[Federal Register Volume 79, Number 72 (Tuesday, April 15, 2014)]
[Notices]
[Pages 21337-21340]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-08412]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-71909; File No. SR-NYSEARCA-2014-28]
Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing
and Immediate Effectiveness of Proposed Rule Change, as Modified by
Amendment No. 1, Amending Rule To Change the Time By Which Purchase
Orders and Redemption Orders Must Be Placed With Respect to the Market
Vectors Low Volatility Commodity ETF and Market Vectors Long/Short
Commodity ETF
April 9, 2014.
Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of
1934 (``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby given
that, on March 28, 2014, NYSE Arca, Inc. (``Exchange'' or ``NYSE
Arca'') filed with the Securities and Exchange Commission
(``Commission'') the proposed rule change, which filing was amended by
Amendment No. 1 thereto on April 2, 2014,\4\ 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.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 15 U.S.C. 78a.
\3\ 17 CFR 240.19b-4.
\4\ In Amendment No. 1, the Exchange corrected erroneous
references to the term ``Adviser'' in the Filing and replaced such
references with the term ``Managing Owner.''
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange is submitting a proposed rule change to change the
time by which purchase orders and redemption orders must be placed with
respect to the Market Vectors Low Volatility Commodity ETF and Market
Vectors Long/Short Commodity ETF (the ``Funds''). The Commission has
approved listing and trading of shares of the Funds on the Exchange
under NYSE Arca Equities Rule 8.200. The text of 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,
[[Page 21338]]
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
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Commission has approved listing and trading on the Exchange of
shares (``Shares'') of the following under NYSE Arca Equities Rule
8.200: Market Vectors Low Volatility Commodity ETF (``Low Volatility
ETF'') and Market Vectors Long/Short Commodity ETF (``Long/Short ETF'')
under NYSE Arca Equities Rule 8.200, which governs the listing and
trading of Trust Issued Receipts.\5\ Shares of the Funds have not yet
commenced trading on the Exchange.
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\5\ See Securities Exchange Act Release No. 70209 (August 15,
2013), 78 FR 51769 (August 21, 2013) (SR-NYSEArca-2013-60) (Order
Granting Approval of Proposed Rule Change to List and Trade Shares
of Market Vectors Low Volatility Commodity ETF and Market Vectors
Long/Short Commodity ETF under NYSE Arca Equities Rule 8.200)
(``Prior Order''). See also See Securities Exchange Act Release No.
69862 (June 26, 2013), 78 FR 39810 (July 2, 2013) (SR-NYSEArca-2013-
60) (``Prior Notice,'' and together with the Prior Order, the
``Prior Release'').
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Each Fund is a series of the Market Vectors Commodity Trust (the
``Trust''), a Delaware statutory trust.\6\
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\6\ The Trust filed a pre-effective amendment to its
registration statements with respect to the Funds on Form S-1 under
the Securities Act of 1933 (``1933 Act'') on December 7, 2012 (File
No. 333-179435 for the Low Volatility ETF (``Low Volatility
Registration Statement'') and File No. 333-179432 for the Long/Short
ETF (``Long/Short Registration Statement'' and, together with the
Low Volatility Registration Statement, the ``Registration
Statements'')). The descriptions of the Funds and the Shares
contained herein are based, in part, on the Registration Statements.
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Van Eck Absolute Return Advisers Corp. is the managing owner of the
Funds (``Managing Owner''). The Managing Owner also serves as the
commodity pool operator and commodity trading advisor of the Funds. The
Managing Owner is registered as a commodity pool operator and commodity
trading advisor with the Commodity Futures Trading Commission
(``CFTC''), and is a member of National Futures Association. Wilmington
Trust, National Association (``Trustee''), a national bank with its
principal place of business in Delaware, is the sole trustee of the
Trust. The Bank of New York Mellon will be the custodian, administrator
and transfer agent for the Funds.
In this proposed rule change, the Exchange proposes to change the
time by which purchase orders and redemption orders must be placed. The
Prior Release stated that purchase orders and redemption orders to
create and redeem one or more blocks of 50,000 Shares (``Baskets'') of
the Funds must be placed by authorized participants by 1:00 p.m.
Eastern Time (``E.T.''). The Exchange proposes to change this
representation to state that purchase orders and redemption orders to
create Basket size aggregations of Shares of the Funds must be placed
by authorized participants by 11:00 a.m. E.T.\7\ The Managing Owner
represents that, upon further analysis, it believes that an 11:00 a.m.
E.T. cut-off time, rather than a 1:00 p.m. E.T. cut-off time for
placing orders to create or redeem Shares of the Funds will permit it
to more efficiently process orders to create and redeem such Shares.
Trading in certain of the futures contracts in the Morningstar[supreg]
Long/Flat Commodity Index and the Morningstar[supreg] Long/Short
Commodity Index closes as early as 1:00 p.m. E.T., and trading in a
substantial number of other component futures contracts closes at 2:00
p.m. E.T. or earlier. The Managing Owner represents that, in view of
the varying closing times for applicable futures contracts, an earlier
cut-off time could permit the Managing Owner to more efficiently engage
in transactions in the applicable futures markets in connection with
orders to create or redeem Shares, which may help reduce the premium or
discount on the Shares, and reduce the difference between the price of
the Shares and the NAV of such Shares.\8\
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\7\ The changes described herein will be effective upon filing
with the Commission of another amendment to the Registration
Statements. See note 6, supra. The Managing Owner represents that it
will not implement the changes described herein until the instant
proposed rule change is operative.
\8\ As stated in the Prior Release, the Market Vectors Low
Volatility Commodity ETF and Market Vectors Long/Short Commodity ETF
seek to track changes, whether positive or negative, in the
performance of the Morningstar[supreg] Long/Flat Commodity Index and
Morningstar[supreg] Long/Short Commodity Index, respectively, over
time.
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The Exchange notes that the Commission previously has approved
representations relating to issues of Trust Issued Receipts whereby the
cut-off time for placing orders to create or redeem shares of an issue
of Trust Issued Receipts is earlier than 1:00 p.m. E.T.\9\
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\9\ See, e.g., Securities Exchange Act Release No. 63915
(February 15, 2011), 76 FR 9843 (February 22, 2011) (SR-NYSEArca-
2010-121) (order approving listing and trading on the Exchange of
FactorShares Funds under NYSE Arca Equities Rule 8.200); 63753
(January 21, 2011), 76 FR 4963 (January 27, 2011) (SR-NYSEArca-2010-
110) (order approving listing and trading of shares of Teucrium
Natural Gas Fund under NYSE Arca Equities Rule 8.200); 63869
(February 8, 2011), 76 FR 8799 (February 15, 2011) (SR-NYSEArca-
2010-119) (order approving listing and trading of shares of Teucrium
WTI Crude Oil Fund under NYSE Arca Equities Rule 8.200).
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The Adviser represents that there is no change to the Funds'
investment objectives from those described in the Prior Release. The
Funds will comply with all initial and continued listing requirements
under NYSE Arca Equities Rule 8.200.
Except for the changes noted above, all other facts presented and
representations made in the Prior Release remain unchanged.
All terms referenced but not defined herein are defined in the
Prior Release.
2. Statutory Basis
The basis under the Act for this proposed rule change is the
requirement under Section 6(b)(5) \10\ 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 remove
impediments to, and perfect the mechanism of a free and open market
and, in general, to protect investors and the public interest.
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\10\ 15 U.S.C. 78f(b)(5).
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The Exchange believes that the proposed rule change is designed to
prevent fraudulent and manipulative acts and practices in that the
Shares will be listed and traded on the Exchange pursuant to the
initial and continued listing criteria in NYSE Arca Equities Rule
8.200. The Exchange notes that the Commission previously has approved
representations relating to issues of Trust Issued Receipts whereby the
cut-off time for placing orders to create or redeem shares of an issue
of Trust Issued Receipts is earlier than 1:00 p.m. E.T.\11\
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\11\ See note 9, supra.
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The proposed rule change is designed to promote just and equitable
principles of trade and to protect investors and the public interest in
that the Adviser represents that there is no change to each Fund's
investment objective as described in the Prior Release. The Funds will
comply with all initial and continued listing requirements under NYSE
Arca Equities Rule 8.200. The Managing Owner represents that, upon
further analysis, it believes that an 11:00 a.m. E.T. cut-off time,
rather than a 1:00 p.m. E.T. cut-off time for placing orders to create
or redeem Shares of the Funds will permit it to more efficiently
process orders to create and redeem Shares. Trading in certain of the
futures
[[Page 21339]]
contracts in the Morningstar[supreg] Long/Flat Commodity Index and the
Morningstar[supreg] Long/Short Commodity Index closes as early as 1:00
p.m. E.T., and trading in a substantial number of other component
futures contracts closes at 2:00 p.m. E.T. or earlier. The Managing
Owner represents that, upon further analysis, it believes that an 11:00
a.m. E.T. cut-off time, rather than a 1:00 p.m. E.T. cut-off time for
placing orders to create or redeem Shares of the Funds will permit it
to more efficiently process orders to create and redeem such Shares.
The Managing Owner represents that, in view of the varying closing
times for applicable futures contracts, an earlier cut-off time could
permit the Managing Owner to more efficiently engage in transactions in
the applicable futures markets in connection with orders to create or
redeem Shares, which may help reduce the premium or discount on the
Shares, and reduce the difference between the price of the Shares and
the NAV of such Shares. The proposed rule change is designed to perfect
the mechanism of a free and open market and, in general, to protect
investors and the public interest in that the Funds will comply with
all initial and continued listing requirements under NYSE Arca Equities
Rule 8.200. The Managing Owner represents that there is no change to
the Funds' investment objectives. Except for the change noted above,
all other representations made in the Prior Release remain unchanged.
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 purposes of the Act. The proposed change to the
Funds' means of achieving their respective investment objective may
permit the Funds to more efficiently handle orders to create and redeem
Shares of the Funds and will enhance competition among issues of Trust
Issued Receipts based on underlying commodity indexes.
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
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, 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
\12\ and Rule 19b-4(f)(6)(iii) thereunder.\13\
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\12\ 15 U.S.C. 78s(b)(3)(A).
\13\ 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.
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A proposed rule change filed under Rule 19b-4(f)(6) \14\ normally
does not become operative for 30 days after the date of the filing.
However, Rule 19b4(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 requests that the
Commission waive the 30-day operative delay to accommodate commencement
of trading in the Shares of the Funds on the Exchange without delay.
The Exchange states that the Managing Owner intends that trading of the
Shares on the Exchange will commence prior to the 30-day delayed
operative date.
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\14\ 17 CFR 240.19b-4(f)(6).
\15\ 17 CFR 240.19b-4(f)(6)(iii).
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The Commission believes that waiving the 30-day operative delay is
consistent with the protection of investors and the public
interest.\16\ As stated in this proposal, the proposed change does not
alter the Funds' investment objectives. Under the proposal, the Funds
seek to change the time by which purchase orders and redemption orders
to create and redeem Basket size aggregations of Shares of the Funds
must be placed by authorized participants from 1:00 p.m. E.T. to 11:00
a.m. E.T. The Managing Owner represents that it believes that an 11:00
a.m. E.T. cut-off time, rather than a 1:00 p.m. E.T. cut-off time will
permit it to more efficiently process orders to create and redeem
Shares. The Exchange represents that, except for this change, all other
representations made in the Prior Release remain unchanged and that the
Funds will continue to comply with all initial and continued listing
requirements under NYSE Arca Equities Rule 8.200. Because the proposed
change does not alter the Funds' investment objectives and does not
raise any novel or unique regulatory issues, the Commission designates
the proposed rule change as operative upon filing.
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\16\ For 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).
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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.
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 [email protected]. Please include
File Number SR-NYSEArca-2014-28 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-2014-28. 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 such filing will also be available
for inspection and copying at the principal office of the Exchange. All
comments
[[Page 21340]]
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-2014-28 and should
be submitted on or before May 6, 2014.
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\17\ 17 CFR 200.30-3(a)(12).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\17\
Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2014-08412 Filed 4-14-14; 8:45 am]
BILLING CODE 8011-01-P