SEC Eases Path For Exchange-Traded Fund (ETF) Launches

In an effort to modernize the regulation of ETFs, the U.S. Securities and Exchange Commission (the SEC) announced today its adoption of Rule 6c-11 (the New Rule) which establishes a clear and consistent framework for the launch and operation of most ETFs. The aim of the New Rule is to facilitate greater competition and innovation in the current ETF marketplace by lowering entry barriers, and also to remove the systematic need for individual ETF exemptive relief applications.

Consistent generally with conditions in prior ETF exemptive orders, the New Rule imposes conditions on ETFs, including:

• Website disclosure/transparency: an ETF will be required to provide daily portfolio disclosures on its website, such as its portfolio holdings; NAV; market price; premium or discount; the extent and frequency of those premiums and discounts; and median bid-ask spread over the last thirty calendar days. These disclosures are intended to provide investors with information