78122 Federal Register / Vol. 79, No. 248 / Monday, December 29, 2014 / Notices 

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

2 17 CFR 240.19b–4. 

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

4 17 CFR 240.19b–4(f)(6)(iii). 

5The Exchange notes that the Third Amended 

and Restated Bylaws of EDGA Exchange, Inc. will 

also be amended and restated to reflect the name 

change of DE as the sole stockholder of EDGA 

Exchange, Inc. 

6See Securities Exchange Act Release Nos. 60651 

(September 11, 2009), 74 FR 47827 (Notice of Filing 

of Applications, as Amended, for Registration as 

National Securities Exchanges under section 6 of 

the Securities Exchange Act of 1934) (including the 

EDGX and EDGA Form 1 Applications and 

Exhibits); and 61698 (March 12, 2010), 75 FR 13151 

(March 18, 2010) (In the Matter of the Applications 

of EDGX Exchange, Inc. and EDGA Exchange, Inc. 

for Registration as National Securities Exchanges); 

and Securities Exchange Act Release No. 71449 

(January 30, 2014), 79 FR 6961 (February 5, 2014) 

(SR–EDGA–2013–34; SR–EDGX–2013–43). 

7The term ‘‘Member’’ is defined as ‘‘any 

registered broker or dealer, or any person associated 

with a registered broker or dealer, that has been 

admitted to the membership in the Exchange. A 

Member will have the status of a ‘‘member’’ of the 

Exchange as that term is defined in section 3(a)(3) 

of the Act.’’ See Exchange Rule 1.5(n). 

8 15 U.S.C. 78f(a). 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–73893; File No. SR–EDGX– 

2014–34] 

Self-Regulatory Organizations; EDGX 

Exchange, Inc.; Notice of Filing and 

Immediate Effectiveness of a Proposed 

Rule Change To Convert Direct Edge, 

Inc., the Parent Company of EDGX 

Exchange, Inc., From a Delaware 

Corporation to a Delaware Limited 

Liability Company 

December 19, 2014. 

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

Securities Exchange Act of 1934 (the 

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

notice is hereby given that on December 

12, 2014, EDGX Exchange, Inc. (the 

‘‘Exchange’’ or ‘‘EDGX’’) filed with the 

Securities and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I and II 

below, which Items have been prepared 

by the Exchange. The Exchange has 

designated this proposal as a ‘‘noncontroversial’’ proposed rule change 

pursuant to section 19(b)(3)(A) of the 

Act 3 and Rule 19b–4(f)(6)(iii) 

thereunder,4 which renders it effective 

upon filing with the Commission. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange filed a proposal to: (i) 

Convert Direct Edge, Inc. (‘‘DE’’) from a 

Delaware corporation to a Delaware 

limited liability company (the 

‘‘Conversion’’), and, in connection 

therewith, change the name of DE from 

‘‘Direct Edge, Inc.’’ to ‘‘Direct Edge 

LLC,’’ and (ii) amend the Third 

Amended and Restated Bylaws of the 

Exchange (the ‘‘Exchange Bylaws’’) to 

reflect the name change of DE as the 

Exchange’s sole stockholder. 

The text of the proposed rule change 

is available at the Exchange’s Web site 

at http://www.directedge.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 parts of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and the 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange submits this Proposed 

Rule Change to seek the Commission’s 

approval of the Conversion, the 

adoption of the Organizational 

Documents, and the Amended Exchange 

Bylaws. The Conversion is proposed as 

a means to simplify the administration 

associated with the Exchange’s overall 

corporate structure. The name change 

from ‘‘Direct Edge, Inc.’’ to ‘‘Direct Edge 

LLC’’ reflected in the Amended 

Exchange Bylaws is a non-substantive 

change. Other than converting DE from 

a corporation to a limited liability 

company and changing the name of DE 

from ‘‘Direct Edge, Inc.’’ to ‘‘Direct Edge 

LLC’’ in the Amended Exchange 

Bylaws, no changes to the ownership or 

structure of the Exchange, DE Holdings, 

or the other entities included in the 

Exchange’s overall corporate structure 

are proposed.5 The proposed 

Organizational Documents are 

consistent in form and scope with the 

most recent governing documents that 

were approved by the Commission.6

There are no new regulatory issues 

implicated in this proposal. Other than 

as described herein and set forth in the 

attached Exhibits 5A through 5C, the 

Exchange will continue to conduct its 

regulated activities (including operating 

and regulating its market and 

Members 7) in the manner currently 

conducted, and will not make any 

changes to its regulated activities in 

connection with the Conversion. The 

Exchange is not proposing any 

amendments to its trading and 

regulatory rules at this time. If the 

Exchange determines to make any such 

changes, it will seek the approval of the 

Commission to the extent required by 

the Act, and the Commission’s rules 

thereunder, and the Rules of the 

Exchange. 

1. Current Corporate Structures 

The Exchange and EDGA Exchange, 

Inc. (‘‘EDGA’’, and together with the 

Exchange, the ‘‘DE Exchanges’’), are 

each Delaware corporations that are 

national securities exchanges registered 

with the Commission pursuant to 

section 6(a) of the Act.8 Each DE 

Exchange is a direct, wholly owned 

subsidiary of DE, a Delaware 

corporation. DE, originally formed as a 

Delaware corporation on July 22, 2010, 

is a direct, wholly owned subsidiary of 

DE Holdings. In addition, DE Holdings 

owns 100 percent of the equity interest 

in Direct Edge ECN LLC d/b/a DE Route, 

a Delaware limited liability company 

and the routing broker-dealer for the DE 

Exchanges. BATS Global Markets, Inc., 

a Delaware corporation (‘‘BGM’’), owns 

100 percent of the equity interest in DE 

Holdings, and is the ultimate parent 

entity in the Exchange’s overall 

corporate structure. 

2. The Conversion 

On December 9, 2014, the Board of 

Directors of DE approved the 

Conversion and Organizational 

Documents on December 9, 2014, and 

DE Holdings approved the Conversion 

and Organizational Documents of DE on 

December 9, 2014. Pursuant to the 

Conversion, DE would be converted 

from a Delaware corporation to a 

Delaware limited liability company. 

BGM will continue to own 100 percent 

of the equity interests in DE Holdings, 

and DE Holdings will continue to own 

100 percent of the equity interest in DE, 

which in turn, will continue to own 100 

percent of the equity interest in each DE 

Exchange. 

3. Adoption of Certificate and Operating 

Agreement 

The Exchange proposes that DE adopt 

a new Certificate and Operating 

Agreement to replace the existing 

Restated Certificate of Incorporation of 

DE and the existing Amended and 


tkelley on DSK3SPTVN1PROD with NOTICES
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9See supra note 6. 

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

11 15 U.S.C. 78s(g). 

12 15 U.S.C. 78s(b). 

13See Operating Agreement, Art. II, section 2.01. 

Restated Bylaws of DE. Each of the 

proposed Certificate and Operating 

Agreement are modeled on, and are 

substantially similar to, the current 

certificate of formation and operating 

agreement, respectively, of DE Holdings, 

which is similarly situated as an 

intermediate holding company. The 

Commission has previously found the 

DE Holdings certificate of formation and 

operating agreement to be consistent 

with the Act.9 Each of the regulatory 

provisions described below, which the 

Exchange proposes to adopt within the 

Operating Agreement of DE, are also 

consistent with current provisions set 

forth in the existing Restated Certificate 

of Incorporation of DE and the existing 

Amended and Restated Bylaws of DE. 

Although DE will not carry out any 

regulatory functions, the Exchange notes 

that its activities with respect to the 

operation of the DE Exchanges must be 

consistent with, and must not interfere 

with, the self-regulatory obligations of 

each DE Exchange. As further described 

below, the Operating Agreement 

therefore will include provisions that 

are designed to maintain the 

independence of the Exchange’s selfregulatory functions, enable the 

Exchange to operate in a manner that 

complies with the federal securities 

laws, including the objectives of 

sections 6(b) 10 and 19(g) 11 of the Act, 

and facilitate the ability of the Exchange 

and the Commission to fulfill their 

regulatory and oversight obligations 

under the Act. 

a. Certificate of Formation 

In connection with the Conversion, 

the Exchange proposes that DE adopt a 

new Certificate, as set forth in Exhibit 

5A, to replace the existing Restated 

Certificate of Incorporation of DE. The 

proposed Certificate includes the 

following provisions required under 

Delaware law: 

• The full legal name of DE as ‘‘Direct 

Edge LLC’’; and 

• The name and address of DE’s 

registered office in the State of 

Delaware. 

b. Operating Agreement 

In connection with the Conversion, 

the Exchange proposes that DE adopt a 

new Operating Agreement, as set forth 

in Exhibit 5B, to replace the existing 

Amended and Restated Bylaws of DE. 

The proposed Operating Agreement 

contains several provisions designed to 

protect the independence of the selfregulatory functions of the DE 

Exchanges. 

The Operating Agreement would 

require DE Holdings and DE’s officers, 

employees and agents to give due regard 

to the preservation of the independence 

of the self-regulatory function of the 

Exchange, as well as to its obligations to 

investors and the general public, and 

not interfere with the effectuation of any 

decisions by the Exchange Board of 

Directors relating to its regulatory 

functions (including disciplinary 

matters) or which would interfere with 

the ability of the Exchange to carry out 

its responsibilities under the Act. The 

Operating Agreement would require that 

DE comply with the U.S. federal 

securities laws and rules and 

regulations thereunder and cooperate 

with the Commission and the Exchange 

pursuant to and to the extent of their 

respective regulatory authority. 

Pursuant to the Operating Agreement, 

DE’s officers, employees and agents, by 

virtue of their acceptance of such 

positions, shall be deemed to agree to (i) 

comply with the U.S. federal securities 

laws and the rules and regulations 

thereunder; and (ii) cooperate with the 

Commission and the Exchange in 

respect of the Commission’s oversight 

responsibilities regarding the Exchange 

and its self-regulatory functions, and DE 

will take reasonable steps to cause its 

officers, employees and agents to so 

cooperate. 

Furthermore, DE and its officers, 

directors, employees and agents will be 

deemed to irrevocably submit to the 

jurisdiction of the U.S. federal courts, 

the Commission, and each DE Exchange, 

as applicable, for the purposes of any 

suit, action, or proceeding pursuant to 

the U.S. federal securities laws or the 

rules or regulations thereunder relating 

to or arising out of the activities of a DE 

Exchange. 

The Operating Agreement would also 

contain a number of provisions 

designed to ensure that the Exchange 

has sufficient access to the books and 

records of DE. Pursuant to the Operating 

Agreement, the books, records, 

premises, officers, agents, and 

employees of DE are deemed to be the 

books, records, premises, officers, agents 

and employees of the Exchange to the 

extent they are related to the operation 

or administration of the Exchange. In 

addition, for as long as DE controls the 

Exchange, DE’s books and records shall 

be subject at all times to inspection and 

copying by the Commission and the 

Exchange, provided that such books and 

records are related to the operation or 

administration of the Exchange. 

The Operating Agreement also would 

provide that, to the fullest extent 

permitted by applicable law, all 

confidential information pertaining to 

the self-regulatory functions of the 

Exchange (including but not limited to 

disciplinary matters, trading data, 

trading practices and audit information) 

contained in the books and records of 

the Exchanges that shall come into the 

possession of DE shall (i) be retained in 

confidence by DE Holdings, DE, and 

DE’s officers, employees and agents, and 

(ii) not be used for any non-regulatory 

purposes. The Operating Agreement 

provides, however, that the foregoing 

shall not limit or impede the rights of 

the Commission or the Exchange to 

access and examine such confidential 

information pursuant to the U.S. federal 

securities laws and the rules and 

regulations thereunder, or limit or 

impede the ability of DE Holdings or 

DE’s officers, employees or agents to 

disclose such confidential information 

to the Commission or the Exchange. 

In addition, the Operating Agreement 

would provide that for so long as DE 

directly or indirectly controls a 

registered national securities exchange, 

before any amendment to or repeal of 

any provision of the Operating 

Agreement may be effective, the changes 

must be submitted to the Board of 

Directors of each such exchange, and if 

the change is required to be filed with 

or filed with and approved by the 

Commission before the change may be 

effective under Section 19 of the Act 

and the rules promulgated thereunder,12

then such proposed change shall not be 

effective until filed with or filed with 

and approved by the Commission, as the 

case may be. 

The Operating Agreement identifies 

DE Holdings as the sole Member of 

DE.13 The identification of the sole 

Member of DE is designed to assure that 

any change to the indirect ownership or 

control of the DE Exchanges occurs 

through a change in the ownership or 

control of DE Holdings, or in accordance 

with the rule filing process described 

above. If the change of control occurs 

through a change in the ownership or 

control of DE Holdings, any purported 

change of such ownership or control 

would need to comply with DE 

Holdings’ organizational documents. 

4. Amended Exchange Bylaws 

The Exchange proposes to amend the 

Exchange Bylaws, as set forth in Exhibit 

5C, to change the name of its sole 

stockholder from ‘‘Direct Edge, Inc.’’ to 

‘‘Direct Edge LLC’’. The name change 

from ‘‘Direct Edge, Inc.’’ to ‘‘Direct Edge 

LLC’’ as reflected in the Amended 


tkelley on DSK3SPTVN1PROD with NOTICES
78124 Federal Register / Vol. 79, No. 248 / Monday, December 29, 2014 / Notices 

14 15 U.S.C. 78f(b). 

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

16See, e.g., Operating Agreement, Article X, 

section 10.03. 17 15 U.S.C. 78f(b)(5). 

18 15 U.S.C. 78s(b)(3)(A). 

19 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– 

4(f)(6)(iii) requires a self-regulatory organization to 

provide the Commission with written notice of its 

intent to file the proposed rule change, along with 

a brief description and text of 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 met this requirement. 

20For purposes only of waiving the 30-day 

operative delay, the Commission has also 

considered the proposed rule’s impact on 

efficiency, competition, and capital formation. See 

15 U.S.C. 78c(f). 

Exchange Bylaws is a non-substantive 

change. No other changes to the 

ownership or structure of the Exchange 

have taken place. 

2. Statutory Basis 

The Exchange believes that the 

Proposed Rule Change is consistent 

with the requirements of the Act and the 

rules and regulations thereunder that 

are applicable to a national securities 

exchange, and, in particular, with the 

requirements of section 6(b) of the 

Act.14 In particular, the proposal is 

consistent with section 6(b)(1) of the 

Act 15 in that it enables the Exchange to 

be so organized as to have the capacity 

to be able to carry out the purposes of 

the Act and to comply, and to enforce 

compliance by its Members and persons 

associated with its Members, with the 

provisions of the Act, the rules and 

regulations thereunder, and the Rules of 

the Exchange. The Proposed Rule 

Change is designed to effect the 

Conversion while ensuring that the 

Exchange will continue to have the 

authority and ability to effectively fulfill 

its self-regulatory duties pursuant to the 

Act and the rules promulgated 

thereunder. In particular, the Proposed 

Rule Change includes in the Operating 

Agreement various provisions intended 

to protect and maintain the integrity of 

the self-regulatory functions of the 

Exchange. For example, the Operating 

Agreement, as described above, is 

drafted to preserve the independence of 

the Exchange’s self-regulatory function 

and ensure that the Exchange is able to 

obtain information it needs from the 

specified parties to detect and deter any 

fraudulent and manipulative acts in its 

marketplace and carry out their 

regulatory responsibilities under the 

Act. Moreover, with the Proposed Rule 

Change, the Commission will continue 

to have regulatory authority 16 over the 

Exchange, as is currently the case, as 

well as jurisdiction over the Exchange’s 

direct and indirect parents with respect 

to activities related to the Exchange. As 

a result, the Proposed Rule Change will 

facilitate an ownership structure that 

will provide the Commission with 

appropriate oversight tools to ensure 

that the Commission will have the 

ability to enforce the Act with respect to 

the Exchange, its direct and indirect 

parent entities and their directors, 

officers, employees and agents to the 

extent they are involved in the activities 

of the Exchange. 

The Exchange also believes that the 

Proposed Rule Change furthers the 

objectives of section 6(b)(5) of the Act 17

because the Proposed Rule Change 

would be consistent with and facilitate 

a governance and regulatory structure 

that is designed to prevent fraudulent 

and manipulative acts and practices, to 

promote just and equitable principles of 

trade, to foster cooperation and 

coordination with persons engaged in 

regulating, clearing, settling, processing 

information with respect to, and 

facilitating transactions in securities, to 

remove impediments to, and perfect the 

mechanism of a free and open market 

and a national market system and, in 

general, to protect investors and the 

public interest. Furthermore, the 

Exchange is not proposing any changes 

to its regulated activities in connection 

with the Conversion; the Exchange will 

operate and regulate its Members in the 

same manner upon consummation of 

the Conversion as it does today. 

Therefore, the Exchange believes that it 

will continue to satisfy the requirements 

of the Act and the rules and regulations 

thereunder that are applicable to a 

national securities exchange. 

In addition, the Proposed Rule 

Change provides transparency and 

certainty, and promotes efficiency, with 

respect to the governance and corporate 

structure of the Exchange and its direct 

and indirect parent companies. The 

Exchange believes that these additional 

changes, among other things, will 

remove administrative impediments to 

the governance of the Exchange. By 

simplifying the governance structure in 

this way, the Proposed Rule Change 

promotes the maintenance of a fair and 

orderly market, the protection of 

investors and the protection of the 

public interest. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange does not believe that 

the Proposed Rule Change would result 

in any burden on competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act, as amended. 

The Exchange will continue to conduct 

regulated activities (including operating 

and regulating its market and Members) 

of the type it currently conducts, but 

will be able to do so in a more efficient 

manner to the benefit of its Members. 

Furthermore, the proposed Conversion 

is not a competitive proposal, but rather 

is intended to add efficiency with 

respect to the governance process for the 

Exchange and its affiliates. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

The Exchange has not solicited or 

received written comments on the 

Proposed Rule Change. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Because the foregoing proposed rule 

change does not: (1) Significantly affect 

the protection of investors or the public 

interest; (2) impose any significant 

burden on competition; and (3) by its 

terms does not become operative for 30 

days after the date of this filing, or such 

shorter time as the Commission may 

designate if consistent with the 

protection of investors and the public 

interest, the proposed rule change has 

become effective pursuant to section 

19(b)(3)(A) of the Act 18 and Rule 19b– 

4(f)(6) thereunder.19

A proposed rule change filed under 

Rule 19b–4(f)(6) normally does not 

become operative for 30 days after the 

date of filing. However, Rule 19b– 

4(f)(6)(iii) permits the Commission to 

designate a shorter time if such action 

is consistent with the protection of 

investors and the public interest. The 

Exchange has asked the Commission to 

waive the 30-day operative delay so that 

the proposal may become operative 

immediately upon filing. The 

Commission believes that waiving the 

30-day operative delay is consistent 

with the protection of investors and the 

public interest as it will allow the 

Exchange to effect the Conversion upon 

filing with the Secretary of State of the 

State of Delaware and, according to the 

Exchange, simplify the administration 

associated with the Exchange’s overall 

corporate structure immediately.20

Accordingly, the Commission hereby 

grants the Exchange’s request and 

designates the proposal operative upon 

filing. 

At any time within 60 days of the 

filing of the proposed rule change, the 

Commission summarily may 

temporarily suspend such rule change if 


tkelley on DSK3SPTVN1PROD with NOTICES
Federal Register / Vol. 79, No. 248 / Monday, December 29, 2014 / Notices 78125 

21 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3The Commission approved BATS Rule 14.11(i) 

in Securities Exchange Act Release No. 65225 

(August 30, 2011), 76 FR 55148 (September 6, 2011) 

(SR–BATS–2011–018). 

4See Registration Statement on Form N–1A for 

the Trust, dated September 3, 2014 (File Nos. 333– 

179904 and 811–22649). The descriptions of the 

Fund and the Shares contained herein are based, in 

part, on information in the Registration Statement. 

The Commission has issued an order granting 

certain exemptive relief to the Trust under the 

Investment Company Act of 1940 (15 U.S.C. 80a– 

1) (‘‘1940 Act’’) (the ‘‘Exemptive Order’’). See 

Investment Company Act Release No. 29571 

(January 24, 2011) (File No. 812–13601). 

5BFA is an indirect wholly owned subsidiary of 

BlackRock, Inc. 

6An investment adviser to an open-end fund is 

required to be registered under the Investment 

Advisers Act of 1940 (the ‘‘Advisers Act’’). As a 

result, the Adviser and its related personnel are 

Continued 

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.. 

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– 

EDGX–2014–34 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–EDGX–2014–34. 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–EDGX– 

2014–34, and should be submitted on or 

before January 20, 2015. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.21

Brent J. Fields, 

Secretary. 

[FR Doc. 2014–30274 Filed 12–24–14; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–73895; File No. SR–BATS– 

2014–054] 

Self-Regulatory Organizations; BATS 

Exchange, Inc.; Notice of Filing of a 

Proposed Rule Change To List and 

Trade Shares of the iShares Short 

Maturity Municipal Bond ETF of the 

iShares U.S. ETF Trust Under Rule 

14.11(i) of BATS Exchange, Inc. 

December 19, 2014. 

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

Securities Exchange Act of 1934 (the 

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

notice is hereby given that on December 

12, 2014, BATS Exchange, Inc. (the 

‘‘Exchange’’ or ‘‘BATS’’) filed with the 

Securities and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I and II 

below, which Items have been prepared 

by the Exchange. The 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 the Substance 

of the Proposed Rule Change 

The Exchange filed a proposal to list 

and trade shares of the iShares Short 

Maturity Municipal Bond ETF (the 

‘‘Fund’’) of the iShares U.S. ETF Trust 

(the ‘‘Trust’’) under BATS Rule 14.11(i) 

(‘‘Managed Fund Shares’’). The shares of 

the Fund are referred to herein as the 

‘‘Shares.’’ 

The text of the proposed rule change 

is available at the Exchange’s Web site 

at http://www.batstrading.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 parts of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes to list and 

trade the Shares under BATS Rule 

14.11(i), which governs the listing and 

trading of Managed Fund Shares on the 

Exchange.3 The Fund will be an actively 

managed fund. The Shares will be 

offered by the Trust, which was 

established as a Delaware statutory trust 

on June 21, 2011. The Trust is registered 

with the Commission as an open-end 

investment company and has filed a 

registration statement on behalf of the 

Fund on Form N–1A (‘‘Registration 

Statement’’) with the Commission.4

Description of the Shares and the Fund 

BlackRock Fund Advisors is the 

investment adviser (‘‘BFA’’ or 

‘‘Adviser’’) to the Fund.5 State Street 

Bank and Trust Company is the 

administrator, custodian, and transfer 

agent (‘‘Administrator,’’ ‘‘Custodian,’’ 

and ‘‘Transfer Agent,’’ respectively) for 

the Trust. BlackRock Investments, LLC 

serves as the distributor (‘‘Distributor’’) 

for the Trust. 

BATS Rule 14.11(i)(7) provides that, if 

the investment adviser to the 

investment company issuing Managed 

Fund Shares is affiliated with a brokerdealer, such investment adviser shall 

erect a ‘‘fire wall’’ between the 

investment adviser and the brokerdealer with respect to access to 

information concerning the composition 

and/or changes to such investment 

company portfolio.6 In addition, Rule 


tkelley on DSK3SPTVN1PROD with NOTICES