Federal Register / Vol. 80, No. 69 / Friday, April 10, 2015 / Notices 19381 

2Every existing entity that currently intends to 

rely on the requested order is named as an 

applicant. Any entity that relies on the order in the 

future will do so only in accordance with the terms 

and condition in the application. 

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). 

management investment companies 

(‘‘Underlying Funds’’) in reliance on 

section 12(d)(1)(G) of the Act; and (d) 

also is eligible to invest in securities (as 

defined in section 2(a)(36) of the Act) in 

reliance on rule 12d1–2 under the Act 

(each a ‘‘Fund of Funds’’), and together 

with the Underlying Funds, the 

‘‘Funds’’), also to invest, to the extent 

consistent with its investment 

objectives, policies, strategies and 

limitations, in financial instruments that 

may not be securities within the 

meaning of section 2(a)(36) of the Act 

(‘‘Other Investments’’).2 Applicants also 

request that the order exempt any entity 

controlling, controlled by or under 

common control with VESC, that now or 

in the future acts as principal 

underwriter with respect to the 

transactions described in the 

application. 

4. Consistent with its fiduciary 

obligations under the Act, each Fund of 

Funds’ board of trustees will review the 

advisory fees charged by the Fund of 

Funds’ Adviser to ensure that they are 

based on services provided that are in 

addition to, rather than duplicative of, 

services provided pursuant to the 

advisory agreement of any investment 

company in which the Fund of Funds 

may invest. 

Applicants’ Legal Analysis 

1. Section 12(d)(1)(A) of the Act 

provides that no registered investment 

company (‘‘acquiring company’’) may 

acquire securities of another investment 

company (‘‘acquired company’’) if such 

securities represent more than 3% of the 

acquired company’s outstanding voting 

stock or more than 5% of the acquiring 

company’s total assets, or if such 

securities, together with the securities of 

other investment companies, represent 

more than 10% of the acquiring 

company’s total assets. Section 

12(d)(1)(B) of the Act provides that no 

registered open-end investment 

company may sell its securities to 

another investment company if the sale 

will cause the acquiring company to 

own more than 3% of the acquired 

company’s voting stock, or cause more 

than 10% of the acquired company’s 

voting stock to be owned by investment 

companies and companies controlled by 

them. 

2. Section 12(d)(1)(G) of the Act 

provides, in part, that section 12(d)(1) 

will not apply to securities of an 

acquired company purchased by an 

acquiring company if: (i) The acquired 

company and acquiring company are 

part of the same group of investment 

companies; (ii) the acquiring company 

holds only securities of acquired 

companies that are part of the same 

group of investment companies, 

Government securities, and short-term 

paper; (iii) the aggregate sales loads and 

distribution-related fees of the acquiring 

company and the acquired company are 

not excessive under rules adopted 

pursuant to section 22(b) or section 

22(c) of the Act by a securities 

association registered under section 15A 

of the Exchange Act or by the 

Commission; and (iv) the acquired 

company has a policy that prohibits it 

from acquiring securities of registered 

open-end investment companies or 

registered unit investment trusts in 

reliance on section 12(d)(1)(F) or (G) of 

the Act. 

3. Rule 12d1–2 under the Act permits 

a registered open-end investment 

company or a registered unit investment 

trust that relies on section 12(d)(1)(G) of 

the Act to acquire, in addition to 

securities issued by another registered 

investment company in the same group 

of investment companies, Government 

securities, and short-term paper: (i) 

Securities issued by an investment 

company that is not in the same group 

of investment companies, when the 

acquisition is in reliance on section 

12(d)(1)(A) or 12(d)(1)(F) of the Act; (ii) 

securities (other than securities issued 

by an investment company); and (iii) 

securities issued by a money market 

fund, when the investment is in reliance 

on rule 12d1–1 under the Act. For the 

purposes of rule 12d1–2, ‘‘securities’’ 

means any security as defined in section 

2(a)(36) of the Act. 

4. Section 6(c) of the Act provides that 

the Commission may exempt any 

person, security, or transaction from any 

provision of the Act, or from any rule 

under the Act, if such exemption is 

necessary or appropriate in the public 

interest and consistent with the 

protection of investors and the purposes 

fairly intended by the policies and 

provisions of the Act. Applicants submit 

that their request for relief meets this 

standard. 

5. Applicants request an order under 

section 6(c) of the Act for an exemption 

from rule 12d1–2(a) to allow the Funds 

of Funds to invest in Other Investments 

while investing in Underlying Funds. 

Applicants state that the Funds of 

Funds will comply with rule 12d1–2 

under the Act, but for the fact that the 

Funds of Funds may invest a portion of 

their assets in Other Investments. 

Applicants assert that permitting the 

Funds of Funds to invest in Other 

Investments as described in the 

application would not raise any of the 

concerns that the requirements of 

section 12(d)(1) were designed to 

address. 

Applicants’ Condition 

Applicants agree that any order 

granting the requested relief will be 

subject to the following condition: 

Applicants will comply with all 

provisions of rule 12d1–2 under the Act, 

except for paragraph (a)(2) to the extent 

that it restricts any Fund of Funds from 

investing in Other Investments as 

described in the application. 

For the Commission, by the Division of 

Investment Management, under delegated 

authority. 

Brent J. Fields, 

Secretary. 

[FR Doc. 2015–08258 Filed 4–9–15; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–74656; File No. SR–BATS– 

2015–25] 

Self-Regulatory Organizations; BATS 

Exchange, Inc.; Notice of Filing and 

Immediate Effectiveness of a Proposed 

Rule Change To Amend Rule 4.3, 

Record of Written Complaints 

April 6, 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 March 26, 

2015, BATS Exchange, Inc. (the 

‘‘Exchange’’ or ‘‘BATS’’) 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 proposes to amend 

Rule 4.3, Record of Written Complaints. 

The text of the proposed rule change is 

below. Proposed new language is in 

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19382 Federal Register / Vol. 80, No. 69 / Friday, April 10, 2015 / Notices 

5See EDGA and EDGX Rules 4.3. See also 

Securities Exchange Act Release Nos. 70715 

(October 15, 2013), 78 FR 64041 (October 18, 2013) 

(SR–EDGA–2013–31) (Notice of Filing and 

Immediate Effectiveness of Proposed Rule Change 

to Amend EDGA Rule 4.3, Record of Written 

Complains, to Conform with Financial Industry 

Regulatory Authority, Inc. Rule 4513); and 70714 

(October 15, 2013), 78 FR 64038 (October 18, 2013) 

(SR–EDGX–2013–39) (Notice of Filing and 

Immediate Effectiveness of Proposed Rule Change 

to Amend EDGX Rule 4.3, Record of Written 

Complains, to Conform with Financial Industry 

Regulatory Authority, Inc. Rule 4513). 

6 17 CFR 240.17d–2. 

7See Securities and Exchange Release No. 58375 

(August 13, 2008), 75 FR 51295 (August 19, 2008) 

(approving File No. 10–198). 

8See also Securities Exchange Act Release No. 

63784 (January 27, 2011), 76 FR 5850 (February 2, 

2011) (Order Approving Proposed Rule Change); 

(File No. SR–FINRA–2010–052). 

9Exchange Rule 4.3(b) defines a ‘‘complaint’’ as 

‘‘any written statement of a customer or any person 

acting on behalf of a customer alleging a grievance 

involving the activities of a Member or persons 

under the control of the Member in connection with 

(1) the solicitation or execution of any transaction 

conducted or contemplated to be conducted 

through the facilities of the Exchange or (2) the 

disposition of securities or funds of that customer 

which activities are related to such a transaction.’’ 

10See 15 U.S.C. 78f(b). 

11 15 U.S.C. 78f(b)(5). 

12 15 U.S.C. 78f(b)(5). 

italics; proposed deletions are in 

brackets. 

* * * * * 

Rule 4.3. Record of Written Complaints 

(a) Each Member shall keep and 

preserve for a period of not less than 

[five]four years a file of all written 

complaints of customers and action 

taken by the Member in respect thereof, 

if any. Further, for the first two years of 

the [five]four-year period, the Member 

shall keep such file in a place readily 

accessible to examination or spot 

checks. 

(b) (No change). 

* * * * * 

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 II.A., II.B., and II.C. 

below, of the most significant aspects 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 filed a proposal to 

amend Rule 4.3, Record of Written 

Complaints, to conform with the rules of 

the Financial Industry Regulatory 

Authority, Inc. (‘‘FINRA’’) for purposes 

of an agreement between the Exchange 

and FINRA, as well as to conform 

Exchange Rule 4.3 with the rules of the 

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

EDGA Exchange, Inc. (‘‘EDGA’’).5

Pursuant to Rule 17d–2 under the 

Act,6 the Exchange and FINRA entered 

into an agreement to allocate regulatory 

responsibility for common rules (the 

‘‘17d–2 Agreement’’). The 17d–2 

Agreement covers common members of 

the Exchange and FINRA and allocates 

to FINRA regulatory responsibility, with 

respect to common members, for the 

following: (i) Examination of common 

members of the Exchange and FINRA 

for compliance with federal securities 

laws, rules and regulations and rules of 

the Exchange that the Exchange has 

certified as identical or substantially 

similar to FINRA rules; (ii) investigation 

of common members of the Exchange 

and FINRA for violations of federal 

securities laws, rules or regulations, or 

Exchange rules that the Exchange has 

certified as identical or substantially 

identical to a FINRA rule; and (iii) 

enforcement of compliance by common 

members of the Exchange and FINRA 

with the federal securities laws, rules 

and regulations, and the rules of the 

Exchange that the Exchange has 

certified as identical or substantially 

similar to FINRA rules.7

The 17d–2 Agreement included a 

certification by the Exchange that states 

that the requirements contained in 

certain Exchange rules are identical to, 

or substantially similar to, certain 

FINRA rules that have been identified as 

comparable. To conform to comparable 

FINRA rules for purposes of the 17d–2 

Agreement, the Exchange proposes to 

amend Rule 4.3, Record of Written 

Complaints, to align with FINRA Rule 

4513.8

Exchange Rule 4.3 currently requires 

that members of the Exchange 

(‘‘Members’’) keep and preserve written 

customer complaints 9 for a period of 

not less than five years, the first two of 

which must be in a readily accessible 

place. To take into account FINRA’s 

four-year routine examination cycle for 

certain members, FINRA Rule 4513 

requires that members preserve the 

customer complaint records for a period 

of at least four years. Under the 17d–2 

Agreement, FINRA examines common 

members of the Exchange and FINRA 

for compliance with Exchange Rule 4.3. 

However, because of the differing 

retention periods between Exchange 

Rule 4.3 and FINRA Rule 4513, the 17d– 

2 Agreement specifically states that 

FINRA has the regulatory 

responsibilities for the first four years of 

Exchange Rule 4.3’s five year record 

retention requirement. 

The Exchange, therefore, proposes to 

decrease the record retention 

requirements under Rule 4.3 from five 

to four years. The Exchange believes 

that amending the record retention 

requirements for customer complaints to 

align with FINRA Rule 4513 would help 

to avoid confusion among Members that 

are also members of FINRA, EDGA, or 

EDGX. The Exchange further believes 

that aligning the Exchange’s rules with 

FINRA Rule 4513 would account for 

FINRA’s four-year routine examination 

cycle for certain members, which 

FINRA conducts on the Exchange’s 

behalf under the 17d–2 Agreement 

ensuring consistent regulation of 

Members that are also members of 

FINRA. 

2. Statutory Basis 

The Exchange believes that the 

proposed rule change is consistent with 

Section 6(b) of the Act 10 in general, and 

furthers the objectives of Section 6(b)(5) 

of the Act 11 in particular, in that 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, by eliminating 

unnecessary confusion with respect to 

the Exchange’s rules. The proposed rule 

change should provide greater 

harmonization between similar 

Exchange, EDGA, EDGX and FINRA 

rules, resulting in greater uniformity 

and less burdensome and more efficient 

regulatory compliance. The proposed 

rule change should foster cooperation 

and coordination with persons engaged 

in facilitating transactions in securities 

and should remove impediments to and 

perfect the mechanism of a free and 

open market and a national market 

system consistent with the requirements 

of Section 6(b)(5) of the Act.12

(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 because the 

proposed change would apply to all 

Members equally. 

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Federal Register / Vol. 80, No. 69 / Friday, April 10, 2015 / Notices 19383 

13See 15 U.S.C. 78s(b)(3)(a)(ii). 

14See 17 CFR 240.19b–4(f)(6). In addition, Rule 

19b–4(f)(6) requires a self-regulatory organization to 

give the Commission written notice of its intent to 

file 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. The Exchange has satisfied this 

requirement. 

15See 17 CFR 200.30–3(a)(12). 

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

2 15 U.S.C. 78a. 

3 17 CFR 240.19b–4. 4See Rule 1000. 

(C) Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants or Others 

No written comments were either 

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)(ii) of the Act 13 and 

subparagraph (f)(6) of Rule 19b–4 

thereunder.14

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: (i) Necessary or appropriate in 

the public interest; (ii) for the protection 

of investors; or (iii) 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. 

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 rule-comments@

sec.gov. Please include File No. SR– 

BATS–2015–25 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–BATS–2015–25. 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; 

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–BATS–2015–25 and should be 

submitted on or before May 1, 2015. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.15

Brent J. Fields, 

Secretary. 

[FR Doc. 2015–08204 Filed 4–9–15; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–74649; File No. SR–NYSE– 

2015–14] 

Self-Regulatory Organizations; New 

York Stock Exchange LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change Amending Rule 

1000 To Reflect That Exchange 

Systems Will Reject Incoming Orders 

of Over 1,000,000 Shares That Are 

Marketable Upon Arrival 

April 6, 2015. 

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 March 23, 

2015, New York Stock Exchange LLC 

(‘‘NYSE’’ or ‘‘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 self-regulatory organization. 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 proposes to amend 

Rule 1000 to reflect that Exchange 

systems will reject incoming orders of 

over 1,000,000 shares that are 

marketable upon arrival. The text of 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 amend 

Rule 1000 (Automatic Executions) to 

reflect that Exchange systems will reject 

incoming orders of over 1,000,000 

shares that are marketable upon arrival 

against interest in Exchange systems. 

Currently, Exchange systems accept 

orders up to a maximum order size of 

25,000,000 shares.4 Rule 1000 provides 

that market and limit orders of up to 

1,000,000 shares are eligible to initiate 

or participate in automatic executions 

on the Exchange. However, because an 

order of over 1,000,000 shares in size is 

ineligible for automatic execution, if 

such an order is marketable on arrival, 

the Exchange suspends automatic 

executions in that security and it is 

auto-quoted with a ‘‘slow’’ quote 

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