SEC Division Grants ETF No-Action Relief from Tender Offer Requirements

The SEC Division of Corporation Finance granted no-action relief from Securities Exchange Act Rule 14e-5 requirements to a managed exchange-traded fund ("ETF") in connection with the creation and redemption of units.

The SEC granted the exemption conditioned upon the following:

• no purchases of securities made by broker-dealers acting as dealers-managers of a tender offer would be effected for the purposes of facilitating a tender offer;
• any purchases of a portfolio security by a dealer-manager during a tender offer will be effected as adjustments to a basket of securities as a result of a change in the composition of the fund's portfolio; and
• except for the specific relief granted, any broker-dealer acting as a dealer-manager of a tender offer will comply with SEA Rule 14c-5.