
[Federal Register Volume 80, Number 189 (Wednesday, September 30, 2015)]
[Notices]
[Pages 58794-58796]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-24715]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-75978; File No. SR-NYSEArca-2015-79]


Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change Regarding the PIMCO 
Intermediate Municipal Bond Active Exchange-Traded Fund

September 24, 2015.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby 
given that, on September 11, 2015, NYSE Arca, Inc. (the ``Exchange'' or 
``NYSE Arca'') filed with the Securities and Exchange Commission (the 
``Commission'') the proposed rule change as described in Items I 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 a change to the average portfolio 
duration of the PIMCO Intermediate Municipal Bond Active Exchange-
Traded Fund. The Fund is currently listed and traded on the Exchange 
under NYSE Arca Equities Rule 8.600. The text of the proposed rule 
change is available on the Exchange's Web site at www.nyse.com, at the 
principal office of the Exchange, and at the Commission's Public 
Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the self-regulatory organization 
included statements concerning the purpose of, 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 a proposed rule change relating to 
listing and trading on the Exchange of shares (``Shares'') of the PIMCO 
Intermediate Municipal Bond Active Exchange-Traded Fund (``Fund'') 
under NYSE Arca Equities Rule 8.600,\4\ which governs the listing and 
trading of Managed Fund Shares.\5\ The Shares are offered by PIMCO ETF 
Trust (the ``Trust''), a statutory trust organized under the laws of 
the State of Delaware

[[Page 58795]]

and registered with the Commission as an open-end management investment 
company.\6\ The investment manager to the Fund is Pacific Investment 
Management Company LLC (``PIMCO'' or the ``Adviser''). The Fund's 
Shares are currently listed and traded on the Exchange under NYSE Arca 
Equities Rule 8.600.
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    \4\ See 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 and 
trading of Shares of the Fund and four other funds of the PIMCO ETF 
Trust on the Exchange) (``Prior Notice''); Securities Exchange Act 
Release No. 60981 (November 10, 2009), 74 FR 59594 (November 11, 
2009) (SR-NYSEArca-2009-79) (order approving listing and trading of 
Shares of the Fund and four other funds of the PIMCO ETF Trust on 
the Exchange) (``Prior Order'' and, together with the Prior Notice, 
the ``Prior Release'').
    \5\ 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 Equities Rule 
5.2(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.
    \6\ The Trust is registered under the Investment Company Act of 
1940 (``1940 Act''). On October 27, 2014, 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 Fund 
(File Nos. 333-155395 and 811-22250) (the ``Registration 
Statement''). The description of the operation of the Trust and the 
Fund herein is based, in part, on the Registration Statement. A 
change to the name of the Fund from PIMCO Intermediate Municipal 
Bond Strategy Fund to PIMCO Intermediate Municipal Bond Exchange-
Traded Fund was reflected in an amendment to the Registration 
Statement, effective October 31, 2012. A change to the name of the 
Fund from PIMCO Intermediate Municipal Bond Exchange-Traded Fund to 
PIMCO Intermediate Municipal Bond Active Exchange-Traded Fund was 
reflected in an amendment to the Registration Statement, effective 
October 31, 2014. 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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    According to the Registration Statement and the Prior Release, the 
average portfolio duration of the Fund normally varies from three to 
eight years, based on PIMCO's forecast for interest rates.\7\
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    \7\ Duration is a measure used to determine the sensitivity of a 
security's price to changes in interest rates. The longer a 
security's duration, the more sensitive it will be to changes in 
interest rates.
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    Going forward, 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 (``Index''), as calculated by PIMCO, which as of 
June 30, 2015 was 5.11 years.\8\ Thus, as of June 30, 2015, average 
portfolio duration of the Fund normally would vary within approximately 
3.11 years and 9.11 years.
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    \8\ The Exchange notes that the Commission has approved the 
listing and trading of other issues of Managed Fund Shares that have 
applied a comparable average portfolio duration to that proposed for 
the Fund. See, e.g., the Prior Release, note 4, supra.
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    The Adviser represents that the proposed change to the average 
portfolio duration of the Fund is consistent with the Fund's investment 
objective, and will further assist the Adviser to achieve such 
investment objective. Except for the change noted above, all other 
representations made in the Prior Release remain unchanged.\9\ The Fund 
will continue to comply with all initial and continued listing 
requirements under NYSE Arca Equities Rule 8.600.
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    \9\ See note 4, supra. All terms referenced but not defined 
herein are defined in the Prior Release.
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    The Adviser represents that the investment objective of the Fund is 
not changing.
2. Statutory Basis
    The basis under the Act for this proposed rule change is the 
requirement under Section 6(b)(5) \10\ that an exchange have rules that 
are designed to prevent fraudulent and manipulative acts and practices, 
to promote just and equitable principles of trade, to remove 
impediments to, and perfect the mechanism of a free and open market 
and, in general, to protect investors and the public interest.
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    \10\ 15 U.S.C. 78f(b)(5).
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    The 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. The Exchange believes that the change to the average 
portfolio duration of the Fund will not adversely impact investors or 
Exchange trading. Such change would accommodate a duration that, while 
generally comparable to the existing average portfolio duration 
normally of three to eight years, will provide the Fund with additional 
flexibility in managing the duration of the Fund's holdings using the 
average portfolio duration of the Barclays 1-15 Year Municipal Bond 
Index, as calculated by PIMCO, as the benchmark against which the 
Fund's average portfolio duration would be measured. Further, a more 
flexible duration bandwidth will allow the Fund to respond more 
effectively to changing market conditions. The Index's average 
duration, as calculated by PIMCO, is typically published monthly, while 
the Fund's average portfolio duration is typically available daily, on 
the Fund's Web site.

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition that is not necessary or appropriate 
in furtherance of the purpose of the Act. The Exchange believes the 
proposed rule change will enhance competition among issues of exchange-
traded funds that invest in municipal securities.

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, if consistent with the protection of 
investors and the public interest, the proposed rule change has become 
effective pursuant to Section 19(b)(3)(A) of the Act \11\ and Rule 19b-
4(f)(6) thereunder.\12\
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    \11\ 15 U.S.C. 78s(b)(3)(A).
    \12\ 17 CFR 240.19b-4(f)(6). As required under Rule 19b-
4(f)(6)(iii), the Exchange provided the Commission with 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.
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    At any time within 60 days of the filing of such proposed rule 
change, the Commission summarily may temporarily suspend such rule 
change if it appears to the Commission that such action is necessary or 
appropriate in the public interest, for the protection of investors, or 
otherwise in furtherance of the purposes of the Act. If the Commission 
takes such action, the Commission shall institute proceedings under 
Section 19(b)(2)(B) of the Act \13\ to determine whether the proposed 
rule change should be approved or disapproved.
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    \13\ 15 U.S.C. 78s(b)(2)(B).
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IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to rule-comments@sec.gov. Please include 
File Number SR-NYSEArca-2015-79 on the subject line.

Paper Comments

     Send paper comments in triplicate to Brent J. Fields, 
Secretary, Securities and Exchange Commission, 100 F Street NE., 
Washington, DC 20549-1090.

All submissions should refer to File Number SR-NYSEArca-2015-79. This 
file number should be included on the subject line if email is used. To 
help the

[[Page 58796]]

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 Section, 100 F Street NE., 
Washington, DC 20549 on official business days between 10 a.m. and 3 
p.m. Copies of the filing will also be available for inspection and 
copying at the NYSE's principal office and on its Internet Web site at 
www.nyse.com. 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-2015-79 and should be submitted on or before October 21, 2015.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\14\
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    \14\ 17 CFR 200.30-3(a)(12).
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Robert W. Errett,
Deputy Secretary.
[FR Doc. 2015-24715 Filed 9-29-15; 8:45 am]
BILLING CODE 8011-01-P


