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Federal Register / Vol. 86, No. 189 / Monday, October 4, 2021 / Notices
As discussed above, under the current rule, a series of Tracking Fund Shares must create or redeem shares in return for the Tracking Basket and/or cash. The Exchange is now proposing to amend BZX Rule 14.11m to allow a series of Tracking Fund Shares to create or redeem shares in return for a Custom Basket, which is a portfolio of securities that is different from the Tracking Basket, to the extent consistent with an issuers exemptive relief under the 1940
Act.17 For the reasons discussed below, the Commission finds that the proposed amendments to BZX Rule 14.11m to provide for the use of Custom Baskets for Tracking Fund Shares, to the extent permitted by an issuers exemptive relief under the 1940 Act, are consistent with Section 6b5 of the Exchange Act.
The Commission believes that the proposed changes to BZX Rules 14.11m2E and F are consistent with the Exchange Act and are reasonably designed to help prevent fraudulent and manipulative acts and practices. The Commission notes that, because Tracking Fund Shares do not publicly disclose on a daily basis information about the holdings of the Fund Portfolio, it is vital that key information relating to Tracking Fund Shares, including information relating to Custom Baskets, be kept confidential prior to its public disclosure and not be subject to misuse.18 Accordingly, the Commission believes that the Exchanges proposal to amend BZX
Rules 14.11m2E and F 19 to apply the current fire wall and other requirements contained therein to those that have access to information concerning, or make decisions pertaining to, the composition of and/or changes to the Custom Baskets, in addition to the existing requirements relating to the Fund Portfolio and the Tracking Basket, is designed to prevent fraud and manipulation with respect to Tracking Fund Shares.
The Commission also believes that the proposed amendments to the initial and continued listing requirements for 19b of the Exchange Act for each series of Tracking Fund Shares. See BZX Rule 14.11m2A.
17 The Commission has granted exemptive relief under the 1940 Act to certain series of Tracking Fund Shares to permit the creation or redemption of shares using a Custom Basket that includes instruments that are not included, or included with different weightings, in the funds Tracking Basket.
See, e.g., Fidelity Beach Street Trust, et al., Investment Company Act Release No. 34350
August 5, 2021.
18 See 2020 Order, supra note 16, 85 FR at 31002
03.
19 See supra Section II, describing proposed BZX
Rules 14.11m2E and F.

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Tracking Fund Shares are adequate to ensure transparency of information relating to Custom Baskets utilized by a fund and to ensure that such information is available to the rest of the market participants at the same time.
Specifically, prior to the opening of trading on each business day, the Investment Company will make publicly available on its website the composition of any Custom Basket transacted on the previous business day, except a Custom Basket that differs from the applicable Tracking Basket only with respect to cash.20 In addition, prior to the initial listing of the Tracking Fund Shares, the Exchange will be required to obtain a representation from the issuer of each series of Tracking Fund Shares that the issuer and any person acting on behalf of the series of Tracking Fund Shares will comply with Regulation FD, including with respect to any Custom Basket.21 These measures help to mitigate concerns that certain information regarding the funds will be available only to select market participants and thereby helps to prevent fraud and manipulation.
The Commission notes that, as set forth in the definition of Custom Basket, a series of Tracking Fund Shares may only utilize Custom Baskets to the extent consistent with the exemptive relief issued pursuant to the 1940 Act applicable to such series.22
The Commission further notes that all series of Tracking Fund Shares will continue to be subject to the existing rules and procedures that govern the listing and trading of Tracking Fund Shares and the trading of equity securities on the Exchange.
IV. Conclusion It is therefore ordered, pursuant to Section 19b2 of the Exchange Act 23
that the proposed rule change SR
CboeBZX2021053, be, and it hereby is, approved.

20 See
proposed BZX Rule 14.11m4Bii.
proposed BZX Rule 14.11m4Aiic.
The Commission notes that a funds use of, or conversations with authorized participants about, Creation Baskets that would result in selective disclosure of nonpublic information would effectively be limited by the funds obligation to comply with Regulation FD. See, e.g., Fidelity Beach Street Trust, et al., Investment Company Act Release No. 34326 July 9, 2021.
22 See proposed BZX Rule 14.11m3F.
23 15 U.S.C. 78sb2.
24 17 CFR 200.303a12.
21 See
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For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.24
J. Matthew DeLesDernier, Assistant Secretary.
FR Doc. 202121483 Filed 10121; 8:45 am BILLING CODE 801101P

SECURITIES AND EXCHANGE
COMMISSION
Release No. 3493144; File No. SR
CboeBZX2021056

Self-Regulatory Organizations; Cboe BZX Exchange, Inc.; Notice of Designation of a Longer Period for Commission Action on a Proposed Rule Change To Allow the Invesco Focused Discovery Growth ETF and Invesco Select Growth ETF To Strike and Publish an Intra-Day NAV and an End-of-Day NAV
September 28, 2021.

On August 12, 2021, Cboe BZX
Exchange, Inc. Exchange or BZX
filed with the Securities and Exchange Commission Commission, pursuant to Section 19b1 of the Securities Exchange Act of 1934 Act 1 and Rule 19b4 thereunder,2 a proposed rule change to allow the Invesco Focused Discovery Growth ETF and Invesco Select Growth ETF to strike and publish an intra-day net asset value NAV
and an end of-day NAV. The proposed rule change was published for comment in the Federal Register on August 24, 2021.3
Section 19b2 of the Act 4 provides that within 45 days of the publication of notice of the filing of a proposed rule change, or within such longer period up to 90 days as the Commission may designate if it finds such longer period to be appropriate and publishes its reasons for so finding, or as to which the self-regulatory organization consents, the Commission shall either approve the proposed rule change, disapprove the proposed rule change, or institute proceedings to determine whether the proposed rule change should be disapproved. The 45th day after publication of the notice for this proposed rule change is October 8, 2021.
The Commission is extending the 45day time period for Commission action on the proposed rule change. The Commission finds it appropriate to designate a longer period within which 1 15

U.S.C. 78sb1.
CFR 240.19b4.
3 See Securities Exchange Act Release No. 92701
August 18, 2021, 86 FR 47359.
4 15 U.S.C. 78sb2.
2 17

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