[Federal Register Volume 85, Number 51 (Monday, March 16, 2020)]
[Notices]
[Pages 14989-14990]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-05245]


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SECURITIES AND EXCHANGE COMMISSION

[Investment Company Act Release No. 33813; 812-15062]


Guinness Atkinson Funds and Guinness Atkinson Asset Management, 
Inc.; Notice of Application

March 10, 2020.
AGENCY: Securities and Exchange Commission (``Commission'').

ACTION: Notice.

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    Notice of an application under section 6(c) of the Investment 
Company Act of 1940 (``Act'') for an exemption from section 15(a) of 
the Act and rule 18f-2 under the Act, as well as from certain 
disclosure requirements in rule 20a-1 under the Act, Item 19(a)(3) of 
Form N-1A, Items 22(c)(1)(ii), 22(c)(1)(iii), 22(c)(8) and 22(c)(9) of 
Schedule 14A under the Securities Exchange Act of 1934, and Sections 6-
07(2)(a), (b), and (c) of Regulation S-X (``Disclosure Requirements''). 
The requested exemption would permit an investment adviser to hire and 
replace certain sub-advisers without shareholder approval and grant 
relief from the Disclosure Requirements as they relate to fees paid to 
the sub-advisers.
    Applicants: Guinness Atkinson Funds (the ``Trust''), a Delaware 
statutory trust registered under the Act as an open-end management 
investment company, and Guinness Atkinson Asset Management, Inc. (the 
``Initial Adviser''), a corporation organized under the laws of 
Delaware registered as an investment adviser under the Investment 
Advisers Act of 1940.
    Filing Dates: The application was filed on August 28, 2019 and 
amended on November 29, 2019 and February 25, 2020.
    Hearing or Notification of Hearing: An order granting the 
application will be issued unless the Commission orders a hearing. 
Interested persons may request a hearing by writing to the Commission's 
Secretary and serving applicants with a copy of the request, personally 
or by mail. Hearing requests should be received by the Commission by 
5:30 p.m. on April 6, 2020, and should be accompanied by proof of 
service on applicants, in the form of an affidavit or, for lawyers, a 
certificate of service. Pursuant to rule 0-5 under the Act, hearing 
requests should state the nature of the writer's interest, any facts 
bearing upon the desirability of a hearing on the matter, the reason 
for the request, and the issues contested. Persons who wish to be 
notified of a hearing may request notification by writing to the 
Commission's Secretary.

ADDRESSES: Secretary, U.S. Securities and Exchange Commission, 100 F 
Street NE, Washington, DC 20549-1090. Applicants: Guinness Atkinson 
Funds, Attn: James J. Atkinson, 225 South Lake Avenue, Suite 216, 
Pasadena, CA 91101.

FOR FURTHER INFORMATION CONTACT: Samuel K. Thomas, Senior Counsel, at 
(202) 551-7952, or Andrea Ottomanelli Magovern, Branch Chief, at (202) 
551-6821 (Division of Investment Management, Chief Counsel's Office).

[[Page 14990]]


SUPPLEMENTARY INFORMATION: The following is a summary of the 
application. The complete application may be obtained via the 
Commission's website by searching for the file number, or for an 
applicant using the Company name box, at http://www.sec.gov/search/search.htm or by calling (202) 551-8090.

Summary of the Application

    1. The Initial Adviser is the investment adviser to the SmartETFs 
Smart Transportation & Technology ETF (the ``Initial Fund''), a series 
of the Trust, pursuant to an investment management agreement with the 
Trust (``Investment Management Agreement'').\1\ Under the terms of the 
Investment Management Agreement, the Adviser, subject to the 
supervision of the board of trustees of the Trust (``Board''), provides 
continuous investment management of the assets of each Subadvised Fund. 
Consistent with the terms of the Investment Management Agreement, the 
Adviser may, subject to the approval of the Board, delegate portfolio 
management responsibilities of all or a portion of the assets of a 
Subadvised Fund to one or more Sub-Advisers.\2\ The Adviser will 
continue to have overall responsibility for the management and 
investment of the assets of each Subadvised Fund. The Adviser will 
evaluate, select, and recommend Sub-Advisers to manage the assets of a 
Subadvised Fund and will oversee, monitor and review the Sub-Advisers 
and their performance and recommend the removal or replacement of Sub-
Advisers.
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    \1\ Applicants request relief with respect to the Initial Fund, 
as well as to any future series of the Trust and any other existing 
or future registered open-end management investment company or 
series thereof that, in each case, is advised by the Initial Adviser 
or any entity controlling, controlled by, or under common control 
with, the Initial Adviser or its successors (each, also an 
``Adviser''), uses the multi-manager structure described in the 
application, and complies with the terms and conditions set forth in 
the application (each, a ``Subadvised Fund''). For purposes of the 
requested order, ``successor'' is limited to an entity that results 
from a reorganization into another jurisdiction or a change in the 
type of business organization. Future Subadvised Funds may be 
operated as a master-feeder structure pursuant to section 
12(d)(1)(E) of the Act. In such a structure, certain series of the 
Trust (each, a ``Feeder Fund'') may invest substantially all of 
their assets in a Subadvised Fund (a ``Master Fund'') pursuant to 
section 12(d)(1)(E) of the Act. No Feeder Fund will engage any sub-
advisers other than through approving the engagement of one or more 
of the Master Fund's sub-advisers.
    \2\ As used herein, a ``Sub-Adviser'' for a Subadvised Fund is 
(1) an indirect or direct ``wholly owned subsidiary'' (as such term 
is defined in the Act) of the Adviser for that Subadvised Fund, or 
(2) a sister company of the Adviser for that Subadvised Fund that is 
an indirect or direct ``wholly-owned subsidiary'' of the same 
company that, indirectly or directly, wholly owns the Adviser (each 
of (1) and (2) a ``Wholly-Owned Sub-Adviser'' and collectively, the 
``Wholly-Owned Sub-Advisers''), or (3) not an ``affiliated person'' 
(as such term is defined in section 2(a)(3) of the Act) of the 
Subadvised Fund, any Feeder Fund invested in a Master Fund, the 
Trust, or the Adviser, except to the extent that an affiliation 
arises solely because the Sub-Adviser serves as a sub-adviser to a 
Subadvised Fund (``Non-Affiliated Sub-Advisers'').
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    2. Applicants request an order to permit the Adviser, subject to 
the approval of the Board, to enter into investment sub-advisory 
agreements with the Sub-Advisers (each, a ``Sub-Advisory Agreement'') 
and materially amend such Sub-Advisory Agreements without obtaining the 
shareholder approval required under section 15(a) of the Act and rule 
18f-2 under the Act.\3\ Applicants also seek an exemption from the 
Disclosure Requirements to permit a Subadvised Fund to disclose (as 
both a dollar amount and a percentage of the Subadvised Fund's net 
assets): (a) The aggregate fees paid to the Adviser and any Wholly-
Owned Sub-Adviser; (b) the aggregate fees paid to Non-Affiliated Sub-
Advisers; and (c) the fee paid to each Affiliated Sub-Adviser 
(collectively, Aggregate Fee Disclosure'').\4\
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    \3\ The requested relief will not extend to any sub-adviser, 
other than a Wholly-Owned Sub-Adviser, who is an affiliated person, 
as defined in section 2(a)(3) of the Act, of the Subadvised Fund, of 
any Feeder Fund, or of the Adviser, other than by reason of serving 
as a sub-adviser to one or more of the Subadvised Funds 
(``Affiliated Sub-Adviser'').
    \4\ For any Subadvised Fund that is a Master Fund, the relief 
would also permit any Feeder Fund invested in that Master Fund to 
disclose Aggregate Fee Disclosure.
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    3. Applicants agree that any order granting the requested relief 
will be subject to the terms and conditions stated in the application. 
Such terms and conditions provide for, among other safeguards, 
appropriate disclosure to Subadvised Funds' shareholders and 
notification about sub-advisory changes and enhanced Board oversight to 
protect the interests of the Subadvised Funds' shareholders.
    4. Section 6(c) of the Act provides that the Commission may exempt 
any person, security, or transaction or any class or classes of 
persons, securities, or transactions from any provisions of the Act, or 
any rule thereunder, if such relief is necessary or appropriate in the 
public interest and consistent with the protection of investors and 
purposes fairly intended by the policy and provisions of the Act. 
Applicants believe that the requested relief meets this standard 
because, as further explained in the application, the Investment 
Management Agreements will remain subject to shareholder approval, 
while the role of the Sub-Advisers is substantially equivalent to that 
of individual portfolio managers, so that requiring shareholder 
approval of Sub-Advisory Agreements would impose unnecessary delays and 
expenses on the Subadvised Funds. Applicants believe that the requested 
relief from the Disclosure Requirements meets this standard because it 
will improve the Adviser's ability to negotiate fees paid to the Sub-
Advisers that are more advantageous for the Subadvised Funds.

    For the Commission, by the Division of Investment Management, 
under delegated authority.
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020-05245 Filed 3-13-20; 8:45 am]
 BILLING CODE 8011-01-P