Document ID: SEC-2017-0126-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: Bats BZX Exchange, Inc.
Posted Date: 2017-01-27T05:00Z

[Federal Register Volume 82, Number 17 (Friday, January 27, 2017)]
[Notices]
[Pages 8642-8644]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-01835]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-79865; File No. SR-BatsBZX-2017-03]

Self-Regulatory Organizations; Bats BZX Exchange, Inc.; Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change To Convert 
the Listing of the Shares of the SPDR DoubleLine Short Term Total 
Return Tactical ETF and the SPDR DoubleLine Emerging Markets Fixed 
Income ETF, Both of Which Are a Series of the SSGA Active Trust, 
Pursuant to BZX Rule 14.11(i), Managed Fund Shares

January 23, 2017.
    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 13, 2017, Bats BZX Exchange, Inc. (the ``Exchange'' or 
``BZX'') 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 ``non-controversial'' 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.
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    \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).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange filed a proposal to convert the shares of the SPDR 
DoubleLine Short Term Total Return Tactical ETF and the SPDR DoubleLine 
Emerging Markets Fixed Income ETF (collectively, the ``Funds''), both 
of which are a series of the SSGA Active Trust (the ``Trust''), from 
listing pursuant to Rule 14.11(i) and approval orders issued by the 
Commission to listing pursuant to Rule 19b-4(e) as provided in Rule 
14.11(i)(4)(C).
    The text of the proposed rule change is available at the Exchange's 
Web site at www.bats.com, at the principal office of the Exchange, and 
at the Commission's Public Reference Room.

[[Page 8643]]

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 convert the listing of the shares of the 
Funds (the ``Shares'') from listing pursuant to approval orders issued 
by the Commission to listing pursuant to Rule 19b-4(e) as provided in 
Rule 14.11(i)(4)(C). The Shares began trading on the Exchange on April 
14, 2016 after the Commission issued orders approving the listing and 
trading of the Shares on the Exchange.\5\ At that time, the Exchange 
was required to file separate proposals under Section 19(b) of the Act 
before the listing of any funds listed pursuant to Rule 14.11(i) 
(``Managed Fund Shares'') and, as provided in the Filings, the Exchange 
will commence delisting procedures under Rule 14.12 for a Fund where 
the Fund is not in compliance with the applicable listing 
requirements.\6\ On July 22, 2016, the Commission approved generic 
listing standards for Managed Fund Shares that would allow a series of 
Managed Fund Shares to list on the Exchange pursuant to Rule 19b-4(e) 
so long as the components of that series of Managed Fund Shares meet 
the criteria in Rule 14.11(i)(4)(C) on an initial and continual 
basis.\7\ The Exchange now proposes to list the Shares pursuant to Rule 
19b-4(e) of the Act as provided in Rule 14.11(i)(4)(C) and, as such, 
the components of the Funds will be required to comply with the 
requirements of that rule on an initial and continual basis. The 
Exchange has confirmed that both of the Funds' respective portfolios 
currently comply with the requirements of Rule 14.11(i)(4)(C).\8\ The 
Exchange notes that if the Funds were not already listed, they could be 
listed pursuant to Rule 19b-4(e) without the submission of a rule 
filing.
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    \5\ See Securities Exchange Act Release Nos. 77567 (April 8, 
2016), 81 FR 22143 (April 14, 2016) (SR-BATS-2015-94) (order 
approving the listing and trading on the Exchange of the SPDR 
DoubleLine Emerging Markets Fixed Income ETF) and 77499 (April 1, 
2016), 81 FR 20428 (April 7, 2016) (SR-BATS-2016-04) (order 
approving the listing and trading on the Exchange of the SPDR 
DoubleLine Short Duration Total Return Tactical ETF) (collectively, 
the ``Filings'').
    \6\ As provided in the Filings, all statements and 
representations made in the Filings regarding (a) the description of 
the portfolio, (b) limitations on portfolio holdings or reference 
assets, or (c) the applicability of Exchange rules and surveillance 
procedures shall constitute continued listing requirements for 
listing the Shares on the Exchange.
    \7\ See Securities Exchange Act Release Nos. 78396 (July 22, 
2016), 81 FR 49698 (July 28, 2016) (SR-BATS-2015-100).
    \8\ As provided in Rule 14.11(i)(4)(C), each Fund must also 
comply with such requirements on a continual basis and any failure 
to meet such requirements will result in the Exchange initiating 
delisting proceedings for the Fund pursuant to Rule 14.12.
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2. Statutory Basis
    The Exchange believes that the proposal is consistent with Section 
6(b) of the Act \9\ in general and Section 6(b)(5) of the Act \10\ in 
particular in that it is designed to prevent fraudulent and 
manipulative acts and practices, to promote just and equitable 
principles of trade, to remove impediments to, and perfect the 
mechanism of a free and open market and, in general, to protect 
investors and the public interest. Specifically, the Exchange believes 
that the proposal is designed to prevent fraudulent and manipulative 
acts and practices, to promote just and equitable principles of trade, 
to remove impediments to, and perfect the mechanism of a free and open 
market and, in general, to protect investors and the public interest 
because the only change in the proposal is to have the Funds listed and 
traded on the Exchange pursuant to the generic listing standards under 
Rule 14.11(i)(4)(C). As noted above, if the Funds were not already 
listed, they would be able to be listed pursuant to Rule 19b-4(e) 
without the submission of a rule filing because the Commission has 
approved rules on the Exchange related to generic listing standards for 
Managed Fund Shares on the basis that the generic listing criteria is 
consistent with the Act and, in particular, ``is consistent with 
Section 6(b)(5) of the Act,\11\ which requires, among other things, 
that the Exchange's rules be designed to prevent fraudulent and 
manipulative acts and practices, to promote just and equitable 
principles of trade, 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.'' \12\ As such, 
the Exchange believes that the proposal is designed to prevent 
fraudulent and manipulative acts and practices, to promote just and 
equitable principles of trade, 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.
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    \9\ 15 U.S.C. 78f.
    \10\ 15 U.S.C. 78f(b)(5).
    \11\ 15 U.S.C. 78f(b)(5).
    \12\ See note 7, supra.
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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 that is not necessary or appropriate 
in furtherance of the purpose of the Act. The Exchange believes that 
the proposal to allow the Funds to be listed on the Exchange pursuant 
to the generic listing standards under Rule 14.11(i)(4)(C) will have no 
impact on competition.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    The Exchange has neither solicited nor 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: (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) of the Act and Rule 19b-
4(f)(6) thereunder.\13\
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    \13\ 17 CFR 240.19b-4(f)(6). As required under Rule 19b-
4(f)(6)(iii), the Exchange provided the Commission with written 
notice of its intent to file the proposed rule change, along with a 
brief description and the 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.
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    A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the 
Act \14\ normally does not become operative for 30 days after the date 
of its filing. However, Rule 19b-4(f)(6)(iii)\15\ 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

[[Page 8644]]

the Commission to waive the 30-day operative delay to allow the Funds 
to be subject to a single compliance regime under Rule 14.11(i)(4)(C) 
instead of the series of representations made in each Fund's respective 
19b-4 as soon as practicable, which will streamline and simplify 
compliance and the costs associated therewith. The Commission finds 
that waiving the 30-day operative delay in this instance is consistent 
with the protection of investors and the public interest. The 
Commission notes that, as represented by the Exchange, if the Funds 
were not currently listed pursuant to the previous Commission approval 
orders, they would be eligible for immediate listing pursuant to 
Exchange Rule 14.11(i)(4)(C). Therefore, the Commission designates the 
proposal operative upon filing.\16\
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    \14\ 17 CFR 240.19b-4(f)(6).
    \15\ 17 CFR 240.19b-4(f)(6)(iii).
    \16\ For purposes only of waiving the 30-day operative delay, 
the Commission has considered the proposed rule's impact on 
efficiency, competition, and capital formation. 15 U.S.C. 78c(f).
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    At any time within 60 days of the filing of such proposed rule 
change, the Commission summarily may temporarily suspend such rule 
change if it appears to the Commission that such action is necessary or 
appropriate in the public interest, for the protection of investors, or 
otherwise in furtherance of the purposes of the Act. If the Commission 
takes such action, the Commission shall institute proceedings to 
determine whether the proposed rule 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-BatsBZX-2017-03 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-BatsBZX-2017-03. 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-BatsBZX-2017-03 and should 
be submitted on or before February 17, 2017.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\17\
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    \17\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-01835 Filed 1-26-17; 8:45 am]
 BILLING CODE 8011-01-P