Federal Register / Vol. 80, No. 76 / Tuesday, April 21, 2015 / Notices 22245 

8 15 U.S.C. 78s(b)(3)(A). 

9 17 CFR 240.19b–4(f)(2). 10 17 CFR 200.30–3(a)(12). 

FINRA rules provide for the equitable 

allocation of reasonable dues, fees and 

other charges among members and 

issuers and other persons using any 

facility or system that FINRA operates 

or controls. FINRA believes that the 

proposed rule change to waive trade 

reporting fees under Rule 7710, as 

described herein, is appropriate in light 

of the ORF systems issue on March 24, 

2015. FINRA does not believe that 

members should incur fees for the 

corrective action they were required to 

take following the ORF systems issue. 

FINRA believes that this limited waiver 

results in reasonable fees and financial 

benefits that are equitably allocated. The 

financial benefit of the trade reporting 

fee waiver is available to all firms that 

reported to the ORF on March 24, 2015 

and to all firms that reported trades with 

an execution date or original report date 

of March 24, 2015, provided that such 

reports were received by March 31, 

2015. The proposed rule change is 

reasonable because the waiver of ORF 

trade reporting fees—and the financial 

benefit from such waiver—is of limited 

amount, duration and application, as 

noted above. Finally, the proposed trade 

reporting fee waiver does not unfairly 

discriminate between or among 

members in that the waiver is available 

to any such member that reported 

transactions to the ORF on the relevant 

dates. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

FINRA 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. FINRA 

believes that the proposed rule change 

to waive the trade reporting fees is 

appropriate in light of the ORF systems 

issue, which required members to take 

corrective action and make additional 

submissions to the ORF. FINRA believes 

that the limited trade reporting fee 

waiver would not place an unreasonable 

fee burden on members, nor confer an 

uncompetitive benefit to members that 

have their trade reporting fees waived, 

in that such waiver would be available 

for a very limited period and the 

financial impact of such a waiver would 

be de minimis. 

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) 

of the Act 8 and paragraph (f)(2) of Rule 

19b–4 thereunder.9 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. 

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 Number SR– 

FINRA–2015–007 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 

Number SR–FINRA–2015–007. 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 also will be available for 

inspection and copying at the principal 

offices 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–FINRA– 

2015–007, and should be submitted on 

or before May 12, 2015. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.10

Brent J. Fields, 

Secretary. 

[FR Doc. 2015–09070 Filed 4–20–15; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Investment Company Act Release No. 

31552; File No. 812–14302] 

Voya Retirement Insurance and 

Annuity Company et al.; Notice of 

Application 

April 15, 2015. 

AGENCY: Securities and Exchange 

Commission (‘‘SEC’’ or ‘‘Commission’’). 

ACTION: Notice of application for an 

order approving the substitution of 

certain securities pursuant to section 

26(c) of the Investment Company Act of 

1940, as amended (the ‘‘1940 Act’’ or 

‘‘Act’’). 

Applicants: Voya Retirement 

Insurance and Annuity Company 

(‘‘Voya Retirement’’), Voya Insurance 

and Annuity Company (‘‘Voya 

Insurance’’), ReliaStar Life Insurance 

Company of New York (‘‘ReliaStar 

NY’’), and Security Life of Denver 

Insurance Company (‘‘Security Life’’) 

(each a ‘‘Company’’ and together, the 

‘‘Companies’’), Variable Annuity 

Account B of Voya Retirement (‘‘Voya 

Retirement B’’), Variable Annuity 

Account I of Voya Retirement (‘‘Voya 

Retirement I’’), Separate Account B of 

Voya Insurance (‘‘Voya Insurance B’’), 

Separate Account EQ of Voya Insurance 

(‘‘Voya Insurance EQ’’), ReliaStar Life 

Insurance Company of New York 

Separate Account NY–B (‘‘ReliaStar 

NY–B’’), Security Life Separate Account 

A1 (‘‘Security Life A1’’), Security Life 

Separate Accounts S–A1 (‘‘Security Life 

S–A1’’) (each, an ‘‘Account’’ and 


tkelley on DSK3SPTVN1PROD with NOTICES
22246 Federal Register / Vol. 80, No. 76 / Tuesday, April 21, 2015 / Notices 

1Prior to September 1, 2014, Voya Retirement 

was known as ING Life Insurance and Annuity 

Company and Voya Insurance was known as ING 

USA Annuity and Life Insurance Company. Prior to 

April 7, 2014, Voya Financial, Inc. was known as 

ING U.S. Inc. 

2Effective May 1, 2014 Voya Variable Portfolios 

changed its name from ING Variable Portfolios, Inc. 

The names of the Replacement Funds were also 

changed as of this date to reflect the rebranding of 

the investment company. 

3Effective May 1, 2014, Voya Investments 

changed its name from ING Investments, LLC. 

together, the ‘‘Accounts’’) and Voya 

Variable Portfolios, Inc. The Companies, 

the Accounts, and Voya Variable 

Portfolios, Inc. are collectively referred 

to herein as the ‘‘Applicants.’’ 

SUMMARY: Summary of Application: 

Applicants seek an order pursuant to 

section 26(c) of the 1940 Act, approving 

the substitution of shares issued by 

certain series of Voya Variable 

Portfolios, Inc. (the ‘‘Replacement 

Funds’’) for shares of certain registered 

investment companies currently held by 

subaccounts of the Accounts (the 

‘‘Existing Funds’’), to support certain 

variable annuity contracts (collectively, 

the ‘‘Contracts’’) issued by the 

Companies. 

DATES:

Filing Date: The application was filed 

on April 29, 2014, and was amended 

and restated October 27, 2014, February 

23, 2015 and March 31, 2015. 

Hearing or Notification of Hearing: An 

order granting the application will be 

issued unless the Commission orders a 

hearing. Interested persons may request 

a hearing by writing to the Secretary of 

the Commission and serving the 

Applicants with a copy of the request, 

personally or by mail. Hearing requests 

should be received by the Commission 

by 5:30 p.m. on May 11, 2015 and 

should be accompanied by proof of 

service on the Applicants in the form of 

an affidavit or, for lawyers, a certificate 

of service. Pursuant to Rule 0–5 under 

the Act, hearing requests should state 

the nature of the writer’s interest, any 

facts bearing upon the desirability of a 

hearing on the matter, the reason for the 

request, and the issues contested. 

Persons who wish to be notified of a 

hearing may request notification by 

writing to the Commission’s Secretary. 

ADDRESSES: Commission: Brent Fields, 

Secretary, SEC, 100 F Street, NE., 

Washington, DC 20549–1090. 

Applicants: J. Neil McMurdie, Esquire, 

Senior Counsel, Voya Financial Legal 

Services, One Orange Way, Windsor, CT 

06095. 

FOR FURTHER INFORMATION CONTACT: 

Rochelle Kauffman Plesset, Senior 

Counsel, at (202) 551–6840, or Nadya 

Roytblat, Assistant Chief Counsel at 

(202) 551–0825 (Division of Investment 

Management, Chief Counsel’s Office). 

SUPPLEMENTARY INFORMATION: The 

following is a summary of the 

application. The complete application 

may be obtained via the Commission’s 

Web site by searching for the file 

number, or for an Applicant using the 

Company name box, at http://

www.sec.gov/search/search.htm, or by 

calling (202) 551–8090. 

Applicants’ Representations 

1. Voya Retirement is the depositor of 

Voya Retirement B and Voya Retirement 

I. Voya Insurance is the depositor of 

Voya Insurance B and Voya Insurance 

EQ. ReliaStar NY is the depositor of 

ReliaStar NY–B. Security Life is the 

depositor of Security Life A1 and 

Security Life S–A1. Each Company is an 

indirect, wholly-owned subsidiary of 

Voya Financial, Inc.1

2. Each Account is a ‘‘separate 

account’’ as defined by Rule 0–1(e) 

under the 1940 Act and each is 

registered under the 1940 Act as a unit 

investment trust. Each of the respective 

Accounts is used by the Company for 

which it is a part to support the 

Contracts that it issues. Each Account is 

divided into subaccounts, each of which 

invests exclusively in shares of an 

Existing Fund or another registered 

open-end management investment 

company. The application sets forth the 

registration statement file numbers for 

the Contracts and the Accounts. 

3. The Contracts are individual 

variable annuity contracts. Each of the 

prospectuses for the Contracts discloses 

that the issuing Company reserves the 

right, subject to Commission approval 

and compliance with applicable law, to 

substitute shares of another registered 

open-end management investment 

company for shares of a registered openend management investment company 

held by a subaccount of an Account 

whenever the Company, in its judgment, 

determines that the investment in the 

registered open-end management 

investment company no longer suits the 

purpose of the Contract. 

4. Voya Variable Portfolios is an openend management investment company 

of the series type that is registered with 

the Commission under the 1940 Act 

(File No. 811–05173).2 Shares of the 

series are registered under the Securities 

Act of 1933 (File No. 333–05173). 

5. Voya Investments LLC (‘‘Voya 

Investments’’), a registered investment 

adviser, has overall responsibility for 

the management of each Replacement 

Fund.3 Voya Investments delegates to a 

sub-adviser the responsibility for day-today management of the investments of 

each Replacement Fund, subject to Voya 

Investment’s oversight. 

6. Applicants propose, as set forth 

below, to substitute shares of the 

Replacement Funds for shares of the 

Existing Funds (‘‘Substitutions’’): 

Existing fund Replacement fund 

ClearBridge Variable 

Large Cap Value 

Portfolio- Class I.

Voya Russell Large 

Cap Value Index 

Portfolio- Class I. 

Fidelity VIP Equity-Income Portfolio- Initial Class.Voya Russell Large 

Cap Value Index 

Portfolio- Class I. 

Fidelity VIP Equity-Income PortfolioService 2 Class.Voya Russell Large 

Cap Value Index 

Portfolio- Class S. 

Invesco VI Core Equity Fund- Class I.Voya Russell Large 

Cap Index 

Portfolio- Class S. 

Invesco VI American 

Franchise FundClass I.

Voya Russell Large 

Cap Growth Index 

Portfolio- Class S. 

Pioneer Equity Income VCT 

Portfolio- Class II.

Voya Russell Large 

Cap Value Index 

Portfolio- Class S. 

7. Applicants state that the 

investment objectives and investment 

policies of each Replacement Fund are 

similar to the corresponding Existing 

Fund, or each Replacement Fund’s 

underlying portfolio construction and 

investment results are similar to those of 

the Existing Fund, and therefore the 

fundamental objectives, risk and 

performance expectations of those 

Contract Owners with interests in 

subaccounts of the Existing Funds will 

continue to be met after the 

Substitutions. 

8. The investment objectives of each 

Existing Fund and its corresponding 

Replacement Fund are set out below. 

Additional information for each Existing 

Fund and Replacement Fund, including 

principal investment strategies, 

principal risks and comparative 

performance history, can be found in 

the application. 


tkelley on DSK3SPTVN1PROD with NOTICES
Federal Register / Vol. 80, No. 76 / Tuesday, April 21, 2015 / Notices 22247 

Existing fund Replacement fund 

ClearBridge Variable Large Cap Value Portfolio seeks long-term growth 

of capital as its primary investment objective. Current income is a 

secondary objective.

Voya Russell Large Cap Value Index Portfolio seeks investment results 

(before fees and expenses) that correspond to the total return (which 

includes capital appreciation and income) of the Russell Top 200 

Value Index. 

Fidelity VIP Equity-Income Portfolio seeks reasonable income. The 

fund will also consider the potential for capital appreciation. The 

fund’s goal is to achieve a yield which exceeds the composite yield 

on the securities comprising the S&P 500 Index.

Voya Russell Large Cap Value Index Portfolio seeks investment results 

(before fees and expenses) that correspond to the total return (which 

includes capital appreciation and income) of the Russell Top 200 

Value Index. 

Invesco VI Core Equity Fund seeks long-term growth of capital ............ Voya Russell Large Cap Index Portfolio seeks investment results (before fees and expenses) that correspond to the total return (which includes capital appreciation and income) of the Russell Top 200 

Index. 

Invesco VI American Franchise Fund seeks capital growth. ................... Voya Russell Large Cap Growth Index Portfolio seeks investment results (before fees and expenses) that correspond to the total return 

(which includes capital appreciation and income) of the Russell Top 

200 Growth Index. 

Pioneer Equity Income VCT Portfolio seeks current income and longterm growth of capital from a portfolio consisting primarily of income 

producing equity securities of U.S. corporations.

Voya Russell Large Cap Value Index Portfolio seeks investment results 

(before fees and expenses) that correspond to the total return (which 

includes capital appreciation and income) of the Russell Top 200 

Value Index. 

9. Applicants state that at the time of 

the Substitutions the overall fees and 

expenses of the Replacement Funds will 

be less than those assessed by the 

Existing Funds and that for two years 

following the effective date of the 

Substitutions (‘‘Effective Date’’), the net 

annual expenses of each of the 

Replacement Funds will not exceed the 

net annual expenses of each 

corresponding Existing Fund. The 

application sets forth the fees and 

expenses of each Existing Fund and its 

corresponding Replacement Fund in 

greater detail. 

10. Applicants state that by 

substituting unaffiliated funds with 

funds that are advised and subadvised 

by affiliates of the Companies, the 

principal purposes of the Substitutions 

would, among other things: (1) Help 

implement the Companies’ overall 

business plan to make the Contracts 

more competitive (and thus more 

attractive to customers) and more 

efficient to administer and oversee; (2) 

provide the Companies with more 

influence over the administrative and 

management aspects of the funds 

offered through the Contracts, thereby 

reducing costs and customer confusion; 

(3) allow each Company the ability to 

react more quickly to the changes and 

problems it encounters in its oversight 

of the funds which are available in its 

Contracts; (4) allow the Companies to 

reduce costs by consolidating the 

administration of the Replacement 

Funds with its other funds; and (5) 

allow the Companies to respond to 

expense, performance and management 

matters that they have identified in their 

due diligence review of the funds 

available through the Contracts. 

11. Applicants represent that as of the 

Effective Date shares of the Existing 

Funds will be redeemed for cash. The 

Companies, on behalf of each Existing 

Fund subaccount of each relevant 

Account, will simultaneously place a 

redemption request with each Existing 

Fund and a purchase order with the 

corresponding Replacement Fund so 

that the purchase of Replacement Fund 

shares will be for the exact amount of 

the redemption proceeds. Thus, 

Contract values will remain fully 

invested at all times. The proceeds of 

such redemptions will then be used to 

purchase the appropriate number of 

shares of the applicable Replacement 

Fund. 

12. The Substitutions will take place 

at relative net asset value (in accordance 

with Rule 22c-1 under the 1940 Act) 

with no change in the amount of any 

Affected Contract Owner’s contract 

value, cash value, accumulation value, 

account value or death benefit or in 

dollar value of his or her investment in 

the applicable Accounts. No brokerage 

commissions, fees or other 

remuneration will be paid by either the 

Existing Funds or the Replacement 

Funds or by Affected Contract Owners 

in connection with the Substitutions. 

13. The Affected Contract Owners 

will not incur any fees or charges as a 

result of the Substitutions nor will their 

rights or the Companies’ obligations 

under the Contracts be altered in any 

way. The Companies or their affiliates 

will pay all expenses and transaction 

costs of the Substitutions, including 

legal and accounting expenses, any 

applicable brokerage expenses, and 

other fees and expenses. The 

Substitutions will not cause the 

Contract fees and charges currently 

being paid by Affected Contract Owners 

to be greater after the Substitutions than 

before the Substitutions. Moreover, the 

Substitutions will not impose any tax 

liability on Affected Contract Owners. 

14. As described in the application, 

after notification of the Substitution and 

for 30 days after the Effective Date, 

Affected Contract Owners may 

reallocate the subaccount value of an 

Existing Fund to any other investment 

option available under their Contract 

without incurring any administrative 

costs or transfer charges. 

15. All Affected Contract Owners 

affected by the Substitutions were 

notified of this application by means of 

supplements to the Contract 

prospectuses shortly after the date the 

application was first filed with the 

Commission. Among other information, 

the supplements informed Affected 

Contract Owners that beginning on the 

date of the supplements, the Companies 

will not exercise any rights reserved by 

them under the Contracts to impose 

restrictions or fees on transfers from an 

Existing Fund (other than restrictions 

related to frequent or disruptive 

transfers) until at least 30 days after the 

Effective Date. 

16. Following the date the order 

requested by this application is issued, 

but at least 30 days before the Effective 

Date, Affected Contract Owners will 

receive a ‘‘Pre-Substitution Notice,’’ 

consisting of a second supplement to 

the Contract prospectuses setting forth 

the intended Effective Date and advising 

Affected Contract Owners of their right, 

if they so choose, at any time during the 

period beginning 30 days before the 

Effective Date through at least 30 days 


tkelley on DSK3SPTVN1PROD with NOTICES
22248 Federal Register / Vol. 80, No. 76 / Tuesday, April 21, 2015 / Notices 

following the Effective Date, to 

reallocate or withdraw accumulated 

value in the Existing Fund subaccounts 

under their Contracts or otherwise 

terminate their interest therein in 

accordance with the terms and 

conditions of their Contracts. If Affected 

Contract Owners reallocate account 

value during this 60 day period, there 

will be no charge for the reallocation of 

accumulated value from the Existing 

Fund subaccounts and the reallocation 

will not count as a transfer when 

imposing any applicable restriction or 

limit under the Contract on transfers. 

Additionally, all Affected Contract 

Owners will be sent prospectuses of the 

applicable Replacement Funds at least 

30 days before the Effective Date. 

17. Within five (5) business days after 

the Effective Date, Affected Contract 

Owners will be sent a written 

confirmation, which will include 

confirmation that the Substitutions were 

carried out as previously notified, a 

restatement of the information set forth 

in the Pre-Substitution Notice and 

information showing how the allocation 

of the Affected Contract Owner’s 

account value before and immediately 

following the Substitution has changed 

as a result of the Substitutions. 

Legal Analysis 

1. Applicants request that the 

Commission issue an order pursuant to 

section 26(c) of the 1940 Act approving 

the Substitutions. Section 26(c) requires 

the depositor of a registered unit 

investment trust holding the securities 

of a single issuer to obtain Commission 

approval before substituting the 

securities held by the trust. Section 

26(c) requires the Commission to issue 

such an order if the evidence establishes 

that the substitution is consistent with 

the protection of investors and the 

purposes fairly intended by the policy 

and provisions of the 1940 Act. 

2. Applicants submit that the terms 

and conditions of the Substitutions meet 

the standards set forth in section 26(c) 

and assert that the replacement of an 

Existing Fund with the corresponding 

Replacement Fund is consistent with 

the protection of investors and the 

purposes fairly intended by the policy 

and provisions of the l940 Act. As 

described in the application, as of the 

Effective Date of the Substitution, the 

overall fees and expenses of each 

Replacement Fund will be less than 

those of the corresponding Existing 

Fund and for two years following the 

Effective Date, the net annual expenses 

of each Replacement Fund will not 

exceed the net annual expenses of the 

corresponding Existing Fund. 

Applicants further asset that each 

Replacement Fund has similar 

investment objectives and investment 

strategies as the corresponding Existing 

Fund, or each Replacement Fund’s 

underlying portfolio construction and 

investment results are similar to those of 

the corresponding Existing Fund. 

Accordingly, Applicants believe that the 

fundamental investment objectives, risk 

and performance expectations of the 

Affected Contract Owners will continue 

to be met after the Substitutions. 

3. Applicants also maintain that 

Affected Contract Owners will be better 

served by the Substitutions. Applicants 

anticipate that the substitution of an 

Existing Fund with the corresponding 

Replacement Fund will result in a 

Contract that is administered and 

managed more efficiently, and one that 

is more competitive with other variable 

products. The rights of Affected 

Contract Owners and the obligations of 

the Companies under the Contracts will 

not be altered by the Substitutions. 

Affected Contract Owners will not incur 

any additional tax liability or any 

additional fees and expenses as a result 

of the Substitutions. 

4. Each of the prospectuses for the 

Contracts discloses that the issuing 

Company reserves the right, subject to 

Commission approval and compliance 

with applicable law, to substitute shares 

of another registered open-end 

management investment company for 

shares of an open-end management 

investment company held by a 

subaccount of an Account. 

5. Applicants also assert that the 

Substitutions do not entail any of the 

abuses that section 26(c) was designed 

to prevent. Unlike a traditional unit 

investment trust where a depositor 

could only substitute an investment 

security in a manner which 

permanently affected all the investors in 

the trust, the Contracts provide each 

Contract Owner with the right to 

exercise his or her own judgment and 

transfer account values into other 

subaccounts. Moreover, the Contracts 

will offer Affected Contract Owners the 

opportunity to transfer amounts out of 

the affected subaccounts into any of the 

remaining subaccounts without cost or 

other disadvantage. The Substitution, 

therefore, will not result in the type of 

costly forced redemptions that section 

26(c) was designed to prevent. 

Applicants also maintain that the 

Substitutions are unlike the type of 

substitutions which section 26(c) was 

designed to prevent in that by 

purchasing a Contract, Contract Owners 

select much more than a particular 

registered management open-end 

investment company in which to invest 

their account values. They also select 

the specific type of death benefit and 

other optional benefits as well as other 

rights and privileges set forth in the 

Contracts that will not be changed as a 

result of the Substitutions. 

Applicants’ Conditions 

Applicants agree that any order of the 

Commission granting the requested 

relief will be subject to the following 

conditions: 

1. The Substitutions will not be 

effected unless the Companies 

determine that: (a) The Contracts allow 

the substitution of shares of registered 

open-end investment companies in the 

manner contemplated by the 

application; (b) the Substitutions can be 

consummated as described in the 

application under applicable insurance 

laws; and (c) any regulatory 

requirements in each jurisdiction where 

the Contracts are qualified for sale have 

been complied with to the extent 

necessary to complete the Substitutions. 

2. The Companies or their affiliates 

will pay all expenses and transaction 

costs of the Substitutions, including 

legal and accounting expenses, any 

applicable brokerage expenses and other 

fees and expenses. No fees or charges 

will be assessed to the Contract Owners 

to effect the Substitutions. 

3. The Substitutions will be effected 

at the relative net asset values of the 

respective shares in conformity with 

section 22(c) of the 1940 Act and Rule 

22c-1 thereunder without the 

imposition of any transfer or similar 

charges by Applicants. The 

Substitutions will be effected without 

change in the amount or value of any 

Contracts held by Affected Contract 

Owners. 

4. The Substitutions will in no way 

alter the tax treatment of Affected 

Contract Owners in connection with 

their Contracts, and no tax liability will 

arise for Affected Contract Owners as a 

result of the Substitutions. 

5. The rights or obligations of the 

Companies under the Contracts of 

Affected Contract Owners will not be 

altered in any way. The Substitutions 

will not adversely affect any riders 

under the Contracts. 

6. Affected Contract Owners will be 

permitted to make at least one transfer 

of Contract value from the subaccount 

investing in the Existing Fund (before 

the Effective Date) or the Replacement 

Fund (after the Effective Date) to any 

other available investment option under 

the Contract without charge for a period 

beginning at least 30 days before the 

Effective Date through at least 30 days 

following the Effective Date. Except as 

described in any market timing/shortterm trading provisions of the relevant 


tkelley on DSK3SPTVN1PROD with NOTICES
Federal Register / Vol. 80, No. 76 / Tuesday, April 21, 2015 / Notices 22249 

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

2 15 U.S.C. 78a. 

3 17 CFR 240.19b–4. 

4See Securities Exchange Act Release No. 74377 

(February 25, 2015), 80 FR 11502 (‘‘Notice’’). 

5The Trust has obtained an order from the 

Commission granting certain exemptive relief to the 

Trust under the 1940 Act. See Investment Company 

Act Release No. 31469 (February 24, 2015) (File No. 

812–14402). 

6See Post- Effective Amendment No. 43 to the 

Registration Statement on Form N–1A for the Trust, 

dated February 4, 2015 (File Nos. 333–179562 and 

811–22668). 

7See Notice, supra note 4, 80 FR at 11503. In 

addition, the Exchange states that, in the event (a) 

the Adviser becomes affiliated with a broker-dealer 

or registers as a broker-dealer, or (b) any new 

adviser or sub-adviser is a registered broker-dealer 

or becomes affiliated with a broker-dealer, it will 

implement a fire wall with respect to its relevant 

personnel and/or such broker-dealer affiliate, as 

applicable, regarding access to information 

concerning the composition and/or changes to the 

portfolio and will be subject to procedures designed 

to prevent the use and dissemination of material 

nonpublic information regarding such portfolio. 

According to the Exchange, the Adviser has no 

present intent or arrangement to become affiliated 

with any broker-dealer, and the Fund does not 

currently intend to use a sub-adviser. Id. 

8Additional information regarding, among other 

things, the Fund, the Shares, the Fund’s investment 

objectives, the Fund’s strategies, the Fund’s 

holdings, risks, fees and expenses associated with 

the Shares, creations and redemptions of Shares, 

availability of information, trading rules and halts, 

and surveillance procedures can be found in the 

Notice and the Registration Statement. See Notice, 

supra note 4, and Registration Statement, supra 

note 6, respectively. 

9The term ‘‘under normal market conditions’’ as 

used herein includes, but is not limited to, the 

absence of adverse market, economic, political or 

other conditions, including extreme volatility or 

trading halts in the securities markets or the 

financial markets generally; operational issues 

causing dissemination of inaccurate market 

information; or force majeure type events such as 

systems failure, natural or man-made disaster, act 

of God, armed conflict, act of terrorism, riot or labor 

disruption or any similar intervening circumstance. 

prospectus, the Company will not 

exercise any right it may have under the 

Contract to impose restrictions on 

transfers between the subaccounts 

under the Contracts, including 

limitations on the future number of 

transfers, for a period beginning at least 

30 days before the Effective Date 

through at least 30 days following the 

Effective Date. 

7. All Affected Contract Owners will 

be notified, at least 30 days before the 

Effective Date about: (a) The intended 

substitution of Existing Funds with the 

Replacement Funds; (b) the intended 

Effective Date; and (c) information with 

respect to transfers as set forth in 

Condition 6 above. In addition, the 

Companies will also deliver, at least 30 

days before the Effective Date a 

prospectus for each applicable 

Replacement Fund. 

8. Companies will deliver to each 

Affected Contract Owner within five (5) 

business days of the Effective Date a 

written confirmation which will 

include: (a) A confirmation that the 

Substitutions were carried out as 

previously notified; (b) a restatement of 

the information set forth in the PreSubstitution Notice; and (c) before and 

after account values. 

9. After the Effective Date Applicants 

agree not to change a Replacement 

Fund’s sub-adviser without first (a) 

obtaining shareholder approval of the 

sub-adviser change or (b) Voya Variable 

Portfolios Inc. determining that it can 

continue to rely on its manager-ofmanagers exemptive order. 

10. For two years following the 

Effective Date the net annual expenses 

of each Replacement Fund will not 

exceed the net annual expenses of the 

corresponding Existing Fund as of the 

Fund’s most recent fiscal year. To 

achieve this limitation, the Replacement 

Fund’s investment adviser will waive 

fees or reimburse the Replacement Fund 

in certain amounts to maintain expenses 

at or below the limit. Any adjustments 

will be made at least on a quarterly 

basis. In addition, the Companies will 

not increase the Contract fees and 

charges including asset based charges 

such as mortality expense risk charges 

deducted from the subaccounts that 

would otherwise be assessed under the 

terms of the Contracts for a period of at 

least two years following the Effective 

Date. 

For the Commission, by the Division of 

Investment Management, under delegated 

authority. 

Brent J. Fields, 

Secretary. 

[FR Doc. 2015–09067 Filed 4–20–15; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–74728; File No. SR– 

NASDAQ–2015–013] 

Self-Regulatory Organizations; The 

NASDAQ Stock Market LLC; Order 

Approving a Proposed Rule Change To 

List and Trade Shares of the 

AlphaMark Actively Managed Small 

Cap ETF of ETF Series Solutions 

April 15, 2015. 

I. Introduction 

On February 17, 2015, The NASDAQ 

Stock Market LLC (the ‘‘Exchange’’ or 

‘‘Nasdaq’’) filed with the Securities and 

Exchange Commission (‘‘Commission’’), 

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

Securities Exchange Act of 1934 (‘‘Act’’ 

or ‘‘Exchange Act’’) 2 and Rule 19b–4 

thereunder,3 a proposed rule change to 

list and trade the shares (‘‘Shares’’) of 

the AlphaMark Actively Managed Small 

Cap ETF (the ‘‘Fund’’) of ETF Series 

Solutions (the ‘‘Trust’’) under Nasdaq 

Rule 5735. The proposed rule change 

was published for comment in the 

Federal Register on March 3, 2015.4 The 

Commission received no comments on 

the proposed rule change. This order 

approves the proposed rule change. 

II. Description of the Proposal 

The Exchange proposes to list and 

trade the Shares under Nasdaq Rule 

5735, which governs the listing and 

trading of Managed Fund Shares on the 

Exchange. The Fund will be an activelymanaged exchange-traded fund (‘‘ETF’’). 

The Shares will be offered by the Trust.5

The Trust is registered with the 

Commission as an investment company 

and has filed a registration statement on 

Form N–1A (‘‘Registration Statement’’) 

with the Commission.6 The Fund is a 

series of the Trust. 

AlphaMark Advisors, LLC will be the 

investment adviser (‘‘Adviser’’) to the 

Fund. Quasar Distributors, LLC (the 

‘‘Distributor’’) will be the principal 

underwriter and distributor of the 

Fund’s Shares. U.S. Bancorp Fund 

Services, LLC will act as the 

administrator, accounting agent, and 

transfer agent to the Fund. U.S. Bank 

National Association will act as the 

custodian to the Fund. The Exchange 

states that the Adviser is not a brokerdealer, and is not affiliated with any 

broker-dealer.7 The Exchange has made 

the following representations and 

statements regarding the Fund.8

Principal Investments 

The Fund’s primary investment 

objective is to seek long-term growth of 

capital. The Fund will pursue its 

objectives by investing primarily—i.e., 

at least 80% of its assets under normal 

market conditions 9—in a portfolio of 

equity securities of small cap companies 

listed on a U.S. exchange. 

The Fund defines ‘‘equity securities’’ 

to include common and preferred stock, 

American Depositary Receipts 

(‘‘ADRs’’), real estate investment trusts, 

and ETFs that under normal 

circumstances invest at least 80% of 

their net assets in equity securities of 

small cap companies (‘‘Small Cap 

ETFs’’). The Fund may invest up to 30% 

of its net assets in foreign equity 

securities of small cap companies traded 

on a U.S. exchange as ADRs, which may 

include companies in emerging markets. 

The Adviser expects that there will 

generally be between 25 and 40 stocks 

in the Fund’s portfolio. 

The Fund is non-diversified, and 

therefore may invest a larger percentage 

of its assets in the securities of a single 


tkelley on DSK3SPTVN1PROD with NOTICES