9768 Federal Register / Vol. 80, No. 36 / Tuesday, February 24, 2015 / Notices 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3 15 U.S.C. 78s(b)(3)(A). 

4 17 CFR 240.19b–4(f)(6)(iii). 

5See Securities Exchange Act Release No. 71375 

(January 23, 2014), 79 FR 4771 (January 29, 2014) 

(SR–BATS–2013–059; SR–BYX–2013–039). 

are based on services provided that are 

in addition to, rather than duplicative 

of, services provided under the advisory 

contract(s) of any Underlying Fund in 

which the Fund of Funds may invest. 

Such finding, and the basis upon which 

the finding was made, will be recorded 

fully in the minute books of the 

appropriate Fund of Funds. 

10. The Adviser will waive fees 

otherwise payable to it by a Fund of 

Funds in an amount at least equal to any 

compensation (including fees received 

pursuant to any plan adopted by an 

Unaffiliated Investment Company 

pursuant to rule 12b-1 under the 1940 

Act) received from an Unaffiliated Fund 

by the Adviser, or an affiliated person 

of the Adviser, other than any advisory 

fees paid to the Adviser or its affiliated 

person by the Unaffiliated Investment 

Company, in connection with the 

investment by the Fund of Funds in the 

Unaffiliated Fund. Any Sub-Adviser 

will waive fees otherwise payable to the 

Sub-Adviser, directly or indirectly, by 

the Fund of Funds in an amount at least 

equal to any compensation received by 

the Sub-Adviser, or an affiliated person 

of the Sub-Adviser, from an Unaffiliated 

Fund, other than any advisory fees paid 

to the Sub-Adviser or its affiliated 

person by the Unaffiliated Investment 

Company, in connection with the 

investment by the Fund of Funds in the 

Unaffiliated Fund made at the direction 

of the Sub-Adviser. In the event that the 

Sub-Adviser waives fees, the benefit of 

the waiver will be passed through to the 

Fund of Funds. 

11. Any sales charges and/or service 

fees charged with respect to shares of a 

Fund of Funds will not exceed the 

limits applicable to funds of funds set 

forth in NASD Conduct Rule 2830. 

12. No Underlying Fund will acquire 

securities of any other investment 

company or company relying on section 

3(c)(1) or 3(c)(7) of the 1940 Act, in 

excess of the limits contained in section 

12(d)(1)(A) of the 1940 Act, except to 

the extent that such Underlying Fund: 

(a) Acquires such securities in 

compliance with section 12(d)(1)(E) of 

the 1940 Act and either is an Affiliated 

Fund or is in the same ‘‘group of 

investment companies’’ as its 

corresponding master fund; (b) receives 

securities of another investment 

company as a dividend or as a result of 

a plan of reorganization of a company 

(other than a plan devised for the 

purpose of evading section 12(d)(1) of 

the 1940 Act); or (c) acquires (or is 

deemed to have acquired) securities of 

another investment company pursuant 

to exemptive relief from the 

Commission permitting such 

Underlying Fund to: (i) Acquire 

securities of one or more investment 

companies for short-term cash 

management purposes or (ii) engage in 

inter-fund borrowing and lending 

transactions. 

B. Other Investments by Section 

12(d)(1)(G) Funds of Funds 

Applicants agree that the order 

granting the requested relief to permit 

Section 12(d)(1)(G) Funds of Funds to 

invest in Other Investments shall be 

subject to the following condition: 

1. Applicants will comply with all 

provisions of rule 12d1–2 under the 

1940 Act, except for paragraph (a)(2) to 

the extent that it restricts any Section 

12(d)(1)(G) Fund of Funds from 

investing in Other Investments as 

described in the application. 

For the Commission, by the Division of 

Investment Management, pursuant to 

delegated authority. 

Brent J. Fields, 

Secretary. 

[FR Doc. 2015–03689 Filed 2–23–15; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–74294; File No. SR–BYX– 

2015–10] 

Self-Regulatory Organizations; BATS 

Y–Exchange, Inc.; Notice of Filing and 

Immediate Effectiveness of a Proposed 

Rule Change To Amend Rule 8.15 

Entitled ‘‘Imposition of Fines for Minor 

Violation(s) of Rules’’ 

February 18, 2015. 

Pursuant to Section 19(b)(1) of the 

Securities Exchange Act of 1934 (the 

‘‘Act’’),1 and Rule 19b–4 thereunder,2

notice is hereby given that on February 

5, 2015, BATS Y–Exchange, Inc. (the 

‘‘Exchange’’ or ‘‘BYX’’) 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. The Exchange has 

designated this proposal as a ‘‘noncontroversial’’ proposed rule change 

pursuant to Section 19(b)(3)(A) of the 

Act 3 and Rule 19b–4(f)(6)(iii) 

thereunder,4 which renders it effective 

upon filing with the Commission. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange filed a proposal to 

amend Rule 8.15 entitled ‘‘Imposition of 

Fines for Minor Violation(s) of Rules.’’ 

The text of the proposed rule change is 

available at the Exchange’s Web site at 

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 Exchange proposes to amend 

Rule 8.15 in order to make it 

substantively identical to the 

corresponding rules on EDGX Exchange, 

Inc. (‘‘EDGX’’) and EDGA Exchange, Inc. 

(‘‘EDGA’’), as further described below. 

Earlier this year, the Exchange and its 

affiliate, BATS Exchange, Inc. (‘‘BZX’’), 

received approval to effect a merger (the 

‘‘Merger’’) of the Exchange’s parent 

company, BATS Global Markets, Inc., 

with Direct Edge Holdings LLC, the 

indirect parent of EDGX and EDGA 

(together with BZX, BYX and EDGX, the 

‘‘BGM Affiliated Exchanges’’).5 In the 

context of the Merger, the BGM 

Affiliated Exchanges are working to 

align certain system and regulatory 

functionality, retaining only intended 

differences between the BGM Affiliated 

Exchanges. Thus, the proposal set forth 

below is intended to amend Rule 8.15 

in order to make the rule substantively 

identical to corresponding rules on 

EDGA and EDGX related to minor 

violations of exchange rules in order to 

provide a consistent regulatory 

approach across each of the BGM 

Affiliated Exchanges. 

Currently, Rule 8.15(a) provides that, 

in lieu of commencing a disciplinary 


tkelley on DSK3SPTVN1PROD with NOTICES
Federal Register / Vol. 80, No. 36 / Tuesday, February 24, 2015 / Notices 9769 

6See EDGX Rule 8.15(a) and Interpretation and 

Policy .01 to Rule 8.15 and EDGA Rule 8.15(a) and 

Interpretation and Policy .01 to Rule 8.15. 

7The Exchange notes that these proposed changes 

would make the Exchange’s Rule 8.15 substantively 

identical to the corresponding EDGA and EDGX 

rules based on filings SR–EDGA–2015–11 and SR– 

EDGX–2015–10. Such filings propose to remove 

paragraph (d) of Interpretation and Policy .01 to 

both EDGA and EDGX rules 8.15. The Exchange 

also notes that BZX intends to file a proposal very 

similar to this proposal that will align the rules 

related to fines for minor violation of exchange 

rules across each of the BGM Affiliated Exchanges. 

8 15 U.S.C. 78f(b). 

9 15 U.S.C. 78f(b)(5). 

10See supra note 7. 11 15 U.S.C. 78f(b)(1) and 78f(b)(6). 

proceeding as described in Rules 8.1 

through 8.13, the Exchange may, subject 

to the requirements set forth in this 

Rule, impose a fine, not to exceed 

$2,500, on any Member, associated 

person of a Member, or registered or 

non-registered employee of a Member, 

for any violation of a Rule of the 

Exchange, which violation the Exchange 

shall have determined is minor in 

nature. The Exchange is proposing to 

add language in order to make Rule 

8.15(a) and Interpretation and Policy .01 

to Rule 8.15 identical to the 

corresponding EDGA and EDGX rules.6

Specifically, the Exchange is proposing 

that the Exchange may, if no exceptional 

circumstances are present, impose a fine 

based upon a determination that there 

exists a pattern or practice of violative 

conduct. As proposed, the Exchange 

also may aggregate similar violations 

generally if the conduct was 

unintentional, there was no injury to 

public investors, or the violations 

resulted from a single systemic problem 

or cause that has been corrected. 

Currently, under Interpretation and 

Policy .01 to Rule 8.15, the Exchange 

fines individuals $100, $300, and $500 

and Member firms $500, $1,000, and 

$2,500 for their first, second, and third 

time fined under Rule 8.15 within a 

rolling 12-month period, respectively, 

for the following violations of Exchange 

rules: (a) Rule 4.2 and Interpretation and 

Policy thereunder requiring the 

submission of responses to Exchange 

requests for trading data within a 

specified time period; (b) Rule 11.19 

requirement to identify short sale orders 

as such; and (c) Rule 11.20 requirement 

to comply with locked and crossed 

market rules. The Exchange is proposing 

to add two additional instances to the 

fine structure described above. These 

additional instances include: (1) Rule 

3.5 Advertising Practices; and (2) Rule 

12.11 Interpretation and Policy .01 and 

Exchange Act Rule 604—Failure to 

properly display limit orders.7

The Exchange is also proposing to 

make several non-substantive changes to 

Interpretation and Policy .01 to Rule 

8.15. First, the Exchange is proposing to 

change the numbering within the rule to 

reflect the additions described above. 

Second, the Exchange is proposing to 

change the phrase ‘‘limit orders’’ in 

paragraph (e) of Interpretation and 

Policy .01 to Rule 8.15 to ‘‘quotations.’’ 

The Exchange believes that this change 

is non-substantive because, in this 

instance, the terms limit orders and 

quotations are interchangeable. 

Paragraph (e) is referring to the 

obligation of a Market Maker under Rule 

11.8 to maintain continuous liquidity of 

both buy and sell orders, which are 

referred to as quotes or quotations in 

Rule 11.8, at certain prices. Based on 

Exchange functionality, the only way to 

enter priced orders that could meet such 

quotation obligations would be through 

use of limit orders. As such, the 

Exchange believes that the proposed 

change is non-substantive, makes the 

rule more clear, and more accurately 

reflects the language used in Exchange 

Rule 11.8. Further, the change would 

make the rule text identical to that of 

EDGA and EDGX. 

2. Statutory Basis 

The Exchange believes that the rule 

change proposed in this submission 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) of the Act.8 Specifically, 

the proposed change is consistent with 

Section 6(b)(5) of the Act,9 because it is 

designed to promote just and equitable 

principles of trade, to remove 

impediments to, and perfect the 

mechanism of, a free and open market 

and a national market system, and, in 

general, to protect investors and the 

public interest. As mentioned above, the 

proposed rule changes, combined with 

the planned filing for BZX,10 would 

allow the BGM Affiliated Exchanges to 

provide a consistent set of rules as it 

relates to the imposition of fines for 

minor violations of rules across each of 

the exchanges. Consistent rules, in turn, 

will simplify the regulatory 

requirements for Members of the 

Exchange that are also participants on 

BZX, EDGA, and/or EDGX. The 

proposed rule change would provide 

greater harmonization between rules of 

similar purpose on the BGM Affiliated 

Exchanges, resulting in greater 

uniformity and less burdensome and 

more efficient regulatory compliance. 

As such, the proposed rule change 

would foster cooperation and 

coordination with persons engaged in 

facilitating transactions in securities and 

would remove impediments to and 

perfect the mechanism of a free and 

open market and a national market 

system. 

Specifically, the changes to Rule 

8.15(a) and the addition of new 

paragraphs (d) and (e) to Interpretation 

and Policy .01 of Rule 8.15 will provide 

the Exchange with additional ways to 

handle related minor violations as well 

as providing the Exchange with the 

ability to handle other rule violations 

which it believes to be minor under 

Rule 8.15. The Exchange believes that, 

in addition to the benefits to Members 

described above, the proposal will 

enhance the Exchange’s ability to 

efficiently regulate its Members, 

meaning that the proposed rule change 

is equitable and will promote fairness in 

the market place. 

Further, the Exchange believes that 

the proposal is consistent with Sections 

6(b)(1) and 6(b)(6) of the Act 11 which 

require that the rules of an exchange 

enforce compliance with, and provide 

appropriate discipline for, violations of 

the Commission and Exchange rules. 

The Exchange also believes that the 

proposal is consistent with the public 

interest, the protection of investors, or 

otherwise in furtherance of the purposes 

of the Act because the proposal helps to 

strengthen the Exchange’s ability to 

carry out its oversight and enforcement 

responsibilities as a self-regulatory 

organization in cases where full 

disciplinary proceedings are unsuitable 

in view of the minor nature of a 

particular violation. 

Finally, the Exchange believes that 

the non-substantive changes discussed 

above will contribute to the protection 

of investors and the public interest by 

helping to avoid confusion with respect 

to Exchange rules. 

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 not 

necessary or appropriate in furtherance 

of the purposes of the act. To the 

contrary, allowing the Exchange to 

implement substantively identical rules 

related to the imposition of fines for 

minor violations of rules across each of 

the BGM Affiliated Exchanges does not 

present any competitive issues, but 

rather is designed to provide greater 

harmonization among Exchange, BZX, 

EDGA, and EDGX rules of similar 

purpose, resulting in less burdensome 

and more efficient regulatory 

compliance for common members of the 


tkelley on DSK3SPTVN1PROD with NOTICES
9770 Federal Register / Vol. 80, No. 36 / Tuesday, February 24, 2015 / Notices 

12 15 U.S.C. 78s(b)(3)(A). 

13 17 CFR 240.19b–4. 

14 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3See Securities Exchange Act Release No. 73593 

(Nov. 14, 2014), 79 FR 69153 (‘‘Notice’’). 

4The Exchange also submitted a copy of the 

amendment to the public comment file. See Letter 

from Sudhir Bhattacharyya, Vice President, New 

York Stock Exchange, to Kevin M. O’Neill, Deputy 

Secretary, Commission (Nov. 14, 2014). 

5 15 U.S.C. 78s(b)(2). 

6See Securities Exchange Act Release No. 73913, 

79 FR 78531 (Dec. 30, 2014). The Commission 

designated February 18, 2015, as the date by which 

it should approve, disapprove, or institute 

proceedings to determine whether to disapprove the 

proposed rule change. 

7 15 U.S.C. 78s(b)(2)(B). 

BGM Affiliated Exchanges and an 

enhanced ability of the BGM Affiliated 

Exchanges to fairly and efficiently 

regulate members, which will further 

enhance competition. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants or Others 

The Exchange has neither solicited 

nor received written comments on the 

proposed rule change. 

III. 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 12 and paragraph 

of Rule 19b–4(f)(6) thereunder.13

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. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views and 

arguments concerning the foregoing, 

including whether the proposal 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 rule-comments@

sec.gov. Please include File No. SR– 

BYX–2015–10 on the subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Brent J. Fields, Secretary, Securities 

and Exchange Commission, 100 F Street 

NE., Washington, DC 20549–1090. 

All submissions should refer to File No. 

SR–BYX–2015–10. 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 such 

filing will also 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 No. SR–BYX–2015– 

10 and should be submitted on or before 

March 17, 2015. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.14

Brent J. Fields, 

Secretary. 

[FR Doc. 2015–03669 Filed 2–23–15; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–74298; File No. SR– 

NYSEMKT–2014–95] 

Self-Regulatory Organizations; NYSE 

MKT LLC; Order Instituting 

Proceedings to Determine Whether to 

Approve or Disapprove a Proposed 

Rule Change, as Modified by Partial 

Amendment No. 1 and Partial 

Amendment No. 2, Amending Rule 

13—Equities and Related Rules 

Governing Order Types and Modifiers 

February 18, 2015. 

I. Introduction 

On October 31, 2014, NYSE MKT LLC 

(‘‘NYSE MKT’’ or ‘‘Exchange’’) filed 

with the Securities and Exchange 

Commission (‘‘Commission’’), pursuant 

to section 19(b)(1) of the Securities 

Exchange Act of 1934 (‘‘Act’’) 1 and Rule 

19b–4 thereunder,2 a proposed rule 

change to amend Exchange Rule 13— 

Equities and other related Exchange 

rules governing order types and order 

modifiers. The proposed rule change 

was published in the Federal Register 

on November 20, 2014.3 On November 

14, 2014, the Exchange submitted 

Partial Amendment No. 1 to the 

Commission.4 On December 22, 2014, 

the Exchange submitted Partial 

Amendment No. 2 to the Commission. 

On December 22, 2014, pursuant to 

section 19(b)(2) of the Act,5 the 

Commission designated a longer period 

within which to approve the proposed 

rule change, disapprove the proposed 

rule change, or institute proceedings to 

determine whether to disapprove the 

proposed rule change.6 The Commission 

has received no other comment on the 

proposal. This order institutes 

proceedings under section 19(b)(2)(B) of 

the Act 7 to determine whether to 

approve or disapprove the proposal. 

II. Description of the Proposal 

The Exchange proposes to amend 

Exchange Rule 13—Equities by regrouping and re-numbering existing 

order types and order modifiers. The 

Exchange also proposes to make 

changes to certain order types and order 

modifiers. In addition, the Exchange 

proposes to amend certain rules to 

remove references to functionality that 

is no longer operative. Under the 

proposal, Rule 13—Equities would be 

reorganized into six categories: (a) 

Primary order types; (b) time in force 

modifiers; (c) auction-only orders; (d) 

orders with instructions not to display 

all or a portion of the order; (e) orders 

with instructions not to route; and (f) 

additional orders and modifiers. 

A. Primary Order Types 

Proposed section (a) of Rule 13— 

Equities would set forth two primary 

order types—Market Orders and Limit 

Orders—and specify which orders are 

eligible for automatic executions. The 

Exchange proposes to delete the current 

definition of ‘‘Auto Ex Order’’ and 


tkelley on DSK3SPTVN1PROD with NOTICES