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respect to this action, see the each participant will speak, and the SECURITIES AND EXCHANGE application for license amendment time allotted for each presentation. COMMISSION dated October 23, 2019. A written summary of the hearing will [Release No. 34–87434; File No. SR– Attorney for licensee: General be compiled, and such summary will be NYSEArca–2019–12] Counsel, Tennessee Valley Authority, made available, upon written request to 400 West Summit Hill Drive, 6A West OPIC’s Corporate Secretary, at the cost Self-Regulatory Organizations; NYSE Tower, Knoxville, TN 37902. of reproduction. Arca, Inc.; Notice of Filing of NRC Branch Chief: Undine Shoop. Amendment No. 2 and Order Granting Written summaries of the projects to Accelerated Approval of a Proposed Dated at Rockville, Maryland, this 31st day be presented at the December 11, 2019, of October 2019. Rule Change, as Modified by Board meeting will be posted on OPIC’s Amendment No. 2, To List and Trade For the Nuclear Regulatory Commission. website. Kimberly J. Green, Shares of the iShares Commodity Senior Project Manager, Plant Licensing CONTACT PERSON FOR INFORMATION: Curve Carry Strategy ETF Under NYSE Branch II–2, Division of Operating Reactor Information on the hearing may be Arca Rule 8.600–E obtained from Catherine F. I. Andrade at Licensing, Office of Nuclear Reactor I. Introduction Regulation. (202) 336–8768, via facsimile at (202) [FR Doc. 2019–24198 Filed 11–5–19; 8:45 am] 408–0297, or via email at On March 1, 2019, NYSE Arca, Inc. BILLING CODE 7590–01–P [email protected]. (‘‘NYSE Arca’’ or ‘‘Exchange’’) filed with the Securities and Exchange Authority: 5 U.S.C. 552b. Commission (‘‘Commission’’), pursuant Dated: October 31, 2019. to Section 19(b)(1) of the Securities OVERSEAS PRIVATE INVESTMENT Catherine F. I. Andrade, Exchange Act of 1934 (‘‘Act’’) 1 and Rule 2 CORPORATION OPIC Corporate Secretary. 19b–4 thereunder, a proposed rule change to list and trade shares [FR Doc. 2019–24276 Filed 11–4–19; 11:15 am] Sunshine Act Notice—December 4, (‘‘Shares’’) of the iShares Commodity 2019 Public Hearing BILLING CODE 3210–01–P Curve Carry Strategy ETF, a series of the iShares U.S. ETF Trust. The proposed TIME AND DATE: 1:00 p.m., Wednesday, rule change was published for comment December 4, 2019. in the Federal Register on March 20, PLACE: Offices of the Corporation, POSTAL SERVICE 2019.3 On April 18, 2019, the Exchange Twelfth Floor Board Room, 1100 New filed Amendment No. 1 to the proposed Board of Governors; Sunshine Act York Avenue NW, Washington, DC. rule change, which replaced and Meeting STATUS: Hearing OPEN to the Public at superseded the proposed rule change as 1:00 p.m. originally filed.4 On May 1, 2019, TIME AND DATE: November 1, 2019, at pursuant to Section 19(b)(2) of the Act,5 MATTERS TO BE CONSIDERED: This will be 11:00 a.m. a Public Hearing, held in conjunction the Commission designated a longer with each meeting of OPIC’s Board of PLACE: Washington, DC. period within which to approve the Directors, to afford an opportunity for proposed rule change, disapprove the STATUS: Closed. any person to present views regarding proposed rule change, or institute the activities of the Corporation. ITEMS CONSIDERED: proceedings to determine whether to approve or disapprove the proposed Individuals wishing to address the 1. Administrative Items. hearing orally must provide advance rule change.6 On June 18, 2019, the notice to OPIC’s Corporate Secretary no 2. Personnel Matter. Commission published Amendment No. later than 5 p.m., Tuesday, November On November 1, 2019, a majority of 1 for notice and comment and instituted 26, 2019. The notice must include the the members of the Board of Governors proceedings under Section 19(b)(2)(B) of individual’s name, title, organization, of the United States Postal Service voted the Act 7 to determine whether to address, and telephone number, and a unanimously to hold and to close to approve or disapprove the proposed concise summary of the subject matter public observation a special meeting in rule change, as modified by Amendment to be presented. Washington, DC, via teleconference. The No. 1.8 On September 10, 2019, the Oral presentations may not exceed ten Board determined that no earlier public Exchange filed Amendment No. 2 to the (10) minutes. The time for individual notice was practicable. proposed rule change, which replaced presentations may be reduced and superseded the proposed rule GENERAL COUNSEL CERTIFICATION: The proportionately, if necessary, to afford General Counsel of the United States 1 all participants who have submitted a 15 U.S.C.78s(b)(1). Postal Service has certified that the 2 timely request an opportunity to be 17 CFR 240.19b–4. meeting may be closed under the 3 See Securities Exchange Act Release No. 85312 heard. Government in the Sunshine Act. (March 14, 2019), 84 FR 10369. Participants wishing to submit a 4 Amendment No. 1 is available at: https:// written statement for the record must CONTACT PERSON FOR MORE INFORMATION: www.sec.gov/comments/sr-nysearca-2019-12/ submit a copy of such statement to Michael J. Elston, Acting Secretary of srnysearca201912-5393880-184151.pdf. OPIC’s Corporate Secretary no later than the Board, U.S. Postal Service, 475 5 15 U.S.C. 78s(b)(2). L’Enfant Plaza SW, Washington, DC 6 See Securities Exchange Act Release No. 85758, 5 p.m. Tuesday, November 26, 2019. 84 FR 19978 (May 7, 2019). The Commission Such statement must be typewritten, 20260–1000. Telephone: (202) 268– designated June 18, 2019 as the date by which the double spaced, and may not exceed 4800. Commission would approve the proposed rule twenty-five (25) pages. change, disapprove the proposed rule change, or Upon receipt of the required notice, Michael J. Elston, institute proceedings to determine whether to Acting Secretary. approve or disapprove the proposed rule change. OPIC will prepare an agenda, which 7 15 U.S.C. 78s(b)(2)(B). [FR Doc. 2019–24294 Filed 11–4–19; 11:15 am] will be available at the hearing, that 8 See Securities Exchange Act Release No. 86136, identifies speakers, the subject on which BILLING CODE 7710–12–P 84 FR 29555 (June 24, 2019).

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change, as modified by Amendment No. will be the distributor for the Fund’s and securities other than 1.9 On September 12, 2019, the Shares. State Street Bank and Trust cash equivalents, as described below. Commission designated a longer period Company will serve as the The Reference Benchmark is currently for Commission action on the administrator, custodian and transfer composed of 18 futures contracts on proceedings to determine whether to agent for the Fund. physical agricultural, energy, precious approve or disapprove the proposed metals, and industrial metals A. Fund Investments rule change.10 The Commission has commodities listed on U.S. regulated received no comment letters on the According to the Exchange, the futures exchanges or non-U.S. futures proposal. investment objective of the Fund will be exchanges with which the Exchange has The Commission is publishing this to seek to provide exposure, on a total in place a comprehensive surveillance notice to solicit comments on the return basis, to a group of commodities sharing agreement (‘‘CSSA’’).19 The proposed rule change, as modified by with higher carry than a broad universe Fund expects to obtain a substantial Amendment No. 2, from interested of commodities. The Fund will be amount of its exposure to the carry persons and is approving the proposed actively managed and will seek to strategy by entering into total return rule change, as modified by Amendment achieve its investment objective in swaps that pay the returns of the No. 2, on an accelerated basis. part 14 by, under normal market commodity futures contracts referenced conditions,15 investing in listed and II. Summary of the Exchange’s in the Reference Benchmark. The over-the-counter (‘‘OTC’’) swaps, Reference Benchmark includes the 10 Description of the Proposal, as including total return swaps referencing Modified by Amendment No. 2 11 futures contracts on commodities the ICE BofAML Commodity Carry Total having the highest degree of The Exchange proposes to list and Return Index (‘‘Reference backwardation or lowest degree of 16 trade the Shares under NYSE Arca Rule Benchmark’’). The Fund is expected to 20 among the Reference 8.600–E, which governs the listing and establish new swaps contracts on an Benchmark universe.21 trading of Managed Fund Shares on the ongoing basis and replace expiring The Fund (through its Subsidiary (as 17 Exchange. The Shares will be offered by contracts. Swaps subsequently entered defined below)) may hold the following iShares U.S. ETF Trust (‘‘Trust’’), which into by the Fund may have terms that listed instruments: futures, is registered with the Commission as an differ from the swaps the Fund options, and swaps on the Reference open-end management investment previously held. The Fund expects 12 Benchmark or commodities (which company. The Fund is a series of the generally to pay a fixed payment rate commodities are from the same sectors Trust. and certain related fees to the as those included in the Reference BlackRock Fund Advisors (‘‘Adviser’’) swap counterparty and receive the total Benchmark); currencies; U.S. and non- will be the investment adviser for the return of the Reference Benchmark, U.S. equity securities; fixed income Fund.13 BlackRock Investments, LLC including, in the event of negative securities (as defined in Commentary performance by the Reference .01(b) to NYSE Arca Rule 8.600–E, but 9 In Amendment No. 2, the Exchange: (1) Benchmark, negative return (i.e., a excluding Short-Term Fixed Income Modified its description of the Reference payment from the Fund to the swap Benchmark (as defined below); (2) modified the Securities (as defined below)); interest description and definition of Short-Term Fixed counterparty). In seeking total return, rates; U.S. Treasuries; or a basket or Income Securities (as defined below); (3) limited the Fund additionally will aim to the Fund’s holdings in non-convertible corporate index of any of the foregoing generate interest income and capital (collectively, ‘‘Listed Derivatives’’). debt securities to 30% of the weight of Fund’s appreciation through a cash collective holdings in cash equivalents and Short- Listed Derivatives will comply with the management strategy consisting Term Fixed Income Securities; and (4) made other criteria in Commentary .01(d) of NYSE technical and conforming changes. Amendment No. primarily of cash, cash equivalents,18 2 is available at: https://www.sec.gov/comments/sr- Arca Rule 8.600–E. nysearca-2019-12/srnysearca201912-6099440- The Fund (through its Subsidiary) a broker-dealer, it will implement and maintain a 191987.pdf. fire wall with respect to its relevant personnel or may hold the following OTC derivative 10 See Securities Exchange Act Release No. 86945, its broker-dealer affiliate regarding access to instruments: Forwards, options, and 84 FR 49158 (September 18, 2019). The information concerning the composition and/or swaps on the Reference Benchmark or Commission extended the date by which the changes to the portfolio, and will be subject to commodities (which commodities are Commission shall approve or disapprove the procedures designed to prevent the use and proposed rule change to November 15, 2019. dissemination of material non-public information 11 For a complete description of the Exchange’s regarding such portfolio. The Exchange also 19 The commodity futures included in the proposal, as amended, see Amendment No. 2, supra represents that the Adviser and its related Reference Benchmark are traded on the CME Group, note 9. personnel are subject to the provisions of Rule ICE Futures U.S., ICE Futures Europe, Inc. and the 12 According to the Exchange, on December 3, 204A–1 under the Investment Advisers Act of 1940 London Metal Exchange (‘‘LME’’). ICE Futures U.S., 2018, the Trust filed with the Commission its relating to codes of ethics. ICE Futures Europe, Inc., and CME are members of registration statement on Form N–1A under the 14 The Fund’s investment objective will also be the Intermarket Surveillance Group (‘‘ISG’’). The Securities Act of 1933 and under the Investment achieved by investing in cash, cash equivalents, Exchange represents that it has in place a CSSA Company Act of 1940 (‘‘1940 Act’’) relating to the Commodity Investments, Fixed Income Securities with the LME. Fund (File Nos. 333–179904 and 811–22649) and Short-Term Fixed Income Securities (each as 20 According to the Exchange, if the price for the (‘‘Registration Statement’’). In addition, the defined or described below). new is less than the price of the Exchange states that the Commission has issued an 15 The term ‘‘normal market conditions’’ is expiring contract, then the market for the order upon which the Trust may rely, granting defined in NYSE Arca Rule 8.600–E(c)(5). commodity is said to be in ‘‘backwardation,’’ and certain exemptive relief under the 1940 Act. See 16 Although the Fund may hold swaps on the the term ‘‘contango’’ is used to describe a market Investment Company Act Release No. 29571 Reference Benchmark, or direct investments in the in which the price for a new futures contract is (January 24, 2011) (File No. 812–13601). same futures contracts as those included in the more than the price of the expiring contract. 13 According to the Exchange, the Adviser is not Reference Benchmark, the Fund is not obligated to 21 The Reference Benchmark universe can have a registered as a broker-dealer but is affiliated with invest in any futures contracts included in, and minimum of 12 and a maximum of 25 contracts on a broker-dealer and has implemented and will does not seek to replicate the performance of, the physical agricultural, energy, precious metals, and maintain a fire wall with respect to its broker-dealer Reference Benchmark. industrial metals commodities. Reference affiliate regarding access to information concerning 17 Swaps on the Reference Benchmark are Benchmark universe constituent futures contracts the composition and/or changes to the portfolio. In included in ‘‘Commodity Investments’’ as defined and weights are set annually and the weights are the event (a) the Adviser becomes registered as a below. rebalanced monthly, taking into account the broker-dealer or newly affiliated with a broker- 18 Cash equivalents are the short-term instruments liquidity of the constituent futures contracts and the dealer, or (b) any new adviser or sub-adviser is a enumerated in Commentary .01(c) to NYSE Arca value of the global production of each underlying registered broker-dealer or becomes affiliated with Rule 8.600–E. commodity.

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from the same sectors as those included be purchased on a current or forward- organized under the laws of the Cayman in the Reference Benchmark); settled basis.26 Islands. The Trust’s Board of Trustees currencies; U.S. and non-U.S. equity The Fund also may invest in fixed (‘‘Board’’) has oversight responsibility securities; fixed income securities (as income securities as defined in for the investment activities of the defined in Commentary .01(b) to NYSE Commentary .01(b) to NYSE Arca Rule Fund, including its investment in the Arca Rule 8.600–E, but excluding Short- 8.600–E,27 other than cash equivalents Subsidiary, and the Fund’s role as sole Term Fixed Income Securities); interest and Short-Term Fixed Income shareholder of the Subsidiary. rates; or a basket or index of any of the Securities, with remaining maturities The Fund’s Commodity Investments held in the Subsidiary are intended to foregoing (collectively, ‘‘OTC longer than 397 days (‘‘Fixed Income Securities’’). Such Fixed Income provide the Fund with exposure to Derivatives,’’ 22 and together with Listed Securities will comply with broad commodities. The Subsidiary may Derivatives, ‘‘Commodity 23 requirements of Commentary .01(b) to hold cash and cash equivalents. Investments’’). 28 NYSE Arca Rule 8.600–E. B. Investment Restrictions The Fund may hold cash, cash The Fund may also hold ETNs 29 and equivalents, and fixed income securities ETFs.30 The Fund and the Subsidiary will not other than cash equivalents, as The Fund’s exposure to Commodity invest in securities or other financial described further below. Investments is obtained by investing instruments that have not been through a wholly-owned subsidiary described in the proposed rule change. Specifically, the Fund may invest in organized in the Cayman Islands The Fund’s holdings in non- Short-Term Fixed Income Securities (as (‘‘Subsidiary’’).31 The Fund controls the convertible corporate debt securities defined below) other than cash Subsidiary, and the Subsidiary is shall not exceed 30% of the weight of equivalents on an ongoing basis for cash Fund’s holdings in cash equivalents and 24 advised by the Adviser and has the management purposes. Short-Term same investment objective as the Fund. Short-Term Fixed Income Securities, Fixed Income Securities will have a In compliance with the requirements of collectively. maturity of no longer than 397 days and Sub-Chapter M of the Internal Revenue The Fund’s investments, including include only the following: (i) Money Code of 1986, the Fund may invest up derivatives, will be consistent with the market instruments; (ii) obligations to 25% of its total assets in the Fund’s investment objective and will issued or guaranteed by the U.S. Subsidiary. The Subsidiary is not an not be used to enhance leverage government, its agencies or investment company registered under (although certain derivatives and other instrumentalities (including the 1940 Act and is a company investments may result in leverage). government-sponsored enterprises); (iii) That is, the Fund’s investments will not negotiable certificates of deposit, 26 To the extent that the Fund and the Subsidiary be used to seek performance that is the bankers’ acceptances, fixed-time invest in cash and Short-Term Fixed Income multiple or inverse multiple (e.g., 2X or deposits and other obligations of U.S. Securities that are cash equivalents (i.e., that have –3X) of the Reference Benchmark. maturities of less than 3 months) as specified in and non-U.S. banks (including non-U.S. Commentary .01(c) to NYSE Arca Rule 8.600–E, C. Use of Derivatives by the Fund branches) and similar institutions; (iv) such investments will comply with Commentary Investments in derivative instruments commercial paper; (v) non-convertible .01(c) and may be held without limitation. Non- convertible corporate debt securities and Non-U.S. will be made in accordance with the corporate debt securities (e.g., bonds Sovereign Debt are not included as cash equivalents Fund’s investment objective and and debentures); (vi) repurchase in Commentary .01(c). policies. To limit the potential risk agreements; and (vii) sovereign debt 27 Commentary .01(b) to NYSE Arca Rule 8.600– E defines fixed income securities as debt securities associated with such transactions, the obligations of non-U.S. countries Fund will enter into offsetting 25 that are notes, bonds, debentures or evidence of excluding emerging market countries indebtedness that include, but are not limited to, transactions or segregate or ‘‘earmark’’ (‘‘Non-U.S. Sovereign Debt’’) U.S. Department of Treasury securities (‘‘Treasury assets determined to be liquid by the (collectively, ‘‘Short-Term Fixed Income Securities’’), government-sponsored entity securities (‘‘GSEs’’), municipal securities, trust Adviser in accordance with procedures Securities’’). Any of these securities may preferred securities, supranational debt and debt of established by the Board. In addition, a foreign country or a subdivision thereof, the Fund has included appropriate risk 22 Examples of OTC Derivatives the Fund may investment grade and high yield corporate debt, disclosure in its offering documents, invest in include swaps on commodity futures bank loans, mortgage and asset backed securities, including leveraging risk. Leveraging contracts similar to those found in the Reference and commercial paper. Benchmark and options that correlate to the 28 Among the Fixed Income Securities in which risk is the risk that certain transactions investment returns of commodities without the Fund may invest are commodity-linked notes. of the Fund, including the Fund’s use of investing directly in physical commodities. 29 ETNs are securities as described in NYSE Arca derivatives, may give rise to leverage, 23 As discussed below under ‘‘Application of Rule 5.2–E(j)(6) (Equity Index-Linked Securities, causing the Fund to be more volatile Generic Listing Requirements,’’ the Fund’s and the Commodity-Linked Securities, Currency-Linked Subsidiary’s holdings in OTC Derivatives will not Securities, Fixed Income Index-Linked Securities, than if it had not been leveraged. comply with the criteria in Commentary .01(e) of Futures-Linked Securities and Multifactor Index- According to the Exchange, the NYSE Arca Rule 8.600–E. Linked Securities). All ETNs will be listed and Adviser believes there will be minimal, 24 As discussed under ‘‘Application of Generic traded in the U.S. on a national securities exchange. if any, impact to the arbitrage Listing Requirements’’ below, investments in Short- The Fund will not invest in inverse or leveraged mechanism as a result of the Fund’s use Term Fixed Income Securities will not comply with (e.g., 2X, –2X, 3X or –3X) ETNs. the requirements of Commentary .01(b)(1)–(4) to 30 For purposes of the filing, the term ‘‘ETFs’’ of derivatives. Additionally, the Adviser NYSE Arca Rule 8.600–E. includes Investment Company Units (as described understands that market makers and 25 According to the Exchange, an ‘‘emerging in NYSE Arca Rule 5.2–E(j)(3)); Portfolio Depositary participants should be able to value market country’’ is a country that, at the time the Receipts (as described in NYSE Arca Rule 8.100– derivatives as long as the positions are Fund invests in the related fixed income E); and Managed Fund Shares (as described in instruments, is classified as an emerging or NYSE Arca Rule 8.600–E). All ETFs will be listed disclosed with relevant information. developing economy by any supranational and traded in the U.S. on a national securities The Adviser further believes that the organization such as the International Bank of exchange. The Fund will not invest in inverse or price at which Shares of the Fund trade Reconstruction and Development or any affiliate leveraged (e.g., 2X, –2X, 3X or –3X) ETFs. will continue to be disciplined by thereof or the United Nations, or related entities, or 31 The Exchange represents that all statements is considered an emerging market country for related to the Fund’s investments and restrictions arbitrage opportunities created by the purposes of constructing a major emerging market are applicable to the Fund and Subsidiary ability to purchase or redeem Shares of securities index. collectively. the Fund at their net asset value

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(‘‘NAV’’), which should ensure that securities included in a fund’s portfolio as well as commodity futures contracts Shares of the Fund will not trade at a are sufficiently large and diverse, and similar to those found in the Reference material discount or premium in have sufficient publicly available Benchmark. The Exchange states that relation to their NAV. information regarding the issuances, the OTC Derivatives can be tailored to The Exchange states that the Adviser Exchange asserts that any concerns provide specific exposure to the Fund’s does not believe there will be any related to non-compliance are mitigated Reference Benchmark, as well as significant impacts to the settlement or by the types of instruments that the commodity futures contracts similar to operational aspects of the Fund’s Fund would hold. The Exchange those found in the Reference arbitrage mechanism due to the use of represents that the Fund’s Short-Term Benchmark, allowing the Fund to more derivatives. Fixed Income Securities primarily efficiently meet its investment would include those instruments that objective.36 The Exchange further D. Application of Generic Listing are included in the definition of cash asserts that, if the Fund were to gain Requirements and cash equivalents,33 but are not commodity exposure exclusively The Exchange states that the portfolio considered cash and cash equivalents through the use of listed futures, the for the Fund will not meet all of the because they have maturities of three Fund’s holdings in Listed Derivatives ‘‘generic’’ listing requirements of months or longer. The Exchange also would be subject to position limits and Commentary .01 to NYSE Arca Rule states that all Short-Term Fixed Income accountability levels established by an 8.600–E applicable to the listing of Securities, including non-convertible exchange, and such limitations would Managed Fund Shares. The Exchange corporate debt securities 34 and Non- restrict the Fund’s ability to gain represents that, other than Commentary U.S. Sovereign Debt (which are not cash efficient exposure to the commodities in .01(b)(1)–(4) (with respect to Short-Term equivalents as enumerated in the Reference Benchmark, or futures Fixed Income Securities) and .01(e) Commentary .01(c) to NYSE Arca Rule contracts similar to those found in the (with respect to OTC Derivatives) to 8.600–E), are less susceptible than other Reference Benchmark, thereby impeding NYSE Arca Rule 8.600–E, the Fund’s types of fixed income instruments both the Fund’s ability to satisfy its portfolio will meet all other to price manipulation and and investment objective. requirements of NYSE Arca Rule 8.600– that the holdings as proposed are The Exchange represents that the E. generally consistent with the policy Adviser and its affiliates actively According to the Exchange, the concerns which Commentary .01(b)(1)– monitor counterparty Fund’s investments in Short-Term Fixed (4) is intended to address. According to exposure (including for OTC Income Securities will not comply with the Exchange, because the Short-Term derivatives) and evaluate counterparty the requirements set forth in Fixed Income Securities will consist of credit quality on a continuous basis. Commentary .01(b)(1)–(4) to NYSE Arca high-quality fixed income securities With respect to the Fund’s (and the Rule 8.600–E.32 The Exchange states described above, the policy concerns Subsidiary’s) investments in derivatives that while the requirements set forth in that Commentary .01(b)(1)–(4) are on the Reference Benchmark or Commentary .01(b)(1)–(4) include rules intended to address are otherwise commodities (which commodities are intended to ensure that the fixed income mitigated and that the Fund should be from the same sectors as those included permitted to hold these securities in a in the Reference Benchmark), the 32 Commentary .01(b)(1)–(4) to NYSE Arca Rule manner that may not comply with Exchange states that the Reference 8.600–E requires that the components of the fixed Commentary .01(b)(1)–(4). Benchmark provides broad-based income portion of a portfolio meet the following The Exchange states that the Fund’s exposure to commodities as an asset criteria initially and on a continuing basis: (1) portfolio with respect to OTC Components that in the aggregate account for at class, as it includes 10 futures contracts least 75% of the fixed income weight of the Derivatives will not comply with the from a universe currently composed of portfolio each shall have a minimum original requirements set forth in Commentary 18 physical commodities in agricultural, 35 principal amount outstanding of $100 million or .01(e) to NYSE Arca Rule 8.600–E. energy, livestock, precious metals, and more; (2) no component fixed-income security Specifically, the Exchange states that up (excluding Treasury Securities and GSEs) shall industrial metals. In addition, the represent more than 30% of the fixed income to 60% of the Fund’s assets (calculated Exchange states that the Adviser weight of the portfolio, and the five most heavily as the aggregate gross notional value) represents that futures on all weighted component fixed income securities in the may be invested in OTC Derivatives. portfolio (excluding Treasury Securities and GSEs) commodities in the Reference The Exchange states that the Adviser Benchmark are traded on futures shall not in the aggregate account for more than believes that it is important to provide 65% of the fixed income weight of the portfolio; (3) exchanges that are members of the ISG an underlying portfolio (excluding exempted the Fund with additional flexibility to or with which the Exchange has in place securities) that includes fixed income securities manage risk associated with its a CSSA. shall include a minimum of 13 non-affiliated investments and, depending on market issuers, provided, however, that there shall be no III. Discussion and Commission’s minimum number of non-affiliated issuers required conditions, it may be critical that the for fixed income securities if at least 70% of the Fund be able to utilize available OTC Findings weight of the portfolio consists of equity securities Derivatives to efficiently gain exposure After careful review, the Commission as described in Commentary .01(a); and (4) to the multiple commodities markets finds that the proposed rule change, as component securities that in aggregate account for that underlie the Reference Benchmark, at least 90% of the fixed income weight of the portfolio must be either (a) from issuers that are 36 As an example, the Exchange states that the required to file reports pursuant to Sections 13 and 33 See supra note 18. Reference Benchmark includes 10 futures contracts, 15(d) of the Act; (b) from issuers that have a 34 The Exchange notes that the Fund’s holdings in which may not be sufficiently liquid and would not worldwide market value of its outstanding common non-convertible corporate debt securities will not provide the commodity exposure the Fund requires equity held by non-affiliates of $700 million or exceed 30% of the weight of the Fund’s holdings to meet its investment objective if the Fund were more; (c) from issuers that have outstanding in cash equivalents and Short-Term Fixed Income to invest in the futures directly. The Exchange securities that are notes, bonds debentures, or Securities, collectively. states that a total return swap can be structured to evidence of indebtedness having a total remaining 35 Commentary .01(e) to NYSE Arca Rule 8.600– provide exposure to the same futures contracts as principal amount of at least $1 billion; (d) exempted E provides that, on an initial and continuing basis, exist in the Reference Benchmark, as well as securities as defined in Section 3(a)(12) of the Act; no more than 20% of the assets in the portfolio may commodity futures contracts similar to those found or (e) from issuers that are a government of a foreign be invested in OTC derivatives (calculated as the in the Reference Benchmark, while providing country or a political subdivision of a foreign aggregate gross notional value of the OTC sufficient efficiency to allow the Fund to more country. derivatives). easily meet its investment objective.

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modified by Amendment No. 2, is cash equivalents and Short-Term Fixed Fund will be required to disclose on its consistent with the Act and the rules Income Securities, collectively. In website the information regarding the and regulations thereunder applicable to addition, the Fund’s investments in Disclosed Portfolio required under a national securities exchange.37 In Short-Term Fixed Income Securities NYSE Arca Rule 8.600–E(c)(2), to the particular, the Commission finds that would include sovereign debt, but extent applicable,45 and the website the proposed rule change, as modified would exclude sovereign debt information will be publicly available at by Amendment No. 2, is consistent with obligations of emerging market no charge.46 Section 6(b)(5) of the Act,38 which countries. Further, the Fund will invest requires (among other things) that the in Short Term Fixed Income Securities The Exchange represents that all Exchange’s rules be designed to prevent for cash management purposes only, statements and representations made in fraudulent and manipulative acts and and the Short Term Fixed Income the filing regarding: (1) The description practices, to promote just and equitable Securities in which the Fund may invest of the portfolio holdings or reference principles of trade, to remove will have maturities of no longer than assets; (2) limitations on portfolio impediments to and perfect the 397 days.42 holdings or reference assets; or (3) the mechanism of a free and open market In addition, the Fund’s investments in applicability of Exchange listing rules and a national market system, and, in OTC Derivatives will not comply with specified in the rule filing constitute general, to protect investors and the Commentary .01(e) to NYSE Arca Rule continued listing requirements for public interest. 8.600–E, which requires that no more listing the Shares on the Exchange. In According to the Exchange, other than than 20% of the assets of the Fund be addition, the Exchange represents that Commentary .01(b)(1)–(4) with respect invested in OTC derivatives (calculated the issuer must notify the Exchange of to Short-Term Fixed Income Securities as the aggregate gross notional value of any failure by the Fund to comply with and Commentary .01(e) with respect to such OTC derivatives). In the the continued listing requirements and, OTC Derivatives, the Fund’s portfolio alternative, the Exchange proposes that pursuant to its obligations under up to 60% of the Fund’s assets will meet all other requirements of Section 19(g)(1) of the Act, the Exchange Commentary .01 to NYSE Arca Rule (calculated as the aggregate gross will monitor 47 for compliance with the 8.600–E, and the Shares of the Fund notional value) may be invested in OTC continued listing requirements. If the will conform to the initial and Derivatives.43 The Exchange states that continued listing criteria under NYSE it may be necessary for the Fund to Fund is not in compliance with the Arca Rule 8.600–E. utilize OTC Derivatives in order to more applicable listing requirements, the The Fund’s investments in Short- efficiently hedge its portfolio or to meet Exchange will commence delisting Term Fixed Income Securities will not its investment objective.44 procedures under NYSE Arca Rule 5.5– meet the requirements for fixed income The Commission, however, believes E(m). securities set forth in Commentary that certain factors help to mitigate For the foregoing reasons, the .01(b)(1)–(4) to NYSE Arca Rule 8.600– concerns that the Fund’s investment in Commission finds that the proposed E.39 The Commission, however, believes OTC Derivatives will make the Shares rule change, as modified by Amendment that the limited nature of the Fund’s more susceptible to manipulation. No. 2, is consistent with Section 6(b)(5) investment in, and certain restrictions Specifically, with respect to OTC of the Act 48 and the rules and Derivatives on the Reference Benchmark on, the Short Term Fixed Income regulations thereunder applicable to a (or on the commodities underlying the Securities helps to mitigate concerns national securities exchange. regarding the Shares being susceptible futures contracts included in the to manipulation because of the Fund’s Reference Benchmark), the Exchange represents that the Reference 45 NYSE Arca Rule 8.600–E(c)(2) requires that the investment in the Short Term Fixed website for each series of Managed Fund Shares 40 Income Securities. Specifically, the Benchmark includes 10 futures disclose the following information regarding the Exchange states that Short-Term Fixed contracts from a universe currently Disclosed Portfolio, to the extent applicable: (A) Income Securities primarily will composed of 18 physical commodities Ticker symbol; (B) CUSIP or other identifier; (C) include instruments that are included in in agriculture, energy, livestock, description of the holding; (D) with respect to the definition of cash equivalents,41 but precious metals, and industrial metals, holdings in derivatives, the identity of the security, are not considered cash equivalents and that futures on all of the commodity, index or other asset upon which the commodities in the Reference derivative is based; (E) the for any because they have maturities of three options; (F) the quantity of each security or other months or longer. As proposed, the Benchmark are traded on futures asset held as measured by (i) par value, (ii) notional Fund’s investments in Short-Term Fixed exchanges that are members of the ISG value, (iii) number of shares, (iv) number of Income Securities will also include non- or with which the Exchange has in place contracts, and (v) number of units; (G) maturity convertible corporate debt securities, a CSSA. Moreover, on a daily basis, the date; (H) coupon rate; (I) effective date; (J) market but such holdings would be limited to value; and (K) percentage weighting of the holding in the portfolio. 30% of the weight of Fund’s holdings in 42 See supra Section II.A. 43 The Exchange represents that the Adviser and 46 See Amendment No. 2, supra note 9, at 17. its affiliates actively monitor counterparty credit 47 The Commission notes that certain proposals 37 In approving this proposed rule change, the risk exposure for OTC derivatives and evaluate for the listing and trading of exchange-traded Commission has considered the proposed rule’s counterparty credit quality on a continuous basis. products include a representation that the exchange impact on efficiency, competition, and capital See supra Section II.D. Moreover, the Exchange will ‘‘surveil’’ for compliance with the continued formation. See 15 U.S.C. 78c(f). states that investments in derivative instruments listing requirements. See, e.g., Securities Exchange 38 15 U.S.C. 78f(b)(5). will be made in accordance with the Fund’s Act Release No. 77499 (April 1, 2016), 81 FR 20428, 39 See supra note 32. investment objective and policies. To limit the 20432 (April 7, 2016) (SR–BATS–2016–04). In the 40 The Commission notes that all the fixed income potential risk associated with such transactions, the context of this representation, it is the securities the Fund may invest in other than those Fund will enter into offsetting transactions or Commission’s view that ‘‘monitor’’ and ‘‘surveil’’ included in Short-Term Fixed Income Securities segregate or ‘‘earmark’’ assets determined to be and cash equivalents will comply with the liquid by the Adviser in accordance with both mean ongoing oversight of compliance with requirements of Commentary .01(b) to NYSE Arca procedures established by the Board. In addition, the continued listing requirements. Therefore, the Rule 8.600–E, and the cash equivalents the Fund the Fund has included appropriate risk disclosure Commission does not view ‘‘monitor’’ as a more or may invest in will comply with the requirements in its offering documents, including leveraging risk. less stringent obligation than ‘‘surveil’’ with respect of Commentary .01(c). See supra Section II.A. See supra Section II.C. to the continued listing requirements. 41 See supra note 18. 44 See supra Section II.D. 48 15 U.S.C. 78f(b)(5).

VerDate Sep<11>2014 17:43 Nov 05, 2019 Jkt 250001 PO 00000 Frm 00090 Fmt 4703 Sfmt 4703 E:\FR\FM\06NON1.SGM 06NON1 59854 Federal Register / Vol. 84, No. 215 / Wednesday, November 6, 2019 / Notices

IV. Solicitation of Comments on V. Accelerated Approval of the 1 application, as amended, provides Amendment No. 2 to the Proposed Rule Proposed Rule Change, as Modified by detailed information on how it proposes Change Amendment No. 2 to satisfy the requirements of the The Commission finds good cause to Exchange Act. Interested persons are invited to approve the proposed rule change, as submit written views, data, and The Commission is publishing this modified by Amendment No. 2, prior to notice to solicit comments on MEMX’s arguments concerning whether the thirtieth day after the date of Amendment No. 2 is consistent with the Form 1 application. The Commission publication of notice of the filing of will take any comments it receives into Act. Comments may be submitted by Amendment No. 2 in the Federal any of the following methods: consideration in making its Register. The Commission notes that determination about whether to grant Electronic Comments Amendment No. 2 clarified the the Applicant’s request to register as a proposed rule change, including the national securities exchange. The • Use the Commission’s internet permitted investments of the Fund. Commission will grant the registration if comment form (http://www.sec.gov/ Such changes did not raise any new it finds that the requirements of the rules/sro.shtml); or issues and assisted the Commission in evaluating whether the Exchange’s Exchange Act and the rules and • Send an email to rule-comments@ proposal to list and trade the Shares is regulations thereunder with respect to sec.gov. Please include File Number SR– 2 consistent with the Act. Accordingly, MEMX are satisfied. NYSEArca–2019–12 on the subject line. the Commission finds good cause, As discussed in the Form 1 Paper Comments pursuant to Section 19(b)(2) of the application, MEMX would be a Act,49 to approve the proposed rule subsidiary of its parent company, • Send paper comments in triplicate change, as modified by Amendment No. MEMX Holdings, LLC (‘‘MEMX to Secretary, Securities and Exchange 2, on an accelerated basis. Holdings’’), which would directly hold Commission, 100 F Street NE, VI. Conclusion 99.5% of the equity of MEMX and Washington, DC 20549–1090. indirectly hold the other 0.5% of the It is therefore ordered, pursuant to All submissions should refer to File 50 equity of MEMX through its 100% Section 19(b)(2) of the Act, that the 3 Number SR–NYSEArca–2019–12. This proposed rule change (SR–NYSEArca– ownership of MEMX SubCo LLC. In file number should be included on the 2019–12), as modified by Amendment turn, MEMX Holdings would be owned subject line if email is used. To help the No. 2 thereto, be, and it hereby is, by a group of nine investors that include Commission process and review your approved on an accelerated basis. broker-dealers, retail brokers, and banks, eight of which have the ability to comments more efficiently, please use For the Commission, by the Division of only one method. The Commission will Trading and Markets, pursuant to delegated appoint a director to the board of MEMX 4 post all comments on the Commission’s authority.51 Holdings. Three of those investors also internet website (http://www.sec.gov/ Jill M. Peterson, would have the ability to nominate a rules/sro.shtml). Copies of the Assistant Secretary. director to the board of MEMX on a 5 submission, all subsequent [FR Doc. 2019–24188 Filed 11–5–19; 8:45 am] rotating schedule. amendments, all written statements BILLING CODE 8011–01–P The governing documents for MEMX with respect to the proposed rule can be found in Exhibit A to MEMX’s change that are filed with the Form 1 application, and a listing of the Commission, and all written SECURITIES AND EXCHANGE officers and directors of MEMX can be communications relating to the COMMISSION found in Exhibit J. The governing proposed rule change between the [Release No. 34–87436; File No. 10–237] documents for MEMX Holdings and Commission and any person, other than MEMX SubCo LLC can be found in those that may be withheld from the MEMX LLC; Notice of Filing of Exhibit C to MEMX’s Form 1 public in accordance with the Application, as Amended, for application. One notable novel provisions of 5 U.S.C. 552, will be Registration as a National Securities governance provision in the LLC available for website viewing and Exchange Under Section 6 of the Agreement of MEMX Holdings concerns printing in the Commission’s Public Securities Exchange Act of 1934 quorum requirements for the board of Reference Room, 100 F Street NE, October 31, 2019. directors that would require the Washington, DC 20549 on official On September 9, 2019, MEMX LLC presence of certain named investor- business days between the hours of (‘‘MEMX’’ or ‘‘Applicant’’) filed with 10:00 a.m. and 3:00 p.m. Copies of the the Securities and Exchange Restated LLC Agreement of MEMX LLC), B (Rules filing also will be available for Commission (‘‘Commission’’) a Form 1 of MEMX), C–2 (Third Amended and Restated LLC inspection and copying at the principal Agreement of MEMX Holdings LLC), and C–4 application under the Securities (Amended and Restated LLC Agreement of MEMX office of the Exchange. All comments Exchange Act of 1934 (‘‘Exchange Act’’), SubCo LLC). received will be posted without change. seeking registration as a national 2 15 U.S.C. 78s(a). Persons submitting comments are securities exchange under Section 6 of 3 A similar ownership structure exists for MEMX cautioned that we do not redact or edit the Exchange Act. On October 23, 2019, Execution Services LLC, which would act as an personal identifying information from MEMX submitted Amendment No. 1 to optional outbound routing broker for MEMX. 4 1 See Exhibit B (Directors and Observers comment submissions. You should its Form 1 application. MEMX’s Form Schedule) to the Third Amended and Restated LLC submit only information that you wish Agreement of MEMX Holdings. to make available publicly. All 49 15 U.S.C. 78s(b)(2). 5 See ‘‘Exchange Director Nominating Member’’ as submissions should refer to File 50 Id. defined in Article 1.1 of the Third Amended and 51 Number SR–NYSEArca–2019–12 and 17 CFR 200.30–3(a)(12). Restated LLC Agreement of MEMX Holdings. See 1 In Amendment No. 1, Applicant submitted also Exhibit J (Exchange Director Nomination should be submitted on or before updated portions of its Form 1 application, Rotation) to the Third Amended and Restated LLC November 27, 2019. including Exhibits A–5 (Second Amended and Agreement of MEMX Holdings.

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