[Federal Register Volume 82, Number 203 (Monday, October 23, 2017)]
[Notices]
[Pages 49046-49050]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-22885]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-81890; File No. SR-NYSEArca-2017-120]
Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing
and Immediate Effectiveness of Proposed Rule Change Relating to Changes
to Certain Representations Relating to Five PIMCO Exchange-Traded Funds
Currently Listed Under NYSE Arca Rule 8.600-E
October 17, 2017.
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 October 5, 2017, NYSE Arca, Inc. (the ``Exchange'' or ``NYSE
Arca'') 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 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 reflect changes to certain representations
made in the respective proposed rule changes previously filed with the
Commission pursuant to Rule 19b-4 relating to the PIMCO Active Bond
Exchange-Traded Fund, PIMCO Enhanced Low Duration Active Exchange-
Traded Fund, PIMCO Short Term Municipal Bond Active Exchange-Traded
Fund, PIMCO Intermediate Municipal Bond Active Exchange-Traded Fund,
and PIMCO Enhanced Short Maturity Active Exchange-Traded Fund (each a
``Fund'' and, collectively, the ``Funds''). Shares of the Funds are
currently listed and traded on the Exchange under NYSE Arca Rule 8.600-
E. 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 Commission has approved the listing and trading on the Exchange
of shares (``Shares'') of the Funds, under NYSE Arca Rule 8.600-E
(formerly NYSE Arca Equities Rule 8.600), which governs the listing and
trading of Managed Fund Shares.\4\ The Shares are offered by PIMCO ETF
Trust (the ``Trust''), a statutory trust organized under the laws of
the State of Delaware and registered with the Commission as an open-end
management investment company.\5\ The investment manager to
[[Page 49047]]
the Funds is Pacific Investment Management Company LLC (``PIMCO'' or
the ``Adviser''). The Funds' Shares are currently listed and traded on
the Exchange under NYSE Arca Rule 8.600-E.
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\4\ A Managed Fund Share is a security that represents an
interest in an investment company registered under the Investment
Company Act of 1940 (15 U.S.C. 80a-1) (``1940 Act'') organized as an
open-end investment company or similar entity that invests in a
portfolio of securities selected by its investment adviser
consistent with its investment objectives and policies. In contrast,
an open-end investment company that issues Investment Company Units,
listed and traded on the Exchange under NYSE Arca Rule 5.2-E(j)(3),
seeks to provide investment results that correspond generally to the
price and yield performance of a specific foreign or domestic stock
index, fixed income securities index or combination thereof.
\5\ The Trust is registered under the 1940 Act. On October 28,
2016 the Trust filed with the Commission the most recent post-
effective amendment to its registration statement under the
Securities Act of 1933 (15 U.S.C. 77a) (``1933 Act'') and under the
1940 Act relating to the Funds (File Nos. 333-155395 and 811-22250)
(the ``Registration Statement''). The description of the operation
of the Trust and the Funds herein is based, in part, on the
Registration Statement. In addition, the Commission has issued an
order granting certain exemptive relief to the Trust under the 1940
Act. See Investment Company Act Release No. 28993 (November 10,
2009) (File No. 812-13571) (``Exemptive Order'').
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In this proposed rule change, the Exchange proposes to reflect
changes to certain representations made in the respective proposed rule
changes previously filed with the Commission pursuant to Rule 19b-4(e)
relating to the Funds, as described below.\6\
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\6\ The Adviser represents that it will manage the Funds in the
manner described in the applicable proposed rule changes for the
Funds referenced below, and will not implement the changes described
herein until the proposed rule change is operative.
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PIMCO Active Bond Exchange-Traded Fund \7\
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\7\ See Securities Exchange Act Release Nos. 65988 (December 16,
2011), 76 FR 79741 (December 22, 2011) (SR-NYSEArca-2011-95) (notice
of filing of proposed rule change relating to Exchange listing and
trading of shares of the PIMCO Total Return Exchange Traded Fund
(now the PIMCO Active Bond Exchange Traded Fund)) (``First Prior
Bond Notice''); 66321 (February 3, 2012), 77 FR 6850 (February 9,
2012) (SR-NYSEArca-2011-95) (order approving listing and trading of
Shares of the Fund on the Exchange). See also Securities Exchange
Act Release Nos. 70905 (November 20, 2013), 78 FR 70610 (November
26, 2013) (SR-NYSEArca-2013-122) (notice of filing of proposed rule
change relating to use of derivative instruments by the Fund); 72666
(July 24, 2014), 79 FR 44224 (July 30, 2014) (SR-NYSEArca-2013-122)
(order approving proposed rule change relating to use of derivative
instruments by the Fund; 73331 (October 9, 2014), 79 FR 62213
(October 16, 2014) (SR-NYSEArca-2014-104) (notice of filing and
immediate effectiveness of proposed rule change relating to use of
derivatives by certain PIMCO exchange traded funds); 75475 (July 16,
2015), 80 FR 43507 (July 22, 2015) (SR-NYSEArca-2015-63) (notice of
filing and immediate effectiveness of proposed rule change relating
to a change in the size of a Creation Unit applicable to Shares of
the Fund); 80534 (April 26, 2017), 82 FR 20525 (May 2, 2017) (SR-
NYSEArca-2017-41) (notice of filing and immediate effectiveness of
proposed rule change to reflect changes in the name of, the
investment objective for, and the means of achieving the investment
objective applicable to the PIMCO Total Return Active Exchange-
Traded Fund) (``2017 Bond Release'' and, together with the other
releases referenced in this footnote, the ``Prior Bond Releases'').
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The 2017 Bond Release stated that the Fund will primarily (under
normal market circumstances, at least 65% of its total assets) invest
in a diversified portfolio of Fixed Income Instruments of varying
maturities, which may be represented by derivatives related to Fixed
Income Instruments, but may invest up to 30% of its total assets in
high yield Fixed Income Instruments (which may be represented by
derivatives related to Fixed Income Instruments) rated B3 through Ba1
by Moody's, or equivalently rated by S&P or Fitch, or, if unrated,
determined by PIMCO to be of comparable credit quality. The Adviser
proposes to revise this representation to state that the Fund will
primarily (under normal market circumstances, at least 65% of its total
assets) invest in a diversified portfolio of Fixed Income Instruments
of varying maturities, which may be represented by derivatives related
to Fixed Income Instruments, and may invest in high yield Fixed Income
Instruments (which may be represented by derivatives related to Fixed
Income Instruments) of any credit quality.\8\
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\8\ The Exchange notes that the Commission previously has
approved the listing and trading of issues of Managed Fund Shares
where there is not a specified limit to a fund's holdings that may
be in high yield bonds or a specified credit quality. See, e.g.,
Securities Exchange Act Release Nos. 75540 (July 28, 2015), 80 FR
46359 (August 4, 2015) (SR-NYSEArca-2015-50) (order approving
listing and trading on the Exchange of shares of the Cambria
Sovereign High Yield Bond ETF and Cambria Value and Momentum ETF
under NYSE Arca Equities Rule 8.600); 77904 (May 25, 2016), 81 FR
35101 (June 1, 2016) (SR-NYSEArca-2016-17) (order approving proposed
rule change to list and trade shares of the JPMorgan Diversified
Alternative ETF under NYSE Arca Equities Rule 8.600).
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The 2017 Bond Release stated that the average portfolio duration of
PIMCO Active Bond Exchange-Traded Fund normally will vary from zero to
eight years based on PIMCO's market forecasts. The Adviser proposes to
revise this representation to state that the average portfolio duration
of this Fund normally will vary from zero to nine years based on
PIMCO's market forecasts.\9\
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\9\ The Exchange notes that the Commission has approved the
listing and trading of other issues of Managed Fund Shares that have
a duration range comparable to those proposed for the Fund. See,
e.g., Securities Exchange Act Release Nos. 79293 (November 10,
2016), 81 FR 81189 (November 17, 2016) (SR-NYSEArca-2016-107) (order
approving listing and trading of shares of Cumberland Municipal Bond
ETF under NYSE Arca Equities Rule 8.600, which states that ``At
least 80% of the weight of the Fund's assets will be in Municipal
Bonds with a modified duration of 15 years or less''); 71617
(February 26, 2014), 79 FR 12257 (March 4, 2014) (SR-NYSEArca-2013-
135) (Order Granting Approval of Proposed Rule Change to List and
Trade Shares of db-X Ultra-Short Duration Fund and db-X Managed
Municipal Bond Fund under NYSE Arca Equities Rule 8.600, which
states that ``[a]lthough the [db-X Managed Municipal Bond Fund] may
adjust duration of its holdings over a wider range, it generally
intends to keep it between five and nine years''); 77522 (April 5,
2016), 81 FR 21420 (April 11, 2016) (SR-NYSEArca-2015-125) (order
approving proposed rule change to list and trade shares of the
Riverfront Dynamic Unconstrained Income ETF and Riverfront Dynamic
Core Income ETF under NYSE Arca Equities Rule 8.600, which states
that ``the Sub-Adviser intends to manage the [Riverfront Dynamic
Unconstrained Income ETF's] portfolio so that it has an average
duration of between two and ten years, under normal
circumstances'').
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The First Prior Bond Notice stated that the Fund may invest up to
15% of its total assets in securities and instruments that are
economically tied to emerging market countries.\10\ The Adviser
proposes to revise this representation to state that the Fund may
invest in securities and instruments that are economically tied to
emerging market countries. Thus, going forward, there would not be a
specified limit in the Fund's investments in emerging markets
securities.\11\
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\10\ The First Prior Bond Notice stated that ``[w]hile corporate
debt securities and debt securities economically tied to an emerging
market country generally must have $200 million or more par amount
outstanding and significant par value traded to be considered as an
eligible investment for the Fund, at least 80% of issues of such
securities held by the Fund must have $200 million or more par
amount outstanding.'' This condition will continue to apply.
\11\ The Exchange notes that the Commission has approved the
listing and trading of other issues of Managed Fund Shares for which
there was not a specified limit in investments in foreign fixed
income securities, which would include emerging markets securities.
See, e.g., Securities Exchange Act Release Nos. 79683 (December 23,
2016) 81 FR 96539 (December 30, 2016) (SR-NYSEArca-2016-82) (order
approving proposed rule change to list and trade shares of the
JPMorgan Diversified Event Driven ETF under NYSE Arca Equities Rule
8.600); 80657 (May 11, 2017) (SR-NYSEArca-2017-09) (order approving
proposed rule change to list and trade shares of the Janus Short
Duration Fund under NYSE Arca Equities Rule 8.600).
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The Adviser represents that the proposed changes to the Fund's
investments referenced above are consistent with the Fund's investment
objective, and will further assist the Adviser to achieve such
investment objective.
PIMCO Enhanced Low Duration Active Exchange-Traded Fund \12\
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\12\ See Securities Exchange Act Release Nos. 70774 (October 30,
2013), 78 FR 66396 (November 5, 2013) (SR-NYSEArca-2013-106) (notice
of filing of proposal relating to PIMCO Diversified Income Exchange-
Traded Fund, PIMCO Low Duration Exchange-Traded Fund and PIMCO Real
Return Exchange-Traded Fund) (``Prior Low Duration Notice''); 71125
(December 18, 2013), 78 FR 77743 (December 24, 2013) (SR-NYSEArca-
2013-106) (order approving listing and trading of PIMCO Diversified
Income Exchange-Traded Fund, PIMCO Low Duration Exchange-Traded Fund
and PIMCO Real Return Exchange-Traded Fund); 73331 (October 9,
2014), 79 FR 62213 (October 16, 2014) (SR-NYSEArca-2014-104) (Notice
of Filing and Immediate Effectiveness of Proposed Rule Change
Relating to Use of Derivative Instruments by Certain PIMCO Exchange-
Traded Funds) (collectively, ``Prior Bond Low Duration Releases'').
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The Prior Low Duration Notice stated that the Fund will invest
primarily in investment grade debt securities, but may invest up to 10%
of its total assets in high yield debt securities rated B to Ba by
Moody's, or equivalently rated by S&P or Fitch, or, if unrated,
determined by PIMCO to be of comparable credit quality. The Adviser
proposes to revise this representation to state that the Fund will
invest primarily in investment grade debt securities, and may invest in
[[Page 49048]]
high yield debt securities of any credit quality.\13\
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\13\ See note 8, supra.
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The Prior Low Duration Notice stated that the average portfolio
duration of the Fund normally will vary from one to three years based
on PIMCO's forecast for interest rates. The Adviser proposes to revise
this representation to state that the average portfolio duration of the
Fund normally will vary from zero to four years based on PIMCO's
forecast for interest rates.\14\
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\14\ See note 9, supra.
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The Prior Low Duration Notice stated that the Fund may invest up to
10% of its total assets in securities and instruments that are
economically tied to emerging market countries, subject to the Fund's
investment limitations relating to particular asset classes.\15\ The
Adviser proposes to revise this representation to state that the Fund
may invest in securities and instruments that are economically tied to
emerging market countries, subject to the Fund's investment limitations
relating to particular asset classes. Thus, going forward, there would
not be a specified limit in investments in the Fund's investments in
emerging markets securities.\16\
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\15\ The Prior Low Duration Notice stated that ``[w]hile
emerging markets corporate debt securities (excluding commercial
paper) generally must have $200 million or more par amount
outstanding and significant par value traded to be considered as an
eligible investment for the Fund, at least 80% of issues of such
securities held by the Fund must have $200 million or more par
amount outstanding at the time of investment. This condition will
continue to apply.
\16\ See note 11, supra.
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The Adviser represents that the proposed changes to the Fund's
investments referenced above are consistent with the Fund's investment
objective, and will further assist the Adviser to achieve such
investment objective.
PIMCO Short Term Municipal Bond Active Exchange-Traded Fund \17\
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\17\ Securities Exchange Act Release No. 60619, (September 3,
2009), 74 FR 46820 (September 11, 2009) (SR-NYSEArca-2009-79)
(notice of filing of proposal relating to PIMCO Intermediate
Municipal Bond Strategy Exchange-Traded Fund and PIMCO Short-Term
Municipal Bond Strategy Exchange-Traded Fund) (``Prior Short Term
Notice''); 60981 (November 10, 2009) 74 FR 59594 (November 18, 2009)
(SR-NYSEArca-2009-79) (order approving proposed rule change relating
to listing of five fixed income funds of the PIMCO ETF Trust)
(``Prior Short Term Order''); 73331 (October 9, 2014), 79 FR 62213
(October 16, 2014) (SR-NYSEArca-2014-104) (Notice of Filing and
Immediate Effectiveness of Proposed Rule Change Relating to Use of
Derivative Instruments by Certain PIMCO Exchange-Traded Funds)
(collectively, ``Prior Short Term Releases'').
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The Prior Short Term Municipal Bond Notice [sic] stated that the
Fund may only invest in U.S. dollar-denominated investment grade debt
securities. The Adviser proposes to revise this representation to state
that the Fund may only invest in U.S. dollar-denominated debt
securities, which may be of any credit quality.\18\
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\18\ See note 8, supra.
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The Prior Short Term Municipal Bond Notice [sic] stated that the
average portfolio duration of this Fund varies based on PIMCO's
forecast for interest rates and under normal market conditions is not
expected to exceed three years. The Adviser proposes to revise this
representation to state that the average portfolio duration of this
Fund varies based on PIMCO's forecast for interest rates and under
normal market conditions is not expected to exceed four years.\19\
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\19\ See note 9, supra.
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The Prior Short Term Municipal Bond Notice [sic] stated that the
dollar-weighted average portfolio maturity of the Fund is normally not
expected to exceed three years. The Adviser proposes to revise this
representation to state that the Fund will not have any portfolio
maturity limitation and may invest its assets in instruments with
short-term, medium-term, or long-term maturities.\20\
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\20\ The Exchange notes that the Commission previously has
approved listing and trading of issues of Managed Fund Shares for
which there was no limitation on portfolio maturity for debt
instruments. See, e.g., Securities Exchange Act Release Nos. 76126
(October 9, 2015) (SR-Nasdaq-2015-095) (Order Granting Approval of
Proposed Rule Change Relating to the Listing and Trading of the
Shares of the AltShares Long/Short High Yield Fund of ETFis Series
Trust I); 68972 (February 22, 2013) (SR-Nasdaq-2012-147) (Order
Granting Approval of Proposed Rule Change Relating to the Listing
and Trading of the Shares of the First Trust High Yield Long/Short
ETF of First Trust Exchange-Traded Fund IV).
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The Adviser represents that the proposed changes to the Fund's
investments referenced above are consistent with the Fund's investment
objective, and will further assist the Adviser to achieve such
investment objective.
PIMCO Intermediate Municipal Bond Active Exchange-Traded Fund \21\
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\21\ Securities Exchange Act Release No. 60619, (September 3,
2009), 74 FR 46820 (September 11, 2009) (SR-NYSEArca-2009-79)
(notice of filing of proposal relating to PIMCO Intermediate
Municipal Bond Strategy Exchange-Traded Fund and PIMCO Short-Term
Municipal Bond Strategy Exchange-Traded Fund) (``First Prior
Intermediate Municipal Bond Notice''); 60981 (November 10, 2009) 74
FR 59594 (November 18, 2009) (SR-NYSEArca-2009-79) (order approving
proposed rule change relating to listing of five fixed income funds
of the PIMCO ETF Trust); 75978 (September 24, 2015) (SR-NYSEArca-
2015-79) (Notice of Filing and Immediate Effectiveness of Proposed
Rule Change Regarding the PIMCO Intermediate Municipal Bond Active
Exchange-Traded Fund) (``Second Prior Intermediate Municipal Bond
Notice''); 73331 (October 9, 2014) (SR-NYSEArca-2014-104) (Notice of
Filing and Immediate Effectiveness of Proposed Rule Change Relating
to Use of Derivative Instruments by Certain PIMCO Exchange-Traded
Funds) (collectively, ``Prior Intermediate Municipal Bond
Releases'').
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The First Prior Intermediate Municipal Bond Notice stated that the
Fund may only invest in U.S. dollar-denominated investment grade debt
securities. The Adviser proposes to revise this representation to state
the Fund may only invest in U.S. dollar-denominated debt securities,
which may be of any credit quality.\22\
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\22\ See note 8, supra.
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The Second Prior Intermediate Municipal Bond Notice stated that the
average portfolio duration of the Fund normally would vary within
(negative) 2 years to positive 4 years of the portfolio duration of the
securities comprising the Barclays 1-15 Year Municipal Bond Index, as
calculated by PIMCO (the ``Index''). The Adviser proposes to revise
this representation to state the average portfolio duration of the Fund
normally would vary within (negative) 3 years to positive 5 years of
the portfolio duration of the securities comprising the Index.\23\ As
of August 31, 2017, the average portfolio duration of the Index was
4.91 years. Thus, as of August 31, 2017, the average portfolio duration
of the Fund normally would vary within approximately 1.9 years and 9.9
years if the proposed revised representation were operative on that
date.
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\23\ See note 9, supra.
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The Adviser represents that the proposed changes to the Fund's
investments referenced above are consistent with the Fund's investment
objective, and will further assist the Adviser to achieve such
investment objective.
PIMCO Enhanced Short Maturity Active Exchange-Traded Fund \24\
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\24\ Securities Exchange Act Release No. 60619 (September 3,
2009), 74 FR 46820 (September 11, 2009) (SR-NYSEArca-2009-79)
(notice of filing of proposed rule change relating to listing of
five fixed income funds of the PIMCO ETF Trust, including the PIMCO
Enhanced Short Maturity Strategy Fund) (``Prior Short Maturity
Notice''); 60981 (November 10, 2009), 74 FR 59594 (November 18,
2009) (SR-NYSEArca-2009-79) (order approving proposed rule change
relating to listing of five fixed income funds of the PIMCO ETF
Trust) (collectively, ``Prior Short Maturity Releases'').
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The Prior Short Maturity Notice stated that the Fund primarily
invests in U.S. dollar-denominated investment grade debt securities,
rated Baa or higher by Moody's, or equivalently rated by S&P or Fitch,
or, if unrated, determined by PIMCO to be of comparable credit quality.
The Adviser proposes to revise this representation to state the Fund
primarily will invest in U.S. dollar-
[[Page 49049]]
denominated debt securities, which may be of any credit quality.\25\
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\25\ See note 8, supra.
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The Prior Short Maturity Notice stated that the average portfolio
duration of this Fund will vary based on PIMCO's forecast for interest
rates and will normally not exceed one year. The Adviser proposes to
revise this representation to state the average portfolio duration of
this Fund will vary based on PIMCO's forecast for interest rates and
will normally not exceed one and one half years.\26\
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\26\ See note 9, supra.
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The Prior Short Maturity Notice stated that the dollar-weighted
average portfolio maturity of the Fund is normally not expected to
exceed three years. The Adviser proposes to revise this representation
to state the Fund will not have any portfolio maturity limitation and
may invest its assets in instruments with short-term, medium-term, or
long-term maturities.\27\
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\27\ See note 20, supra.
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The Prior Short Maturity Notice stated that the Fund may invest up
to 5% of its total assets in U.S. dollar-denominated fixed-income
securities and instruments that are economically tied to emerging
market countries. The Adviser proposes to revise this representation to
state the Fund may invest up to 10% of its total assets in U.S. dollar-
denominated fixed-income securities and instruments that are
economically tied to emerging market countries.\28\
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\28\ See note 11, supra.
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The Adviser represents that the proposed changes to the Fund's
investments referenced above are consistent with the Fund's investment
objective, and will further assist the Adviser to achieve such
investment objective.
Except for the changes noted above, all other representations made
in the Prior Bond Releases, the Prior Bond Low Duration Releases, the
Prior Short Term Releases, the Prior Intermediate Municipal Bond
Releases, and the Prior Short Maturity Releases, respectively, remain
unchanged.
All terms referenced but not defined herein are defined in the
Prior Bond Releases, the Prior Low Duration Releases [sic], the Prior
Short Term Releases, the Prior Intermediate Municipal Bond Releases,
and the Prior Short Maturity Releases, respectively.
2. Statutory Basis
The basis under the Act for this proposed rule change is the
requirement under Section 6(b)(5) \29\ 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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\29\ 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, and is designed
to promote just and equitable principles of trade and to protect
investors and the public interest.
With respect to changes in the representations regarding
investments in investment grade and high yield debt securities for each
of the Funds' portfolios, such changes will provide each Fund with
additional flexibility in selecting fixed income securities investments
in view of changing market conditions and consistent with a Fund's
investment objectives. The Exchange believes that the changes to
representations regarding investments in investment grade or high yield
fixed income securities in the applicable Funds' portfolios are
consistent with prior Commission approvals of proposed rule changes for
other issues of Managed Fund Shares and will not adversely impact
investors or Exchange trading.\30\
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\30\ See note 8, supra.
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With respect to the proposed changes to the representations
regarding the average portfolio duration regarding the portfolios of
each of the Funds, and the change to the representation regarding the
dollar-weighted average portfolio maturity regarding the portfolio of
the PIMCO Enhanced Short Maturity Active Exchange-Traded Fund and the
PIMCO Short Term Municipal Bond Active Exchange-Traded Fund, the
Exchange believes such changes will not adversely impact investors or
Exchange trading and will provide such Funds with additional
flexibility in managing the Funds' investments based on the Adviser's
assessment of market conditions impacting the Funds' investments.
Further, a more flexible bandwidth for the average portfolio duration
and dollar-weighted average portfolio maturity will allow the Funds to
respond more effectively to changing market conditions. The Exchange
believes that the change to the average portfolio duration and dollar-
weighted average portfolio maturity of the applicable Funds' portfolios
are consistent with prior Commission approvals of proposed rule changes
for other issues of Managed Fund Shares and will not adversely impact
investors or Exchange trading.\31\
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\31\ See notes 9 and 20, supra.
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With respect to proposed changes in the representations regarding
investments in securities and instruments that are economically tied to
emerging market countries for the PIMCO Active Bond Exchange-Traded
Fund, PIMCO Enhanced Short Maturity Active Exchange-Traded Fund and
PIMCO Enhanced Low Duration Active Exchange-Traded Fund, such changes
will provide each Fund with additional flexibility in selecting fixed
income securities investments of emerging market issuers, which may be
appropriate in view of changing market conditions and consistent with a
Fund's investment objectives. The Exchange believes that the changes to
such representations are consistent with prior Commission approvals of
proposed rule changes for other issues of Managed Fund Shares and will
not adversely impact investors or Exchange trading.\32\
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\32\ See note 11, 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 purposes of the Act. The Exchange believes the
proposed rule change will enhance competition among issues of exchange-
traded funds that invest in fixed income securities to the benefit of
investors and the marketplace.
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 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 \33\ and Rule 19b-4(f)(6) thereunder.\34\
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\33\ 15 U.S.C. 78s(b)(3)(A).
\34\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii)
requires a self-regulatory organization to give the Commission
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. The Exchange has satisfied this requirement.
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[[Page 49050]]
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. 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 [email protected]. Please include
File Number SR-NYSEArca-2017-120 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-2017-120. 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-2017-120 and should
be submitted on or before November 13, 2017.
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\35\ 17 CFR 200.30-3(a)(12).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\35\
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-22885 Filed 10-20-17; 8:45 am]
BILLING CODE 8011-01-P