5796 Federal Register / Vol. 81, No. 22 / Wednesday, February 3, 2016 / Notices 

6 15 U.S.C. 78f(b)(5). 

7 If the Exchange changes its method of funding 

regulation or if circumstances otherwise change in 

the future, the Exchange may decide to modify the 

ORF or assess a separate regulatory fee on Permit 

Holder proprietary transactions if the Exchange 

deems it advisable. 

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

9 17 CFR 240.19b–4(f). 

10 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

equitable allocation of reasonable dues, 

fees, and other charges among its Permit 

Holders and other persons using its 

facilities. Additionally, the Exchange 

believes the proposed rule change is 

consistent with the Section 6(b)(5) 6

requirement that the rules of an 

exchange not be designed to permit 

unfair discrimination between 

customers, issuers, brokers, or dealers. 

The Exchange believes the proposed 

fee change is reasonable because it 

would help the Exchange offset 

increased regulatory costs but would not 

result in total regulatory revenue 

exceeding total regulatory costs. 

Moreover, the Exchange believes the 

ORF ensures fairness by assessing 

higher fees to those Permit Holders that 

require more Exchange regulatory 

services based on the amount of 

customer options business they 

conduct. Regulating customer trading 

activity is much more labor intensive 

and requires greater expenditure of 

human and technical resources than 

regulating non-customer trading 

activity, which tends to be more 

automated and less labor-intensive. As a 

result, the costs associated with 

administering the customer component 

of the Exchange’s overall regulatory 

program are materially higher than the 

costs associated with administering the 

non-customer component (e.g., Permit 

Holder proprietary transactions) of its 

regulatory program.7 The Exchange 

believes the proposed fee change is 

equitable and not unfairly 

discriminatory in that it is charged to all 

Permit Holders on all their transactions 

that clear in the customer range at the 

OCC. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

C2 does not believe that the proposed 

rule change will impose any burden on 

competition that is not necessary or 

appropriate in furtherance of the 

purposes of the Act, because it applies 

to all Permit Holders. The proposed 

ORF is comparable to fees charged by 

other options exchanges for the same or 

similar service. The Exchange believes 

any burden on competition imposed by 

the proposed rule change is outweighed 

by the need to help the Exchange 

adequately fund its regulatory activities 

to ensure compliance with the Exchange 

Act. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

The Exchange neither solicited nor 

received comments on 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) 

of the Act 8 and paragraph (f) of Rule 

19b–4 9 thereunder. 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 will institute proceedings 

to determine whether the proposed rule 

change 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– 

C2–2016–001 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–C2–2016–001. 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 Number SR–C2– 

2016–001 and should be submitted on 

or before February 24, 2016. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.10

Robert W. Errett, 

Deputy Secretary. 

[FR Doc. 2016–01931 Filed 2–2–16; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–76984; File No. SR–Phlx– 

2016–07] 

Self-Regulatory Organizations; 

NASDAQ OMX PHLX LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change to Make Minor 

Changes to Rule 1064, Crossing, 

Facilitation and Solicited Orders 

January 28, 2016. 

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

Securities Exchange Act of 1934 

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

notice is hereby given that on January 

14, 2016, NASDAQ OMX PHLX LLC 

(‘‘Phlx’’ or ‘‘Exchange’’) filed with the 

Securities and Exchange Commission 

(‘‘SEC’’ or ‘‘Commission’’) the proposed 

rule change as described in Items I, II, 

and III below, which Items have been 

prepared by the Exchange. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

mstockstill on DSK4VPTVN1PROD with NOTICES

Federal Register / Vol. 81, No. 22 / Wednesday, February 3, 2016 / Notices 5797 

3Rule 1064(a). 

4Rule 1064(d). 

5Rule 1064(e). 

6 15 U.S.C. 78f(b). 

7 15 U.S.C. 78f(b)(5). 

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

9 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. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to make 

minor changes to Rule 1064, Crossing, 

Facilitation and Solicited Orders. 

The text of the proposed rule change 

is available on the Exchange’s Web site 

at http:// 

nasdaqomxphlx.cchwallstreet.com/, at 

the principal office of the Exchange, and 

at the Commission’s Public Reference 

Room. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

Exchange included statements 

concerning the purpose of and basis for 

the proposed rule change and discussed 

any comments it received on the 

proposed rule change. The text of these 

statements may be examined at the 

places specified in Item IV below. The 

Exchange has prepared summaries, set 

forth in sections A, B, and C below, of 

the most significant 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 purpose of the filing is to 

improve the readability of Rule 1064 

with a few minor changes. Rule 1064 is 

lengthy and covers several complicated, 

related topics. 

First, the Exchange proposes to add 

headings to certain paragraphs to make 

it easier to locate each of the following 

topics: Crossing,3 Anticipatory 

Hedging 4 and Floor Qualified 

Contingent Cross.5 Paragraph (b), 

Facilitation Orders and paragraph (c), 

Solicited Orders, already have headings 

so headings would now run consistently 

throughout the rule. 

Second, the Exchange also proposes 

to move the language from two 

commentaries into the body of the rule, 

also to improve readability. Specifically, 

the language in Commentary .03 is being 

moved to become the new Rule 

1064(a)(iv), because it relates to crossing 

orders, which is covered in paragraph 

(a). Also, the language in Commentary 

.04 is being moved to become the new 

Rule 1064(d)(iii), which is related to the 

anticipatory hedging provisions 

currently in paragraph (d). 

2. Statutory Basis 

The Exchange believes that its 

proposal is consistent with Section 6(b) 

of the Act 6 in general, and furthers the 

objectives of Section 6(b)(5) of the Act 7

in particular, in that it is designed to 

protect investors and the public interest 

by improving the readability of a 

lengthy and complicated rule. The 

Exchange believes that the proposed 

headings and merging of commentary 

language into the main body of the rule 

should prevent confusion. 

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 

proposal merely reorganizes a rule, it 

has no impact on either inter-market or 

intra-market competition. 

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)(iii) of the Act 8 and 

subparagraph (f)(6) 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: (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 rulecomments@sec.gov. Please include File 

Number SR–Phlx–2016–07 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–Phlx–2016–07. 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 Number SR–Phlx– 

2016–07, and should be submitted on or 

before February 24, 2016. 

mstockstill on DSK4VPTVN1PROD with NOTICES

5798 Federal Register / Vol. 81, No. 22 / Wednesday, February 3, 2016 / Notices 

10 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 Securities Exchange Act Release No. 68158 

(Nov. 5, 2012), 77 FR 67412 (Nov. 9, 2012) (SR– 

NYSEArca–2012–101) (‘‘Prior Order’’). See also 

Securities Exchange Act Release No. 67881 (Sept. 

18, 2012), 77 FR 58889 (Sept. 24, 2012) (SR– 

NYSEArca–2012–101) (‘‘Prior Notice,’’ and together 

with the Prior Order, the ‘‘Prior Release’’). 

5The Trust is registered under the Investment 

Company Act of 1940 (15 U.S.C. 80a–1) (‘‘1940 

Act’’). The Trust intends to file a prospectus 

supplement with the Commission or a post-effective 

amendment to its registration statement on Form N– 

1A under the Securities Act of 1933 (15 U.S.C. 77a) 

(‘‘Securities Act’’), and under the 1940 Act relating 

to the Fund (File Nos. 333–147622 and 811–22148) 

(‘‘Registration Statement’’) to reflect the changes 

requested in the proposed rule change upon 

effectiveness of the rule change. The description of 

the operation of the Trust and the Fund herein will 

be reflected in any such filing. In addition, the 

Commission has issued an order granting certain 

exemptive relief to the Trust under the1940 Act. 

See Investment Company Act Release No. 28171 

(Feb. 27, 2008) (File No. 812–13386) (‘‘Exemptive 

Order’’). 

6The changes described herein will be effective 

contingent upon filing of a prospectus supplement 

or upon effectiveness of the Trust’s most recent 

post-effective amendment to its Registration 

Statement. See note 5, supra. The Adviser 

represents that the Adviser will not implement the 

changes described herein until the instant proposed 

rule change is operative. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.10

Robert W. Errett, 

Deputy Secretary. 

[FR Doc. 2016–01925 Filed 2–2–16; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–76981; File No. SR– 

NYSEArca–2016–20] 

Self-Regulatory Organizations; NYSE 

Arca, Inc.; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change To Reflect Changes to 

the Investment Strategy for the 

PowerShares S&P 500® Downside 

Hedged Portfolio 

January 28, 2016. 

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

Securities Exchange Act of 1934 (the 

‘‘Act’’) 2 and Rule 19b–4 thereunder,3

notice is hereby given that, on January 

26, 2016, NYSE Arca, Inc. (the 

‘‘Exchange’’ or ‘‘NYSE Arca’’) filed with 

the Securities and Exchange 

Commission (the ‘‘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 a rule change 

to reflect changes to the investment 

strategy for the PowerShares S&P 500®

Downside Hedged Portfolio (the 

‘‘Fund’’). 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 Commission previously approved 

listing and trading on the Exchange of 

shares (‘‘Shares’’) of the Fund, a series 

of the PowerShares Actively Managed 

Exchange-Traded Fund Trust (the 

‘‘Trust’’),4 under NYSE Arca Equities 

Rule 8.600, which governs the listing 

and trading of Managed Fund Shares. 

Shares of the Fund have commenced 

listing and trading on the Exchange. 

The Shares are offered by the Trust, 

a statutory trust organized under the 

laws of the State of Delaware and 

registered with the Commission as an 

open-end management investment 

company.5 The investment advisor to 

the Fund is Invesco PowerShares 

Capital Management LLC (the 

‘‘Adviser’’). 

In this proposed rule change, the 

Exchange proposes to reflect changes to 

the investment strategy that the Adviser 

utilizes in seeking to achieve the Fund’s 

investment objective, as described 

below.6

The Prior Release stated that, 

according to the Registration Statement, 

the Fund is an actively managed 

exchange-traded fund that will seek to 

achieve positive total returns in rising or 

falling markets that are not directly 

correlated to broad equity or fixed 

income market returns. According to the 

Registration Statement, the Fund seeks 

to achieve its investment objective by 

using a quantitative, rules-based 

investment strategy designed to provide 

returns that correspond to the 

performance of the S&P 500 Dynamic 

VEQTOR Index (the ‘‘Benchmark’’). The 

Registration Statement also stated that 

the allocation among the Fund’s 

investments generally will approximate 

the allocation among the components of 

the Benchmark. 

The Adviser now represents that, 

rather than employing a quantitative, 

rules-based strategy designed to provide 

returns that correspond to the 

performance of the Benchmark, the 

Fund will use a quantitative, rulesbased strategy that is designed to 

outperform the Benchmark rather than 

match it. 

The Adviser will continue to invest 

the Fund in the same instruments as are 

contained in the Benchmark, as 

discussed in the Prior Release. However, 

the Adviser now represents that the 

Fund will use portfolio management 

strategies in seeking to achieve its 

investment objective that allocate the 

Fund’s assets in a manner that may not 

correspond to the Benchmark. The 

Adviser also now represents that, going 

forward, the Fund will seek to 

outperform the Benchmark rather than 

match it. 

The Exchange notes that the Prior 

Release stated that, according to the 

Registration Statement, the Fund may 

invest a portion of its assets in highquality money market instruments, 

cash, and cash equivalents to provide 

liquidity, to collateralize its futures 

contracts investments, or to track the 

Benchmark during times when the 

Benchmark moves its entire allocation 

to cash. The Exchange also proposes to 

change this representation to state that 

the Fund may invest a portion of its 

assets in high-quality money market 

instruments, cash, and cash equivalents 

to provide liquidity, to collateralize its 

futures contracts investments, or during 

periods of heightened volatility when 

the Adviser believes that it is in the best 

interest of the Fund to do so. Because 

the Fund, going forward, would seek to 

outperform rather than match the 

Benchmark, the Fund would no longer 

utilize high quality money market 

instruments, cash and cash equivalents 

for the purpose of tracking the 

Benchmark. 

The Adviser represents that there is 

no change to the Fund’s investment 

objective. The Fund will continue to 

invest in the securities and financial 

instruments identified in the Prior 

mstockstill on DSK4VPTVN1PROD with NOTICES