[Federal Register Volume 77, Number 27 (Thursday, February 9, 2012)]
[Notices]
[Pages 6831-6833]
[FR Doc No: 2012-3000]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-66322; File No. SR-NASDAQ-2012-020]

Self-Regulatory Organizations; The NASDAQ Stock Market LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Modify NASDAQ's Transaction Execution Fee and Credit Schedule in Rules
7014 and 7018

February 3, 2012.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on January 27, 2012, The NASDAQ Stock Market LLC (``NASDAQ'' or
``Exchange''), 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 Exchange. 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\ 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

    NASDAQ is proposing to modify NASDAQ's transaction execution fee
and credit schedule in Rules 7014 and 7018. NASDAQ will implement the
proposed change on February 1, 2012. The text of the proposed rule
change is available at http://nasdaq.cchwallstreet.com/, at NASDAQ's
principal office, 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 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 aspects of such
statements.

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

1. Purpose
    NASDAQ is amending its fee and credit schedule for transaction
executions in Rules 7014 and 7018. First, NASDAQ is amending the rebate
associated with its recently introduced ``Pre-Market Investor Program''
(the ``PMI Program''). The goal of the PMI Program is to encourage the
development of a deeper, more liquid trading book during pre-market
hours, while also recognizing the correlation observed by NASDAQ
between levels of liquidity provided during pre-market hours and levels
provided during regular trading hours. Under the program, a member is
required to designate one or more market participant identifiers
(``MPIDs'') for use under the program. The member will then qualify for
an extra rebate with respect to all displayed liquidity provided
through a designated MPID that executes at a price of $1 or more during
the month if the following conditions are met:
    (1) The MPID's ``PMI Execution Ratio'' for the month is less than
10. The PMI Execution Ratio is defined as the ratio of (A) the total
number of liquidity-providing orders entered by a member through a PMI-
designated MPID during the specified time period to (B) the number of
liquidity-providing orders entered by such member through such PMI-
designated MPID and executed (in full or partially) in the Nasdaq
Market Center during such time period; provided that: (i) No order
shall be counted as executed more than once; and (ii) no Pegged Orders,
odd-lot orders, or MIOC or SIOC \3\ orders shall be included in the
tabulation. Thus, the requirement stipulates that a high proportion of
potentially liquidity-providing orders entered through the MPID
actually execute and provide liquidity. This requirement is designed to
focus the availability of the program on members representing retail
and institutional customers.
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    \3\ ``Market Hours Immediate-or-Cancel'' or ``System Hours
Immediate-or-Cancel'' orders.
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    (2) The member provides an average daily volume of 2 million or
more shares of liquidity during the month using orders that are
executed prior to NASDAQ's Opening Cross. NASDAQ has observed that
members that provide higher volumes of liquidity-providing orders
during the pre-market hours generally do so throughout the rest of the
trading day. Accordingly, the PMI pays a credit with respect to all
liquidity-providing orders, but only in the event that comparatively
large volumes of such orders execute in pre-market hours.
    (3) The ratio between shares of liquidity provided through the MPID
and total shares accessed, provided, or routed through the MPID during
the month is at least 0.80. This requirement reflects the PMI's goal of
encouraging members that provide high levels of liquidity in pre-market
hours to also do so during the rest of the trading day.
    Under the proposed change, NASDAQ is raising the extra rebate under
the program from $0.0001 per share executed to $0.0002 per share
executed. As is currently the case, the rebate is paid with respect to
all displayed liquidity provided through a designated MPID that
executes at a price of $1 or more during the month. NASDAQ is making
the change to encourage more market participants to join the program.

    Second, NASDAQ is amending Rule 7018(a)(3) \4\ to introduce volume
tiers with respect to its fees for the execution of orders that access
liquidity in securities listed on exchanges other than NASDAQ and the
New York Stock Exchange (``Tape B Securities''). Currently, NASDAQ
charges $0.0030 per share executed for execution of all orders that
access liquidity in Tape B Securities, with the exception of orders
that are designated to use the SAVE or SOLV routing strategies but that
execute at NASDAQ (either before or after routing), which are charged
$0.0027 per share executed. Under the proposed change, if a member
enters an order through a Nasdaq Market Center market participant
identifier (``MPID'') through which the member (i) accesses shares of
liquidity in Tape B Securities that represent more than 0.5% of
Consolidated Volume \5\ in Tape B Securities during the month, and (ii)
provides shares of liquidity in Tape B Securities that represent more
than 0.25% of Consolidated Volume in Tape B Securities during the
month, the charge will be $0.0028 per share executed with respect to
such an order. Similarly, if a member enters an order through a NASDAQ
Market Center MPID through which the member (i) accesses shares of
liquidity in Tape B Securities that represent more than 1.5% of
Consolidated Volume in Tape B Securities during the month, and (ii)
provides shares of liquidity in Tape B Securities that represent more
than 0.5% of Consolidated Volume in Tape B Securities during the month,
the charge will be $0.0027 per share executed with respect to such an
order.\6\ The change is designed to encourage greater use of NASDAQ's
facilities for the purpose of trading Tape B Securities. In this
regard, NASDAQ notes that NYSEArca currently charges a fee to access
liquidity in Tape B Securities of $0.0028 per share executed, but a fee
to access liquidity in other securities of $0.0030 per share
executed.\7\ Accordingly, the change will enhance NASDAQ's ability to
compete for orders in Tape B Securities. NASDAQ further notes that, as
is the case with other portions of its fee schedule, the change is
designed to ensure that NASDAQ's fee schedule does not provide
excessive encouragement to members to aggregate the activity of several
member firms under a single MPID for the sole purpose of receiving more
favorable pricing. Accordingly, the proposed volume tiers are available
only to the extent that a member achieves them through a single MPID.
NASDAQ believes that this requirement promotes market quality by
providing more favorable pricing to members that engage in unified
management of high volumes of quotes/orders through a single MPID,
while discouraging sponsored relationships that are established solely
for pricing benefits.\8\
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    \4\ Rule 7018(a) applies to executions of transactions at a
price of $1 or more. Fees for transactions at a price below $1
remain unchanged.
    \5\ For purposes of Rule 7018, Rule 7018(a)(1) defines
``Consolidated Volume'' as the total consolidated volume reported to
all consolidated transaction reporting plans by all exchanges and
trade reporting facilities.
    \6\ The change would not alter pricing with respect to SAVE and
SOLV orders. Thus, a member qualifying for the $0.0028 tier with
respect to orders entered through a qualifying MPID would
nevertheless pay $0.0027 per share executed with respect to all SAVE
and SOLV orders.
    \7\ See http://usequities.nyx.com/markets/nyse-arca-equities/trading-fees.
    \8\ See Securities Exchange Act Release No. 64003 (March 2,
2011), 76 FR 12784 (March 8, 2011) (SR-NASDAQ-2011-028) (proposed
rule change that first established single-MPID pricing requirements
on NASDAQ).
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2. Statutory Basis
    NASDAQ believes that the proposed rule change is consistent with
the provisions of Section 6 of the Act,\9\ in general, and with
Sections 6(b)(4) and (5) of the Act,\10\ in particular, in that it
provides for the equitable allocation of reasonable dues, fees and
other charges among members and issuers and other persons using any
facility or system which NASDAQ operates or controls, and is not
designed to permit unfair discrimination between customers, issuers,
brokers or dealers. All similarly situated members are subject to the
same fee structure, and access to NASDAQ is offered on fair and non-
discriminatory terms.
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    \9\ 15 U.S.C. 78f.
    \10\ 15 U.S.C. 78f(b)(4) and (5).
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    The proposed new tiers for members that use NASDAQ to trade
significant amounts of Tape B Securities are reasonable because they
will result in a fee reduction for members that qualify for the tiers,
but will not increase the costs borne by other members or limit the
availability of other, pre-existing pricing incentives. Moreover, the
proposed change is consistent with an equitable allocation of fees
because it charges lower fees for executing Tape B Securities to
members that make significant contributions to NASDAQ market quality
and price discovery by accessing and providing high volumes of
liquidity in Tape B Securities. NASDAQ believes that the change is not
unfairly discriminatory because the price reduction offered to
qualifying members is linked to the volume of trading in the securities
to which the discount applies. NASDAQ further believes that the program
may encourage members to become more active in trading Tape B
Securities through NASDAQ, thereby benefitting other market
participants that may be able to trade larger volumes of stocks without
affecting the price of those stocks. Finally, NASDAQ believes that it
is reasonable, equitable, and not unfairly discriminatory to stipulate
that members qualifying for the pricing tiers must achieve the
requisite volume thresholds through a single MPID, thereby enhancing
market quality through unified management of the member's quotes/orders
and discouraging aggregation arrangements that exist solely for pricing
reasons. NASDAQ believes that firms that engage in more unified
management of their quotes and orders are most likely to promote price
discovery and market stability.\11\
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    \11\ See also Securities Exchange Act Release No. 64003 (March
8, 2011), 76 FR 12784 (March 8, 2011) (SR-NASDAQ-2011-028).
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    As described in the filing that instituted it,\12\ the PMI program
is not unfairly discriminatory because it is intended to promote
submission of liquidity-providing orders to NASDAQ, which benefits all
NASDAQ members and all investors. Likewise, the PMI is consistent with
the Act's requirement for the equitable allocation of reasonable dues,
fees, and other charges. Members who choose to significantly increase
the volume of PMI-eligible liquidity-providing orders that they submit
to NASDAQ would be benefitting all investors, and therefore providing
credits to them, as contemplated in the PMI program, is equitable.
Moreover, NASDAQ believes that the level of the credit to be offered
under the proposed change--$0.0002 per share, in addition to credits
ranging from $0.0020 to $0.00295 per share under NASDAQ's regular
transaction execution fee and rebate schedule for execution of
displayed quotes/orders--is reasonable, in that it provides a reduction
of fees to members qualifying for the program.
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    \12\ Securities Exchange Act Release No. 65717 (November 9,
2011), 76 FR 70784 (November 15, 2011) (SR-NASDAQ-2011-150).
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    Finally, NASDAQ notes that it operates in a highly competitive
market in which market participants can readily favor competing venues
if they deem fee levels at a particular venue to be excessive. In such
an environment, NASDAQ must continually adjust its fees to remain
competitive with other exchanges and with alternative trading systems
that have been exempted from compliance with the statutory standards
applicable to exchanges. NASDAQ

believes that the proposed rule change reflects this competitive
environment because it will reduce fees paid by active market
participants, without removing any of the market's existing pricing
incentives.

B. Self-Regulatory Organization's Statement on Burden on Competition

    NASDAQ does not believe that the proposed rule change will result
in any burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act, as amended. Because the market
for order execution is extremely competitive, members may readily opt
to disfavor NASDAQ's execution services if they believe that
alternatives offer them better value. The proposed changes will enhance
competition by reducing certain of NASDAQ's fees. Notably, the proposed
pricing tiers for Tape B Securities will enhance NASDAQ's ability to
compete with NYSEArca, which currently offers reduced fees to access
liquidity in Tape B Securities.\13\ Similarly, the change to the PMI
Program will enhance competition with the EDGX Exchange, which
encourages participation in its pre-market and post-market trading
sessions by means of favorable pricing offered to members that are
active during pre-market and/or post-market hours.\14\
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    \13\ http://usequities.nyx.com/markets/nyse-arca-equities/trading-fees.
    \14\ http://www.directedge.com/Membership/FeeSchedule/EDGXFeeSchedule.aspx.
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C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others

    Written comments were neither solicited nor received.

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

    The foregoing rule change has become effective pursuant to Section
19(b)(3)(A)(ii) of the Act \15\ and subparagraph (f)(2) of Rule 19b-4
thereunder.\16\ At any time within 60 days of the filing of the
proposed rule change, the Commission summarily may temporarily suspend
such rule change if it appears to the Commission that such action is
necessary or appropriate in the public interest, for the protection of
investors, or otherwise in furtherance of the purposes of the Act. If
the Commission takes such action, the Commission shall institute
proceedings to determine whether the proposed rule should be approved
or disapproved.
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    \15\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \16\ 17 CFR 240.19b-4(f)(2).
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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-NASDAQ-2012-020 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-NASDAQ-2012-020. 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 Web site (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 Web site 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
a.m. and 3 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; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File Number SR-NASDAQ-2012-020 and should
be submitted on or before March 1, 2012.
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    \17\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\17\
Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-3000 Filed 2-8-12; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 84, Number 250 (Tuesday, December 31, 2019)]
[Notices]
[Pages 72347-72348]
[FR Doc No: 2019-28255]

=======================================================================
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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Docket No. ER20-660-000]

Supplemental Notice That Initial Market-Based Rate Filing
Includes Request for Blanket Section 204 Authorization; Bolt Energy
Marketing, LLC

    This is a supplemental notice in the above-referenced proceeding of
Bolt Energy Marketing, LLC's application for market-based rate
authority, with an accompanying rate tariff, noting that such
application includes a request for blanket authorization, under 18 CFR
part 34, of future issuances of securities and assumptions of
liability.
    Any person desiring to intervene or to protest should file with the
Federal Energy Regulatory Commission, 888 First Street NE, Washington,
DC 20426, in accordance with Rules 211 and 214 of the Commission's
Rules of Practice and Procedure (18 CFR 385.211 and 385.214). Anyone
filing a motion to intervene or protest must serve a copy of that
document on the Applicant.
    Notice is hereby given that the deadline for filing protests with
regard to the applicant's request for blanket authorization, under 18
CFR part 34, of future issuances of securities and assumptions of
liability, is January 13, 2020.
    The Commission encourages electronic submission of protests and
interventions in lieu of paper, using the FERC Online links at http://www.ferc.gov. To facilitate electronic service, persons with internet
access who will eFile a document and/or be listed as a contact for an
intervenor must create and validate an eRegistration account using the
eRegistration link. Select the eFiling link to log on and submit the
intervention or protests.
    Persons unable to file electronically should submit an original and
5 copies of the intervention or protest to the Federal Energy
Regulatory Commission, 888 First Street NE, Washington, DC 20426.
    The filings in the above-referenced proceeding are accessible in
the Commission's eLibrary system by clicking on the appropriate link in
the above list. They are also available for electronic review in the
Commission's Public Reference Room in Washington, DC. There is an
eSubscription link on the website that enables subscribers to receive
email notification when a document is added to a subscribed docket(s).
For assistance with any FERC

Online service, please email<EMAIL_ADDRESS>or call (866)
208-3676 (toll free). For TTY, call<PHONE_NUMBER>.

    Dated: December 23, 2019.
Nathaniel J. Davis, Sr.,
Deputy Secretary.
[FR Doc. 2019-28255 Filed 12-30-19; 8:45 am]
 BILLING CODE 6717-01-P


[Federal Register Volume 82, Number 209 (Tuesday, October 31, 2017)]
[Notices]
[Pages 50461-50468]
[FR Doc No: 2017-23582]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-81944; File No. SR-NYSEArca-2017-99]

Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing
of Proposed Rule Change To List and Trade Shares of the Hartford
Schroders Tax-Aware Bond ETF Under NYSE Arca Rule 8.600-E

October 25, 2017.
    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 October 11, 2017, NYSE Arca, Inc. (``Exchange'' or ``NYSE
Arca'') filed with the Securities and Exchange Commission
(``Commission'') the proposed rule change as described in Items I and
II below, which Items have been prepared by the self-regulatory
organization. The Commission is publishing this notice to solicit
comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange proposes to list and trade shares of the Hartford
Schroders Tax-Aware Bond ETF under NYSE Arca Rule 8.600-E (``Managed
Fund Shares''). The proposed rule change is available on the Exchange's
Web site 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 to list and trade shares (``Shares'') of the
Hartford Schroders Tax-Aware Bond ETF (``Fund'') under NYSE Arca Rule
8.600-E, which governs the listing and trading of Managed Fund
Shares.\4\ The Shares will be offered by the Hartford Funds Exchange-
Traded 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.
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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.
    \5\ The Trust is registered under the 1940 Act. On June 26,
2017, the Trust filed with the Commission its registration statement
on Form N-1A under the Securities Act of 1933 (15 U.S.C. 77a)
(``Securities Act''), and under the 1940 Act relating to the Funds
[sic] (File Nos. 333-215165 and 811-23222) (``Registration
Statement''). The description of the operation of the Trust and the
Funds [sic] herein is based, in part, on the Registration Statement.
In addition, the Commission has issued an order granting certain
exemptive relief to the Trust under the 1940 Act. See Investment
Company Act Release No. 32454 (January 27, 2017) (File No. 812-
13828-01) (``Exemptive Order'').
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    Hartford Funds Management Company, LLC (``HFMC'' or ``Manager'')
will be the investment manager to the Fund. ALPS Distributors, Inc.
(``ALPS'' or the ``Distributor'') will be the principal underwriter to
the Fund. HFMC is an indirect subsidiary of The Hartford Financial
Services Group, Inc. Schroder Investment Management North America Inc.
(``Sub-Adviser'') will be the sub-adviser to the Fund and performs the
daily investment of the assets 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 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.\6\ 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. Neither the
Manager nor Sub-Adviser is registered as a broker-dealer but each is
affiliated with a broker-dealer. The Manager and Sub-Adviser each has
implemented and will maintain a ``fire wall'' with respect to such
broker-dealer affiliate regarding access to information concerning the
composition of and/or changes to the Fund's portfolio.\7\ In the event
(a) the Manager or Sub-Adviser becomes registered as a broker-dealer or
newly affiliated with a broker-dealer, or (b) any new adviser or sub-
adviser to the Fund is a registered broker-dealer or becomes affiliated
with a broker-dealer, the applicable adviser or sub-adviser will
implement and maintain a ``fire wall'' with respect to its relevant
personnel or broker-dealer affiliate regarding access to information
concerning the composition and/or changes to the Fund's portfolio.
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    \6\ 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 Manager and Sub-Adviser and their 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.
    \7\ While the Sub-Adviser is not registered as a broker-dealer,
it has a wholly-owned broker-dealer subsidiary. This broker-dealer
is limited purpose and exists solely to serve as the distributor of
pooled investment vehicles for which the Sub-Adviser acts as an
investment adviser. This broker-dealer does not execute securities
transactions or accept customer funds. For purposes of this filing,
the term ``firewall'' shall mean that personnel of such broker-
dealer are subject to procedures designed to prevent the use and
dissemination of material non-public information, including
information regarding the Fund's portfolio.
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Hartford Schroders Tax-Aware Bond ETF
Principal Investments
    According to the Registration Statement, the Fund will seek total
return on an after-tax basis. The Fund will seek to achieve its
investment objective by investing in a diversified portfolio of fixed
income debt instruments of varying maturities. Under normal market
conditions,\8\ the Fund will invest principally (that is, more than 50%
of its assets) in the U.S. dollar-denominated, fixed income debt
instruments described below.
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    \8\ The term ``normal market conditions'' is defined in NYSE
Arca Rule 8.600-E(c)(5).
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    The fixed income debt instruments in which the Fund may invest as
part of its principal investment strategy are securities issued or
guaranteed by the U.S. government and its agencies, government-
sponsored enterprise securities, corporate bonds, agency mortgage-
backed securities (including ``to be announced'' or ``TBA''
transactions), agency asset-backed securities (``ABS''), ``Municipal
Securities'' (as described below), sovereign debt and debt securities
issued by supranational organizations. They may pay fixed, variable, or
floating interest rates. The Fund may invest in U.S. dollar denominated
foreign securities. The Fund may also invest in cash and cash
equivalents.\9\
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    \9\ For purposes of this filing, cash equivalents are money
market funds and the following short-term instruments with
maturities of less than three months: (i) Certificates of deposit
issued against funds deposited in a bank or savings and loan
association; (ii) bankers' acceptances, which are short-term credit
instruments used to finance commercial transactions; (iii) U.S.
Government obligations or corporate debt obligations (including
those subject to repurchase agreements); (iv) bank time deposits;
and (v) commercial paper.
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    According to the Registration Statement, in seeking to achieve the
Fund's investment objective, the Sub-Adviser will employ a tax-aware
investing strategy that attempts to realize total return for
shareholders, primarily in the form of current income and price
appreciation, by balancing investment considerations and tax
considerations.
    According to the Registration Statement, the Fund may invest in the
following Municipal Securities: General obligation bonds; revenue (or
limited obligation) bonds; private activity (or industrial development)
bonds; bonds that are collateralized with agency and/or treasury
securities, municipal notes; municipal lease obligations; and municipal
inverse floaters.\10\ The Fund's investments in Municipal Securities
will be diversified among issuers in at least 10 states and U.S.
territories. The Fund may invest up to 40% of the Fund's total assets
in Municipal Securities of issuers in each of California, New York and
Texas. The Fund will limit its investments in Municipal Securities of
any one state (except California, New York and Texas) or U.S. territory
to 25% of the Fund's total assets.
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    \10\ Municipal inverse floaters are a type of inverse floater in
which a municipal bond is deposited with a special purpose vehicle
(SPV), which issues, in return, the municipal inverse floater (which
is comprised of a residual interest in the cash flows and assets of
the SPV) plus proceeds from the issuance by the SPV of floating rate
certificates to third parties.
---------------------------------------------------------------------------

    The Fund may hold restricted securities, which are securities that
cannot be offered for public resale unless registered under the
applicable securities laws or that have a contractual restriction that
prohibits or limits their resale. Restricted securities include private
placement securities that have not been registered under the applicable
securities laws, such as Rule 144A securities, and securities of U.S.
and non-U.S. issuers that are issued pursuant to Regulation S.
Other Investments
    While the Fund, under normal market conditions, will invest
principally in the securities and financial instruments described
above, the Fund may invest its remaining assets in the securities and
financial instruments described below.
    The Fund may invest in non-agency ABS, which are securities backed
by a pool of some underlying asset, including but not limited to home
equity loans, installment sale contracts, credit card receivables or
other assets.
    The Fund may invest in collateralized debt obligations (``CDOs''),
which include collateralized bond obligations (``CBOs''),
collateralized loan obligations (``CLOs'') and other similarly
structured securities.
    The Fund may invest in non-agency mortgage-related securities.
    The Fund may invest in the securities of other registered
investment companies, including exchange-traded funds (``ETFs'').\11\
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    \11\ For purposes of this filing, ETFs include Investment
Company Units (as described in NYSE Arca Rule 5.2-E(j)(3));
Portfolio Depositary Receipts (as described in NYSE Arca Rule 8.100-
E); and Managed Fund Shares (as described in NYSE Arca Rule 8.600-
E). The ETFs all will be listed and traded in the U.S. on registered
exchanges. The Fund will not invest in inverse or leveraged (e.g.,
+2x, -2X) index ETFs.
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    The Fund may engage actively in transactions in derivatives
(futures, options, swaps and forward rate agreements), as described
below. The Fund will normally use derivatives to supplement the
effective management of its duration profile, to gain exposure to
particular securities or markets, in connection with hedging
transactions, or for purposes of efficient portfolio management,
including managing cash flows or as part of the Fund's risk management
process.
    The Fund may invest in U.S and foreign exchange-traded and over-the
counter (``OTC'') put and call options. The Fund may engage in options
transactions on any security, index or instrument in which it may
invest.

    The Fund may invest in U.S and foreign exchange-traded and OTC
currency options.
    The Fund may invest in U.S. and foreign exchange-traded futures
contracts and options on futures contracts with respect to equity and
debt securities, foreign currencies, aggregates of equity and debt
securities (aggregates are composites of equity or debt securities that
are not tied to a commonly known index), interest rates, indices,
commodities and other financial instruments.
    The Fund may enter into commodity swaps, total return swaps,
currency swaps, credit default swaps, asset swaps, inflation swaps,
event-linked swaps, interest rate swaps, swaps on specific securities
or indices, swaps on rates (such as mortgage prepayment rates),
municipal credit default swaps, municipal market data derivatives rate
locks, caps, collars, and floors. The Fund may also enter into options
on swap agreements (``swaptions''). The Fund may also invest in the Dow
Jones CDX (``CDX''), which is a family of indices that track credit
derivative indices in various countries around the world. Swaps and
swaptions can be both exchange traded and OTC.
    The Fund may enter into forward rate agreements.
    The Fund may invest in inflation-protected debt securities.
    The Fund may invest in OTC and exchange-traded convertible and
nonconvertible preferred stock.
    The Fund may invest in when-issued and delayed delivery securities
and forward commitments.
Disclosure of Portfolio Holdings
    On each day the NYSE Arca is open (a ``Business Day''), before
commencement of trading in Shares on the Exchange, HFMC will disclose
the Fund's iNAV Basket.\12\ Additionally, on each Business Day, before
commencement of trading in Shares on the Exchange, the Fund will
disclose on its Web site the identities and quantities of the Fund's
portfolio holdings that will form the basis for the Fund's calculation
of NAV at the end of the Business Day.
---------------------------------------------------------------------------

    \12\ An iNAV will be based on the current market value of the
Fund's portfolio holdings that will form the basis for the Fund's
calculation of NAV at the end of the Business Day, as disclosed on
the Fund's Web site prior to that Business Day's commencement of
trading (the ``iNAV Basket'').
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Creation and Redemption of Shares
    According to the Registration Statement, the Trust will issue and
sell Shares of the Fund only in Creation Units at the NAV next
determined after receipt of an order in proper form on any Business
Day. The number of Shares of the Fund that will constitute a Creation
Unit is 50,000. The size of a Creation Unit is subject to change.
Creation of Shares
    The consideration for purchase of Creation Units will generally
consist of ``Deposit Securities'' and the ``Cash Component'', which
will generally correspond pro rata, to the extent practicable, to the
Fund's securities, or, as permitted or required by the Fund, of cash.
Together, the Deposit Securities and Cash Component constitute the
``Fund Deposit,'' which represents the minimum initial and subsequent
investment amount for a Creation Unit of the Fund. Creation Units of
Shares of the Fund may be issued partially for cash.
    The Transfer Agent, through the National Securities Clearing
Corporation (``NSCC''), will make available on each Business Day, prior
to the Core Trading Session (subject to amendments) on the Exchange
(currently 9:30 a.m., Eastern time), the identity and the required
number of each Deposit Security and the amount of the Cash Component to
be included in the current Fund Deposit (based on information at the
end of the previous Business Day).
    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 NSCC (the
``Clearing Process''); or (ii) a participant of Depository Trust
Company (``DTC'') (``DTC Participant'') and must have executed an
agreement with the Distributor (and accepted by the Transfer Agent),
with respect to creations and redemptions of Creation Units
(``Participant Agreement'') (discussed below). A Participating Party or
DTC Participant who has executed a Participant Agreement is referred to
as an ``Authorized Participant.''
    Except as described below, and in all cases subject to the terms of
the applicable Participant Agreement, all orders to create Creation
Units of the Fund must be received by the Transfer Agent no later than
1:00 p.m., Eastern time) in each case on the date such order is placed
for creation of Creation Units to be effected based on the NAV of
shares of the Fund as next determined after receipt of an order in
proper form. Orders requesting substitution of a ``cash-in-lieu''
amount or a cash creation, must be received by the Transfer Agent no
later than 1:00 p.m., Eastern time. The date on which an order to
create Creation Units (or an order to redeem Creation Units, as
discussed below) is placed is referred to as the ``Transmittal Date''.
    Fund Deposits created through the Clearing Process, if available,
must be delivered through a Participating Party that has executed a
Participant Agreement.
    The Participant Agreement authorizes the Transfer Agent to transmit
to NSCC on behalf of the Participating Party such trade instructions as
are necessary to effect the Participating Party's creation order.
Pursuant to such trade instructions from the Transfer Agent to NSCC,
the Participating Party agrees to transfer the requisite Deposit
Securities (or contracts to purchase such Deposit Securities that are
expected to be delivered in a ``regular way'' manner by the second
Business Day) and the Cash Component to the Trust, together with such
additional information as may be required by the Transfer Agent and the
Distributor as set forth in the Participant Agreement. An order to
create Creation Units of the Fund through the Clearing Process is
deemed received by the Transfer Agent on the Transmittal Date if (i)
such order is received by the Transfer Agent not later than the Order
Cutoff Time on such Transmittal Date and (ii) all other procedures set
forth in the Participant Agreement are properly followed.
    Fund Deposits created outside the Clearing Process must be
delivered through a DTC Participant that has executed a Participant
Agreement.
Redemption of Shares
    Shares may be redeemed only in Creation Units at their NAV next
determined after receipt of a redemption request in proper form on a
Business Day and only through a Participating Party or DTC Participant
who has executed a Participant Agreement.
    With respect to the Fund, the Transfer Agent, through the NSCC,
makes available immediately prior to the opening of business on the
Exchange (currently 9:30 a.m., Eastern time) on each Business Day, the
identity of the Fund's securities and/or an amount of cash that will be
applicable (subject to possible amendment or correction) to redemption
requests received in proper form (as described below) on that day. All
orders are subject to acceptance by the Distributor. The Fund's
securities received on redemption will generally correspond pro rata,
to the extent practicable, to the Fund's securities. The Fund's
securities received on redemption (``Fund Securities'') may not be
identical to Deposit Securities that

are applicable to creations of Creation Units.
    Unless cash only redemptions are available or specified for the
Fund, the redemption proceeds for a Creation Unit will generally
consist of Fund Securities--as announced on the Business Day of the
request for a redemption order received in proper form--plus cash in an
amount equal to the difference between the NAV of the Shares being
redeemed, as next determined after a receipt of a request in proper
form, and the value of the Fund Securities, less the redemption
transaction fee and variable fees described below. Notwithstanding the
foregoing, the Trust will substitute a ``cash-in-lieu'' amount to
replace any Fund Security that is a non-deliverable instrument.
    Orders to redeem Creation Units of the Fund through the Clearing
Process, if available, must be delivered through a Participating Party
that has executed the Participant Agreement. An order to redeem
Creation Units of the Fund through the Clearing Process will be deemed
received by the Transfer Agent on the Transmittal Date if such order is
received by the Transfer Agent not later than 1:00 p.m. Eastern time on
such Transmittal Date and other applicable procedures are properly
followed.
    Orders to redeem Creation Units of the Fund outside the Clearing
Process must be delivered through a DTC Participant that has executed
the Participant Agreement. An order to redeem Creation Units of the
Fund outside the Clearing Process will be deemed received by the
Transfer Agent on the Transmittal Date if such order is received by the
Transfer Agent not later than 1:00 p.m. Eastern time on such
Transmittal Date and other applicable procedures are properly followed.
Availability of Information
    The Fund will disclose on the Fund's Web site
(www.hartfordfunds.com) at the start of each Business Day the
identities and quantities of the securities and other assets held by
the Fund that will form the basis of the Fund's calculation of its NAV
on that Business Day. The portfolio holdings so disclosed will be based
on information as of the close of business on the prior Business Day
and/or trades that have been completed prior to the opening of business
on that Business Day and that are expected to settle on the Business
Day.
    The Web site for the Fund will contain the following information,
on a per-Share basis, for the Fund: (1) The prior Business Day's NAV;
(2) the reported midpoint of the bid-ask spread at the time of NAV
calculation (the ``Bid-Ask Price''); (3) a calculation of the premium
or discount of the Bid-Ask Price against such NAV; and (4) data in
chart format displaying the frequency distribution of discounts and
premiums of the Bid-Ask Price against the NAV, within appropriate
ranges, for each of the four previous calendar quarters (or for the
life of the Fund if, shorter).
    The Fund's portfolio holdings will be disclosed on the Fund's Web
site daily after the close of trading on the Exchange and prior to the
opening of trading on the Exchange the following day. 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 Fund's prospectus and
Statement of Additional Information (``SAI'') will be available on the
Fund's Web site. The Web site information will be publicly available at
no charge.
    Investors can also obtain the Fund's SAI, shareholder reports, Form
N-CSR and Form 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 and Form N-SAR may be viewed on-
screen or downloaded from the Commission's Web site at www.sec.gov.
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 publicly available and will be
published daily in the financial section of newspapers.
    Quotation and last sale information for the Shares and ETFs will be
available via the Consolidated Tape Association (``CTA'') high-speed
line, and from the national securities exchanges on which they are
listed.
    Quotation information from brokers and dealers or pricing services
will be available for Municipal Securities. Price information for money
market funds will be available from the applicable investment company's
Web site and from market data vendors. Pricing information regarding
each asset class in which the Fund will invest will generally be
available through nationally recognized data service providers through
subscription agreements. In addition, the iNAV (which is the Portfolio
Indicative Value, as defined in NYSE Arca Rule 8.600-E(c)(3)), will be
widely disseminated at least every 15 seconds during the Core Trading
Session by one or more major market data vendors or other information
providers.\13\ One source of price information for municipal securities
is the Electronic Municipal Market Access (``EMMA''), which is
administered by the Municipal Securities Rulemaking Board.
---------------------------------------------------------------------------

    \13\ Currently, it is the Exchange's understanding that several
major market data vendors display and/or make widely available
Portfolio Indicative Values taken from CTA or other data feeds.
---------------------------------------------------------------------------

Investment Restrictions
    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.
    With respect to the Fund's investments in Municipal Securities,
under normal market conditions, except for periods of high cash inflows
or outflows, the Fund will satisfy the following criteria:
    i. The Fund will have a minimum of 20 non-affiliated issuers;
    ii. No single Municipal Securities issuer will account for more
than 10% of the weight of the Fund's portfolio; \14\
---------------------------------------------------------------------------

    \14\ The Exchange notes that the Commission has approved the
listing and trading of another issue of Managed Fund Shares that
principally holds municipal securities for which no single issuer
would account for more than 10% of the weight of the fund's
portfolio. See Securities Exchange Act Release No. 79293 (November
10, 2016), 81 FR 81189 (November 17, 2016) (SR-NYSEArca-2016-107)
(order approving listing and trading of shares of Cumberland
Municipal Bond ETF under Rule 8.600).
---------------------------------------------------------------------------

    iii. No individual bond will account for more than 5% of the weight
of the Fund's portfolio; \15\
---------------------------------------------------------------------------

    \15\ The Exchange notes that the Commission has approved the
listing and trading of another issue of Managed Fund Shares that
principally holds municipal securities for which no single bond
would exceed 5% of the fund's portfolio. See Securities Exchange Act
Release No. 80885 (June 8, 2017), 82 FR 27302 (June 14, 2017) (order
approving listing and trading of shares of the IQ Municipal Insured
ETF, IQ Municipal Short Duration ETF, and IQ Municipal Intermediate
ETF under NYSE Arca Equities Rule 8.600).
---------------------------------------------------------------------------

    iv. The Fund will limit its investments in Municipal Securities of
any one state to 25% of the Fund's total assets, provided that up to
and including 40% of the Fund's total assets may be invested in
Municipal Securities of issuers in each of California, New York and
Texas; \16\
---------------------------------------------------------------------------

    \16\ The Exchange notes that the Commission has approved the
listing and trading of other issues of Managed Fund Shares that
principally hold municipal securities for which the applicable
fund's assets in municipal securities of any one state would be
limited to 25% of such fund's assets. See Securities Exchange Act
Release Nos. 80885 (June 8, 2017), 82 FR 27302 (June 14, 2017)
(order approving listing and trading of shares of the IQ Municipal
Insured ETF, IQ Municipal Short Duration ETF, and IQ Municipal
Intermediate ETF under NYSE Arca Equities Rule 8.600); 79293
(November 10, 2016), 81 FR 81189 (November 17, 2016) (SR-NYSEArca-
2016-107) (order approving listing and trading of shares of
Cumberland Municipal Bond ETF under Rule 8.600); 78913 (September
23, 2016) (SR-Nasdaq-2016-002) (order approving listing and trading
of the First Trust Municipal High Income ETF of First Trust
Exchange-Traded Fund III).

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

    v. The Fund's investments in Municipal Securities will be
diversified among issuers in at least 10 states and U.S. territories;
\17\
---------------------------------------------------------------------------

    \17\ The Exchange notes that the Commission has approved the
listing and trading of another issue of Managed Fund Shares that
principally holds municipal securities and for which the fund's
assets would be diversified among issuers in 10 states. See
Securities Exchange Act Release No. 80865 (June 6, 2017), 82 FR
26970 (June 12, 2017) (order approving listing and trading of shares
of the Franklin Liberty Intermediate Municipal Opportunities ETF and
Franklin Liberty Municipal Bond ETF under NYSE Arca Equities Rule
8.600).
---------------------------------------------------------------------------

    vi. The Fund will be diversified among a minimum of five different
sectors of the Municipal Securities market.\18\
---------------------------------------------------------------------------

    \18\ The Fund's investments in Municipal Securities will include
investments in state and local (e.g., county, city, town) Municipal
Securities relating to such sectors as the following: Airports;
bridges and highways; hospitals; housing; jails; mass
transportation; nursing homes; parks; public buildings; recreational
facilities; school facilities; streets; and water and sewer works.
---------------------------------------------------------------------------

    Pre-refunded bonds will be excluded from the above limits given
that they have a high level of credit quality and liquidity.\19\
---------------------------------------------------------------------------

    \19\ The Exchange notes that the Commission has approved the
listing and trading of another issue of Managed Fund Shares that
principally holds municipal securities for which pre-refunded bonds
were excluded from the specified limits in the fund's municipal bond
investments. See Securities Exchange Act Release No. 80865 (June 6,
2017), 82 FR 26970 (June 12, 2017) (order approving listing and
trading of shares of the Franklin Liberty Intermediate Municipal
Opportunities ETF and Franklin Liberty Municipal Bond ETF under NYSE
Arca Equities Rule 8.600). Pre-refunded bonds (also known as
refunded or escrow-secured bonds) have a high level of credit
quality and liquidity because the issuer ``pre-refunds'' the bond by
setting aside in advance all or a portion of the amount to be paid
to the bondholders when the bond is called. Generally, an issuer
uses the proceeds from a new bond issue to buy high grade, interest
bearing debt securities, including direct obligations of the U.S.
government, which are then deposited in an irrevocable escrow
account held by a trustee bank to secure all future payments of
principal and interest on the pre-refunded bonds.
---------------------------------------------------------------------------

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).\20\
---------------------------------------------------------------------------

    \20\ Commentary .01(b)(1) to NYSE Arca Rule 8.600-E provides
that 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.
---------------------------------------------------------------------------

    The Exchange believes that it is appropriate and in the public
interest to approve listing and trading of Shares of the Fund on the
Exchange notwithstanding that the Fund would not meet the requirements
of Commentary .01(b)(1) to Rule 8.600-E in that the Fund's investments
in fixed income securities, including Municipal Securities, will be
well-diversified.
    The Exchange believes that permitting Fund Shares to be listed and
traded on the Exchange, notwithstanding that, as a result principally
of the Fund's investments in Municipal Securities, less than 75% of the
weight of the Fund's portfolio may consist of components with $100
million minimum or more original principal amount outstanding, would
provide the Fund with greater ability to select from a broad range of
fixed income securities, including Municipal Securities, as described
above, that would support the Fund's investment goal.
    The Exchange believes that, notwithstanding that the Fund's
portfolio may not satisfy Commentary .01(b)(1) to Rule 8.600-E, the
Fund will not be susceptible to manipulation. As noted above, with
respect to the Fund's investments in Municipal Securities, such
securities will be diversified among a minimum of 20 non-affiliated
issuers; no single Municipal Securities issuer will account for more
than 10% of the weight of the Fund's portfolio; no individual bond will
account for more than 5% of the weight of the Fund's portfolio; the
Fund will limit its investments in Municipal Securities of any one
state to 25% of the Fund's total assets, provided that up to and
including 40% of the Fund's total assets may be invested in Municipal
Securities of issuers in each of California, New York and Texas; and
the Fund's investments in Municipal Securities will be diversified
among issuers in at least 10 states and U.S. territories and will be
diversified among a minimum of five different sectors of the Municipal
Securities market.
    The Exchange notes that, other than Commentary .01(b)(1) to Rule
8.600-E, the Fund's portfolio will meet all other requirements of Rule
8.600-E.
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.\21\ 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'').
---------------------------------------------------------------------------

    \21\ 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., Eastern Time 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) 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 Manager 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 \22\ 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.
---------------------------------------------------------------------------

    \22\ 17 CFR 240.10A-3.
---------------------------------------------------------------------------

Surveillance
    The Exchange represents that trading in the Shares will be subject
to the existing trading surveillances,

administered by the Financial Industry Regulatory Authority (``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.\23\
---------------------------------------------------------------------------

    \23\ 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.\24\
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    \24\ 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.
---------------------------------------------------------------------------

    The Exchange or FINRA, on behalf of the Exchange, or both, will
communicate as needed regarding trading in the Shares, ETFs, certain
exchange-traded options and certain exchange-traded futures 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 the Shares, ETFs, certain
exchange-traded options and certain exchange-traded futures from such
markets and other entities. In addition, the Exchange may obtain
information regarding trading in the Shares, ETFs, certain exchange-
traded options and certain exchange-traded futures 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 Trade Reporting and Compliance Engine (``TRACE'').
FINRA also can access data obtained from the Municipal Securities
Rulemaking Board (``MSRB'') relating to municipal bond trading activity
for surveillance purposes in connection with trading in the Shares.
    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, (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 has represented to the Exchange that it will advise 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 iNAV will not be calculated or publicly disseminated; (4) how
information regarding the iNAV 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) \25\ 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.
---------------------------------------------------------------------------

    \25\ 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 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, ETFs,
certain exchange-traded options and certain exchange-traded futures
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 the Shares, ETFs, certain
exchange-traded options and certain exchange-traded futures from such
markets and other entities. In addition, the Exchange may obtain
information regarding trading in the Shares, ETFs, certain exchange-
traded options and certain exchange-traded futures 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 TRACE. FINRA also can access data obtained from the MSRB
relating to municipal bond trading activity for surveillance purposes
in connection with trading in the Shares. Neither the Manager nor Sub-
Adviser is registered as a broker-dealer but each is affiliated with a
broker-dealer. The Manager and Sub-Adviser each has implemented a
``fire wall'' with respect to such broker-dealer affiliate regarding
access to information concerning the composition of and/or changes to
the Fund's portfolio.\26\
---------------------------------------------------------------------------

    \26\ See note 7, supra.

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

    The Exchange believes that it is appropriate and in the public
interest to approve listing and trading of Shares of the Fund on the
Exchange notwithstanding that the Fund would not meet the requirements
of Commentary .01(b)(1) to Rule 8.600-E in that the Fund's investments
in Municipal Securities will be well-diversified.
    The Exchange believes that permitting Fund Shares to be listed and
traded on the Exchange notwithstanding that, as a result principally of
the Fund's investments in Municipal Securities, less than 75% of the
weight of the Fund's portfolio may consist of components with $100
million minimum or more original principal amount outstanding would
provide the Fund with greater ability to select from a broad range of
Municipal Securities, as described above, that would support the Fund's
investment goal.
    The Exchange believes that, notwithstanding that the Fund's
portfolio may not satisfy Commentary .01(b)(1) to Rule 8.600-E, the
Fund's portfolio will not be susceptible to manipulation. As noted
above, with respect to the Fund's investments in Municipal Securities,
such securities will be diversified among a minimum of 20 non-
affiliated issuers; no single Municipal Securities issuer will account
for more than 10% of the weight of the Fund's portfolio; no individual
bond will account for more than 5% of the weight of the Fund's
portfolio; the Fund will limit its investments in Municipal Securities
of any one state to 25% of the Fund's total assets, provided that up to
and including 40% of the Fund's total assets may be invested in
Municipal Securities of issuers in each of California, New York and
Texas; and the Fund's investments in Municipal Securities will be
diversified among issuers in at least 10 states and will be diversified
among a minimum of five different sectors of the Municipal Securities
market. The Exchange notes that, other than Commentary .01(b)(1) to
Rule 8.600-E, 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 is publicly available regarding the Fund and the Shares,
thereby promoting market transparency. Quotation and last sale
information for the Shares and ETFs will be available via the CTA high-
speed line, and from the national securities exchanges on which they
are listed. 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 Funds [sic] may be halted. In
addition, as noted above, investors will have ready access to
information regarding the Fund's holdings, the iNAV, the Disclosed
Portfolio, and quotation and last sale information for the Shares.
    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 additional type of actively-managed exchange-traded product that
principally will hold fixed income securities and that will enhance
competition among market participants, to the benefit of investors and
the marketplace. As noted above, the Exchange has in place surveillance
procedures relating to trading in the Shares and may obtain information
via ISG from other exchanges that are members of ISG or with which the
Exchange has entered into a comprehensive surveillance sharing
agreement. In addition, as noted above, investors will have ready
access to information regarding the Fund's holdings, iNAV, 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
principally will hold fixed income securities and 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 within such longer period 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 protected]. Please include
File Number SR-NYSEArca-2017-99 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-2017-99. 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 Web site (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 Web site 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-2017-99 and should
be submitted on or before November 21, 2017.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\27\

    \27\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-23582 Filed 10-30-17; 8:45 am]
 BILLING CODE 8011-01-P


[Federal Register: November 24, 2008 (Volume 73, Number 227)]
[Notices]
[Page 70998]
[DOCID:fr24no08-94]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Docket No. IS08-405-000]

Dixie Pipeline Company; Notice of Extension of Time for Technical
Conference

November 18, 2008.
    On November 14, 2008, Dixie Pipeline Company (Dixie) and the
protesting parties \1\ in the above-captioned proceeding (Joint
Movants) filed a Joint Motion to Extend Date for Technical Conference.
---------------------------------------------------------------------------

    \1\ The protesting parties include Dow Hydrocarbon and Resources
LLC; CITGO Petroleum Corporation; ConocoPhillips Company; Targa
Midstream Services Limited Partnership and Targa Louisiana; and
Crosstex NGL Marketing, L.P. and Crosstex Processing Services, LLC.
Joint Movants state that the following intervenors and/or commenters
do not oppose the motion: National Propane Gas Association,
FerrellGas, L.P., BP Products North America Inc., and the South
Carolina Department of Labor, Licensing and Regulation, Liquefied
Petroleum Gas Board. Dixie further states that it informed an
additional intervenor, Petrologistics Olefins LLC, of the instant
motion, but as of the time it filed the motion, Dixie had not
received a response.
---------------------------------------------------------------------------

    In the order issued August 22, 2008,\2\ the Commission established
a technical conference in this proceeding. By notice issued October 3,
2008, the technical conference was scheduled for 9 a.m. on Thursday,
October 23, 2008, at the Commission's offices. By further notice issued
October 22, 2008, the conference was postponed at the request of Dixie
and the protesting parties until November 20, 2008, at 9 a.m. at the
Commission's offices.
---------------------------------------------------------------------------

    \2\ Dixie Pipeline Co., 124 FERC ] 61,175 (2008).
---------------------------------------------------------------------------

    Joint Movants state that the parties are continuing to work toward
a settlement of the issues in this proceeding and that they believe an
additional extension of time for the technical conference will benefit
the ongoing discussions. Joint Movants ask the Commission to further
extend the date of the technical conference and agree to report their
progress before December 19, 2008. Dixie states that, if the parties
have not resolved the matter before that date, it will withdraw FERC
Tariffs No. 92 and 93 and refile them at a later date to allow the
parties time to confer.
    Take notice that the Commission will convene the technical
conference in this proceeding on Tuesday, December 16, 2008, at 9 a.m.
(EST), in a room to be designated at the offices of the Federal Energy
Regulatory Commission, 888 First Street, NE., Washington, DC 20426.
    FERC conferences are accessible under section 508 of the
Rehabilitation Act of 1973. For accessibility accommodations, please
send an e-mail to<EMAIL_ADDRESS>or call toll free 1-866-208-
3372 (voice) or<PHONE_NUMBER> (TTY), or send a FAX to<PHONE_NUMBER>
with the required accommodations.
    All parties and staff are permitted to attend. For further
information, please contact Jenifer Lucas at<PHONE_NUMBER> or
<EMAIL_ADDRESS>
Kimberly D. Bose,
Secretary.
[FR Doc. E8-27814 Filed 11-21-08; 8:45 am]

BILLING CODE 6717-01-P


[Federal Register: October 24, 2008 (Volume 73, Number 207)]
[Notices]
[Page 63529-63531]
[DOCID:fr24oc08-133]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-58776; File No. SR-BATS-2008-007]

Self-Regulatory Organizations; BATS Exchange, Inc.; Notice of
Filing and Immediate Effectiveness of Proposed Rule Change To Amend
BATS Rule 11.13, Entitled ``Order Execution''

October 14, 2008.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on October 10, 2008, BATS Exchange, Inc. (``BATS'' or the ``Exchange'')
filed with the Securities and Exchange Commission (``Commission'') the
proposed rule change as described in Items I and II below, which Items
have been prepared by the Exchange. BATS has designated the proposed
rule change as constituting a non-controversial rule change under Rule
19b-4(f)(6) under the Act,\3\ which renders the proposal effective upon
filing with the Commission. BATS has also requested that the Commission
waive the 30-day pre-operative waiting period contained in Rule 19b-
4(f)(6)(iii) under the Act.\4\ If such waiver is granted by the
Commission, the Exchange will implement this rule proposal immediately
upon commencement of its operations as a national securities exchange.
The Commission is publishing this notice to solicit comments on the
proposed rule change from interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 17 CFR 240.19b-4(f)(6).
    \4\ Id.
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange is proposing to amend BATS Rule 11.13, entitled
``Order Execution,'' to more closely mirror the rules of other self-
regulatory organizations related to order routing and to provide the
Exchange's Outbound Router (as defined below) with additional
flexibility when routing orders away from the Exchange.
    The text of the proposed rule change is available at the Exchange's
Web site at http://www.batstrading.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 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
    The routing performed in connection with the operation of the
Exchange will be conducted by an affiliate of the Exchange, BATS
Trading, Inc. (the ``Outbound Router''), which is regulated as a
facility of the Exchange (as defined in Section 3(a)(2) of the Act),\5\
subject to Section 6 of the Act.\6\ The role and functions of the
Outbound Router are set forth in BATS Rule 2.11, which has previously
been approved by the Commission.
---------------------------------------------------------------------------

    \5\ 15 U.S.C. 78c(a)(2).
    \6\ 15 U.S.C. 78f.
---------------------------------------------------------------------------

    The purpose of the proposed rule change is to provide the
Exchange's Outbound Router with additional flexibility when routing
orders away from the Exchange. The proposed modifications will permit
the Outbound Router to route to additional Trading Centers (as defined
in Exchange Rule 2.11),\7\ without limiting the permissible
destinations to execution venues with ``protected quotations'' (as
defined in Rule 600(b)(58) of the Act).\8\ Under the proposed rule,
orders could be routed to one or more Trading Centers provided that
such routing is compliant with Regulation NMS, specifically, Rule 611
thereof (the ``Order Protection Rule'').\9\ Such Trading Centers may
include execution venues known as ``dark books.''
---------------------------------------------------------------------------

    \7\ The Exchange's definition of Trading Center, contained in
Rule 2.11, is consistent with the definition of ``trading center''
contained in Rule 600(b)(78) of Regulation NMS.
    \8\ 17 CFR 242.600(b)(58).
    \9\ 17 CFR 242.611.
---------------------------------------------------------------------------

    Under current Rule 11.13, when an incoming market or marketable
limit order is received by the Exchange, the order will first check the
BATS Book. If such order is not executed in full against liquidity on
the BATS Book, and is eligible for routing based on the User's
instructions, then the order will be transmitted to the Outbound Router
to be routed away. The Outbound Router will then route the order to one
or more protected quotations for potential execution in compliance with
the Order Protection Rule of Regulation NMS. This process continues
until the order has been executed in full or the Outbound Router has
confirmed that there are no available protected quotations at the
routed price level or at a better price level. Following the routing
process described above, the order will return to the Exchange to check
available liquidity at the next permissible price level, and, if not
executed in full, will either be posted to the BATS Book or again
routed away to protected quotations at that next permissible price
level.
    After the proposed rule change, the Order Router may route orders
not only to protected quotations, but also to other Trading Centers, so
long as such routing is in compliance with the Order Protection Rule of
Regulation NMS. With the exception of this proposed change, the order
routing process will continue as it does currently. Thus, orders will
continue to be routed in the order routing process until the order has
been executed in full or the Outbound Router has confirmed that there
are no available protected quotations at the routed price level or at a
better price level. The order will then return to the Exchange to check
available liquidity at the next permissible price level, and, if not
executed in full, will either be

posted to the BATS Book or again routed away to available Trading
Centers at that next permissible price level.
    Routing under the proposed rule change will be subject to the
requirements as those contained in Rule 2.11. Such requirements include
that: (1) The Outbound Router will operate as a facility of the
Exchange, and thus, the Exchange will be responsible for filing with
the Commission rule changes related to the operation of, and fees for
services provided by, the Outbound Router, and the Outbound Router
shall be subject to exchange non-discrimination requirements; (2) for
purposes of Rule 17d-1 under the Act,\10\ the designated examining
authority of the Outbound router will be a self-regulatory organization
unaffiliated with the Exchange or any of its affiliates; (3) use of the
Outbound Router is optional; (4) the Outbound Router will not engage in
any business other than (a) its Outbound Router function and (b) any
other activities it may engage in as approved by the Commission; (5)
the Exchange shall establish and maintain procedures and internal
controls reasonably designed to adequately restrict the flow of
confidential and proprietary information between the Exchange and its
facilities (including the Outbound Router), and any other entity,
including any affiliate of the Outbound Router, and, if the Outbound
Router or any of its affiliates engages in any other business
activities other than providing routing services to the Exchange,
between the segment of the Outbound Router or its affiliate that
provides the other business activities and the routing services; and
(6) the books, records, premises, officers, agents, directors and
employees of the Outbound Router as a facility of the Exchange shall be
deemed to be the books, records, premises, officers, agents, directors
and employees of the Exchange for purposes of, and subject to oversight
pursuant to, the Act, and the books and records of the Outbound Router,
as a facility of the Exchange shall be subject at all times to
inspection and copying by the Exchange and the Commission. Accordingly,
the Exchange believes that routing of orders away from the Exchange
under the proposed rule change is consistent with the previously
approved functions of the Outbound Router, and the Exchange does not
believe that such functions are expanded through the proposed rule
change.
---------------------------------------------------------------------------

    \10\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

    The Exchange believes that routing under the proposed rule change
will enhance order execution opportunities for market participants by
allowing such participants to benefit from the Outbound Router's
ability to route orders to additional Trading Centers,\11\ rather than
limiting such routing to market centers with protected quotations.
Accordingly, the modifications to BATS Rule 11.13 promote just and
equitable principles of trade, remove impediments to, and perfect the
mechanism of, a free and open market and a national market system. As
described in more detail below, the Exchange also believes that the
proposed modification is similar to routing capabilities provided by
other national securities exchanges and permissible under such
exchanges' approved rules.\12\
---------------------------------------------------------------------------

    \11\ Such benefits may include, for example, potentially
receiving lower transaction fees or executions at a single price.
    \12\ See, e.g., Rule 4758(a)(1)(A)(iii) of the Nasdaq Stock
Market LLC (``NASDAQ''); see also NYSE Arca Equities Rule 7.37(d).
---------------------------------------------------------------------------

2. Statutory Basis
    The Exchange believes the proposal is consistent with the
requirements of the Act and the rules and regulations thereunder that
are applicable to a national securities exchange, and, in particular,
with the requirements of Section 6(b).\13\ In particular, for the
reasons described above, the proposed change is consistent with Section
6(b)(5) of the Act,\14\ because it would promote just and equitable
principles of trade, remove impediments to, and perfect the mechanism
of, a free and open market and a national market system, and, in
general, protect investors and the public interest, by providing the
Outbound Router with additional flexibility when routing orders away
from the Exchange, which may allow market participants to obtain better
prices and/or lower access fees for such orders, while making clear the
requirement that such routing be compliant with the Order Protection
Rule.
---------------------------------------------------------------------------

    \13\ 15 U.S.C. 78(f)(b).
    \14\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change imposes
any burden on competition.

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.

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

    Because the foregoing proposed rule change does not: (i)
Significantly affect the protection of investors or the public
interest; (ii) impose any significant burden on competition; and (iii)
become operative for 30 days from the date on which it was filed, or
such shorter time as the Commission may designate, it has become
effective pursuant to Section 19(b)(3)(A) of the Act \15\ and Rule 19b-
4(f)(6) thereunder.\16\
---------------------------------------------------------------------------

    \15\ 15 U.S.C. 78s(b)(3)(A).
    \16\ 17 CFR 240.19b-4(f)(6). Rule 19b-4(f)(6) also requires the
self-regulatory organization to give the Commission notice of its
intent to file the proposed rule change, along with a brief
description and text of the proposed rule change, at least five
business days prior to the date of filing of the proposed rule
change, or such shorter time as designated by the Commission. BATS
has satisfied the five-day pre-filing requirement.
---------------------------------------------------------------------------

    At any time within 60 days of the filing of the proposed rule
change, the Commission may summarily abrogate such rule change if it
appears to the Commission that such action is necessary or appropriate
in the public interest, for the protection of investors, or otherwise
in furtherance of the purposes of the Act.
    BATS has requested that the Commission waive the 30-day operative
delay. The Commission believes that waiver of the 30-day operative
delay is consistent with the protection of investors and the public
interest. The Commission notes that the proposal is designed to provide
for more efficient routing of orders of BATS members, and may provide
further benefits to investors such as lower transaction fees or
executions at a single price.\17\ The Commission also notes that BATS
Rule 11.13, as amended pursuant to the proposal, will be similar to
rules of other exchanges that the Commission has previously approved
\18\ in that it will permit BATS to route to trading centers other than
only those displaying protected quotations, and in this regard raises
no new regulatory issues. Waiver of the 30-day operative delay will
allow the Exchange to implement the proposed rule change upon
commencement of its operations as a national securities exchange.

Accordingly, the Commission designates the proposal to be operative
upon filing with the Commission.\19\
---------------------------------------------------------------------------

    \17\ See supra note 11 and accompanying text.
    \18\ See supra note 12 and accompanying text. See also
Securities Exchange Act Release Nos. 54155 (July 14, 2006), 71 FR
41291 (July 20, 2006) (SR-NASDAQ-2006-001) (order approving The
Nasdaq Stock Market LLC's ``Single Book'' proposal, including Nasdaq
Rule 4758) and 54549 (September 29, 2006), 71 FR 59179 (October 6,
2006) (SR-NYSEArca-2006-59) (order approving NYSE Arca, Inc.'s
proposed rule change relating to the adoption of Regulation NMS,
including revisions to NYSEArca Rule 7.37(d)).
    \19\ For purposes only of waiving the 30-day operative delay of
this proposal, the Commission has considered the proposed rule's
impact on efficiency, competition, and capital formation. 15 U.S.C.
78c(f).
---------------------------------------------------------------------------

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 e-mail to<EMAIL_ADDRESS>Please include
File Number SR-BATS-2008-007 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-BATS-2008-007. This file
number should be included on the subject line if e-mail 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 Web site (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 inspection and
copying in the Commission's Public Reference Room, on official business
days between the hours of 10 a.m. and 3 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; the
Commission does not edit personal identifying information from
submissions. You should submit only information that you wish to make
available publicly. All submissions should refer to File Number SR-
BATS-2008-007 and should be submitted on or before November 13, 2008.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\20\
---------------------------------------------------------------------------

    \20\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Jill M. Peterson,
Assistant Secretary.
 [FR Doc. E8-25388 Filed 10-23-08; 8:45 am]

BILLING CODE 8011-01-P