On June 12, the Securities and Exchange Commission announced that it is seeking public comment in connection with its review of the listing and trading of exchange-traded products (ETPs) on national securities exchanges and retail sales of ETPs by broker-dealers.
The request for comment addresses exchange standards for listing novel ETPs, exemptions sought by market participants to trade new or complex ETPs and market pricing and arbitrage mechanisms for ETPs. Specifically, the request seeks to examine the application of Rules 101 and 102 of Regulation M in the context of ETPs, and invites comment on the conditions pertaining to ETPs’ exemptions from Section 11(d)(1) of the Securities Exchange Act of 1934 (Exchange Act) and Exchange Act Rules 10b-10, 11d1-2, 14e-5, 15c1-5, and 15c1-6.
In addition, the request asks for comment with respect to selling ETPs to retail investors. In particular, the release addresses investor understanding and use of ETPs, and how broker-dealers meet their obligations to customers when recommending ETPs.
All comments must be received by August 17.
Click here for Release No. 34-75165.