Federal Register / Vol. 79, No. 207 / Monday, October 27, 2014 / Notices 63997 

9For purposes only of waiving the 30-day 

operative delay, the Commission has considered the 

proposed rule’s impact on efficiency, competition, 

and capital formation. See 15 U.S.C. 78c(f). 

10 15 U.S.C. 78s(b)(3)(C). 

11 Id. 12 17 CFR 200.30–3(a)(12). 

1Further, the Letter states that should the Shares 

also trade on a market pursuant to unlisted trading 

privileges, such trading will be conducted pursuant 

to self-regulatory organization rules that have 

become effective pursuant to Section 19(b) of the 

Exchange Act. 

2Exchange Act Rel. No. 67215 (June 19, 2012); 77 

FR 37941 (June 25, 2012); Letter from Catherine 

McGuire, Esq., Chief Counsel, Division of Market 

Regulation, to the Securities Industry Association 

Derivative Products Committee (November 21, 

2005); Letter from Racquel L. Russell, Branch Chief, 

Division of Market Regulation, to George T. Simon, 

Esq., Foley & Lardner LLP (June 21, 2006); Letter 

from James A. Brigagliano, Acting Associate 

Director, Division of Market Regulation, to Stuart 

M. Strauss, Esq., Clifford Chance US LLP (October 

Continued 

because it provides firms with a 

reasonable amount of additional time to 

make necessary systems changes so they 

can accurately complete and file the 

SIS. Therefore, the Commission 

designates the proposal operative upon 

filing.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.10

If the Commission takes such action, the 

Commission shall institute proceedings 

to determine whether the proposed rule 

should be approved or disapproved.11

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–FINRA–2014–44 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–2014–44. 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 

a.m. and 3 p.m. Copies of the filing also 

will be available for inspection and 

copying at FINRA’s principal office. 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–2014–44 and 

should be submitted on or before 

November 17, 2014. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.12

Kevin M. O’Neill, 

Deputy Secretary. 

[FR Doc. 2014–25428 Filed 10–24–14; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–73398; File No. TP 15–02] 

Order Granting Limited Exemptions 

From Exchange Act Rule 10b–17 and 

Rules 101 and 102 of Regulation M to 

Global X JP Morgan Efficiente Index 

and Global X JP Morgan US Sector 

Rotator Index ETFs Pursuant to 

Exchange Act Rule 10b–17(b)(2) and 

Rules 101(d) and 102(e) of 

Regulation M 

October 21, 2014. 

By letter dated October 21, 2014 (the 

‘‘Letter’’), as supplemented by 

conversations with the staff of the 

Division of Trading and Markets, 

counsel for Global X Funds (the 

‘‘Trust’’), on behalf of the Trust, Global 

X JP Morgan Efficiente Index and Global 

X JP Morgan US Sector Rotator Index 

ETFs (collectively the ‘‘Funds’’), any 

national securities exchange on or 

through which shares issued by the 

Funds (‘‘Shares’’) may subsequently 

trade, SEI Investment Distribution 

Company, and persons or entities 

engaging in transactions in Shares 

(collectively, the ‘‘Requestors’’), 

requested exemptions, or interpretive or 

no-action relief, from Rule 10b–17 of the 

Securities Exchange Act of 1934, as 

amended (‘‘Exchange Act’’), and Rules 

101 and 102 of Regulation M, in 

connection with secondary market 

transactions in Shares and the creation 

or redemption of aggregations of Shares 

of at least 50,000 shares (‘‘Creation 

Units’’). 

The Trust is registered with the 

Securities and Exchange Commission 

(‘‘Commission’’) under the Investment 

Company Act of 1940, as amended 

(‘‘1940 Act’’), as an open-end 

management investment company. The 

Funds seek to track the performance of 

underlying indexes, specifically the JP 

Morgan ETF Efficiente 10 TR Series X 

Index for the Global X JP Morgan 

Efficiente Index ETF and the JP Morgan 

US Sector Rotator TR Series X Index for 

the Global X JP Morgan US Sector 

Rotator Index ETF (collectively the 

‘‘Indexes’’). The Funds intend to operate 

as ‘‘ETF of ETFs’’ by seeking to track the 

performance of their underlying Indexes 

through investing at least 80% of their 

net assets (plus the amount of any 

borrowings for investment purposes) in 

the ETFs and ETPs which comprise the 

Indexes. Except for the fact that the 

Funds will operate as an ETF of ETFs, 

the Funds will operate in a manner 

identical to the ETFs and ETPs that are 

included in the Indexes. 

The Requestors represent, among 

other things, the following: 

• Shares of the Funds will be issued 

by the Trust, an open-end management 

investment company that is registered 

with the Commission; 

• The Trust will continuously redeem 

Creation Units at net asset value 

(‘‘NAV’’) and the secondary market 

price of the Shares should not vary 

substantially from the NAV of such 

Shares; 

• Shares of the Funds will be listed 

and traded on the NYSE Arca, Inc. or 

another exchange in accordance with 

exchange listing standards that are, or 

will become, effective pursuant to 

Section 19(b) of the Exchange Act (the 

‘‘Exchange’’); 1

• All ETFs and ETPs in which the 

Funds are invested will meet all 

conditions set forth in a relevant class 

relief letter,2 will have received 


tkelley on DSK3SPTVN1PROD with NOTICES
63998 Federal Register / Vol. 79, No. 207 / Monday, October 27, 2014 / Notices 

24, 2006); Letter from James A. Brigagliano, 

Associate Director, Division of Market Regulation, 

to Benjamin Haskin, Esq., Willkie. Farr & Gallagher 

LLP (April 9, 2007); or Letter from Josephine Tao, 

Assistant Director, Division of Trading and Markets, 

to Domenick Pugliese, Esq., Paul, Hastings, Janofsky 

and Walker LLP (June 27, 2007). See also Staff Legal 

Bulletin No. 9, ‘‘Frequently Asked Questions About 

Regulation M’’ (April 12, 2002) (regarding activelymanaged ETFs). 

3While ETFs operate under exemptions from the 

definitions of ‘‘open-end company’’ under Section 

5(a)(1) of the 1940 Act and ‘‘redeemable security’’ 

under Section 2(a)(32) of the 1940 Act, the Funds 

and their securities do not meet those definitions. 

4Additionally, we confirm the interpretation that 

a redemption of Creation Unit size aggregations of 

Shares of the Funds and the receipt of securities in 

exchange by a participant in a distribution of Shares 

of the Funds would not constitute an ‘‘attempt to 

induce any person to bid for or purchase, a covered 

security during the applicable restricted period’’ 

within the meaning of Rule 101 of Regulation M 

and therefore would not violate that rule. 

individual relief from the Commission, 

or will be able to rely upon individual 

relief even though they are not named 

parties (for example, a no-action letter); 

• At least 70% of the Funds are 

comprised of component securities that 

will meet the minimum public float and 

minimum average daily trading volume 

thresholds under the ‘‘actively-traded 

securities’’ definition found in 

Regulation M for excepted securities 

during each of the previous two months 

of trading prior to formation of the 

Funds; provided, however, that if the 

Funds have 200 or more component 

securities, then 50% of the component 

securities will meet the actively-traded 

securities thresholds; 

• All the components of the Indexes 

will have publicly available last sale 

trade information; 

• The intra-day proxy value of the 

Funds per share and the value of the 

Indexes will be publicly disseminated 

by a major market data vendor 

throughout the trading day; 

• On each business day before the 

opening of business on the Exchange, 

the Funds’ custodian, through the 

National Securities Clearing 

Corporation, will make available the list 

of the names and the numbers of 

securities and other assets of the Funds’ 

portfolio that will be applicable that day 

to creation and redemption requests; 

• The Exchange or other market 

information provider will disseminate 

(i) continuously every 15 seconds 

throughout the trading day, through the 

facilities of the consolidated tape, the 

market value of a Share and (ii) every 

15 seconds throughout the trading day, 

a calculation of the intraday indicative 

value of a Share; 

• The arbitrage mechanism will be 

facilitated by the transparency of the 

Funds’ portfolio and the availability of 

the intra-day indicative value, the 

liquidity of securities held by the Funds 

and the ability to acquire such 

securities, as well as the arbitrageurs’ 

ability to create workable hedges; 

• The Funds will invest solely in 

liquid securities; 

• The Funds will invest in securities 

that will facilitate an effective and 

efficient arbitrage mechanism and the 

ability to create workable hedges; 

• The Trust believes that arbitrageurs 

are expected to take advantage of price 

variations between the Funds’ market 

price and its NAV; and 

• A close alignment between the 

market price of Shares and the Funds’ 

NAV is expected. 

Regulation M 

While redeemable securities issued by 

an open-end management investment 

company are excepted from the 

provisions of Rule 101 and 102 of 

Regulation M, the Requestors may not 

rely upon that exception for the Shares.3

However, we find that it is appropriate 

in the public interest and is consistent 

with the protection of investors to grant 

a conditional exemption from Rules 101 

and 102 to persons who may be deemed 

to be participating in a distribution of 

Shares of the Funds as described in 

more detail below. 

Rule 101 of Regulation M 

Generally, Rule 101 of Regulation M 

is an anti-manipulation rule that, 

subject to certain exceptions, prohibits 

any ‘‘distribution participant’’ and its 

‘‘affiliated purchasers’’ from bidding for, 

purchasing, or attempting to induce any 

person to bid for or purchase any 

security which is the subject of a 

distribution until after the applicable 

restricted period, except as specifically 

permitted in the rule. Rule 100 of 

Regulation M defines ‘‘distribution’’ to 

mean any offering of securities that is 

distinguished from ordinary trading 

transactions by the magnitude of the 

offering and the presence of special 

selling efforts and selling methods. The 

provisions of Rule 101 of Regulation M 

apply to underwriters, prospective 

underwriters, brokers, dealers, or other 

persons who have agreed to participate 

or are participating in a distribution of 

securities. The Shares are in a 

continuous distribution and, as such, 

the restricted period in which 

distribution participants and their 

affiliated purchasers are prohibited from 

bidding for, purchasing, or attempting to 

induce others to bid for or purchase 

extends indefinitely. 

Based on the representations and facts 

presented in the Letter, particularly that 

the Trust is a registered open-end 

management investment company that 

will continuously redeem at the NAV 

Creation Unit size aggregations of the 

Shares of the Funds and that a close 

alignment between the market price of 

Shares and the Funds’ NAV is expected, 

the Commission finds that it is 

appropriate in the public interest, and 

consistent with the protection of 

investors to grant the Trust an 

exemption under paragraph (d) of Rule 

101 of Regulation M with respect to the 

Funds, thus permitting persons 

participating in a distribution of Shares 

of the Funds to bid for or purchase such 

Shares during their participation in 

such distribution.4

Rule 102 of Regulation M 

Rule 102 of Regulation M prohibits 

issuers, selling security holders, and any 

affiliated purchaser of such person from 

bidding for, purchasing, or attempting to 

induce any person to bid for or purchase 

a covered security during the applicable 

restricted period in connection with a 

distribution of securities effected by or 

on behalf of an issuer or selling security 

holder. 

Based on the representations and facts 

presented in the Letter, particularly that 

the Trust is a registered open-end 

management investment company that 

will redeem at the NAV Creation Unit 

size aggregations of Shares of the Funds 

and that a close alignment between the 

market price of Shares and the Funds’ 

NAV is expected, the Commission finds 

that it is appropriate in the public 

interest, and consistent with the 

protection of investors to grant the Trust 

an exemption under paragraph (e) of 

Rule 102 of Regulation M with respect 

to the Funds, thus permitting the Funds 

to redeem Shares of the Funds during 

the continuous offering of such Shares. 

Rule 10b–17 

Rule 10b–17, with certain exceptions, 

requires an issuer of a class of publicly 

traded securities to give notice of certain 

specified actions (for example, a 

dividend distribution) relating to such 

class of securities in accordance with 

Rule 10b–17(b). Based on the 

representations and facts in the Letter, 

and subject to the conditions below, the 

Commission finds that it is appropriate 

in the public interest, and consistent 

with the protection of investors, to grant 

the Trust a conditional exemption from 

Rule 10b–17 because market 

participants will receive timely 

notification of the existence and timing 

of a pending distribution, and thus the 

concerns that the Commission raised in 


tkelley on DSK3SPTVN1PROD with NOTICES
Federal Register / Vol. 79, No. 207 / Monday, October 27, 2014 / Notices 63999 

5We also note that timely compliance with Rule 

10b–17(b)(1)(v)(a) and (b) would be impractical in 

light of the nature of the Funds. This is because it 

is not possible for the Funds to accurately project 

ten days in advance what dividend, if any, would 

be paid on a particular record date. 6 17 CFR 200.30–3(a)(6) and (9). 

adopting Rule 10b–17 will not be 

implicated.5

Conclusion 

It is hereby ordered, pursuant to Rule 

101(d) of Regulation M, that the Trust, 

based on the representations and facts 

presented in the Letter, is exempt from 

the requirements of Rule 101 with 

respect to the Funds, thus permitting 

persons who may be deemed to be 

participating in a distribution of Shares 

of the Funds to bid for or purchase such 

Shares during their participation in 

such distribution. 

It is further ordered, pursuant to Rule 

102(e) of Regulation M, that the Trust, 

based on the representations and the 

facts presented in the Letter, is exempt 

from the requirements of Rule 102 with 

respect to the Funds, thus permitting 

the Funds to redeem Shares of the 

Funds during the continuous offering of 

such Shares. 

It is further ordered, pursuant to Rule 

10b–17(b)(2), that the Trust, based on 

the representations and the facts 

presented in the Letter and subject to 

the conditions below, is exempt from 

the requirements of Rule 10b–17 with 

respect to transactions in the Shares of 

the Funds. 

This exemptive relief is subject to the 

following conditions: 

• The Trust will comply with Rule 

10b–17 except for Rule 10b– 

17(b)(1)(v)(a) and (b); and 

• The Trust will provide the 

information required by Rule 10b– 

17(b)(1)(v)(a) and (b) to the Exchange as 

soon as practicable before trading begins 

on the ex-dividend date, but in no event 

later than the time when the Exchange 

last accepts information relating to 

distributions on the day before the exdividend date. 

This exemptive relief is subject to 

modification or revocation at any time 

the Commission determines that such 

action is necessary or appropriate in 

furtherance of the purposes of the 

Exchange Act. This exemption is based 

on the facts presented and the 

representations made in the Letter. Any 

different facts or representations may 

require a different response. In the event 

that any material change occurs in the 

facts or representations in the Letter, 

transactions in Shares of the Funds 

must be discontinued, pending 

presentation of the facts for our 

consideration. In addition, persons 

relying on this exemption are directed 

to the anti-fraud and anti-manipulation 

provisions of the Exchange Act, 

particularly Sections 9(a), 10(b), and 

Rule 10b–5 thereunder. Responsibility 

for compliance with these and any other 

applicable provisions of the federal 

securities laws must rest with the 

persons relying on this exemption. This 

order should not be considered a view 

with respect to any other question that 

the proposed transactions may raise, 

including, but not limited to the 

adequacy of the disclosure concerning, 

and the applicability of other federal or 

state laws to, the proposed transactions. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.6

Kevin M. O’Neill, 

Deputy Secretary. 

[FR Doc. 2014–25434 Filed 10–24–14; 8:45 am] 

BILLING CODE 8011–01–P 

SMALL BUSINESS ADMINISTRATION 

[Disaster Declaration #14161 and #14162] 

New Jersey Disaster #NJ–00038 

AGENCY: U.S. Small Business 

Administration. 

ACTION: Notice. 

SUMMARY: This is a notice of an 

Administrative declaration of a disaster 

for the State of New Jersey: dated 10/16/ 

2014. 

Incident: Severe Storms and Flooding. 

Incident Period: 08/12/2014. 

Effective Date: 10/16/2014. 

Physical Loan Application Deadline 

Date: 12/15/2014. 

Economic Injury (EIDL) Loan 

Application Deadline Date: 07/16/2015. 

ADDRESSES: Submit completed loan 

applications to: U.S. Small Business 

Administration, Processing And 

Disbursement Center, 14925 Kingsport 

Road., Fort Worth, TX 76155. 

FOR FURTHER INFORMATION CONTACT: A. 

Escobar, Office of Disaster Assistance, 

U.S. Small Business Administration, 

409 3rd Street SW., Suite 6050, 

Washington, DC 20416. 

SUPPLEMENTARY INFORMATION: Notice is 

hereby given that as a result of the 

Administrator’s disaster declaration, 

applications for disaster loans may be 

filed at the address listed above or other 

locally announced locations. 

The following areas have been 

determined to be adversely affected by 

the disaster: 

Primary Counties: Cumberland. 

Contiguous Counties: 

New Jersey: Atlantic, Cape May, 

Gloucester, Salem. 

The Interest Rates are: 

Percent 

For Physical Damage: 

Homeowners With Credit Available Elsewhere ...................... 4.125 

Homeowners Without Credit 

Available Elsewhere .............. 2.063 

Businesses With Credit Available Elsewhere ...................... 6.000 

Businesses Without Credit 

Available Elsewhere .............. 4.000 

Non-Profit Organizations With 

Credit Available Elsewhere ... 2.625 

Non-Profit Organizations Without Credit Available Elsewhere ..................................... 2.625 

For Economic Injury: 

Businesses & Small Agricultural 

Cooperatives Without Credit 

Available Elsewhere .............. 4.000 

Non-Profit Organizations Without Credit Available Elsewhere ..................................... 2.625 

The number assigned to this disaster 

for physical damage is 14161 B and for 

economic injury is 14162 0. 

The State which received an EIDL 

Declaration # is New Jersey. 

(Catalog of Federal Domestic Assistance 

Numbers 59002 and 59008) 

Maria Contreras-Sweet, 

Administrator. 

[FR Doc. 2014–25478 Filed 10–24–14; 8:45 am] 

BILLING CODE 8025–01–P 

DEPARTMENT OF STATE 

[Public Notice 8932] 

30-Day Notice of Proposed Information 

Collection: Passport Demand 

Forecasting Study 

ACTION: Notice of request for public 

comment and submission to OMB of 

proposed collection of information. 

SUMMARY: The Department of State has 

submitted the information collection 

described below to the Office of 

Management and Budget (OMB) for 

approval. In accordance with the 

Paperwork Reduction Act of 1995, we 

are requesting comments on this 

collection from all interested 

individuals and organizations. The 

purpose of this Notice is to allow 30 

days for public comment. 

DATES: Submit comments directly to the 

Office of Management and Budget 

(OMB) up to November 26, 2014. 

ADDRESSES: Direct comments to the 

Department of State Desk Officer in the 

Office of Information and Regulatory 


tkelley on DSK3SPTVN1PROD with NOTICES