[Federal Register Volume 83, Number 249 (Monday, December 31, 2018)]
[Notices]
[Pages 67734-67741]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-28381]



[[Page 67734]]

-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-84945; File No. SR-CboeBZX-2018-094]


Self-Regulatory Organizations; Cboe BZX Exchange, Inc.; Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change To List 
and Trade, Under BZX Rule 14.11(c)(4), Shares of the VanEck Vectors 
Short High-Yield Municipal Index ETF of the VanEck Vectors ETF Trust

December 21, 2018.
    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 20, 2018, Cboe BZX Exchange, Inc. (the ``Exchange'' or 
``BZX'') filed with the Securities and Exchange Commission (the 
``Commission'') the proposed rule change as described in Items I and II 
below, which Items have been prepared by the Exchange. The Exchange 
filed the proposal as a ``non-controversial'' proposed rule change 
pursuant to Section 19(b)(3)(A)(iii) of the Act \3\ and Rule 19b-
4(f)(6) thereunder.\4\ The Commission is publishing this notice to 
solicit comments on the proposed rule change from interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \4\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to list and trade under BZX Rule 14.11(c)(4) 
shares of the VanEck Vectors Short High-Yield Municipal Index ETF (the 
``Fund'') of the VanEck Vectors ETF Trust (the ``Trust''), which is 
currently listed on NYSE Arca, Inc. (``Arca''). The shares of the Fund 
are referred to herein as the ``Shares.''
    The text of the proposed rule change is available on the Exchange's 
website (http://www.cboe.com/AboutCBOE/CBOELegalRegulatoryHome.aspx), 
at the Exchange's Office of the Secretary, 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 aspects 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 \5\ on the 
Exchange. The Exchange is submitting this proposed rule change because 
the Index, as defined below, for the Fund does not meet all of the 
``generic'' listing requirements of BZX Rule 14.11(c)(4) \6\ applicable 
to the listing of Index Fund Shares based on fixed income securities 
indexes. The Index meets all requirements of Rule 14.11(c)(4) except 
for BZX Rule 14.11(c)(4)(B)(i)(b) \7\ and will continue to meet all 
other requirements of Rule 14.11(c)(4) on an ongoing basis.\8\ The 
Exchange notes that the Fund is currently listed on Arca and the Shares 
are already trading on the Exchange pursuant to unlisted trading 
privileges, as provided in Rule 14.11(j). The Shares are offered by the 
Trust, which was established as a Delaware statutory trust on March 15, 
2001. The Trust is registered with the Commission as an open-end 
investment company and has filed a registration statement on behalf of 
the Funds [sic] on Form N-1A (``Registration Statement'') with the 
Commission.\9\ All statements and representations made in this filing 
regarding (a) the description of the Fund's index, portfolio, or 
reference asset, (b) limitations on index or 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. The issuer has represented to 
the Exchange that it will advise the Exchange of any failure by the 
Fund or the Shares to comply with the continued listing requirements, 
and, pursuant to its obligations under Section 19(g)(1) of the Act, the 
Exchange will surveil for compliance with the continued listing 
requirements.
---------------------------------------------------------------------------

    \5\ The Exchange notes that the Commission previously approved a 
proposal to list and trade shares of the Fund on Arca. See 
Securities Exchange Act Release Nos. 71232 (January 3, 2014), 79 FR 
1662 (January 9, 2014) (SR-NYSEArca-2013-118) (Notice of Filing of 
Amendment No. 2 and Order Granting Accelerated Approval of a 
Proposed Rule Change, as Modified By Amendments Nos. 1 and 2, To 
List and Trade Shares of the Market Vectors Short High-Yield 
Municipal Index ETF Under NYSE Arca Equities Rule 5.2(j)(3), 
Commentary .02) and 76645 (December 15, 2015), 80 FR 79392 (December 
21, 2015) (SR-NYSEArca-2015-74) (Order Approving a Proposed Rule 
Change Regarding a Change to the Underlying Index of the Market 
Vectors Short High Yield Municipal Index ETF) (collectively, the 
``Prior Proposal''). This proposal is substantively identical to the 
Prior Proposal and the issuer represents that all material 
representations contained within the Prior Proposal remain true. As 
further described below, the Exchange believes that its surveillance 
procedures are adequate to properly monitor the trading of the 
Shares on the Exchange during all trading sessions and to deter and 
detect violations of Exchange rules and the applicable federal 
securities laws. Trading of the Shares through the Exchange will be 
subject to the Exchange's surveillance procedures for derivative 
products, including Index Fund Shares.
    \6\ The Commission approved BZX Rule 14.11(c) in Securities 
Exchange Act Release No. 65225 (August 30, 2011), 76 FR 55148 
(September 6, 2011) (SR-BATS-2011-018). Subsequent amendments to 
Rule 14.11(c) include amendments approved by the Commission in 
Securities Exchange Act Release Nos. 80169 (March 7, 2017), 82 FR 
13536 (March 13, 2017) (SR-BatsBZX-2016-80) and 81070 (June 30, 
2017), 82 FR 31650 (July 7, 2017) (SR-BatsBZX-2017-26).
    \7\ BZX Rule 14.11(c)(4)(B)(i)(b) provides that Fixed Income 
Security components that in the aggregate account for at least 75% 
of the Fixed Income Securities portion of the weight of the index or 
portfolio must have a minimum original principal amount outstanding 
of $100 million or more.
    \8\ The Exchange notes that this includes all requirements 
applicable under Rule 14.11(c)(4)(B)(i), including Rule 
14.11(c)(4)(B)(i)(d) which provides that no fixed-income security 
(excluding Treasury Securities) will represent more than 30% of the 
Fixed Income Securities portion of the weight of the index or 
portfolio, and the five highest weighted component fixed-income 
securities do not in the aggregate account for more than 65% of the 
Fixed Income Securities portion of the weight of the index or 
portfolio.
    \9\ See Registration Statement on Form N-1A for the Trust, dated 
September 1, 2018 [sic] (File Nos. 333-123257 and 811-10325). The 
descriptions of the Funds [sic] 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''). See Investment Company Act Release No. 28021 
(October 24, 2007) (File No. 812-13426).
---------------------------------------------------------------------------

    Van Eck Associates Corporation is the investment adviser 
(``Adviser'') for the Fund. Van Eck Securities Corporation is the 
Fund's distributor (``Distributor''). Van Eck Associates Corporation 
also is the administrator for the Fund (the ``Administrator''), and is 
responsible for certain clerical, recordkeeping and/or bookkeeping 
services. The Bank of New York Mellon is the custodian of the Fund's 
assets and provides transfer agency and fund accounting services to the 
Fund.
    The investment objective of the Fund is to seek to replicate as 
closely as possible, before fees and expenses, the price and yield 
performance of the Bloomberg Barclays Municipal High Yield Short 
Duration Index (the ``Short High Yield Index'' or ``Index''). Under 
Normal Market Conditions,\10\ the Fund

[[Page 67735]]

will invest at least 80% of its total assets in securities that compose 
the Index.
---------------------------------------------------------------------------

    \10\ As defined in Rule 14.11(i)(3)(E), the term ``Normal Market 
Conditions'' includes, but is not limited to, the absence of trading 
halts in the applicable financial markets generally; operational 
issues causing dissemination of inaccurate market information or 
system failures; or force majeure type events such as natural or 
man-made disaster, act of God, armed conflict, act of terrorism, 
riot or labor disruption, or any similar intervening circumstance.
---------------------------------------------------------------------------

    The Fund, using a ``passive'' or indexing investment approach, will 
attempt to approximate the investment performance of the Index. The 
Adviser expects that, over time, the correlation between the Fund's 
performance before fees and expenses and that of the Index will be 95% 
or better. A figure of 100% would indicate perfect correlation. Because 
of the practical difficulties and expense of purchasing all of the 
securities in the Index, the Fund will not purchase all of the 
securities in the Index. Instead, the Adviser will utilize a 
``sampling'' methodology in seeking to achieve the Fund's objective. As 
such, the Fund may purchase a subset of the bonds in the Index in an 
effort to hold a portfolio of bonds with generally the same risk and 
return characteristics of the Index.
Other Investments
    While the Fund will, under Normal Market Conditions, invest at 
least 80% of its total assets in securities that compose the Index, the 
Fund may invest its remaining assets in other financial instruments, as 
described below.
    The Fund may invest its remaining assets in municipal bonds not 
included in the Short High Yield Index, money market instruments, 
including repurchase agreements or other funds which invest exclusively 
in money market instruments, convertible securities,\11\ structured 
notes (notes on which the amount of principal repayment and interest 
payments are based on the movement of one or more specified factors, 
such as the movement of a particular stock or stock index),\12\ and 
certain other derivative instruments that are mentioned below. The Fund 
may also invest, to the extent permitted by the 1940 Act, in other 
affiliated and unaffiliated funds, such as open-end or closed-end 
management investment companies, including other exchange-traded funds 
(``ETFs'').\13\
---------------------------------------------------------------------------

    \11\ A convertible security is a bond, debenture, note, 
preferred stock, right, warrant or other security that may be 
converted into or exchanged for a prescribed amount of common stock 
or other security of the same or a different issuer or into cash 
within a particular period of time at a specified price or formula.
    \12\ Structured notes are derivative securities for which the 
amount of principal repayment and/or interest payments is based on 
the movement of one or more factors, including, but not limited to, 
currency exchange rates, interest rates (such as the prime lending 
rate or LIBOR), referenced bonds and stock indices.
    \13\ For purposes of this filing, ETFs include index fund shares 
(as described in BZX Rule 14.11(c)); Portfolio Depositary Receipts 
(as described in BZX Rule 14.11(b)); and Managed Fund Shares (as 
described in BZX Rule 14.11(i)). The ETFs all will be listed and 
traded in the U.S. on registered exchanges. The Fund may invest in 
the securities of ETFs registered under the 1940 Act consistent with 
the requirements of Section 12(d)(1) of the 1940 Act, or any rule, 
regulation or order of the Commission or interpretation thereof. 
While the Fund may invest in inverse ETFs, the Fund will not invest 
in leveraged (e.g., 2X, -2X, 3X or -3X) ETFs.
---------------------------------------------------------------------------

    The Fund may invest in repurchase agreements with commercial banks, 
brokers or dealers to generate income from its excess cash balances and 
to invest securities lending cash collateral.
    The Fund may use exchange-traded futures contracts and exchange-
traded or over-the-counter (``OTC'') options thereon, together with 
positions in cash and money market instruments, to simulate full 
investment in the Index.
    The Fund may use cleared or non-cleared index, interest rate or 
credit default swap agreements. Swap agreements are contracts between 
parties in which one party agrees to make payments to the other party 
based on the change in market value or level of a specified index or 
asset.
    The Fund may invest in exchange-traded warrants, which are equity 
securities in the form of options issued by a corporation which give 
the holder the right to purchase stock, usually at a price that is 
higher than the market price at the time the warrant is issued.
    The Fund may invest in participation notes, which are issued by 
banks or broker-dealers and are designed to offer a return linked to 
the performance of a particular underlying equity security or market.
    The Fund will only enter into transactions in derivative 
instruments with counterparties that the Adviser reasonably believes 
are capable of performing under the contract and will post as 
collateral as required by the counterparty.\14\
---------------------------------------------------------------------------

    \14\ The Fund will seek, where possible, to use counterparties, 
as applicable, whose financial status is such that the risk of 
default is reduced; however, the risk of losses resulting from 
default is still possible. The Adviser will evaluate the 
creditworthiness of counterparties on a regular basis. In addition 
to information provided by credit agencies, the Adviser will review 
approved counterparties using various factors, which may include the 
counterparty's reputation, the Adviser's past experience with the 
counterparty and the price/market actions of debt of the 
counterparty.
---------------------------------------------------------------------------

    The Fund may hold up to an aggregate amount of 15% of its net 
assets in illiquid assets (calculated at the time of investment), 
including Rule 144A securities deemed illiquid by the Adviser, in 
accordance with Commission guidance.\15\ The Fund will monitor its 
portfolio liquidity on an ongoing basis to determine whether, in light 
of current circumstances, an adequate level of liquidity is being 
maintained, and will consider taking appropriate steps in order to 
maintain adequate liquidity if, through a change in values, net assets, 
or other circumstances, more than 15% of the Fund's net assets are held 
in illiquid assets. Illiquid assets include securities subject to 
contractual or other restrictions on resale and other instruments that 
lack readily available markets as determined in accordance with 
Commission staff guidance.\16\
---------------------------------------------------------------------------

    \15\ In reaching liquidity decisions, the Adviser may consider 
the following factors: The frequency of trades and quotes for the 
security; the number of dealers wishing to purchase or sell the 
security and the number of other potential purchasers; dealer 
undertakings to make a market in the security; and the nature of the 
security and the nature of the marketplace in which it trades (e.g., 
the time needed to dispose of the security, the method of soliciting 
offers, and the mechanics of transfer).
    \16\ [thinsp]The Commission has stated that long-standing 
Commission guidelines have required open-end funds to hold no more 
than 15% of their net assets in illiquid securities and other 
illiquid assets. See Investment Company Act Release No. 28193 (March 
11, 2008), 73 FR 14618 (March 18, 2008), footnote 34. See also, 
Investment Company Act Release No. 5847 (October 21, 1969), 35 FR 
19989 (December 31, 1970) (Statement Regarding ``Restricted 
Securities''); Investment Company Act Release No. 18612 (March 12, 
1992), 57 FR 9828 (March 20, 1992) (Revisions of Guidelines to Form 
N-1A). A fund's portfolio security is illiquid if it cannot be 
disposed of in the ordinary course of business within seven days at 
approximately the value ascribed to it by the fund. See Investment 
Company Act Release No. 14983 (March 12, 1986), 51 FR 9773 (March 
21, 1986) (adopting amendments to Rule 2a-7 under the 1940 Act); 
Investment Company Act Release No. 17452 (April 23, 1990), 55 FR 
17933 (April 30, 1990) (adopting Rule 144A under the 1933 Act).
---------------------------------------------------------------------------

Description of the Index
    The Index is a market size weighted index composed of publicly 
traded municipal bonds that cover the U.S. dollar denominated high 
yield short-term tax-exempt bond market. The majority of the Index's 
constituents are from the revenue sector, with some constituents being 
from the general obligation sector. The revenue sector is divided into 
industry sectors that consist of, but may not be limited to, electric, 
health care, transportation, education, water and sewer, resource 
recovery, leasing and special tax. As [sic] November 30, 2018, the 
Index consisted of approximately 10,050 bonds and 958 unique 
issuers.\17\
---------------------------------------------------------------------------

    \17\ The Index is published by Bloomberg Index Services Limited. 
(``Index Provider''). The Index Provider is not a registered broker-
dealer and is not affiliated with a broker-dealer. In the event that 
the Index Provider becomes a broker-dealer or becomes affiliated 
with a broker-dealer, the Index Provider will implement and maintain 
a fire wall with respect to its relevant personnel regarding access 
to information concerning the composition and/or changes to the 
Index. In addition, the Index Provider has implemented and will 
maintain procedures around the relevant personnel that are designed 
to prevent the use and dissemination of material, non-public 
information regarding the Index.

---------------------------------------------------------------------------

[[Page 67736]]

    The Index is calculated using a market value weighting methodology. 
Index constituents are capitalization-weighted, based on their current 
amount outstanding. The Index will include at least 500 constituents on 
a continuous basis. The Index tracks the high yield municipal bond 
market with a 65% weight in non-investment grade municipal bonds, a 25% 
weight in Baa/BBB-rated investment grade municipal bonds and a 10% 
weight in Aa/AA-rated investment grade municipal bonds. It is comprised 
of four total return, market size weighted benchmark indexes with 
weights as follows:
     40% weight in Muni High Yield/$100 Million Deal Size 
Index. To be included in the Muni High Yield/$100 Million Deal Size 
Index, bonds must be unrated or rated Ba1/BB+ or lower by at least two 
of the following rating agencies if all three rate the bond: Moody's 
Investors Service, Inc. (``Moody's''), Standard & Poor's, Inc. 
(``S&P'') and Fitch, Inc. (``Fitch''). If only two of the three 
agencies rate the security, the lower rating is used to determine index 
eligibility. If only one of the three agencies rates a security, the 
rating must be Ba1/BB+ or lower. Bonds in the Muni High Yield/$100 
Million Deal Size Index must have an outstanding par value of at least 
$3 million and be issued as part of a transaction of at least $100 
million.
     25% weight in Muni High Yield/Under $100 Million Deal Size 
Index. To be included in the Muni High Yield/Under $100 Million Deal 
Size Index, bonds must be unrated or rated Ba1/BB+ or lower by at least 
two of the following rating agencies if all three rate the bond: 
Moody's, S&P and Fitch. If only two of the three agencies rate the 
security, the lower rating is used to determine index eligibility. If 
only one of the three agencies rates a security, the rating must be 
Ba1/BB+ or lower. Bonds in the Muni High Yield/Under $100 Million Deal 
Size Index must have an outstanding par value of at least $3 million 
and be issued as part of a transaction of under $100 million but over 
$20 million.
     25% weight in Muni Baa-Rated/$100 Million Deal Size Index. 
To be included in the Muni Baa-Rated/$100 Million Deal Size Index, 
bonds must have a Barclays Index credit quality classification between 
Baa1/BBB+ and Baa3/BBB-. Barclays Index credit quality classification 
is based on the three rating agencies, Moody's, S&P and Fitch. If two 
of the three agencies rate the bond equivalently, then that rating is 
used. If all three rate the bond differently, the middle rating is 
used. If only two of the three agencies rate the security, the lower 
rating is used to determine index eligibility. If only one of the three 
agencies rates a security, the rating must be Baa1/BBB+, Baa2/BBB, or 
Baa3/BBB-. The bonds must have an outstanding par value of at least $7 
million and be issued as part of a transaction of at least $100 
million.
     10% weight in Muni A-Rated Index. To be included in the 
Muni A-Rated Index, bonds must have a Barclays Index credit quality 
classification between A1/A+ and A3/A-. The Barclays Index credit 
quality classification is based on the three rating agencies, Moody's, 
S&P and Fitch. If two of the three agencies rate the bond equivalently, 
then that rating is used. If all three rate the bond differently, the 
middle rating is used. If only two of the three agencies rate the 
security, the lower rating is used to determine index eligibility. If 
only one of the three agencies rates a security, the rating must be A1/
A+, A2/A, or A3/A-. The bonds must have an outstanding par value of at 
least $7 million and be issued as part of a transaction of at least $75 
million.
    Remarketed issues are not allowed in the benchmark. All bonds must 
have a fixed rate, a dated-date after December 31, 1990 and a nominal 
maturity of 1 to 12 years. Taxable municipal bonds, bonds with floating 
rates and derivatives are excluded from the Index.
    The composition of the Index is rebalanced monthly. Interest and 
principal payments earned by the component securities are held in the 
Index without a reinvestment return until month end when they are 
removed from the Index. Qualifying securities issued, but not 
necessarily settled, on or before the month end rebalancing date 
qualify for inclusion in the Index in the following month.
    Total returns are calculated based on the sum of price changes, 
gain/loss on repayments of principal, and coupons received or accrued, 
expressed as a percentage of beginning market value. The Index is 
calculated and is available once a day.
    As noted above, the Exchange is submitting this proposed rule 
change because the Index for the Fund does not meet BZX Rule 
14.11(c)(4)(B)(i)(b) \18\ applicable to the listing of Index Fund 
Shares based on fixed income securities indexes. The Index meets and 
will continue to meet on an ongoing basis all other requirements of 
Rule 14.11(c)(4). Specifically, as of November 30, 2018, 27.35% of the 
weight of the Index components have a minimum original principal amount 
outstanding of $100 million or more.
---------------------------------------------------------------------------

    \18\ BZX Rule 14.11(c)(4)(B)(i)(b) provides that components that 
in the aggregate account for at least 75% of the weight of the index 
or portfolio each shall have a minimum original principal amount 
outstanding of $100 million or more.
---------------------------------------------------------------------------

    As of November 30, 2018, 74.52% of the weight of the Index 
components was composed of individual maturities that were part of an 
entire municipal bond offering with a minimum original principal amount 
outstanding of $100 million or more for all maturities of the offering. 
In addition, the total dollar amount outstanding of issues in the Index 
was approximately $240,994,112,111 and the average dollar amount 
outstanding of issues in the Index was approximately $23,979,514. 
Further, the most heavily weighted component represents 1.96% of the 
weight of the Index and the five most heavily weighted components 
represent 7.36% of the weight of the Index. Therefore, the Exchange 
believes that, notwithstanding that the Index does not satisfy the 
criterion in BZX Rule 14.11(c)(4)(B)(i)(b), the Index is sufficiently 
broad-based to deter potential manipulation, given that it is composed 
of approximately 10,050 issues and 958 unique issuers. In addition, the 
Index securities are sufficiently liquid to deter potential 
manipulation in that a substantial portion (74.52%) of the Index weight 
is composed of maturities that were part of an entire municipal bond 
offering with a minimum original principal amount outstanding of $100 
million or more, and in view of the substantial total dollar amount 
outstanding and the average dollar amount outstanding of Index issues, 
as referenced above.
    The Index value, calculated and disseminated at least once daily, 
as well as the components of the Index and their percentage weighting, 
will be available from major market data vendors. In addition, the 
portfolio of securities held by the Fund will be disclosed daily on the 
Fund's website at www.vaneck.com.
    The Exchange represents that: (1) Except for BZX Rule 
14.11(c)(4)(B)(i)(b), the Shares of the Fund currently satisfy all of 
the generic listing standards under BZX Rule 14.11(c)(4); (2) the 
continued listing standards under BZX Rule 14.11(c) applicable to index 
fund shares shall apply to the Shares of the Fund;

[[Page 67737]]

and (3) the Trust is required to comply with Rule 10A-3 \19\ under the 
Act for the initial and continued listing of the Shares. In addition, 
the Exchange represents that the Shares of the Fund will comply with 
all other requirements applicable to index fund shares including, but 
not limited to, requirements relating to the dissemination of key 
information such as the value of the Index and the IIV (as defined 
below), rules governing the trading of equity securities, trading 
hours, trading halts, surveillance, and the information circular, as 
set forth in Exchange rules applicable to index fund shares and the 
orders approving such rules.
---------------------------------------------------------------------------

    \19\ 17 CFR 240.10A-3.
---------------------------------------------------------------------------

    The current value for the index underlying the Fund is widely 
disseminated by one or more major market data vendors at least once per 
day. The IIV for Shares of the Fund is disseminated by one or more 
major market data vendors, updated at least every 15 seconds during the 
Exchange's Regular Trading Hours.\20\ In addition, the portfolio of 
securities held by the Fund is disclosed daily on the Fund website 
(www.vaneck.com). Further, the website for the Fund will contain the 
applicable fund's prospectus and additional data relating to net asset 
value (``NAV'') and other applicable quantitative information. The 
Exchange has obtained a representation from the Fund issuer that the 
NAV per share will be calculated daily and will be made available to 
all market participants at the same time.
---------------------------------------------------------------------------

    \20\ Regular Trading Hours are 9:30 a.m. to 4:00 p.m. Eastern 
Time.
---------------------------------------------------------------------------

Creation and Redemption of Shares
    According to the Registration Statement, the Fund will issue and 
sell Shares only in ``Creation Units'' of 100,000 Shares or multiples 
thereof on a continuous basis through the Distributor, without an 
initial sales load, at their NAV next determined after receipt, on any 
business day, of an order in proper form.
    The consideration for a purchase of Creation Units generally will 
consist of cash, in-kind, or a combination of cash and in-kind. The in-
kind purchase of Creation Units will consist of the deposit of a 
designated portfolio of fixed income securities (the ``Deposit 
Securities'') that compose the Index and an amount of cash computed as 
described below (the ``Cash Component'') or, as permitted or required 
by the Fund, of the cash value of the Deposit Securities (the ``Deposit 
Cash'') and the Cash Component computed as described below. When 
accepting purchases of Creation Units for cash, the Fund may incur 
additional costs associated with the acquisition of Deposit Securities.
    The Cash Component together with the Deposit Securities or the 
Deposit Cash, as applicable, are referred to as the ``Fund Deposit,'' 
which represents the minimum initial and subsequent investment amount 
for Shares. The specified Deposit Securities generally will correspond, 
pro rata, to the extent practicable, to the component securities of the 
Fund's portfolio. The Cash Component represents the difference between 
the NAV of a Creation Unit and the market value of Deposit Securities 
and may include a ``Dividend Equivalent Payment''. The Dividend 
Equivalent Payment will enable the Fund to make a complete distribution 
of dividends on the next dividend payment date, and is an amount equal, 
on a per Creation Unit basis, to the dividends on all the securities 
held by the Fund (``Fund Securities'') with ex-dividend dates within 
the accumulation period for such distribution (the ``Accumulation 
Period''), net of expenses and liabilities for such period, as if all 
of the Fund Securities had been held by the Trust for the entire 
Accumulation Period. The Accumulation Period begins on the ex-dividend 
date for the Fund and ends on the next ex-dividend date.
    The Trust may determine to issue Shares on an all cash basis (i.e., 
in exchange for the Deposit Cash and the Cash Component) if the Trust 
and the Adviser believe such method would substantially minimize the 
Fund's transactional costs or would enhance the Fund's operational 
efficiencies. This may occur on days when a substantial rebalancing of 
the Fund's portfolio is required.
    The Administrator, through the National Securities Clearing 
Corporation (``NSCC''), will make available on each business day, 
immediately prior to the opening of business on the Exchange (currently 
9:30 a.m. Eastern Time), the list of the names and the required 
principal amounts of each Deposit Security to be included in the 
current Fund Deposit (based on information at the end of the previous 
business day) as well as the Cash Component for the Fund. Such Fund 
Deposit is applicable, subject to any adjustments as described in the 
Registration Statement, in order to effect creations of Creation Units 
of the Fund until such time as the next-announced Deposit Securities 
composition or the required amount of Deposit Cash, as applicable, is 
made available.
    In addition to the list of names and numbers of securities 
constituting the current Deposit Securities of a Fund Deposit, the 
Administrator, through the NSCC, also will make available on each 
business day, the Dividend Equivalent Payment, if any, and the 
estimated Cash Component effective through and including the previous 
business day, per outstanding Shares of the Fund.
    All orders to create Creation Units must be placed in multiples of 
100,000 Shares of the Fund. All orders to create Creation Units must be 
received by the Distributor no later than the closing time of the close 
of Regular Trading Hours (``Closing Time'', ordinarily 4:00 p.m. 
Eastern time) on the date such order is placed in order for creation of 
Creation Units to be effected based on the NAV of the Fund as 
determined on such date.
    Shares may be redeemed only in Creation Units at their NAV next 
determined after receipt of a redemption request in proper form by the 
Distributor, only on a business day and only through a ``Participating 
Party'' or Depository Trust Company (``DTC'') Participant who has 
executed a ``Participant Agreement'', as described in the Registration 
Statement. The Trust will not redeem Shares in amounts less than 
Creation Units.
    The Administrator, through NSCC, will make available immediately 
prior to the opening of business on the Exchange (currently 9:30 a.m. 
Eastern time) on each day that the Exchange is open for business, the 
Fund Securities that will be delivered to satisfy (subject to possible 
amendment or correction) redemption requests received in proper form 
(as defined below) on that day. The Fund Securities generally will 
correspond, pro rata, to the extent practicable, to the component 
securities of the Fund's portfolio. If the Trust determines, based on 
information available to the Trust when a redemption request is 
submitted by an Authorized Participant, that (i) the short interest of 
the Fund in the marketplace is greater than or equal to 100% and (ii) 
redemption orders in the aggregate from all Authorized Participants on 
a business day represent 25% or more of the outstanding Shares of the 
Fund, such Authorized Participant will be required to verify to the 
Trust the accuracy of its representations that are deemed to have been 
made by submitting a request for redemption. If, after receiving notice 
of the verification requirement, the Authorized Participant does not 
verify the accuracy of its representations that are deemed to have been 
made by submitting a request for redemption in accordance with this

[[Page 67738]]

requirement, its redemption request will be considered not to have been 
received in proper form.
    Unless cash redemptions are permitted or required for the Fund, the 
redemption proceeds for a Creation Unit generally will consist of Fund 
Securities as announced by the Administrator on the business day of the 
request for redemption, plus cash in an amount equal to the difference 
between the NAV of the Shares being redeemed, as next determined after 
a receipt of a request in proper form, and the value of the Fund 
Securities, less the redemption transaction fee and variable fees 
described below. An Authorized Participant may receive the cash 
equivalent of one or more Fund Securities because it was restricted 
from transacting in one or more Fund Securities. Should the Fund 
Securities have a value greater than the NAV of the Shares being 
redeemed, a compensating cash payment to the Trust equal to the 
differential plus the applicable redemption transaction fee will be 
required to be arranged for by or on behalf of the redeeming 
shareholder. The Fund reserves the right to honor a redemption request 
by delivering a basket of securities or cash that differs from the Fund 
Securities.
    Orders to redeem Creation Units of the Fund must be delivered 
through a DTC Participant that has executed the Participant Agreement 
with the Distributor and with the Trust. A DTC Participant who wishes 
to place an order for redemption of Creation Units of the Fund to be 
effected need not be a Participating Party, but such orders must state 
that redemption of Creation Units of the Fund will instead be effected 
through transfer of Creation Units of the Fund directly through DTC. An 
order to redeem Creation Units of the Fund will be deemed received by 
the Administrator on the ``Transmittal Date'' if (i) such order is 
received by the Administrator not later than 4:00 p.m. Eastern time on 
such Transmittal Date; (ii) such order is preceded or accompanied by 
the requisite number of Shares of Creation Units specified in such 
order, which delivery must be made through DTC to the Administrator no 
later than 11:00 a.m. Eastern time, on such Transmittal Date (the ``DTC 
Cut-Off-Time''); and (iii) all other procedures set forth in the 
Participant Agreement are properly followed.
    A standard creation and redemption transaction fee will be imposed 
to offset transfer and other transaction costs that may be incurred by 
the Fund.
    All persons creating and redeeming Shares during a business day 
will be treated in the same manner with respect to payment of proceeds 
in-kind, in cash, or in a combination thereof.
    Detailed descriptions of the Fund, the Index, procedures for 
creating and redeeming Shares, transaction fees and expenses, 
dividends, distributions, taxes, risks, and reports to be distributed 
to beneficial owners of the Shares can be found in the Registration 
Statement or on the website for the Fund (www.vaneck.com), as 
applicable.
Availability of Information
    The Fund website, www.vaneck.com, is publicly available and 
includes a form of the prospectus for the Fund that may be downloaded. 
The website will include additional quantitative information updated on 
a daily basis, including, for the Fund: (1) The prior business day's 
reported NAV, daily trading volume, the closing market price or the 
midpoint of the bid/ask spread at the time of calculation of such NAV 
(the ``Bid/Ask Price''),\21\ and a calculation of the premium and 
discount of the closing market price or Bid/Ask Price against the NAV; 
and (2) data in chart format displaying the frequency distribution of 
discounts and premiums of the daily closing market price or Bid/Ask 
Price against the NAV, within appropriate ranges, for each of the four 
previous calendar quarters. Daily trading volume information for the 
Fund will also be available in the financial section of newspapers, 
through subscription services such as Bloomberg, Thomson Reuters, and 
International Data Corporation, which can be accessed by authorized 
participants and other investors, as well as through other electronic 
services, including major public websites. On each business day, before 
commencement of trading in Shares during Regular Trading Hours on the 
Exchange, the Fund will disclose on its website, www.vaneck.com, the 
identities and quantities of the portfolio of securities and other 
assets in the daily disclosed portfolio held by the Fund that formed 
the basis for the Fund calculation of NAV at the end of the previous 
business day. The daily disclosed portfolio will include, as 
applicable: The ticker symbol; CUSIP number or other identifier, if 
any; a description of the holding (including the type of holding, such 
as the type of swap); the identity of the security, index or other 
asset or instrument underlying the holding, if any; for options, the 
option strike price; quantity held (as measured by, for example, par 
value, notional value or number of shares, contracts, or units); 
maturity date, if any; coupon rate, if any; effective date, if any; 
market value of the holding; and the percentage weighting of the 
holding in the Fund's portfolio. The website and information will be 
publicly available at no charge. The value, components, and percentage 
weightings of the Index will be calculated and disseminated at least 
once daily and will be available from major market data vendors. Rules 
governing the Index are available on Barclays' website, https://indices.barclays, and the Fund prospectus.
---------------------------------------------------------------------------

    \21\ The Bid/Ask Price of each [sic] Fund will be determined 
using the midpoint of the highest bid and the lowest offer on the 
Exchange as of the time of calculation of the Fund's NAV. The 
records relating to Bid/Ask Prices will be retained by the Funds 
[sic] and their service providers.
---------------------------------------------------------------------------

    In addition, an estimated value, defined in BZX Rule 14.11(c)(6)(A) 
as the ``Intraday Indicative Value,'' (the ``IIV'') that reflects an 
estimated intraday value of the Fund portfolio, will be disseminated. 
Moreover, the IIV will be based upon the current value for the 
components of the daily disclosed portfolio and will be updated and 
widely disseminated by one or more major market data vendors at least 
every 15 seconds during the Exchange's Regular Trading Hours. In 
addition, the quotations of certain of the Fund holdings may not be 
updated during U.S. trading hours if updated prices cannot be 
ascertained.
    The dissemination of the IIV, together with the daily disclosed 
portfolio, will allow investors to determine the value of the 
underlying portfolio of the Fund on a daily basis and provide a close 
estimate of that value throughout the trading day.
    Quotation and last sale information for the Shares of the Fund will 
be available via the CTA high speed line.
Initial and Continued Listing
    The Shares of the Fund will conform to the initial and continued 
listing criteria under BZX Rule 14.11(c)(4), except for those set forth 
in 14.11(c)(4)(B)(i)(b). The Exchange represents that, for initial and/
or continued listing, the Fund and the Trust must be in compliance with 
Rule 10A-3 under the Act.\22\ A minimum of 100,000 Shares of the Fund 
will be outstanding at the commencement of trading on the Exchange. The 
Exchange will obtain a representation from the issuer of the Shares 
that the NAV per Share of the Fund will be calculated daily and will be 
made available to all market participants at the same time.
---------------------------------------------------------------------------

    \22\ See 17 CFR 240.10A-3.
---------------------------------------------------------------------------

Trading Halts
    With respect to trading halts, the Exchange may consider all 
relevant

[[Page 67739]]

factors in exercising its discretion to halt or suspend trading in the 
Shares of the Fund. The Exchange will halt trading in the Shares under 
the conditions specified in BZX Rule 11.18. Trading may be halted 
because of market conditions or for reasons that, in the view of the 
Exchange, make trading in the Shares inadvisable. These may include: 
(1) The extent to which trading is not occurring in the securities and/
or the financial instruments composing the index of the Fund; or (2) 
whether other unusual conditions or circumstances detrimental to the 
maintenance of a fair and orderly market are present.
Trading Rules
    The Exchange deems the Shares to be equity securities, thus 
rendering trading in the Shares subject to the Exchange's existing 
rules governing the trading of equity securities. The Exchange will 
allow trading in the Shares from 8:00 a.m. until 5:00 p.m. Eastern time 
and has the appropriate rules to facilitate transactions in the Shares 
during all trading sessions. As provided in BZX Rule 11.11(a), the 
minimum price variation for quoting and entry of orders in securities 
traded on the Exchange is $0.01, with the exception of securities that 
are priced less than $1.00, for which the minimum price variation for 
order entry is $0.0001.
Surveillance
    The Exchange believes that its surveillance procedures are adequate 
to properly monitor the trading of the Shares on the Exchange during 
all trading sessions and to deter and detect violations of Exchange 
rules and the applicable federal securities laws. Trading of the Shares 
through the Exchange will be subject to the Exchange's surveillance 
procedures for derivative products, including Index Fund Shares. The 
issuer has represented to the Exchange that it will advise the Exchange 
of any failure by the Fund to comply with the continued listing 
requirements, and, pursuant to its obligations under Section 19(g)(1) 
of the Exchange Act, the Exchange will surveil for compliance with the 
continued listing requirements. If the Fund is not in compliance with 
the applicable listing requirements, the Exchange will commence 
delisting procedures for the Fund under Exchange Rule 14.12. The 
Exchange or the Financial Industry Regulatory Authority (``FINRA''), on 
behalf of the Exchange, or both, will communicate as needed regarding 
trading in the Shares and the underlying shares in exchange-traded 
investment companies, futures, options, and warrants with other markets 
or other entities that are members of the Intermarket Surveillance 
Group (``ISG'') \23\ or with which the Exchange has in place a 
comprehensive surveillance sharing agreement, and may obtain trading 
information regarding trading in the Shares from such markets or 
entities. FINRA can also access data obtained from the EMMA system 
relating to municipal bond trading activity for surveillance purposes 
in connection with trading in the Shares. The Exchange or FINRA, on 
behalf of the Exchange, are able to access, as needed, trade 
information for certain fixed income securities held by the Fund 
reported to FINRA's Trade Reporting and Compliance Engine (``TRACE''). 
The Exchange prohibits the distribution of material non-public 
information by its employees.
---------------------------------------------------------------------------

    \23\ For a list of the current members of ISG, see 
www.isgportal.org.
---------------------------------------------------------------------------

Information Circular
    Prior to the commencement of trading, the Exchange will inform its 
members in an Information Circular of the special characteristics and 
risks associated with trading the Shares. Specifically, the Information 
Circular will discuss the following: (1) The procedures for purchases 
and redemptions of Shares in Creation Units (and that Shares are not 
individually redeemable); (2) BZX Rule 3.7, which imposes suitability 
obligations on Exchange members with respect to recommending 
transactions in the Shares to customers; (3) how information regarding 
the IIV is disseminated; (4) the risks involved in trading the Shares 
during the Pre-Opening \24\ and After Hours Trading Sessions \25\ when 
an updated IIV will not be calculated or publicly disseminated; (5) the 
requirement that members deliver a prospectus to investors purchasing 
newly issued Shares prior to or concurrently with the confirmation of a 
transaction; and (6) trading information.
---------------------------------------------------------------------------

    \24\ The Pre-Opening Session is from 8:00 a.m. to 9:30 a.m. 
Eastern Time.
    \25\ The After Hours Trading Session is from 4:00 p.m. to 5:00 
p.m. Eastern Time.
---------------------------------------------------------------------------

    In addition, the Information Circular will advise members, prior to 
the commencement of trading, of the prospectus delivery requirements 
applicable to the Fund. Members purchasing Shares from the Fund for 
resale to investors will deliver a prospectus to such investors. The 
Information Circular will also discuss any exemptive, no-action, and 
interpretive relief granted by the Commission from any rules under the 
Act.
    In addition, the Information Circular will reference that the Fund 
is subject to various fees and expenses described in the Registration 
Statement. The Information Circular will also disclose the trading 
hours of the Shares of the Fund and the applicable NAV calculation time 
for the Shares. The Information Circular will disclose that information 
about the Shares of the Fund will be publicly available on the Fund 
website, www.vaneck.com.
2. Statutory Basis
    The basis under the Act for this proposed rule change is the 
requirement under Section 6(b)(5) \26\ 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 because, 
in addition to the reasons laid out above, the Commission has 
previously approved the Shares to list and trade on Arca and this 
proposal is substantively identical to the Prior Proposal as it relates 
to the Fund and the Shares and all material representations contained 
within the Prior Proposal remain true.
---------------------------------------------------------------------------

    \26\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Exchange believes that its surveillance procedures are adequate 
to properly monitor the trading of the Shares on the Exchange during 
all trading sessions and to deter and detect violations of Exchange 
rules and the applicable federal securities laws. Trading of the Shares 
through the Exchange will be subject to the Exchange's surveillance 
procedures for derivative products, including Index Fund Shares. The 
issuer has represented to the Exchange that it will advise the Exchange 
of any failure by the Fund to comply with the continued listing 
requirements, and, pursuant to its obligations under Section 19(g)(1) 
of the Exchange Act, the Exchange will surveil for compliance with the 
continued listing requirements. If the Fund is not in compliance with 
the applicable listing requirements, the Exchange will commence 
delisting procedures for the Fund under Exchange Rule 14.12. FINRA 
conducts certain cross-market surveillances on behalf of the Exchange 
pursuant to a regulatory services agreement. The Exchange is 
responsible for FINRA's performance under the regulatory services 
agreement.
    The Exchange or FINRA, on behalf of the Exchange, or both, will 
communicate as needed regarding trading in the Shares and the 
underlying

[[Page 67740]]

shares in exchange-traded investment companies, futures, options, and 
warrants with other markets or other entities that are members of the 
ISG or with which the Exchange has in place a comprehensive 
surveillance sharing agreement, and may obtain trading information 
regarding trading in the Shares from such markets or entities. FINRA 
can also access data obtained from the EMMA system relating to 
municipal bond trading activity for surveillance purposes in connection 
with trading in the Shares. The Exchange or FINRA, on behalf of the 
Exchange, are able to access, as needed, trade information for certain 
fixed income securities held by the Fund reported to TRACE. The 
Exchange prohibits the distribution of material non-public information 
by its employees. The Index Provider is not a registered broker-dealer 
and is not affiliated with a broker-dealer. In the event that the Index 
Provider becomes a broker-dealer or becomes affiliated with a broker-
dealer, the Index Provider will implement and maintain a fire wall with 
respect to its relevant personnel regarding access to information 
concerning the composition and/or changes to the Index. In addition, 
the Index Provider has implemented and will maintain procedures around 
the relevant personnel that are designed to prevent the use and 
dissemination of material, non-public information regarding the Index.
    As of November 30, 2018, there were approximately 10,050 issues in 
the Index. The Index meets all such requirements except for those set 
forth in BZX Rule 14.11(c)(4)(B)(i)(b). Specifically, as of November 
30, 2018, 27.35% of the weight of the Index components have a minimum 
original principal amount outstanding of $100 million or more.
    As of November 30, 2018, 74.52% of the weight of the Index 
components was composed of individual maturities that were part of an 
entire municipal bond offering with a minimum original principal amount 
outstanding of $100 million or more for all maturities of the offering. 
In addition, the total dollar amount outstanding of issues in the Index 
was approximately $240,994,112,111 and the average dollar amount 
outstanding of issues in the Index was approximately $23,979,514. 
Further, the most heavily weighted component represents 1.96% of the 
weight of the Index and the five most heavily weighted components 
represent 7.36% of the weight of the Index. Therefore, the Exchange 
believes that, notwithstanding that the Index does not satisfy the 
criterion in 14.11(c)(4)(B)(i)(b), the Index is sufficiently broad-
based to deter potential manipulation, given that it is composed of 
approximately 10,050 issues. In addition, the Index securities are 
sufficiently liquid to deter potential manipulation in that a 
substantial portion (74.52%) of the Index weight is composed of 
maturities that were part of an entire municipal bond offering with a 
minimum original principal amount outstanding of $100 million or more, 
and in view of the substantial total dollar amount outstanding and the 
average dollar amount outstanding of Index issues, as referenced above. 
The Index value, calculated and disseminated at least once daily, as 
well as the components of the Index and their respective percentage 
weightings, will be available from major market data vendors. In 
addition, the portfolio of securities held by the Fund will be 
disclosed on the Fund's website. The IIV for Shares of the Fund will be 
disseminated by one or more major market data vendors, updated at least 
every 15 seconds during Regular Trading Hours, [sic] According to the 
Registration Statements[sic], The Adviser represents that bonds that 
share similar characteristics tend to trade similarly to one another; 
therefore, within these categories, the issues may be considered 
fungible from a portfolio management perspective. Within a single 
municipal bond issuer, the Adviser represents that separate issues by 
the same issuer are also likely to trade similarly to one another. In 
addition, the Adviser represents that individual CUSIPs within the 
Index that share characteristics with other CUSIPs have a high yield to 
maturity correlation, and frequently have a correlation of one or close 
to one.
    The proposed rule change is designed to promote just and equitable 
principles of trade and to protect investors and the public interest. 
In addition, a large amount of information is publicly available 
regarding the Fund and the Shares, thereby promoting market 
transparency. The Fund's portfolio holdings will be disclosed on the 
Fund's website daily after the close of trading on the Exchange and 
prior to the opening of trading on the Exchange the following day. 
Moreover, the IIV will be widely disseminated by one or more major 
market data vendors at least every 15 seconds during Regular Trading 
Hours. The current value of the Index will be disseminated by one or 
more major market data vendors at least once per day. Information 
regarding market price and trading volume of the Shares will be 
continually available on a real-time basis throughout the day on 
brokers' computer screens and other electronic services, and quotation 
and last sale information will be available via the CTA high-speed 
line. The website for the Fund will include the prospectus for the Fund 
and additional data relating to NAV and other applicable quantitative 
information. Moreover, prior to the commencement of trading, the 
Exchange will inform its Members in an Information Circular of the 
special characteristics and risks associated with trading the Shares. 
If the Exchange becomes aware that the NAV is not being disseminated to 
all market participants at the same time, it will halt trading in the 
Shares until such time as the NAV is available to all market 
participants. With respect to trading halts, the Exchange may consider 
all relevant factors in exercising its discretion to halt or suspend 
trading in the Shares of the Fund. Trading also may be halted because 
of market conditions or for reasons that, in the view of the Exchange, 
make trading in the Shares inadvisable. If the IIV or the Index values 
are not being disseminated as required, the Corporation [sic] may halt 
trading during the day in which the interruption to the dissemination 
of the applicable IIV or Index value occurs. If the interruption to the 
dissemination of the applicable IIV or Index value persists past the 
trading day in which it occurred, the Corporation [sic] will halt 
trading. Trading in Shares of the Fund will be halted if the circuit 
breaker parameters in BZX Rule 11.18 have been reached or because of 
market conditions or for reasons that, in the view of the Exchange, 
make trading in the Shares inadvisable, and trading in the Shares will 
be subject to Rule 14.11(c)(1)(B)(iv), which sets forth circumstances 
under which Shares of the Fund may be halted. In addition, investors 
will have ready access to information regarding the IIV, and quotation 
and last sale information for the 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 it will facilitate the listing and trading of 
an additional type of exchange-traded product that will enhance 
competition among market participants, to the benefit of investors and 
the marketplace. As noted above, the Exchange has in place surveillance 
procedures relating to trading in the Shares and may obtain information 
via ISG from other exchanges that are members of ISG or with which the 
Exchange has entered into a comprehensive surveillance sharing 
agreement. In addition,

[[Page 67741]]

investors will have ready access to information regarding the IIV and 
quotation and last sale information for the Shares.

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 notes that the 
proposed rule change, rather will facilitate the transfer from Arca and 
listing of additional exchange-traded products on the Exchange, which 
will enhance competition among listing venues, to the benefit of 
issuers, investors, and the marketplace more broadly.

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)(iii) of the Act \27\ and 
subparagraph (f)(6) of Rule 19b-4 thereunder.\28\
---------------------------------------------------------------------------

    \27\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \28\ 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.
---------------------------------------------------------------------------

    A proposed rule change filed under Rule 19b-4(f)(6) \29\ normally 
does not become operative prior to 30 days after the date of the 
filing. However, Rule 19b-4(f)(6)(iii) \30\ 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 Exchange states that 
such waiver will allow the Fund to transfer listing to the Exchange as 
soon as is practicable, and will minimize the amount of time that the 
Fund listing venue will be in transition. Additionally, the Exchange 
states that waiver will allow the Fund to be listed on the Exchange in 
December 2018, which will allow the Fund to have lower listing fees on 
a going forward basis, and to avoid paying Arca's listing fees for 
2019, which will be applied at the beginning of January 2019. For these 
reasons, the Commission believes that waiver of the 30-day operative 
delay is consistent with the protection of investors and the public 
interest. Accordingly, the Commission hereby waives the operative delay 
and designates the proposed rule change as operative upon filing.\31\
---------------------------------------------------------------------------

    \29\ 17 CFR 240.19b-4(f)(6).
    \30\ 17 CFR 240.19b-4(f)(6)(iii).
    \31\ 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).
---------------------------------------------------------------------------

    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: (i) 
Necessary or appropriate in the public interest; (ii) for the 
protection of investors; or (iii) 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 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-CboeBZX-2018-094 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-CboeBZX-2018-094. 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 website (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 website 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. Persons submitting comments are 
cautioned that we do not redact or edit personal identifying 
information from comment submissions. You should submit only 
information that you wish to make available publicly. All submissions 
should refer to File Number SR-CboeBZX-2018-094 and should be submitted 
on or before January 22, 2019.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\32\
---------------------------------------------------------------------------

    \32\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Brent J. Fields,
Secretary.
[FR Doc. 2018-28381 Filed 12-28-18; 8:45 am]
BILLING CODE 8011-01-P