Document ID: SEC-2016-1500-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: NYSE Arca, Inc.
Posted Date: 2016-08-26T04:00Z

[Federal Register Volume 81, Number 166 (Friday, August 26, 2016)]
[Notices]
[Pages 59025-59027]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-20460]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-78633; File No. SR-NYSEArca-2016-114]

Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change Amending the 
Exchange's Schedule of Fees and Charges To Eliminate the Listing Fee in 
Connection With Exchange Listing of Certain Exchange Traded Products

August 22, 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 August 8, 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, II, 
and III 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.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to [sic] the Exchange's Schedule of Fees and 
Charges (``Fee Schedule'') to eliminate the Listing Fee in connection 
with Exchange listing of certain Exchange Traded Products, effective 
August 8,

[[Page 59026]]

2016. 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 Exchange proposes to amend the Exchange's Schedule of Fees and 
Charges (``Schedule'') to eliminate the Listing Fee applicable to 
certain issues of Managed Fund Shares listed pursuant to NYSE Arca 
Equities Rule 8.600, effective August 8, 2016, as described below.
    Currently the Exchange's Schedule of Fees and Charges 
(``Schedule'') does not impose a ``Listing Fee'' for the following 
Exchange-Traded Products (``ETPs'') \4\ listed on the Exchange pursuant 
to Rule 19b-4(e) under the Act, and for which a proposed rule change 
pursuant to Section 19(b) of the Act is not required to be filed with 
the Commission \5\: Investment Company Units; Portfolio Depositary 
Receipts; and Currency Trust Shares (collectively, ``Generically-Listed 
Exchange Traded Products'').\6\
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    \4\ For the purposes of the Schedule, the term ``Exchange Traded 
Products'' includes securities described in NYSE Arca Equities Rules 
5.2(j)(3) (Investment Company Units); 8.100 (Portfolio Depositary 
Receipts); 8.200 (Trust Issued Receipts); 8.201 (Commodity-Based 
Trust Shares); 8.202 (Currency Trust Shares); 8.203 (Commodity Index 
Trust Shares); 8.204 (Commodity Futures Trust Shares); 8.300 
(Partnership Units); 8.500 (Trust Units); 8.600 (Managed Fund 
Shares), and 8.700 (Managed Trust Securities).
    \5\ Exchange rules applicable to listing of certain ETPs provide 
for listing such products pursuant to Rule 19b-4(e) under the Act if 
they satisfy all criteria--referred to as ``generic'' listing 
criteria--in the applicable Exchange ETP rule. If an ETP does not 
satisfy all applicable generic criteria, the Commission must approve 
or issue a notice of effectiveness with respect to a proposed rule 
change filed by the Exchange pursuant to Section 19(b) of the Act 
prior to Exchange listing of such ETP.
    \6\ See Securities Exchange Act Release No. 77883 (May 23, 
2016), 81 FR 33720 (May 27, 2016) (SR-NYSEArca-2016-69) (Notice of 
Filing and Immediate Effectiveness of Proposed Rule Change Amending 
the Exchange's Schedule of Fees and Charges to Eliminate the Listing 
Fee in Connection with Exchange Listing of Certain Exchange Traded 
Products).
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    Other ETPs--specifically, Trust Issued Receipts,\7\ Commodity-Based 
Trust Shares, Commodity Index Trust Shares, Commodity Futures Trust 
Shares, Partnership Units, Trust Units, and non-generically-listed 
Investment Company Units, Portfolio Depositary Receipts and Currency 
Trust Shares--are subject to a Listing Fee of $7,500.\8\ Under Item 5b 
of the Schedule, Managed Fund Shares and Managed Trust Securities are 
subject to a Listing Fee of $10,000.
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    \7\ Commentary .01 to NYSE Arca Equities Rule 8.200 provides 
generic standards for listing Trust Issued Receipts pursuant to Rule 
19b-4(e) under the Act. However, the Exchange does not currently 
intend to list Trust Issued Receipts under Commentary .01, but 
instead lists Trust Issued Receipts under Commentary .02 to NYSE 
Arca Equities Rule 8.200, which does not provide generic standards 
for listing pursuant to Rule 19b-4(e) under the Act. Before listing 
any Trust Issued Receipts pursuant to Commentary .01 to NYSE Arca 
Equities Rule 8.200, the Exchange will first file a proposed rule 
change with respect to the Listing Fee applicable to any such 
generically-listed securities.
    \8\ Exchange rules applicable to Trust Issued Receipts 
(Commentary .02 to NYSE Arca Equities Rule 8.200); Commodity-Based 
Trust Shares (NYSE Arca Equities Rule 8.201), Commodity Index Trust 
Shares (NYSE Arca Equities Rule 8.203), Commodity Futures Trust 
Shares (NYSE Arca Equities Rule 8.204), Partnership Units (NYSE Arca 
Equities Rule 8.300), and Trust Units (NYSE Arca Equities Rule 
8.500) do not provide for listing pursuant to Rule 19b-4(e) under 
the Act.
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    The Commission has recently approved an Exchange proposed rule 
change that permits generic listing of Managed Fund Shares pursuant to 
Rule 19b-4(e) under the Act.\9\ The Exchange proposes to amend Item 5a 
of the Schedule to include Managed Fund Shares under the term 
``Generically-Listed Exchange Traded Products''. In addition, the 
Exchange proposes to delete Managed Fund Shares from Item 5b of the 
Schedule. Thus, an issue of Managed Fund Shares that is a 
``Generically-Listed Exchange Traded Product'' would incur no charge to 
list on the Exchange, and an issue of Managed Fund Shares for which a 
proposed rule change under the Act is required would be subject to a 
Listing Fee of $7,500. Issues of Managed Trust Securities would 
continue to be subject to a Listing Fee of $10,000.
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    \9\ See Securities Exchange Act Release No. 78397 (July 22, 
2016), 81 FR 49320 (July 27, 2016) (SR-NYSEArca-2015-110).
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    The Exchange believes eliminating the Listing Fee for generically-
listed Managed Fund Shares would help correlate the Listing Fee 
applicable to such issues to the resources required to list such issues 
on the Exchange. The Exchange believes it is appropriate to continue to 
charge a Listing Fee for ETPs for which a proposed rule change pursuant 
to Section 19(b) of the Act is required to be filed because of the 
additional time and resources required by Exchange staff to prepare and 
review such filings and to communicate with issuers and the Commission 
regarding such filings. Application of a Listing Fee for Managed Trust 
Securities is appropriate because the Exchange generally incurs 
increased costs in connection with the rule-making process, listing 
administration process, issuer services, and consultative legal 
services where a proposed rule change pursuant to Section 19(b) of the 
Act is required to be filed with the Commission.
    Annual Fees set forth in the Schedule applicable to ETPs would 
remain unchanged.
    Notwithstanding the elimination of the Listing Fee applicable to 
generically-listed Managed Fund Shares, as well as the decrease in the 
Listing Fee for non-generically-listed Managed Fund Shares, as 
described above, the Exchange will continue to be able to fund its 
regulatory obligations.
2. Statutory Basis
    NYSE Arca believes that the proposal is consistent with Section 
6(b) \10\ of the Act, in general, and Section 6(b)(4) \11\ of the Act 
in particular, in that it provides for the equitable allocation of 
reasonable dues, fees and other charges among its issuers and other 
persons using its facilities. In addition, the Exchange believes the 
proposal is consistent with the requirement under Section 6(b)(5) \12\ 
that an exchange have rules that are 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, in general, to protect investors and the 
public interest; and are not designed to permit unfair discrimination 
between customers, issuers, brokers, or dealers. The proposed 
elimination of the Listing Fee for Managed Fund Shares that are 
Generically-Listed ETPs, as well as the decrease in the Listing Fee for 
non-generically-listed Managed Fund Shares, as described above, is 
equitable

[[Page 59027]]

and does not unfairly discriminate between issuers because it would 
apply uniformly to all such issues listed generically under Exchange 
rules. The Exchange believes eliminating the Listing Fee for such 
Managed Fund Shares, decreasing the Listing Fee for non-generically-
listed Managed Fund Shares, as described above, and continuing to 
impose Listing Fees for ETPs that are not generically listed is 
reasonable given the additional resources required by the Exchange in 
connection with ETPs requiring a proposed rule change pursuant to 
Section 19(b). The Exchange believes it is appropriate to continue to 
charge a Listing Fee for ETPs for which a proposed rule change pursuant 
to Section 19(b) of the Act is required to be filed because of the 
significant additional extensive time, legal and business resources 
required by Exchange staff to prepare and review such filings and to 
communicate with issuers and the Commission regarding such filings.
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    \10\ 15 U.S.C. 78f(b).
    \11\ 15 U.S.C. 78f(b)(4).
    \12\ 15 U.S.C. 78f(b)(5).
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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 the 
proposed rule change would promote competition because it will 
eliminate the Listing Fee for generically-listed issues of Managed Fund 
Shares and will therefore encourage issuers to develop and list 
additional such issues on the Exchange.

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 is effective upon filing pursuant to 
Section 19(b)(3)(A) \13\ of the Act and subparagraph (f)(2) of Rule 
19b-4 \14\ thereunder, because it establishes a due, fee, or other 
charge imposed by the Exchange.
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    \13\ 15 U.S.C. 78s(b)(3)(A).
    \14\ 17 CFR 240.19b-4(f)(2).
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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 under 
Section 19(b)(2)(B) \15\ of the Act to determine whether the proposed 
rule change should be approved or disapproved.
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    \15\ 15 U.S.C. 78s(b)(2)(B).
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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-2016-114 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-2016-114. 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-NYSEArca-2016-114 and should 
be submitted on or before September 16, 2016.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\16\
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    \16\ 17 CFR 200.30-3(a)(12).
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Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016-20460 Filed 8-25-16; 8:45 am]
 BILLING CODE 8011-01-P