January 24, 2020
Filed via EDGAR
Ms. Elena Stojic
U.S. Securities and Exchange Commission
100 F Street, NE
Washington, DC 20549
Subject: Franklin Templeton ETF Trust (the “Trust”)
(File Nos. 333-208873; 811-23124)
Dear Ms. Stojic:
On behalf of the Trust, submitted herewith via the EDGAR system please find the response to the additional comment conveyed by the staff (the “Staff”) of the U.S. Securities and Exchange Commission (the “Commission”) provided via telephone to J. Stephen Feinour, Jr. with regard to Post-Effective Amendment Nos. 50/54 to the Trust’s Registration Statement on Form N-1A (the “Amendment”), which was filed with the Commission on October 15, 2019 under the Securities Act of 1933 (the “1933 Act”) and the Investment Company Act of 1940 (the “1940 Act”) to register shares of the Franklin Disruptive Commerce ETF, Franklin Genomic Advancements ETF and Franklin Intelligent Machines ETF series of the Trust (each, a “Fund” and collectively, the “Funds”). Terms not defined herein have the meaning set forth for that term in the Amendment.
Comment: With respect to each Fund, the Staff reiterates its position that, under 1940 Act Rule 35d-1(a)(2), a fund with the terms “disruptive commerce,” “genomic” or “intelligent machines” in its name must have a policy to invest, under normal circumstances, at least 80% of its net assets plus any amount of borrowings for investment purposes in companies whose economic fortunes are significantly tied to disruptive commerce, genomics or intelligent machines, respectively. Please confirm that each Fund’s disclosure specifies the criteria the Fund will use to determine whether a particular company’s economic fortunes are significantly tied to disruptive commerce, genomics or intelligent machines, as applicable.
Response: In response to this comment, the Funds have adopted the requested Rule 35d-1 80% investment policies and revised their principal investment strategy disclosure as follows:
Franklin Disruptive Commerce ETF
Under normal market conditions, the Fund investsprimarilyat least 80% of its net assetsin equity securities of companies that are relevant to the Fund’s investment theme of disruptive commerce.
…
Companies relevant to the Fund’s investment theme of disruptive commerce are those that the investment manager believes are substantially focused on and/orare expected to substantially benefit from e-commerce, auctions, the sharing economy,e-Payments, drop shipwarehousingelectronic payment capabilities ("e-payments"), drop shipping, direct marketingand last mile transportationor significant decreases in transport and delivery costs, all of which provide the customer with a more customized, secure and time efficient buying process.ThisThese companies may include retailers, payment companies, logistics and delivery companies,software companies that focus on multichannel capabilities, as well as companies utilizing innovative marketing methods. Developments relevant to the disruptive commerce themecan extend from benefits to the consumer to benefits for businesses and business commerce.
Franklin Genomic Advancements ETF
Under normal market conditions, the Fund investsprimarilyat least 80% of its net assetsin equity securities of companies that are relevant to the Fund’s investment theme of genomicdiscoveryadvancements.
…
Companies relevant to the Fund’s investment theme of genomicdiscoveryadvancementsare those that the investment manager believes are substantially focused on and/orare expected to substantially benefit from extending and enhancing the quality of human and other life(e.g., animals)by incorporating technological and scientific developments, improvements and advancements in the field of genomics into their business, such as by offering new products or services that rely on genetic engineering, gene therapy, genome analysis, DNA sequencing, synthesis or instrumentation. These companies may include those that research, develop, produce, manufacture or significantly rely on or enable bionic devices, bio-inspired computing, bioinformatics, molecular medicine and diagnostics, pharmaceuticals and agricultural applications of genomics, and related equipment, techniques and processes.
Franklin Intelligent Machines ETF
Under normal market conditions, the Fund investsprimarilyat least 80% of its net assetsin equity securities of companies that are relevant to the Fund’s investment theme of intelligent machines.
…
Companies relevant to the Fund’s investment theme of intelligent machines are those that the investment manager believes are substantially focused on and/orare expected to substantially benefit from the ongoing technology-driven transformation ofproducts, software, systems and machinery as well asproduct design, manufacture, logistics, distribution and maintenance, including through developments in artificial intelligence, as well as the product itself. These companies may include those that develop, produce, manufacture, design, maintain and deliver products or services with new capabilities previously unavailable in the marketplace.
Please do not hesitate to contact J. Stephen Feinour, Jr. at (215) 564-8521 if you have any questions or wish to discuss any of the responses presented above.
Very truly yours,
/s/NAVID TOFIGH
Navid Tofigh
Vice President and Secretary
Franklin Templeton ETF Trust
cc: Julie Patel