).
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    OTC Derivatives can be tailored to provide specific exposure to the
Fund's Reference Benchmark, allowing the Fund to more efficiently meet
its investment objective. For example, the Reference Benchmark is
composed of 22 futures contracts across 20 physical commodities, which
may not be sufficiently liquid and would not provide the commodity
exposure the Fund requires to meet its investment objective if the Fund
were to invest in the futures directly. A total return swap can be
structured to provide exposure to the same futures contracts as exist
in the Reference Benchmark, while providing sufficient efficiency to
allow the Fund to more easily meet its investment objective.
    In addition, if the Fund were to gain commodity exposure
exclusively through the use of listed futures, the Fund's holdings in
Listed Derivatives would be subject to position limits and
accountability levels established by an exchange. Such limitations
would restrict the Fund's ability to gain efficient exposure to the
commodities in the Reference Benchmark, thereby impeding the Fund's
ability to satisfy its investment objective.
    The Adviser represents that the basket or index on which much of
the Fund's OTC Derivatives will be based will satisfy the criteria
applicable to holdings in Listed Derivatives in Commentary .01(d)(2) on
an initial and

continued listing basis.\34\ With respect to the Fund's holdings in OTC
Derivatives, the aggregate gross notional value of OTC Derivatives
based on any five or fewer underlying reference assets will not exceed
65% of the weight of the portfolio (including gross notional
exposures), and the aggregate gross notional value of OTC Derivatives
based on any single underlying reference asset will not exceed 30% of
the weight of the portfolio (including gross notional exposures).
Futures on all commodities in the Reference Benchmark are traded on
futures exchanges that are members of the ISG.
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    \34\ See note 22, supra.
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    The Adviser represents that it is in the best interests of the
Fund's shareholders for the Fund to be allowed to reduce commodities-
related risks arising from the Fund's investments using the most
efficient financial instruments. While certain risks can be hedged via
Listed Derivatives, OTC Derivatives can be customized to hedge against
precise risks. Accordingly, the Adviser believes that OTC Derivatives
may frequently be a more efficient hedging vehicle than Listed
Derivatives. Depending on market conditions, it may be critical that
the Fund be able to utilize available OTC Derivatives for this purpose
to gain exposure to the commodities in the Reference Benchmark in an
efficient manner. Therefore, the Exchange believes that increasing the
percentage limit in Commentary .01(e) (with respect to OTC
Derivatives), as described above, to the Fund's investments in OTC
Derivatives would help protect investors and the public interest.
    The proposed rule change is designed to perfect the mechanism of a
free and open market and, in general, to protect investors and the
public interest in that it will facilitate the listing and trading of
an actively-managed exchange-traded product that, through permitted use
of an increased level of OTC derivatives above that currently permitted
by the generic listing requirements of Commentary .01 to NYSE Arca Rule
8.600-E, will enhance competition among market participants, to the
benefit of investors and the marketplace. As noted above, the Exchange
has in place surveillance procedures relating to trading in the Shares
and may obtain information via ISG from other exchanges that are
members of ISG or with which the Exchange has entered into a
comprehensive surveillance sharing agreement. In addition, as noted
above, investors have ready access to information regarding the Fund's
holdings, the PIV, the Disclosed Portfolio, and quotation and last sale
information for the Shares.

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 actively-managed exchange-traded product that will
enhance competition among market participants, to the benefit of
investors and the marketplace.

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

    No written comments were solicited or received with respect to the
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action

    Within 45 days of the date of publication of this notice in the
Federal Register or up to 90 days (i) as the Commission may designate
if it finds such longer period to be appropriate and publishes its
reasons for so finding or (ii) as to which the self-regulatory
organization consents, the Commission will:
    (A) By order approve or disapprove the proposed rule change, or
    (B) institute proceedings to determine whether the proposed rule
change should be disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:

Electronic Comments

     Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to<EMAIL_ADDRESS>Please include
File Number SR-NYSEArca-2018-83 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.

All submissions should refer to File Number SR-NYSEArca-2018-83. 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-NYSEArca-2018-83 and should be submitted
on or before January 22, 2019.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\35\
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    \35\ 17 CFR 200.30-3(a)(12).
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Brent J. Fields,
Secretary.
[FR Doc. 2018-28393 Filed 12-28-18; 8:45 am]
 BILLING CODE 8011-01-P