We represent index-based, leveraged, and actively managed exchange-traded funds (ETFs), their sponsors, and boards of directors in all legal aspects of designing, developing, organizing, registering, and operating ETFs. Our clients include ETFs that invest in equity and fixed-income securities as well as commodities-referenced exchange-traded products.
Our ETF team takes a multidisciplinary approach in serving clients to ensure they receive prompt and effective advice to address issues, including those concerning federal securities and commodities laws, tax laws, intellectual property protection, broker-dealer regulation, derivatives and fund financing, exchange listing standards, and state corporate and trust laws. Our lawyers regularly obtain routine and novel exemptive relief for our ETF clients from the U.S. Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission. In fact, many team members are former SEC staffers, including those from the Divisions of Investment Management and Enforcement.
Our ETF team monitors business trends and legal developments to help our clients remain competitive in a rapidly changing environment. Team members are well versed in the business, regulatory, and compliance issues surrounding ETF operations, including share creation and redemption process, marketing, seed capital arrangements, share trading, portfolio management and index construction, and licensing. They have also represented broker-dealers that serve as authorized participants of ETFs and assisted clients with cross-listings around the world.
The team has played a part in a number of firsts in the ETF industry, including:
- The first actively managed ETFs to use traditional, non-quantitative techniques;
- The first ETF sponsor to obtain manager of managers relief from the SEC;
- The first New York Stock Exchange Arca-listed physically backed platinum, palladium, and mixed precious metals exchange-traded products; and
- The first IRS private letter ruling permitting gains derived from options and futures contracts on gold to constitute qualifying income for an ETF as a regulated investment company when the ETF entered into these contracts to hedge investments in securities of gold mining companies.