35554 Federal Register / Vol. 86, No. 126 / Tuesday, July 6, 2021 / Notices 

22 15 U.S.C. 78s(b)(3)(A)(ii). 23 17 CFR 200.30–3(a)(12). 

than on an off-exchange venue because 

ETP Holders would be able to transact 

such orders at no cost. Greater liquidity 

benefits all market participants on the 

Exchange by providing more trading 

opportunities and encourages ETP 

Holders to send orders, thereby 

contributing to robust levels of liquidity, 

which benefits all market participants. 

The proposed pricing for internalizing 

Retail Orders would be available to all 

similarly-situated market participants, 

and, as such, the proposed change 

would not impose a disparate burden on 

competition among market participants 

on the Exchange. 

Intermarket Competition. The 

Exchange believes the proposed rule 

change does not impose any burden on 

intermarket competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act. The 

Exchange operates in a highly 

competitive market in which market 

participants can readily choose to send 

their orders to other exchanges and offexchange venues if they deem fee levels 

at those other venues to be more 

favorable. As noted above, the 

Exchange’s market share of intraday 

trading (i.e., excluding auctions) is 

currently less than 10%. In such an 

environment, the Exchange must 

continually adjust its fees and rebates to 

remain competitive with other 

exchanges and with off-exchange 

venues. Because competitors are free to 

modify their own fees and credits in 

response, and because market 

participants may readily adjust their 

order routing practices, the Exchange 

does not believe this proposed fee 

change would impose any burden on 

intermarket competition. 

The Exchange believes that the 

proposed change could promote 

competition between the Exchange and 

other execution venues, including those 

that currently offer similar order types 

and comparable transaction pricing, by 

encouraging additional orders to be sent 

to the Exchange for execution. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

No written comments were solicited 

or received with respect to the proposed 

rule change. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The foregoing rule change has become 

effective pursuant to Section 

19(b)(3)(A)(ii) of the Act.22

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 Number SR– 

NYSEArca–2021–52 on the subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Secretary, Securities and Exchange 

Commission, 100 F Street NE, 

Washington, DC 20549–1090. 

All submissions should refer to File 

Number SR–NYSEArca–2021–52. 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 website (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 website viewing and 

printing in the Commission’s Public 

Reference Room, 100 F Street NE, 

Washington, DC 20549, on official 

business days between the hours of 

10:00 a.m. and 3:00 p.m. Copies of the 

filing also will be available for 

inspection and copying at the principal 

office of the Exchange. All comments 

received will be posted without change. 

Persons submitting comments are 

cautioned that we do not redact or edit 

personal identifying information from 

comment submissions. You should 

submit only information that you wish 

to make available publicly. All 

submissions should refer to File 

Number SR–NYSEArca–2021–52 and 

should be submitted on or before July 

27, 2021. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.23

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2021–14254 Filed 7–2–21; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

Sunshine Act Meeting; Cancellation 

FEDERAL REGISTER CITATION OF PREVIOUS

ANNOUNCEMENT: 86 FR 34080, June 28, 

2021. 

PREVIOUSLY ANNOUNCED TIME AND DATE OF

THE MEETING: Thursday, July 1, 2021 at 

2 p.m. 

CHANGES IN THE MEETING: The Closed 

Meeting scheduled for Thursday, July 1, 

2021 at 2 p.m., has been cancelled. 

CONTACT PERSON FOR MORE INFORMATION: 

For further information; please contact 

Vanessa A. Countryman from the Office 

of the Secretary at (202) 551–5400. 

Dated: July 1, 2021. 

Vanessa A. Countryman, 

Secretary. 

[FR Doc. 2021–14426 Filed 7–1–21; 11:15 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Investment Company Act Release No. 

34320; File No. 812–15214] 

BNY Mellon Alcentra Opportunistic 

Global Credit Income Fund and BNY 

Mellon Investment Adviser, Inc. 

June 29, 2021. 

AGENCY: Securities and Exchange 

Commission (the ‘‘Commission’’). 

ACTION: Notice. 

Notice of an application for an order 

pursuant to section 6(c) of the 

Investment Company Act of 1940 (the 

‘‘1940 Act’’) for an exemption from 

sections 18(a)(2), 18(c), and 18(i) of the 

1940 Act, pursuant to section 6(c) and 

23(c) of the 1940 Act for certain 

exemptions from rule 23c–3 under the 

1940 Act, and for an order pursuant to 


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Federal Register / Vol. 86, No. 126 / Tuesday, July 6, 2021 / Notices 35555 

1A successor in interest is limited to an entity 

that results from a reorganization into another 

jurisdiction or a change in the type of business 

organization. 

2The Initial Fund and any Future Fund relying 

on the requested relief will do so in compliance 

with the terms and conditions of the application. 

Applicants represent that any person presently 

intending to rely on the requested relief is listed as 

an applicant. 

3Any references to FINRA Rule 2341 include any 

successor or replacement rule that may be adopted 

by FINRA. 

section 17(d) of the 1940 Act and rule 

17d–1 thereunder. 

SUMMARY OF APPLICATION: Applicants 

request an order to permit certain 

registered closed-end management 

investment companies to issue multiple 

classes of common shares of beneficial 

interest (‘‘Shares’’) with varying sales 

loads and asset-based service and/or 

distribution fees and to impose early 

withdrawal charges. 

APPLICANTS: BNY Mellon Alcentra 

Opportunistic Global Credit Income 

Fund (the ‘‘Initial Fund’’) and BNY 

Mellon Investment Adviser, Inc. 

(‘‘Adviser’’). 

FILING DATES: The application was filed 

on April 1, 2021. 

HEARING OR NOTIFICATION OF HEARING: An 

order granting the requested relief will 

be issued unless the Commission orders 

a hearing. Interested persons may 

request a hearing by emailing the 

Commission’s Secretary at SecretarysOffice@sec.gov and serving applicants 

with a copy of the request by email. 

Hearing requests should be received by 

the Commission by 5:30 p.m. on July 23, 

2021, 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 1940 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 emailing the 

Commission’s Secretary at SecretarysOffice@sec.gov. 

ADDRESSES: The Commission: 

Secretarys-Office@sec.gov. Applicants: 

Jeff Prunofsky, Esq., jeff.prusnofsky@

bnymellon.com. 

FOR FURTHER INFORMATION CONTACT: 

Bruce R. MacNeil, Senior Counsel, at 

(202) 551–6817, or Kaitlin C. Bottock, 

Branch Chief, at (202) 551–6825 

(Division of Investment Management, 

Chief Counsel’s Office). 

SUPPLEMENTARY INFORMATION: The 

following is a summary of the 

application. The complete application 

may be obtained by searching the 

Commission’s website, at http://

www.sec.gov/search/search.htm, using 

the application’s file number or the 

applicant’s name, or by calling the 

Commission at (202) 551–8090. 

Applicants’ Representations 

1. The Initial Fund is a newly 

organized Maryland statutory trust that 

is registered under the 1940 Act as a 

closed-end management investment 

company and classified as a nondiversified investment company. The 

Initial Fund’s investment objective is to 

seek to provide total return consisting of 

high current income and capital 

appreciation. 

2. The Adviser, a New York 

corporation, is registered as an 

investment adviser under the 

Investment Advisers Act of 1940. The 

Adviser serves as investment adviser to 

the Initial Fund. 

3. The applicants seek an order to 

permit the Initial Fund to offer investors 

multiple classes of Shares with varying 

sales loads and asset-based service and/ 

or distribution fees and to impose early 

withdrawal charges. 

4. Applicants request that the order 

also apply to any other registered 

closed-end management investment 

company that conducts a continuous 

offering of its shares, existing now or in 

the future, for which the Adviser, its 

successors,1 or any entity controlling, 

controlled by, or under common control 

with the Adviser, or its successors, acts 

as investment adviser, and which 

provides periodic liquidity with respect 

to its Shares through tender offers 

conducted in compliance with either 

rule 23c–3 under the 1940 Act or rule 

13e–4 under the Securities Exchange 

Act of 1934 (the ‘‘1934 Act’’) (each such 

closed-end management investment 

company a ‘‘Future Fund’’ and, together 

with the Initial Fund, each a ‘‘Fund,’’ 

and collectively the ‘‘Funds’’).2

5. The Initial Fund’s initial 

Registration Statement filed on Form N– 

2 seeks to register an initial class of 

Shares (the ‘‘Initial Class Shares’’). 

Shares will be offered on a continuous 

basis pursuant to a registration 

statement under the Securities Act of 

1933 at their net asset value per share. 

The Initial Fund, as a closed-end 

management investment company, does 

not intend to continuously redeem 

Shares as does an open-end 

management investment company. 

Shares of the Initial Fund will not be 

listed on any securities exchange and 

will not trade on an over-the-counter 

system. Applicants do not expect that 

any secondary market will ever develop 

for the Shares. 

6. If the requested relief is granted, the 

Initial Fund intends to offer multiple 

classes of Shares, such as the Initial 

Class Shares and a new Share class (the 

‘‘New Class Shares’’), or any other 

classes. Because of the different 

distribution fees, shareholder services 

fees, and any other class expenses that 

may be attributable to the different 

classes, the net income attributable to, 

and any dividends payable on, each 

class of Shares may differ from each 

other from time to time. 

7. Applicants state that, from time to 

time, the Board of a Fund may create 

and offer additional classes of Shares, or 

may vary the characteristics described 

of the Initial Class and New Class 

Shares, including without limitation, in 

the following respects: (1) The amount 

of fees permitted by a distribution and 

service plan as to such class; (2) voting 

rights with respect to a distribution and 

service plan as to such class; (3) 

different class designations; (4) the 

impact of any class expenses directly 

attributable to a particular class of 

Shares allocated on a class basis as 

described in the application; (5) 

differences in any dividends and net 

asset values per Share resulting from 

differences in fees under a distribution 

and service plan or in class expenses; 

(6) any early withdrawal charge or other 

sales load structure; and (7) any 

exchange or conversion features, as 

permitted under the 1940 Act. 

8. Applicants state that, in order to 

provide some liquidity to shareholders, 

the Initial Fund is structured as an 

‘‘interval fund’’ and conducts quarterly 

offers to repurchase between five 

percent and twenty-five percent of its 

outstanding Shares at net asset value, 

pursuant to rule 23c–3 under the 1940 

Act, unless such offer is suspended or 

postponed in accordance with 

regulatory requirements. Any other 

Fund that intends to rely on the 

requested relief will provide periodic 

liquidity to shareholders in accordance 

with either rule 23c–3 under the 1940 

Act or rule 13e–4 under the 1934 Act. 

9. Applicants represent that any assetbased distribution and servicing fee of a 

Fund will comply with the provisions of 

Rule 2341 of the Rules of the Financial 

Industry Regulatory Authority (‘‘FINRA 

Rule 2341’’).3 Applicants also represent 

that each Fund will disclose in its 

prospectus the fees, expenses, and other 

characteristics of each class of Shares 

offered for sale by the prospectus, as is 

required for open-end, multiple class 

funds under Form N–1A. As if it were 

an open-end management investment 

company, each Fund will disclose fund 


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35556 Federal Register / Vol. 86, No. 126 / Tuesday, July 6, 2021 / Notices 

4Shareholder Reports and Quarterly Portfolio 

Disclosure of Registered Management Investment 

Companies, Investment Company Act Release No. 

26372 (Feb. 27, 2004) (adopting release). 

5 Disclosure of Breakpoint Discounts by Mutual 

Funds, Investment Company Act Release No. 26464 

(June 7, 2004) (adopting release). 

6Fund of Funds Investments, Investment 

Company Act Release Nos. 26198 (Oct. 1, 2003) 

(proposing release) and 27399 (June 20, 2006) 

(adopting release). See also rules 12d1–1, et seq. 

under the 1940 Act. 

7A CDSL, assessed by an open-end fund pursuant 

to Rule 6c–10 under the 1940 Act, is a distributionrelated charge payable to the distributor. Pursuant 

to the requested order, the early withdrawal charge 

will likewise be a distribution-related charge 

payable to the distributor. (which is payable to a 

Fund) 

8Unlike a distribution-related charge, the 

repurchase fee is payable to the Fund to 

compensate long-term shareholders for the 

expenses related to shorter-term investors, in light 

of the Fund’s generally longer-term investment 

horizons and investment operations. 

expenses borne by shareholders during 

the reporting period in shareholder 

reports 4 and describe in its prospectus 

any arrangements that result in 

breakpoints in, or elimination of, sales 

loads.5 In addition, applicants will 

comply with applicable enhanced fee 

disclosure requirements for fund of 

funds, including registered funds of 

hedge and private equity funds.6

10. Each Fund and its distributor (the 

‘‘Distributor’’) will also comply with 

any requirements that may be adopted 

by the Commission or FINRA regarding 

disclosure at the point of sale and in 

transaction confirmations about the 

costs and conflicts of interest arising out 

of the distribution of open-end 

investment company shares, and 

regarding prospectus disclosure of sales 

loads and revenue sharing arrangements 

as if those requirements apply to the 

Fund and the Distributor. Each Fund or 

the Distributor will contractually 

require that any other distributor of the 

Fund’s Shares comply with such 

requirements in connection with the 

distribution of Shares of the Fund. 

11. All expenses incurred by a Fund 

will be allocated among its various 

classes of Shares based on the net assets 

of the Fund attributable to each class, 

except that the net asset value and 

expenses of each class will reflect the 

expenses associated with the 

distribution and service plan of that 

class (if any), shareholder services fees 

attributable to a particular class 

(including transfer agency fees, if any), 

and any other incremental expenses of 

that class. Expenses of a Fund allocated 

to a particular class of the Fund’s Shares 

will be borne on a pro rata basis by each 

outstanding Share of that class. 

Applicants state that each Fund will 

comply with the provisions of rule 18f– 

3 under the 1940 Act as if it were an 

open-end management investment 

company. 

12. Applicants state that the Initial 

Fund does not intend to offer any 

exchange privilege or conversion 

feature, but any such privilege or feature 

introduced in the future by a Fund will 

comply with rule 11a–1, rule 11a–3, and 

rule 18f–3 as if the Fund were an openend management investment company. 

13. Applicants seek relief to the extent 

necessary for each Fund to impose an 

early withdrawal charge on shares 

submitted for repurchase that have been 

held less than a specified period. 

Applicants state that each Fund may 

grant waivers of the early withdrawal 

charges on repurchases for certain 

categories of shareholders or 

transactions established from time to 

time. Applicants state that each Fund 

will apply the early withdrawal charge 

(and any waivers or scheduled 

variations of the early withdrawal 

charge) uniformly to all shareholders in 

a given class and consistently with the 

requirements of rule 22d–1 under the 

1940 Act as if the Fund were an openend management investment company. 

14. Applicants state that a Fund 

operating as an interval fund pursuant 

to rule 23c–3 under the 1940 Act may 

offer its shareholders an exchange 

feature under which the shareholders of 

the Fund may, in connection with the 

Fund’s periodic repurchase offers, 

exchange their Shares of the Fund for 

shares of the same class of (i) registered 

open-end management investment 

companies or (ii) other registered 

closed-end investment companies that 

comply with rule 23c–3 under the 1940 

Act and continuously offer their shares 

at net asset value, that are in the Fund’s 

group of investment companies 

(collectively, the ‘‘Other Funds’’). 

Shares of a Fund operating pursuant to 

rule 23c–3 that are exchanged for shares 

of Other Funds will be included as part 

of the repurchase offer amount for such 

Fund as specified in rule 23c–3 under 

the 1940 Act. Any exchange option will 

comply with rule 11a–3 under the 1940 

Act, as if the Fund were an open-end 

management investment company 

subject to rule 11a–3. In complying with 

rule 11a–3 under the 1940 Act, each 

Fund will treat an early withdrawal 

charge as if it were a contingent deferred 

sales load (a ‘‘CDSL’’).7

15. Applicants state that the Initial 

Fund does not currently, nor does it 

currently intend to, impose a repurchase 

fee, but may do so in the future. If a 

Fund charges a repurchase fee, Shares of 

the Fund will be subject to a repurchase 

fee at a rate of no greater than two 

percent of the shareholder’s repurchase 

proceeds if the interval between the date 

of purchase of the Shares and the 

valuation date with respect to the 

repurchase of those Shares is less than 

one year.8 Repurchase fees, if charged, 

will equally apply to all classes of 

Shares of the Fund, consistent with 

section 18 of the 1940 Act and rule 18f– 

3 thereunder. To the extent a Fund 

determines to waive, impose scheduled 

variations of, or eliminate a repurchase 

fee, it will do so consistently with the 

requirements of rule 22d–1 under the 

1940 Act as if the repurchase fee were 

a CDSL and as if the Fund were a 

registered open-end management 

investment company. In addition, the 

Fund’s waiver of, scheduled variation 

in, or elimination of the repurchase fee 

will apply uniformly to all shareholders 

of the Fund regardless of class. 

Applicants’ Legal Analysis 

Multiple Classes of Shares 

1. Section 18(a)(2)(A) and (B) makes it 

unlawful for a registered closed-end 

management investment company to 

issue a senior security that is a stock 

unless (a) immediately after such 

issuance it will have an asset coverage 

of at least 200% and (b) provision is 

made to prohibit the declaration of any 

distribution upon its common stock, or 

the purchase of any such common stock, 

unless in every such case such senior 

security has at the time of the 

declaration of any such distribution, or 

at the time of any such purchase, an 

asset coverage of at least 200% after 

deducting the amount of such 

distribution or purchase price, as the 

case may be. Applicants state that the 

creation of multiple classes of Shares of 

the Funds may violate section 18(a)(2) 

because the Funds may not meet section 

18(a)(2)’s requirements with respect to a 

class of Shares that may be a senior 

security. 

2. Section 18(c) of the 1940 Act 

provides, in relevant part, that a 

registered closed-end management 

investment company may not issue or 

sell any senior security which is a stock 

if immediately thereafter the company 

will have outstanding more than one 

class of senior security that is a stock. 

Applicants state that the creation of 

multiple classes of Shares of a Fund 

may be prohibited by section 18(c), as 

a class may have priority over another 

class as to payment of dividends 

because shareholders of different classes 

would pay different fees and expenses. 

3. Section 18(i) of the 1940 Act 

generally provides that each share of 

stock issued by a registered management 


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investment company will be a voting 

stock and have equal voting rights with 

every other outstanding voting stock. 

Applicants state that permitting 

multiple classes of Shares of a Fund 

may violate section 18(i) of the 1940 Act 

because each class would be entitled to 

exclusive voting rights with respect to 

matters solely related to that class. 

4. Section 6(c) of the 1940 Act 

provides that the Commission may 

exempt any person, security, or 

transaction, or any class or classes of 

persons, securities, or transactions, from 

any provision of the 1940 Act, or from 

any rule or regulation under the 1940 

Act, if and to the extent that such 

exemption is necessary or appropriate 

in the public interest and consistent 

with the protection of investors and the 

purposes fairly intended by the policy 

and provisions of the 1940 Act. 

Applicants request an exemption under 

section 6(c) from sections 18(a)(2), 18(c), 

and 18(i) to permit the Funds to issue 

multiple classes of Shares. 

5. Applicants submit that the 

proposed allocation of expenses relating 

to distribution and voting rights is 

equitable and will not discriminate 

against any group or class of 

shareholders. Applicants submit that 

the proposed arrangements would 

permit each Fund to facilitate the 

distribution of its Shares and provide 

investors with a broader choice of 

shareholder options. Applicants assert 

that the proposed closed-end 

management investment company 

multiple class structure does not raise 

the concerns underlying section 18 of 

the 1940 Act to any greater degree than 

open-end management investment 

companies’ multiple class structures 

that are permitted by rule 18f–3 under 

the 1940 Act. Applicants state that each 

Fund will comply with the provisions of 

rule 18f–3 as if it were an open-end 

management investment company. 

Early Withdrawal Charges 

1. Section 23(c) of the 1940 Act 

provides, in relevant part, that no 

registered closed-end management 

investment company shall purchase 

securities of which it is the issuer, 

except: (a) On a securities exchange or 

other open market; (b) pursuant to 

tenders, after reasonable opportunity to 

submit tenders given to all holders of 

securities of the class to be purchased; 

or (c) under other circumstances as the 

Commission may permit by rules and 

regulations or orders for the protection 

of investors. 

2. Rule 23c–3 under the 1940 Act 

permits an interval fund to make 

repurchase offers of between five and 

twenty-five percent of its outstanding 

shares at net asset value at periodic 

intervals pursuant to a fundamental 

policy of the interval fund. Rule 23c– 

3(b)(1) under the 1940 Act permits an 

interval fund to deduct from repurchase 

proceeds only a repurchase fee, not to 

exceed two percent of the proceeds, that 

is paid to the interval fund and is 

reasonably intended to compensate the 

fund for expenses directly related to the 

repurchase. 

3. Section 23(c)(3) of the 1940 Act 

provides that the Commission may issue 

an order that would permit a closed-end 

management investment company to 

repurchase its shares in circumstances 

in which the repurchase is made in a 

manner or on a basis that does not 

unfairly discriminate against any 

holders of the class or classes of 

securities to be purchased. 

4. Applicants request relief under 

section 6(c), discussed above, and 

section 23(c)(3) from rule 23c–3 to the 

extent necessary for each Fund to 

impose early withdrawal charges on 

shares of the Fund submitted for 

repurchase that have been held for less 

than a specified period. 

5. Applicants state that the early 

withdrawal charges they may seek intend 

to impose are functionally similar to 

CDSLs imposed by open-end 

management investment companies 

under rule 6c–10 under the 1940 Act. 

Rule 6c–10 permits open-end 

management investment companies to 

impose CDSLs, subject to certain 

conditions. Applicants note that rule 

6c–10 is grounded in policy 

considerations supporting the 

employment of CDSLs where there are 

adequate safeguards for the investor. 

Applicants state that these same policy 

considerations support imposition of 

early withdrawal charges in the interval 

fund context, and are a solid basis for 

the Commission to grant exemptive 

relief to permit interval funds to impose 

early withdrawal charges. In addition, 

applicants state that early withdrawal 

charges may be necessary for the Fund’s 

Distributor to recover distribution costs 

from shareholders who exit their 

investments early. Applicants represent 

that any early withdrawal charge 

imposed by a Fund will comply with 

rule 6c–10 under the 1940 Act as if the 

rule were applicable to closed-end 

management investment companies. 

Each Fund will disclose early 

withdrawal charges in accordance with 

the requirements of Form N–1A 

concerning CDSLs. 

Asset-Based Service and/or Distribution 

Fees 

1. Section 17(d) of the 1940 Act and 

rule 17d–1 thereunder prohibit an 

affiliated person of a registered 

investment company, or an affiliated 

person of such person, acting as 

principal, from participating in or 

effecting any transaction in connection 

with any joint enterprise or other joint 

arrangement in which the investment 

company participates unless the 

Commission issues an order permitting 

the transaction. In reviewing 

applications submitted under section 

17(d) and rule 17d–1, the Commission 

considers whether the participation of 

the investment company in a joint 

enterprise or joint arrangement is 

consistent with the provisions, policies, 

and purposes of the 1940 Act, and the 

extent to which the participation is on 

a basis different from or less 

advantageous than that of other 

participants. 

2. Rule 17d–3 under the 1940 Act 

provides an exemption from section 

17(d) and rule 17d–1 to permit openend management investment companies 

to enter into distribution arrangements 

pursuant to rule 12b–1 under the 1940 

Act. Applicants request an order 

pursuant to section 17(d) of the 1940 

Act and rule 17d–1 thereunder to the 

extent necessary to permit each Fund to 

impose asset-based service and/or 

distribution fees (in a manner similar to 

rule 12b–1 fees for an open-end 

management investment company). 

Applicants have agreed to comply with 

rules 12b–1 and 17d–3 as if those rules 

apply to closed-end management 

investment companies, which they 

believe will resolve any concerns that 

might arise in connection with a Fund 

financing the distribution of its Shares 

through asset-based service and/or 

distribution fees. 

For the reasons stated above, 

applicants submit that the exemptions 

requested under section 6(c) are 

necessary and appropriate in the public 

interest and are consistent with the 

protection of investors and the purposes 

fairly intended by the policy and 

provisions of the 1940 Act. Applicants 

further submit that the relief requested 

pursuant to section 23(c)(3) will be 

consistent with the protection of 

investors and will insure that applicants 

do not unfairly discriminate against any 

holders of the class of securities to be 

purchased. Finally, applicants state that 

the Funds’ imposition of asset-based 

service and/or distribution fees is 

consistent with the provisions, policies, 

and purposes of the 1940 Act and does 

not involve participation on a basis 

different from or less advantageous than 

that of other participants. 


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Applicants’ Condition 

Applicants agree that any order 

granting the requested relief will be 

subject to the following condition: 

Each Fund relying on the requested 

order will comply with the provisions of 

rules 6c–10, 12b–1, 17d–3, 18f–3, 22d– 

1 and, where applicable, 11a–3 under 

the 1940 Act, as amended from time to 

time or replaced, as if those rules 

applied to closed-end management 

investment companies, and will comply 

with FINRA Rule 2341, as amended 

from time to time, as if that rule applies 

to all closed-end management 

investment companies. 

For the Commission, by the Division of 

Investment Management, under delegated 

authority. 

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2021–14261 Filed 7–2–21; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[SEC File No. 270–450, OMB Control No. 

3235–0505] 

Proposed Collection; Comment 

Request 

Upon Written Request, Copies Available 

From: Securities and Exchange 

Commission, Office of FOIA Services, 

100 F Street NE, Washington, DC 

20549–2736 

Extension: 

Rule 303 of Regulation ATS 

Notice is hereby given that pursuant 

to the Paperwork Reduction Act of 1995 

(‘‘PRA’’) (44 U.S.C. 3501 et seq.), the 

Securities and Exchange Commission 

(‘‘Commission’’) is soliciting comments 

on the existing collection of information 

provided for in Rule 303 of Regulation 

ATS (17 CFR 242.303) under the 

Securities Exchange Act of 1934 (15 

U.S.C. 78a et seq.) (‘‘Exchange Act’’). 

The Commission plans to submit this 

existing collection of information to the 

Office of Management and Budget 

(‘‘OMB’’) for extension and approval. 

Regulation ATS sets forth a regulatory 

regime for ‘‘alternative trading systems’’ 

(‘‘ATSs’’), which are entities that carry 

out exchange functions but are not 

required to register as national securities 

exchanges under the Act. In lieu of 

exchange registration, an ATS can 

instead opt to register with the 

Commission as a broker-dealer and, as 

a condition to not having to register as 

an exchange, must instead comply with 

Regulation ATS. Rule 303 of Regulation 

ATS (17 CFR 242.303) describes the 

record preservation requirements for 

ATSs. Rule 303 also describes how such 

records must be maintained, what 

entities may perform this function, and 

how long records must be preserved. 

Under Rule 303, ATSs are required to 

preserve all records made pursuant to 

Rule 302, which includes information 

relating to subscribers, trading 

summaries, and time-sequenced order 

information. Rule 303 also requires 

ATSs to preserve any notices provided 

to subscribers, including, but not 

limited to, notices regarding the ATSs 

operations and subscriber access. For an 

ATS subject to the fair access 

requirements described in Rule 

301(b)(5)(ii) of Regulation ATS, Rule 

303 further requires the ATS to preserve 

at least one copy of its standards for 

access to trading, all documents relevant 

to the ATS’s decision to grant, deny, or 

limit access to any person, and all other 

documents made or received by the ATS 

in the course of complying with Rule 

301(b)(5) of Regulation ATS. For an ATS 

subject to the capacity, integrity, and 

security requirements for automated 

systems under Rule 301(b)(6) of 

Regulation ATS, Rule 303 requires an 

ATS to preserve all documents made or 

received by the ATS related to its 

compliance, including all 

correspondence, memoranda, papers, 

books, notices, accounts, reports, test 

scripts, test results, and other similar 

records. Rule 303(a)(1)(v) of Regulation 

ATS requires every ATS to preserve the 

written safeguards and written 

procedures mandated under Rule 

301(b)(10). As provided in Rule 

303(a)(1), ATSs are required to keep all 

of these records, as applicable, for a 

period of at least three years, the first 

two in an easily accessible place. In 

addition, Rule 303 requires ATSs to 

preserve records of partnership articles, 

articles of incorporation or charter, 

minute books, stock certificate books, 

copies of reports filed pursuant to Rule 

301(b)(2) and Rule 304, and records 

made pursuant to Rule 301(b)(5) for the 

life of the ATS. ATSs that trade both 

NMS Stock and securities other than 

NMS Stock are required to file, and also 

preserve under Rule 303, both Form 

ATS and related amendments and Form 

ATS–N and related amendments. 

The information contained in the 

records required to be preserved by Rule 

303 will be used by examiners and other 

representatives of the Commission, state 

securities regulatory authorities, and the 

self-regulatory organizations to ensure 

that ATSs are in compliance with 

Regulation ATS as well as other 

applicable rules and regulations. 

Without the data required by the Rule, 

regulators would be limited in their 

ability to comply with their statutory 

obligations, provide for the protection of 

investors, and promote the maintenance 

of fair and orderly markets. Respondents 

consist of ATSs that choose to register 

as broker-dealers and comply with the 

requirements of Regulation ATS. 

There are currently 94 respondents. 

The Commission believes that the 

average ongoing hourly burden for a 

respondent to comply with the baseline 

record preservation requirements under 

Rule 303 is approximately 15 hours per 

year. We thus estimate that the average 

aggregate ongoing burden to comply 

with the baseline Rule 303 record 

preservation requirements is 

approximately 1,410 hours per year (94 

ATSs × 15 hours = 1,410 hours). In 

addition, there are currently two ATSs 

that transact in both NMS stock and 

non-NMS stock on their ATSs. These 

two ATSs have a slightly greater burden 

because they have to keep both Form 

ATS and Form ATS–N and related 

documents (e.g., amendments). For 

these two ATS’s, we estimate that the 

ongoing burden above the current 

baseline estimate for preserving records 

will be approximately 1 hour annually 

per ATS for a total annual burden above 

the current baseline burden estimate of 

2 hours for all respondents. Thus, the 

estimated average annual aggregate 

burden for alternative trading systems to 

comply with Rule 303 is approximately 

1,412 hours (1,410 hours + 2 hours). 

Written comments are invited on: (a) 

Whether the proposed collection of 

information is necessary for the proper 

performance of the functions of the 

Commission, including whether the 

information shall have practical utility; 

(b) the accuracy of the Commission’s 

estimates of the burden of the proposed 

collection of information; (c) ways to 

enhance the quality, utility, and clarity 

of the information collected; and (d) 

ways to minimize the burden of the 

collection of information on 

respondents, including through the use 

of automated collection techniques or 

other forms of information technology. 

Consideration will be given to 

comments and suggestions submitted in 

writing within 60 days of this 

publication. 

An agency may not conduct or 

sponsor, and a person is not required to 

respond to, a collection of information 

under the PRA unless it displays a 

currently valid OMB control number. 

Please direct your written comments 

to: David Bottom, Director/Chief 

Information Officer, Securities and 

Exchange Commission, c/o Cynthia 

Roscoe, 100 F Street NE, Washington, 

DC 20549, or send an email to: PRA_

Mailbox@sec.gov. 


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