The SEC unanimously approved a new rule proposal under the 1940 Act that would allow the majority of ETFs to be launched without the previously required lengthy approval process. Proposed rule 6c-11 would be available to ETFs organized as open-end funds, but not unit investment trusts, leveraged or inverse ETFs or ETFs structured as a share class of a multi-class fund. The proposal recommends rescinding exemptive relief previously granted to ETFs that would be able to rely on the rule. Certain ETFs would still need to apply for exemptive relief. Under the proposed rule, an ETF would be required to provide daily portfolio transparency on its website, among other key disclosures. ETFs relying on the rule would be permitted to use “custom baskets” if the ETF adopts written policies and procedures setting forth detailed parameters for the construction and acceptance of custom baskets that are in the best interests of the ETF and its shareholders, according to the release. The SEC noted that the ETF’s board of directors’ oversight of the ETF’s compliance policies and procedures, as well as their general oversight of the ETF, would provide an additional layer of protection for an ETF’s use of custom baskets.