[Federal Register Volume 79, Number 107 (Wednesday, June 4, 2014)]
[Notices]
[Pages 32345-32347]
[FR Doc No: 2014-12886]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-72273; File No. SR-MIAX-2014-22]

Self-Regulatory Organizations; Miami International Securities
Exchange LLC; Notice of Filing and Immediate Effectiveness of a
Proposed Rule Change To Amend MIAX Rule 516 To Remove the Size
Restrictions on Contra-Party Participation on a Qualified Contingent
Cross Order

May 29, 2014.
    Pursuant to the provisions of Section 19(b)(1) of the Securities
Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice
is hereby given that on May 21, 2014, Miami International Securities
Exchange LLC (``MIAX'' or ``Exchange'') filed with the Securities and
Exchange Commission (``Commission'') a proposed rule change as
described in Items I and II below, which Items have been prepared by
the Exchange. The Commission is publishing this notice to solicit
comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange is filing a proposal to amend MIAX Rule 516(j) to
remove the size restrictions on contra-party participation on a
Qualified Contingent Cross Order (``QCC Order'').
    The text of the proposed rule change is available on the Exchange's
Web site at http://www.miaxoptions.com/filter/wotitle/rule_filing, at
MIAX's principal office, and at the Commission's Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
sections A, B, and C below, of the most significant aspects of such
statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The purpose of this rule filing is to amend Rule 516(j) to remove
the size restriction on contra-party participation on a QCC Order. The
proposed rule change, which mirrors a recently adopted rule by the
International Securities Exchange (``ISE'') and NYSE Arca,\3\ would
expand the availability of QCC Orders by permitting multiple contra-
parties on a QCC Order, each of which may consist of an order for less
than 1,000 contracts; provided however, that the originating QCC Order
is a single order that meets the 1,000 contract minimum (as well as the
other requirements of a QCC Order), as discussed below.\4\ The proposed
change

is intended to allow the Exchange to compete fairly and equally with
other options exchanges, including the ISE, that have recently adopted
similar rule changes.\5\ Additionally, the Exchange proposes adding
language to Rule 516(j) to account for mini-options that currently
trade on the Exchange and that an originating order in mini-options
must be at least 10,000 contracts to qualify as an QCC Order under Rule
516(j).
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    \3\ See Securities Exchange Act Release Nos. 71863 (April, 3,
2014), 79 FR 19680 (April 9, 2014) (SR-ISE-2013-72); 71965 (April
17, 2014), 79 FR 22737 (April 23, 2014) (SR-NYSEArca-2014-43).
    \4\ In the case of mini-options, as proposed, the minimum size
is 10,000 contracts.
    \5\ See supra n. 3.
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    Rule 516(j) provides that a QCC Order must be comprised of an order
to buy or sell at least 1,000 contracts \6\ that is identified as being
part of a qualified contingent trade,\7\ coupled with a contra-side
order to buy or sell an equal number of contracts. As Qualified
Contingent Crosses, QCC Orders are automatically executed upon entry
provided that the execution (i) is not at the same price as a Priority
Customer Order on the Exchange Book and (ii) is at or between the
NBBO.\8\ In addition, QCC Orders that cannot be executed when entered
will automatically cancel.\9\ Finally, QCC Orders may only be entered
in the regular trading increments applicable to the options class under
Rule 510 (Minimum Price Variations and Minimum Trading Increments).
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    \6\ See supra n. 3.
    \7\ A ``qualified contingent trade'' must meet the following
conditions: (i) At least one component must be an NMS Stock; (ii)
all the components must be effected with a product price contingency
that either has been agreed to by all the respective counterparties
or arranged for by a broker-dealer as principal or agent; (iii) the
execution of one component must be contingent upon the execution of
all other components at or near the same time; (iv) the specific
relationship between the component orders (e.g., the spread between
the prices of the component orders) must be determined by the time
the contingent order is placed; (v) the component orders must bear a
derivative relationship to one another, represent different classes
of shares of the same issuer, or involve the securities of
participants in mergers or with intentions to merge that have been
announced or cancelled; and (vi) the transaction must be fully
hedged (without regard to any prior existing position) as a result
of other components of the contingent trade. In addition, ATP
Holders must demonstrate that the transaction is fully hedged using
reasonable risk-valuation methodologies. See Securities Exchange Act
Release No. 57620 (April 4, 2008), 73 FR 19271 (April 9, 2008).
    \8\ See Rule 515(h)(2).
    \9\ Id.
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    As discussed above, the Exchange now proposes to amend Rule 516(j)
to remove the size limitation placed on each contra-party to a QCC
Order.\10\ The Exchange is proposing this change for competitive
reasons, as it will allow the Exchange to compete fairly and equally
with other option exchanges that have similarly amended their rules,
including ISE and NYSE Arca.\11\ The Exchange does not propose to
remove the size requirement on the originating order of a QCC Order.
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    \10\ Per proposed Rule 516(j): ``A Qualified Contingent Cross
Order is comprised of an originating order to buy or sell at least
1,000 contracts, or 10,000 mini-option contracts, that is identified
as being part of a qualified contingent trade, as that term is
defined in Interpretations and Policies .01 below, coupled with a
contra-side order or orders totaling an equal number of contracts.''
    \11\ See supra n. 3.
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    In connection with this proposal, the Exchange represents that it
will track and monitor QCC Orders to determine which is the originating
side of the order and which is the contra-side(s) of the order to
ensure that Members are complying with the minimum 1,000 contract size
requirement on the originating side of the QCC Order. In this regard,
the Exchange will monitor whether Members are aggregating multiple
orders to meet the 1,000 contract minimum on the originating side of
the trade in violation of the requirements of the rule. The rule
requires that the originating side of the trade consist of one party
who is submitting a QCC Order for at least 1,000 contracts.
    The Exchange represents that it will enforce compliance with this
portion of the rule by checking to see if a Member breaks up the
originating side of the order in a post trade allocation to different
Clearing Members, allocating less than 1,000 contracts to a party or
multiple parties. For example, a Member enters a QCC Order into the
system for 1,500 contracts and receives an execution. Subsequent to the
execution, the Member allocates the originating side of the order to
two different clearing firms on a post trade allocation basis, thereby
allocating 500 contracts to one Clearing Member and 1,000 contracts to
another Clearing Member. The Exchange states that this type of
transaction would not meet the requirements of a QCC Order under the
current rule. With regard to order entry, the Exchange notes that
Members must designate orders entered in the system as either the
originating side or the contra-side(s). The Exchange will monitor order
entries to ensure that Members are properly entering QCC Orders into
the system.
2. Statutory Basis
    The Exchange believes that its proposed rule change is consistent
with Section 6(b) \12\ of the Act in general, and furthers the
objectives of Section 6(b)(5) \13\ of the Act in particular, in that it
is designed to prevent fraudulent and manipulative acts and practices,
to promote just and equitable principles of trade, to foster
cooperation and coordination with persons engaged in facilitating
transactions in securities, to remove impediments to and perfect the
mechanisms of a free and open market and a national market system and,
in general, to protect investors and the public interest.
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    \12\ 15 U.S.C. 78f(b).
    \13\ 15 U.S.C. 78f(b)(5).
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    Specifically, because the proposal leaves unchanged the minimum
size requirement for the originating order, the Exchange believes that
the proposal should provide more opportunity to participate in QCC
trades, consistent with the key principles behind the QCC Order.
    The Exchange believes the proposed rule change is consistent with
Section 6(b)(8) of the Act, as it will enable the Exchange to compete
with other options exchanges, including the ISE and NYSE Arca,\14\ for
QCC Orders. In addition, the proposed rule change will be beneficial to
market participants because allowing multiple parties of any size on
the contra-side of a QCC Order should foster competition for filling
QCC Orders and thereby result in potentially better prices.
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    \14\ Id.
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    Furthermore, the Exchange believes that the proposed rule change
should improve the utility of the QCC Order without raising novel
regulatory issues, because the proposal does not impact the fundamental
aspects of the QCC Order type. Rather, the proposal merely permits
multiple contra-parties, regardless of size, on one side, while
preserving the 1,000 contract minimum on the originating QCC Order.

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will
impose any burden on competition not necessary or appropriate in
furtherance of the purposes of the Act. In fact, the proposal is
intended to relieve a burden on competition, which results from
different exchanges interpreting their rules differently. Among the
options exchanges, the Exchange believes that the proposal should
foster competition for filling the contra-side of a QCC Order and
thereby result in potentially better prices for such orders. In
addition, the proposal will enable the Exchange to more effectively
compete with other option exchanges like the ISE and NYSE Arca that
have already implemented similar rule changes.\15\
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    \15\ Id.

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C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others

    Written comments were neither solicited nor received.

III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action

    The Exchange has filed the proposed rule change pursuant to Section
19(b)(3)(A)(iii) of the Act \16\ and Rule 19b-4(f)(6) thereunder.\17\
Because the foregoing proposed rule change does not: (i) Significantly
affect the protection of investors or the public interest; (ii) impose
any significant burden on competition; and (iii) become operative for
30 days after the date of the filing, or such shorter time as the
Commission may designate, it has become effective pursuant to Section
19(b)(3)(A) of the Act \18\ and Rule 19b-4(f)(6)(iii) \19\ thereunder.
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    \16\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \17\ 17 CFR 240.19b-4(f)(6).
    \18\ 15 U.S.C. 78s(b)(3)(A).
    \19\ 17 CFR 240.19b-4(f)(6)(iii). As required under Rule 19b-
4(f)(6)(iii), the Exchange provided the Commission with written
notice of its intent to file the proposed rule change, along with a
brief description and the text of the proposed rule change, at least
five business days prior to the date of filing of the proposed rule
change, or such shorter time as designated by the Commission.
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    A proposed rule change filed under Rule 19b-4(f)(6) \20\ normally
does not become operative prior to 30 days after the date of the
filing. However, pursuant to Rule 19b-4(f)(6)(iii),\21\ the Commission
may designate a shorter time if such action is consistent with the
protection of investors and the public interest. The Exchange has asked
the Commission to waive the 30-day operative delay so that the proposal
may become operative immediately upon filing. The Commission believes
that waiving the 30-day operative delay is consistent with the
protection of investors and the public interest, as it will help
eliminate investor confusion and promote competition among the option
exchanges.\22\ Therefore, the Commission designates the proposed rule
change to be operative upon filing.
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    \20\ 17 CFR 240.19b-4(f)(6).
    \21\ 17 CFR 240.19b-4(f)(6)(iii).
    \22\ For purposes only of waiving the 30-day operative delay,
the Commission has also considered the proposed rule's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
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    The Commission notes that, given the differing requirements as
between the originating side and contra-side for QCC Orders, it is
essential that the Exchange be able to clearly identify and monitor--
throughout the life of a QCC Order, beginning at time of order entry on
the Exchange through the post-trade allocation process--each side of
the QCC Order and ensure that the requirements of the order type are
being satisfied including, importantly, those relating to the
originating side. The Commission believes this to be critical so that
the Exchange can ensure that market participants are not able to
circumvent the requirements of the QCC Order (as amended by this
proposed rule change), each of which the Commission continues to
believe are critical to ensuring that the QCC Order is narrowly
drawn.\23\ Further, the Commission notes that the Exchange has made
certain representations regarding its enforcement and surveillance of
its Members' use of QCC Orders, including, for example, not only at the
time of order entry, but through the post-trade allocation process as
well.
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    \23\ The Commission expects the Exchange to have the capability
to enable it to surveil that such requirements are being met. Though
the Exchange has stated its ability to do so, if the Exchange is not
able to have such monitoring at any point in time, the Commission
would expect the Exchange to take other steps to ensure that the QCC
Order cannot be improperly used. For example, if the Exchange were
not able to identify and monitor which side of a QCC Order is the
originating order, the Commission would expect that it would require
that both sides of the QCC Order meet the more stringent
requirements of the originating side, i.e., that it be for a single
order for at least 1,000 contracts.
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    At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act. If the Commission
takes such action, the Commission shall institute proceedings to
determine whether the proposed rule should be approved or disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to<EMAIL_ADDRESS>Please include
File Number SR-MIAX-2014-22 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.

All submissions should refer to File Number SR-MIAX-2014-22. This file
number should be included on the subject line if email is used. To help
the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for Web site viewing and
printing in the Commission's Public Reference Room, 100 F Street NE.,
Washington, DC 20549, on official business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the filing also will be available
for inspection and copying at the principal office of the Exchange. All
comments received will be posted without change; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File Number SR-MIAX-2014-22, and should be
submitted on or before June 25, 2014.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\24\
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    \24\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2014-12886 Filed 6-3-14; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register: January 22, 2007 (Volume 72, Number 13)]
[Notices]
[Page 2717-2720]
[DOCID:fr22ja07-111]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-55085; File No. SR-NYSEArca-2006-37]

Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing
and Order Granting Accelerated Approval of Proposed Rule Change as
Modified by Amendment No. 1 Thereto To Trade the StreetTRACKS Dow Jones
Global Titans Index Fund Pursuant to Unlisted Trading Privileges

January 11, 2007.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on October 18, 2006, NYSE Arca, Inc. (``NYSE Arca'' or ``Exchange'')
filed with the Securities and Exchange Commission (``Commission'') the
proposed rule change as described in Items I and II below, which Items
have been substantially prepared by the Exchange. On January 4, 2007,
the Exchange amended the proposed rule change (``Amendment No. 1'').\3\
This order provides notice of the proposed rule change, as modified by
Amendment No. 1, and approves the proposed rule change as amended on an
accelerated basis.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ In Amendment No. 1 the Exchange provided additional
information relating to the dissemination of the index value and the
estimates of the value of the fund shares.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange, through its wholly owned subsidiary NYSE Arca
Equities, Inc. (``NYSE Arca Equities'') proposes to trade shares
(``Shares'') of the streetTRACKS[supreg] Dow Jones Global Titans Index
Fund (Symbol: DGT) (``Fund'') pursuant to unlisted trading privileges
(``UTP'') based on NYSE Arca Equities Rule 5.2(j)(3).
    The text of the proposed rule change is available on the Exchange's
Web site (http://www.nysearca.com), at the principal office of the

Exchange, and at the Commission's Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the Exchange included statements
concerning the purpose of, and basis for, the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item III below. The Exchange has prepared summaries, set forth in
Sections A, B, and C below, of the most significant aspects of such
statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange is proposing to trade Shares of the Fund pursuant to
UTP. The Fund is comprised of 50 common stocks, which are chosen by Dow
Jones based on a multi-factor methodology. The Fund invests in foreign
securities, including non-U.S.-dollar-denominated securities traded
outside the United States and dollar-denominated securities of foreign
issuers traded in the United States. The Fund's investment objective is
to replicate as closely as possible, before expenses, the performance
of the Dow Jones Global Titans Index (``Index''), using an indexing
investment approach. The net asset value (``NAV'') for the Fund is
calculated by the Fund's custodian, State Street Global Advisors. After
calculation, such NAV is disseminated by the American Stock Exchange
LLC (``Amex'') and is available to the public through the Fund's
distributor, State Street Capital Markets, LLC. The NAV is also
available to National Securities Clearing Corporation (``NSCC'')
participants through data made available from NSCC. The NAV of the Fund
is determined each business day, normally at the close of regular
trading of the New York Stock Exchange (``NYSE'').
    The Commission previously approved the original listing and trading
of the Shares on Amex.\4\ The Exchange deems the Shares to be equity
securities, thus rendering trading in the Shares subject to the
Exchange's existing rules governing the trading of equity securities.
The trading hours for the Shares on the Exchange are the same as those
set forth in NYSE Arca Equities Rule 7.34, except that the Shares will
not trade during the Opening Session (4 a.m. to 9:30 a.m. Eastern Time)
unless the Indicative Optimized Portfolio Value (``IOPV'') is
calculated and disseminated during that time.
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    \4\ See Securities Exchange Act Release No. 43338 (September 25,
2000), 65 FR 59235 (October 4, 2000) (SR-Amex-00-53).
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    Quotations for and last sale information regarding the Shares are
disseminated through the Consolidated Quotation System. The value of
the Index is updated intra-day on a real-time basis as individual
component securities of the Index change in price. The intra-day value
of the Index is disseminated every 15 seconds throughout Amex's trading
day. In addition, a value for the Index is disseminated once each
trading day, based on closing prices in the relevant exchange market.
    To provide updated information relating to the Shares for use by
investors, professionals, and persons wishing to create or redeem them,
Amex disseminates through the facilities of the Consolidated Tape
Association (``CTA'') the IOPV for the Fund as calculated by a
securities information provider. The IOPV is disseminated on a per-
share basis every 15 seconds during regular Amex trading hours of 9:30
a.m. to 4 p.m. or 4:15 p.m. Eastern Time depending on the time Amex
specifies for the trading of the Shares.
    The Fund includes companies trading in markets with trading hours
overlapping Amex's regular trading hours. During the overlap period, an
IOPV calculator updates an IOPV every 15 seconds to reflect price
changes in the principal foreign markets, and converts such prices into
U.S. dollars based on the currency exchange rates. When the foreign
market or markets are closed but Amex is open for trading, the IOPV is
updated every 15 seconds to reflect changes in currency exchange rates.
    The IOPV may not reflect the value of all securities included in
the Index. In addition, the IOPV does not necessarily reflect the
precise composition of the current portfolio of securities held by the
Fund at a particular point in time. Therefore, the IOPV on a per-share
basis disseminated during the NYSE's regular trading hours should not
be viewed as a real time update of the NAV of the Fund, which is
calculated only once a day. The IOPV is intended to closely approximate
the value per share of the portfolio of securities for the Fund and
provide for a close proxy of the NAV at a greater frequency for
investors.
    The Commission has granted the Fund an exemption from certain
prospectus delivery requirements under Section 24(d) of the Investment
Company Act of 1940 (``1940 Act.'') \5\ Any product description used in
reliance on the Section 24(d) exemptive order will comply with all
representations made and all conditions contained in the Fund's
application for orders under the 1940 Act.\6\
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    \5\ 15 U.S.C. 80a-24(d).
    \6\ See Investment Company Act Release No. 25738 (October 11,
2002).
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    In connection with the trading of the Shares, the Exchange would
inform ETP Holders in an Information Circular of the special
characteristics and risks associated with trading the Shares, including
how they are created and redeemed, the prospectus or product
description delivery requirements applicable to the Shares, applicable
Exchange rules, how information about the value of the underlying Index
is disseminated, and trading information. In addition, before an ETP
Holder recommends a transaction in the Shares, the ETP Holder must
determine that the Shares are suitable for the customer as required by
NYSE Arca Equities Rule 9.2(a)-(b).
    The Exchange intends to utilize its existing surveillance
procedures applicable to derivative products to monitor trading in the
Shares. The Exchange represents that these procedures are adequate to
monitor Exchange trading of the Shares.
2. Statutory Basis
    The Exchange believes that the proposal is consistent with Section
6(b) of the Act \7\ in general and Section 6(b)(5) of the Act \8\ in
particular in that it is designed to promote just and equitable
principles of trade, to foster cooperation and coordination with
persons engaged in facilitating transactions in securities, to remove
impediments and perfect the mechanisms of a free and open market, and
to protect investors and the public interest. In addition, the Exchange
believes that the proposal is consistent with Rule 12f-5 under the Act
\9\ because it deems the Shares to be equity securities, thus rendering
trading in the Shares subject to the Exchange's existing rules
governing the trading of equity securities.
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    \7\ 15 U.S.C. 78f(b).
    \8\ 15 U.S.C. 78f(b)(5).
    \9\ 17 CFR 240.12f-5.
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will
impose any burden on competition that is not necessary or appropriate
in furtherance of the purposes of the Act.

C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants or Others

    Written comments on the proposed rule change were neither solicited
nor received.

III. Solicitation of Comments

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml.
); or     Send an e-mail to<EMAIL_ADDRESS>Please include

File Number SR-NYSEArca-2006-37 on the subject line.

Paper Comments

     Send paper comments in triplicate to Nancy M. Morris,
Secretary, Securities and Exchange Commission, 100 F Street, NE.,
Washington, DC 20549-1090.

All submissions should refer to File Number SR-NYSEArca-2006-37. This
file number should be included on the subject line if e-mail is used.
To help the Commission process and review your comments more
efficiently, please use only one method. The Commission will post all
comments on the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml
). Copies of the submission, all subsequent amendments,

all written statements with respect to the proposed rule change that
are filed with the Commission, and all written communications relating
to the proposed rule change between the Commission and any person,
other than those that may be withheld from the public in accordance
with the provisions of 5 U.S.C. 552, will be available for inspection
and copying in the Commission's Public Reference Room. Copies of such
filing also will be available for inspection and copying at the
principal office of the Exchange. All comments received will be posted
without change; the Commission does not edit personal identifying
information from submissions. You should submit only information that
you wish to make available publicly. All submissions should refer to
File Number SR-NYSEArca-2006-37 and should be submitted on or before
February 12, 2007.

IV. Commission's Findings and Order Granting Accelerated Approval of
the Proposed Rule Change

    After careful review, the Commission finds that the proposed rule
change, as amended, is consistent with the requirements of the Act and
the rules and regulations thereunder applicable to a national
securities exchange.\10\ In particular, the Commission finds that the
proposed rule change is consistent with Section 6(b)(5) of the Act,\11\
which requires that an exchange have rules designed, among other
things, to promote just and equitable principles of trade, to remove
impediments to and perfect the mechanism of a free and open market and
a national market system, and in general to protect investors and the
public interest. The Commission believes that this proposal should
benefit investors by increasing competition among markets that trade
the Shares.
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    \10\ In approving this rule change, the Commission notes that it
has considered the proposal's impact on efficiency, competition, and
capital formation. See 15 U.S.C. 78c(f).
    \11\ 15 U.S.C. 78f(b)(5).
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    In addition, the Commission finds that the proposal is consistent
with Section 12(f) of the Act,\12\ which permits an exchange to trade,
pursuant to UTP, a security that is listed and registered on another
exchange.\13\ The Commission notes that it previously approved the
listing and trading of the Shares on Amex.\14\ The Commission also
finds that the proposal is consistent with Rule 12f-5 under the
Act,\15\ which provides that an exchange shall not extend UTP to a
security unless the exchange has in effect a rule or rules providing
for transactions in the class or type of security to which the exchange
extends UTP. The Exchange has represented that it meets this
requirement because it deems the Shares to be equity securities, thus
rendering trading in the Shares subject to the Exchange's existing
rules governing the trading of equity securities.
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    \12\ 15 U.S.C. 78l(f).
    \13\ Section 12(a) of the Act, 15 U.S.C. 78l(a), generally
prohibits a broker-dealer from trading a security on a national
securities exchange unless the security is registered on that
exchange pursuant to Section 12 of the Act. Section 12(f) of the Act
excludes from this restriction trading in any security to which an
exchange ``extends UTP.'' When an exchange extends UTP to a
security, it allows its members to trade the security as if it were
listed and registered on the exchange even though it is not so
listed and registered.
    \14\ See supra note 4.
    \15\ 17 CFR 240.12f-5.
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    The Commission further believes that the proposal is consistent
with Section 11A(a)(1)(C)(iii) of the Act,\16\ which sets forth
Congress' finding that it is in the public interest and appropriate for
the protection of investors and the maintenance of fair and orderly
markets to assure the availability to brokers, dealers, and investors
of information with respect to quotations for and transactions in
securities. Quotations for and last sale information regarding the
Shares are disseminated through the Consolidated Quotation System.
Furthermore, an IOPV calculator updates the IOPV every 15 seconds to
reflect price changes in the principal foreign markets and converts
such prices into U.S. dollars based on the current currency exchange
rate. When the foreign market or markets are closed but Amex is open
for trading, the IOPV is updated every 15 seconds to reflect changes in
currency exchange rates. NYSE Arca Equities Rule 7.34 describes the
situations when the Exchange would halt trading when the IOPV or the
value of the Index underlying one of the Funds is not calculated or
widely available.
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    \16\ 15 U.S.C. 78k-1(a)(1)(C)(iii).
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    The Commission notes that, if the Shares should be delisted by
Amex, the original listing exchange, the Exchange would no longer have
authority to trade the Shares pursuant to this order.
    In support of this proposal, the Exchange has made the following
representations:
    1. The Exchange's surveillance procedures are adequate to monitor
the trading of the Shares.
    2. In connection with the trading of the Shares, the Exchange would
inform ETP Holders in an Information Circular of the special
characteristics and risks associated with trading the Shares.
    3. The Information Circular would inform participants of the
prospectus or product delivery requirements applicable to the Shares.
This approval order is conditioned on the Exchange's adherence to these
representations.

    The Commission finds good cause for approving this proposal before
the thirtieth day after the publication of notice thereof in the
Federal Register. As noted previously, the Commission previously found
that the listing and trading of the Shares on Amex is consistent with
the Act.\17\ The Commission presently is not aware of any regulatory
issue that should cause it to revisit that earlier finding or preclude
the trading of the Shares on the Exchange pursuant to UTP. Therefore,
accelerating approval of this proposal should benefit investors by
creating, without undue delay, additional

competition in the market for the Shares.
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    \17\ See supra note 4.
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V. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the
Act,\18\ that the proposed rule change (SR-NYSEArca-2006-37), as
modified by Amendment No. 1, be, and it hereby is, approved on an
accelerated basis.
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    \18\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\19\
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    \19\ 17 CFR 200.30-3(a)(12).
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Nancy M. Morris,
Secretary.
[FR Doc. E7-756 Filed 1-19-07; 8:45 am]

BILLING CODE 8011-01-P