Self-Regulatory Organizations; New York Stock Exchange LLC; Order Granting Accelerated Approval of Proposed Rule Change as Modified by Amendment No. 1 To List and Trade Nine Series of Exchange-Traded Notes of Barclays Bank PLC Linked to the Performance of Sub-Indices of the Dow Jones-AIG Commodity Index SM, 16392-16395 [E7-6189]
Download as PDF
16392
Federal Register / Vol. 72, No. 64 / Wednesday, April 4, 2007 / Notices
become a part of its identity to
investors.9
Nasdaq believes that this proposal is
also consistent with the historical
practice of companies that have
switched among national securities
exchanges. Since August 2001,
approximately 200 issues have
transferred their listing between the
Amex, the New York Stock Exchange
(‘‘NYSE’’), and NYSE Arca, while
maintaining their original ticker symbol
upon transfer.10 Now that Nasdaq is also
a national securities exchange,11
allowing companies to maintain their
symbol when transferring to Nasdaq
would be consistent with the current
practices of other exchanges.
Finally, Nasdaq believes that the
changes to its systems to accommodate
one-, two-, and three-character symbols
will enhance the strength of the U.S.
capital markets. As a result of these
technological changes, all Nasdaq
systems, including the Securities
Information Processor (SIP), are able to
support all NYSE- and Amex-listed
securities using their original symbols
over its core transaction and data
platforms. Nasdaq notes that this
provides an added level of redundancy
and resiliency for the U.S. capital
markets, and is key to Nasdaq’s ability
to provide a full back-up for other
equity markets in the event of a national
or local emergency thereby enhancing
the strength of the U.S. capital markets.
jlentini on PROD1PC65 with NOTICES
2. Statutory Basis
Nasdaq believes that the proposed
rule change is consistent with the
provisions of Section 6 of the Act,12 in
9 Nasdaq states that a market transfer will be
transparent to investors because, under the
Commission’s rules, a company must announce the
transfer of its listing on a Form 8–K. See Form
8–K, item 3.01(d). In addition, the issuer must
publish notice of its intent to delist its securities
from the current market, in a press release and on
its Web site. See 17 CFR 240.12d2–2(c)(2)(iii).
10 See, e.g., Allis-Chambers Energy (announced
on March 7, 2007 its intent to switch from Amex
to NYSE keeping the symbol ALY), Yamana Gold
Inc. (announced on December 21, 2006 its intent to
switch from Amex to NYSE keeping the symbol
AUY), VAALCO Energy (announced on October 2,
2006 its intent to switch from Amex to NYSE
keeping the symbol EGY), the transfer of 15 iShares
ETFs from the Amex to NYSE Arca keeping their
symbols announced on September 27, 2006, and the
transfer of The Latin America Equity Fund, Inc.,
Credit Suisse Asset Management Income Fund, Inc.,
The Chile Fund, among others, from NYSE to
AMEX on May 11, 2006 keeping their respective
symbols CIK, LAQ and CH. A complete list of these
transfers is available from Nasdaq upon request.
11 Nasdaq became operational as an exchange for
Nasdaq-listed securities on August 1, 2006. See
Nasdaq Issuer Alert 2006–001, available at: https://
www.complinet.com/file_store/pdf/rulebooks/
nasdaq_ia2006-001.pdf. See also Securities
Exchange Act Release No. 53128 (January 13, 2006),
71 FR 3550 (January 23, 2006).
12 15 U.S.C. 78f.
VerDate Aug<31>2005
18:47 Apr 03, 2007
Jkt 211001
general and with Section 6(b)(5) of the
Act,13 in particular, in that it is designed
to prevent fraudulent and manipulative
acts and practices, to promote just and
equitable principles of trade, to remove
impediments to a free and open market
and a national market system, and, in
general, to protect investors and the
public interest. Nasdaq believes that the
proposal will reduce investor confusion
and encourage competition among
exchanges.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
Nasdaq does not believe that the
proposed rule change will result in any
burden on competition that is not
necessary or appropriate in furtherance
of the purposes of the Act, as amended.
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
Within 35 days of the date of
publication of this notice in the Federal
Register or within such longer period (i)
as the Commission may designate up to
90 days of such date if it finds such
longer period to be appropriate and
publishes its reasons for so finding or
(ii) as to which the self-regulatory
organization consents, the Commission
will:
(A) By order approve such proposed
rule change, or
(B) Institute proceedings to determine
whether the proposed rule change
should be 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 (https://www.sec.gov/
rules/sro.shtml); or
• Send an e-mail to rulecomments@sec.gov. Please include File
Number SR–NASDAQ–2007–031 on the
subject line.
Paper Comments
• Send paper comments in triplicate
to Nancy M. Morris, Secretary,
13 15
PO 00000
U.S.C. 78f(b)(5).
Frm 00068
Fmt 4703
Securities and Exchange Commission,
100 F Street, NE., Washington, DC
20549–1090.
All submissions should refer to File
Number SR–NASDAQ–2007–031. 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 (https://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–NASDAQ–2007–031 and
should be submitted on or before April
25, 2007.
For the Commission, by the Division of
Market Regulation, pursuant to delegated
authority.14
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E7–6335 Filed 4–3–07; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–55548; File No. SR–NYSE–
2006–71]
Self-Regulatory Organizations; New
York Stock Exchange LLC; Order
Granting Accelerated Approval of
Proposed Rule Change as Modified by
Amendment No. 1 To List and Trade
Nine Series of Exchange-Traded Notes
of Barclays Bank PLC Linked to the
Performance of Sub-Indices of the Dow
Jones—AIG Commodity Index SM
March 28, 2007.
On August 24, 2006, the New York
Stock Exchange LLC (‘‘Exchange’’ or
14 17
Sfmt 4703
E:\FR\FM\04APN1.SGM
CFR 200.30–3(a)(12).
04APN1
Federal Register / Vol. 72, No. 64 / Wednesday, April 4, 2007 / Notices
‘‘NYSE’’) filed with the Securities and
Exchange Commission (‘‘Commission’’),
pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’) 1 and Rule 19b–4 thereunder,2 a
proposed rule change to list and trade
notes linked to the performance of subindices of the Dow Jones—AIG
Commodity IndexSM. On February 20,
2007, the Exchange submitted
Amendment No. 1.3 The proposed rule
change was published for comment in
the Federal Register on March 2, 2007.4
The Commission received no comments
on the proposal. This order approves the
proposed rule change, as modified by
Amendment No. 1, on an accelerated
basis.
Under Section 703.19 of NYSE’s
Listed Company Manual (the
‘‘Manual’’),5 the Exchange proposes to
list and trade nine series of notes
(‘‘Notes’’) issued by Barclays Bank PLC
(‘‘Barclays’’ or ‘‘Issuer’’), which are
linked to the performance of the
following sub-indices (each sub-index
herein referred to as the ‘‘Index’’ with
respect to the corresponding series of
Notes) of the Dow Jones—AIG
Commodity IndexSM: the Dow Jones—
AIG Petroleum Total Return SubIndexSM; the Dow Jones—AIG Livestock
Total Return Sub-IndexSM; the Dow
Jones—AIG Agriculture Total Return
Sub-IndexSM; the Dow Jones—AIG
Grains Total Return Sub-IndexSM; the
Dow Jones—AIG Energy Total Return
Sub-IndexSM; the Dow Jones—AIG
Precious Metals Total Return SubIndexSM; the Dow Jones—AIG ExEnergy
Total Return Sub-IndexSM; the Dow
Jones—AIG Industrial Metals Total
Return Sub-IndexSM; and the Dow
Jones—AIG Softs Total Return SubIndexSM. Barclays intends to issue the
Notes under the name ‘‘iPathSM
Exchange-Traded Notes.’’
The Indexes
Each Index is comprised of
constituents making up the Dow Jones—
AIG Commodity IndexSM, which the
Commission has previously reviewed in
connection with the listing of exchangetraded notes.6 Each Index is comprised
1 15
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 Amendment No. 1 replaced and superseded the
Exchange’s original filing in its entirety.
4 See Securities Exchange Act Release No. 55352
(February 26, 2007), 72 FR 9599 (‘‘Notice’’).
5 Section 703.19 of the Manual provides that the
Exchange may approve for listing and trading
securities not otherwise covered by the criteria of
Sections 1 and 7 of the Manual, provided the issue
is suited for auction market trading.
6 See Securities Exchange Act Release No. 53876
(May 25, 2006), 71 FR 32158 (June 2, 2006) (SR–
NYSE–2006–16). As set out in that filing, the Dow
Jones—AIG Commodity IndexSM is designed to be
jlentini on PROD1PC65 with NOTICES
2 17
VerDate Aug<31>2005
17:57 Apr 03, 2007
Jkt 211001
of commodity contracts relating to a
specific industry or sector.7 For
example, the Dow Jones—AIG
Petroleum Total Return Sub-IndexSM
includes those contracts in the Dow
Jones—AIG Commodity IndexSM that
relate to petroleum-related
commodities: crude oil, heating oil and
unleaded gasoline. Each Index is
determined annually by AIG–FP and
calculated daily by Dow Jones. The
weightings of each Index component are
a function of their weighting in the Dow
Jones—AIG Commodity IndexSM, which,
in turn, derives from liquidity and
world production data.
Dow Jones disseminates the Index
value of each sub-index every 15
seconds (assuming the Index value has
changed within such 15 second interval)
from 8 a.m. to 3 p.m. ET and publishes
a daily Index value at approximately 4
p.m. ET on each day on which the Index
is calculated. The sub-index values can
still be retrieved after 3 p.m. until the
end of the Exchange trading day but
their values are generally static after 3
p.m., although they may change if
settlement values for Index components
become available after that time.
16393
This credit risk is addressed by the
listing standards in § 703.19(1) of
NYSE’s Manual, which provide that a
security may not be listed on the
Exchange unless its issuer satisfies
certain financial requirements.
Section 703.19(2) of NYSE’s Manual
requires a market value of $4 million for
initial listing of debt securities. In
addition, the Notes would have to
comply with continued listing standards
in Section 802.01D of NYSE’s Manual.
The Exchange would remove from
listing any security where the public
distribution or aggregate market value
has fallen below the specified
thresholds or become so reduced to
make further dealings on the Exchange
inadvisable, or where such other event
shall occur or condition exists which in
the opinion of the Exchange makes
further dealings on the Exchange
inadvisable.
Pricing Information
An intraday Indicative Value meant to
approximate the intrinsic economic
value of the Notes will be calculated
and published via the facilities of the
Consolidated Tape Association (‘‘CTA’’)
every 15 seconds throughout the NYSE
trading day on each day on which the
Notes are traded on the Exchange.
Additionally, Barclays or an affiliate
will calculate and publish the closing
Indicative Value of the Notes on each
trading day at https://www.ipathetn.com.
The last sale price of the Notes will also
be disseminated over the consolidated
tape, subject to a 20-minute delay.9
The Notes
The Notes will offer investors
exposure to specific commodity sectors.
The Notes are debt securities of Barclays
with a term of 30 years that provide for
a cash payment at maturity or upon
earlier exchange at the holder’s option,
based on the performance of the
relevant Index according to a formula
set forth in the notice of NYSE’s
proposal.8 Unlike traditional debt
securities, the Notes would not have a
minimum principal amount that would
be repaid prior to or at maturity.
Accordingly, the return could be less
than the original issue price. Also,
holders of the Notes will not receive any
interest payments from the Notes. Prior
to maturity, Notes may be redeemed in
large aggregations as described further
in the notice of NYSE’s proposal.
Because the Notes will be debt
securities of Barclays, the Notes are
dependent upon its creditworthiness.
Trading Rules
The Notes will trade as equity
securities, subject to NYSE rules
governing, among other things, priority,
parity, and precedence of orders;
specialist responsibilities; margin; 10
and customer suitability requirements.
The Notes will trade between the hours
of 9:30 a.m. and 4 p.m. ET. The
Exchange would halt trading in the
Securities if the circuit breaker
parameters of Exchange Rule 80B have
been reached and may halt trading
pursuant to Exchange Rule 123D
a diversified benchmark for commodities as an asset
class and reflects the returns that are potentially
available through an unleveraged investment in the
futures contracts on physical commodities
comprising the Index plus the rate of interest that
could be earned on cash collateral invested
Treasury Bills. The Dow Jones—AIG Commodity
IndexSM was developed by AIGI International Inc.,
each year is determined by AIG Financial Products
Corp. (‘‘AIG-FP’’), and is calculated by Dow Jones.
The relative weightings of each component
commodity is determined annually according to
liquidity and dollar adjusted production data in 2⁄3
and 1⁄3 shares, respectively.
7 See Notice, supra note 4, 72 FR at 9602–9604.
8 See Notice, supra note 4, 72 FR at 9601.
9 As described in the notice of the NYSE’s
proposal, the Indicative Value will not reflect price
changes to the price of an underlying commodity
between the close of trading of the futures contract
at the relevant futures exchange and the close of
trading on the NYSE at 4 p.m. ET. While the market
for futures trading for each of the Index
commodities is open, the Indicative Value can be
expected to closely approximate the redemption
value of the Notes. However, during NYSE trading
hours when the futures contracts have ceased
trading, spreads and resulting premiums or
discounts may widen, and therefore, increase the
difference between the price of the Notes and their
redemption value.
10 See NYSE Rule 431.
PO 00000
Frm 00069
Fmt 4703
Sfmt 4703
E:\FR\FM\04APN1.SGM
04APN1
16394
Federal Register / Vol. 72, No. 64 / Wednesday, April 4, 2007 / Notices
pending the dissemination of material
news with respect to the issuer. If the
Index value or the Indicative Value is
not being disseminated as required, the
Exchange may halt trading during the
day on which the interruption to the
dissemination of the Index value or the
Indicative Value first occurs. If the
interruption to the dissemination of the
Index value or the Indicative Value
persists past the trading day in which it
occurred, the Exchange will halt trading
no later than the beginning of the
trading day following the interruption.
Surveillance
The NYSE has represented that it
would rely on its existing surveillance
procedures governing equities, which it
represented are adequate to monitor
trading of the Notes. Through
information sharing agreements and its
membership in the Intermarket
Surveillance Group, the Exchange stated
that it has access to all relevant trading
information in connection with
commodity futures comprising each
Index. Further, the Exchange stated that
it currently has the authority under
NYSE Rule 476 to request the Exchange
specialist in the Notes to provide NYSE
Regulation with information that the
specialist uses in connection with
pricing the Notes on the Exchange,
including specialist proprietary or other
information regarding securities,
commodities, futures, options on futures
or other derivative instruments. The
Exchange believes it also has authority
to request any other information from its
members—including floor brokers,
specialists and ‘‘upstairs’’ firms—to
fulfill its regulatory obligations.
jlentini on PROD1PC65 with NOTICES
Suitability
Pursuant to Exchange Rule 405, the
Exchange will impose a duty of due
diligence on its members and member
firms to learn the essential facts relating
to every customer prior to trading the
Notes.11 With respect to suitability
recommendations and risks, the
Exchange will require members,
member organizations and employees
thereof recommending a transaction in
the Notes: (1) To determine that such
transaction is suitable for the customer,
and (2) to have a reasonable basis for
believing that the customer can evaluate
the special characteristics of, and is able
to bear the financial risks of, such
transaction.
11 NYSE Rule 405 requires that every member,
member firm or member corporation use due
diligence to learn the essential facts relative to
every customer and to every order or account
accepted.
VerDate Aug<31>2005
17:57 Apr 03, 2007
Jkt 211001
Discussion and Commission Findings
After careful consideration, the
Commission finds that the proposed
rule change is consistent with the
requirements of the Act and the rules
and regulations thereunder applicable to
a national securities exchange.12 In
particular the Commission finds that the
proposed rule change is consistent with
the requirements of Section 6(b)(5) of
the Act,13 which requires among other
things, that the Exchange’s rules be
designed to promote just and equitable
principles of trade, to facilitate
transactions in securities, 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 notes
that it has previously approved the
listing and trading of other index-linked
securities that have a structure similar
to the Notes.14
The Commission further believes that
the proposal is consistent with Section
11A(a)(1)(C)(iii) of the Act,15 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
Notes will be disseminated through the
facilities of the Consolidated Tape
Association (‘‘CTA’’). The value of each
Index is calculated and disseminated
daily and, because the composition of
each Index is public and pricing of the
constituents is transparent, it may be
verified by a number of independent
sources. In addition, an intraday
Indicative Value for each Note series
will be available through the CTA.
Furthermore, financial information
regarding the Issuer is publicly
available, allowing investors to evaluate
12 In approving the rule, the Commission notes
that it has considered the proposed rule’s impact on
efficiency, competition and capital formation. See
15 U.S.C. 78c(f).
13 15 U.S.C. 78f(b)(5).
14 See, e.g., Securities Exchange Act Release Nos.
54177 (July 19, 2006), 71 FR 54177 (July 27, 2006)
(SR–NYSE–2006–19) (relating to the trading of the
Index-Linked Securities of Barclays Bank PLC
linked to the Performance of the Goldman Sachs
Crude Oil Total Return IndexTM); 53876 (May 25,
2006), 71 FR 32158 (June 2, 2006) (SR–NYSE–2006–
16) (relating to the trading of the Index-Linked
Securities of Barclays Bank PLC linked to the
performance of the Dow Jones—AIG Commodity
Index Total Return); and 53849 (May 22, 2006), 71
FR 30706 (May 30, 2006) (SR–NYSE–2006–20)
(relating to the trading of the Index-Linked
Securities of Barclays Bank PLC linked to the
performance of the GSCI Total Return Index).
15 15 U.S.C. 78k–1(a)(1)(C)(iii).
PO 00000
Frm 00070
Fmt 4703
Sfmt 4703
the creditworthiness of the Issuer. The
Commission also believes that sufficient
venues exist for obtaining reliable
information so that holders of the Notes
can track the value of their investment.
Accordingly, the Commission finds that
NYSE’s proposal is reasonably designed
to promote transparency in the pricing
of the Notes, and to prevent trading
when a reasonable degree of
transparency cannot be assured.
The proposal also appears reasonably
designed to prevent conveyance of
inside information from the Index
Calculator to market participants who
may trade the Notes.
In support of this proposal, the
Exchange has made the following
representations:
(1) NYSE has received a
representation from AIG–FP, the Index
Sponsor, that it will
(a) Implement and maintain
procedures reasonably designed to
prevent the use and dissemination by
relevant employees of AIG–FP, in
violation of applicable laws, rules and
regulations, of material non-public
information relating to changes in the
composition or method of computation
or calculation of the Index and (b)
periodically check the application of
such procedures as they relate to
officers and directors of AIG–FP directly
responsible for such changes.16
(2) NYSE will, prior to trading the
Notes, distribute an information
memorandum to the membership
providing guidance with regard to
member firm compliance
responsibilities (including suitability
recommendations) when handling
transactions in the Notes and
highlighting the special risks and
characteristics of the Notes. In addition,
during the initial distribution of the
Notes and during any subsequent
distribution of the Notes, NYSE member
organizations will deliver a prospectus
to investors purchasing Notes from
distributors.
(3) NYSE will rely on its existing
surveillance procedures governing
equities with regard to surveillance of
the Notes, which are adequate to
properly monitor trading of the Notes
16 AIG–FP is a wholly-owned guaranteed
subsidiary of American International Group, Inc. It
is not a broker-dealer or futures commission
merchant; however, AIG–FP may have such
affiliates. The Exchange has stated that Dow Jones
does not have any affiliates engaged in the
securities or commodities trading businesses and,
as such, Dow Jones does not believe that such
firewall procedures are necessary in its case. Dow
Jones and the Dow Jones—AIG Commodity IndexSM
Oversight Committee will adopt and maintain
policies that acknowledge their obligations with
respect to material non-public information. See
supra note 6, 71 FR at 32159–32160 nn.10,15.
E:\FR\FM\04APN1.SGM
04APN1
jlentini on PROD1PC65 with NOTICES
Federal Register / Vol. 72, No. 64 / Wednesday, April 4, 2007 / Notices
and detect violations of Exchange rules,
thereby deterring manipulation.
(4) With regard to the Index
components, the Exchange can obtain
market all relevant trading information,
including customer identity
information, with respect to transactions
through agreements with futures
exchanges and participation in the
Intermarket Surveillance Group.
(5) NYSE prohibits the initial and/or
continued listing of any security that is
not in compliance with Rule 10A–3
under the Act.17
This order is conditioned on NYSE’s
adherence to these representations.
Under the proposal, the Exchange will
delist any series of the Notes under the
following circumstances:
(1) (a) If, following the initial twelve
month period from the date of
commencement of trading of the Notes,
the Notes have more than 60 days
remaining until maturity and there are
fewer than 50 beneficial holders of the
Notes for 30 or more consecutive trading
days; (b) if fewer than 100,000 Notes
remain issued and outstanding; or (c) if
the market value of all outstanding
Notes is less than $1,000,000.
(2) If the Index value ceases to be
calculated or available during the time
the Notes trade on the Exchange on at
least a 15 second basis through one or
more major market data vendors or the
sponsors of the Index.
(3) If, during the time the Notes trade
on the Exchange, the Indicative Value
ceases to be available on a 15 second
delayed basis.
In addition, NYSE has represented
that it would delist the Notes (unless the
Commission approved a proposed rule
change submitted pursuant to Rule 19b–
4 under the Act) if: (1) Dow Jones and
AIG–FP substantially change either the
Index component selection
methodology or the weighting
methodology; (2) a new component is
added to the Index (or pricing
information is used for a new or existing
component) that constitutes more than
10% of the weight of the Index with
whose principal trading market the
Exchange does not have a
comprehensive surveillance sharing
agreement; or (3) a successor or
substitute index is used in connection
with the Notes. The Commission
believes that each of these
circumstances represents material
changes to the characteristics of the
Index described herein and on which
the Commission is basing its findings.
Under these circumstances, the
Exchange could not rely on this
approval to list and trade the Notes.
Acceleration
The Commission finds good cause to
approve the proposal, as amended, prior
to the thirtieth day after the amended
proposal was published for comment in
the Federal Register. Accelerating
approval of the proposal should benefit
investors who desire to participate in
the designated Indexes by expediting
the listing and trading of the Notes by
the Exchange. The Commission also
notes that the proposal is similar to
others previously approved by the
Commission, and does not appear to
raise any new regulatory issues. Thus,
the Commission finds good cause,
consistent with Section 19(b)(2) of the
Act,18 to grant accelerated approval of
the proposed rule change, as amended.
It is therefore ordered, pursuant to
Section 19(b)(2) of the Act, that the
proposed rule change (SR–NYSE–2006–
71), as modified by Amendment No. 1,
be, and it hereby is, approved on an
accelerated basis.
For the Commission, by the Division of
Market Regulation, pursuant to delegated
authority.19
J. Lynn Taylor,
Assistant Secretary.
[FR Doc. E7–6189 Filed 4–3–07; 8:45 am]
BILLING CODE 8010–01–P
SMALL BUSINESS ADMINISTRATION
Data Collection Available for Public
Comments and Recommendations
Notice and request for
comments.
ACTION:
SUMMARY: In accordance with the
Paperwork Reduction Act of 1995, this
notice announces the Small Business
Administration’s intentions to request
approval on a new and/or currently
approved information collection.
DATES: Submit comments on or before
June 4, 2007.
ADDRESSES: Send all comments
regarding whether this information
collection is necessary for the proper
performance of the function of the
agency, whether the burden estimates
are accurate, and if there are ways to
minimize the estimated burden and
enhance the quality of the collection, to
Janet Tasker, Deputy Associate
Administrator, Office of Capital Access,
Small Business Administration, 409 3rd
Street SW., 8th Floor, Washington, DC
20416
FOR FURTHER INFORMATION CONTACT:
Janet Tasker, Tasker, Office of Capitol
18 15
17 See
17 CFR 240.10A–3.
VerDate Aug<31>2005
17:57 Apr 03, 2007
19 17
Jkt 211001
PO 00000
U.S.C. 78s(b)(2).
CFR 200.30–3(a)(12).
Frm 00071
Fmt 4703
Sfmt 4703
16395
Access, 202–205–6657,
janet.tasker@sba.gov. Curtis B. Rich,
Management Analyst, 202–205–7030,
curtis.rich@sba.gov.
SUPPLEMENTARY INFORMATION:
Title: ‘‘Office of Capital Access Online
Survey.’’
Description of Respondents: Finance
Lenders, International Finance Lenders,
7(a) Lenders and CDC’s in the 504
program, Small Business Investment
Companies, Surety Bond Guarantee
Companies.
Form No: N/A.
Annual Responses: 23,396.
Annual Burden: 1,204.
Jacqueline White,
Chief, Administrative Information Branch.
[FR Doc. E7–6247 Filed 4–3–07; 8:45 am]
BILLING CODE 8025–01–P
SMALL BUSINESS ADMINISTRATION
[Disaster Declaration #10830]
Florida Disaster #FL–00021 Declaration
of Economic Injury
U.S. Small Business
Administration.
ACTION: Notice.
AGENCY:
SUMMARY: This is a notice of an
Economic Injury Disaster Loan (EIDL)
declaration for the State of Florida,
dated 3/26/2007.
Incident: Fire.
Incident Period: 11/19/2006.
Effective Date: 3/26/2007.
EIDL Loan Application Deadline Date:
12/26/2007.
ADDRESSES: Submit completed loan
applications to: U.S. Small Business
Administration, Processing and
Disbursement Center, 14925 Kingsport
Road, Fort Worth, TX 76155.
FOR FURTHER INFORMATION CONTACT: A.
Escobar, Office of Disaster Assistance,
U.S. Small Business Administration,
409 3rd Street, SW., Suite 6050,
Washington, DC 20416.
SUPPLEMENTARY INFORMATION: Notice is
hereby given that as a result of the
Administrator’s EIDL declaration,
applications for economic injury
disaster loans may be filed at the
address listed above or other locally
announced locations.
The following areas have been
determined to be adversely affected by
the disaster:
Primary County: Miami-Dade.
Contiguous Counties: Florida: Broward,
Collier, Monroe.
The Interest Rate is: 4.000.
The number assigned to this disaster
for economic injury is 108300.
E:\FR\FM\04APN1.SGM
04APN1
Agencies
[Federal Register Volume 72, Number 64 (Wednesday, April 4, 2007)]
[Notices]
[Pages 16392-16395]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-6189]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-55548; File No. SR-NYSE-2006-71]
Self-Regulatory Organizations; New York Stock Exchange LLC; Order
Granting Accelerated Approval of Proposed Rule Change as Modified by
Amendment No. 1 To List and Trade Nine Series of Exchange-Traded Notes
of Barclays Bank PLC Linked to the Performance of Sub-Indices of the
Dow Jones--AIG Commodity Index \SM\
March 28, 2007.
On August 24, 2006, the New York Stock Exchange LLC (``Exchange''
or
[[Page 16393]]
``NYSE'') filed with the Securities and Exchange Commission
(``Commission''), pursuant to Section 19(b)(1) of the Securities
Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4 thereunder,\2\ a
proposed rule change to list and trade notes linked to the performance
of sub-indices of the Dow Jones--AIG Commodity IndexSM. On
February 20, 2007, the Exchange submitted Amendment No. 1.\3\ The
proposed rule change was published for comment in the Federal Register
on March 2, 2007.\4\ The Commission received no comments on the
proposal. This order approves the proposed rule change, as modified by
Amendment No. 1, on an accelerated basis.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ Amendment No. 1 replaced and superseded the Exchange's
original filing in its entirety.
\4\ See Securities Exchange Act Release No. 55352 (February 26,
2007), 72 FR 9599 (``Notice'').
---------------------------------------------------------------------------
Under Section 703.19 of NYSE's Listed Company Manual (the
``Manual''),\5\ the Exchange proposes to list and trade nine series of
notes (``Notes'') issued by Barclays Bank PLC (``Barclays'' or
``Issuer''), which are linked to the performance of the following sub-
indices (each sub-index herein referred to as the ``Index'' with
respect to the corresponding series of Notes) of the Dow Jones--AIG
Commodity IndexSM: the Dow Jones--AIG Petroleum Total Return
Sub-IndexSM; the Dow Jones--AIG Livestock Total Return Sub-
IndexSM; the Dow Jones--AIG Agriculture Total Return Sub-
IndexSM; the Dow Jones--AIG Grains Total Return Sub-
IndexSM; the Dow Jones--AIG Energy Total Return Sub-
IndexSM; the Dow Jones--AIG Precious Metals Total Return
Sub-IndexSM; the Dow Jones--AIG ExEnergy Total Return Sub-
IndexSM; the Dow Jones--AIG Industrial Metals Total Return
Sub-IndexSM; and the Dow Jones--AIG Softs Total Return Sub-
IndexSM. Barclays intends to issue the Notes under the name
``iPathSM Exchange-Traded Notes.''
---------------------------------------------------------------------------
\5\ Section 703.19 of the Manual provides that the Exchange may
approve for listing and trading securities not otherwise covered by
the criteria of Sections 1 and 7 of the Manual, provided the issue
is suited for auction market trading.
---------------------------------------------------------------------------
The Indexes
Each Index is comprised of constituents making up the Dow Jones--
AIG Commodity IndexSM, which the Commission has previously
reviewed in connection with the listing of exchange-traded notes.\6\
Each Index is comprised of commodity contracts relating to a specific
industry or sector.\7\ For example, the Dow Jones--AIG Petroleum Total
Return Sub-IndexSM includes those contracts in the Dow
Jones--AIG Commodity IndexSM that relate to petroleum-
related commodities: crude oil, heating oil and unleaded gasoline. Each
Index is determined annually by AIG-FP and calculated daily by Dow
Jones. The weightings of each Index component are a function of their
weighting in the Dow Jones--AIG Commodity IndexSM, which, in
turn, derives from liquidity and world production data.
---------------------------------------------------------------------------
\6\ See Securities Exchange Act Release No. 53876 (May 25,
2006), 71 FR 32158 (June 2, 2006) (SR-NYSE-2006-16). As set out in
that filing, the Dow Jones--AIG Commodity IndexSM is
designed to be a diversified benchmark for commodities as an asset
class and reflects the returns that are potentially available
through an unleveraged investment in the futures contracts on
physical commodities comprising the Index plus the rate of interest
that could be earned on cash collateral invested Treasury Bills. The
Dow Jones--AIG Commodity IndexSM was developed by AIGI
International Inc., each year is determined by AIG Financial
Products Corp. (``AIG-FP''), and is calculated by Dow Jones. The
relative weightings of each component commodity is determined
annually according to liquidity and dollar adjusted production data
in \2/3\ and \1/3\ shares, respectively.
\7\ See Notice, supra note 4, 72 FR at 9602-9604.
---------------------------------------------------------------------------
Dow Jones disseminates the Index value of each sub-index every 15
seconds (assuming the Index value has changed within such 15 second
interval) from 8 a.m. to 3 p.m. ET and publishes a daily Index value at
approximately 4 p.m. ET on each day on which the Index is calculated.
The sub-index values can still be retrieved after 3 p.m. until the end
of the Exchange trading day but their values are generally static after
3 p.m., although they may change if settlement values for Index
components become available after that time.
The Notes
The Notes will offer investors exposure to specific commodity
sectors. The Notes are debt securities of Barclays with a term of 30
years that provide for a cash payment at maturity or upon earlier
exchange at the holder's option, based on the performance of the
relevant Index according to a formula set forth in the notice of NYSE's
proposal.\8\ Unlike traditional debt securities, the Notes would not
have a minimum principal amount that would be repaid prior to or at
maturity. Accordingly, the return could be less than the original issue
price. Also, holders of the Notes will not receive any interest
payments from the Notes. Prior to maturity, Notes may be redeemed in
large aggregations as described further in the notice of NYSE's
proposal.
---------------------------------------------------------------------------
\8\ See Notice, supra note 4, 72 FR at 9601.
---------------------------------------------------------------------------
Because the Notes will be debt securities of Barclays, the Notes
are dependent upon its creditworthiness. This credit risk is addressed
by the listing standards in Sec. 703.19(1) of NYSE's Manual, which
provide that a security may not be listed on the Exchange unless its
issuer satisfies certain financial requirements.
Section 703.19(2) of NYSE's Manual requires a market value of $4
million for initial listing of debt securities. In addition, the Notes
would have to comply with continued listing standards in Section
802.01D of NYSE's Manual. The Exchange would remove from listing any
security where the public distribution or aggregate market value has
fallen below the specified thresholds or become so reduced to make
further dealings on the Exchange inadvisable, or where such other event
shall occur or condition exists which in the opinion of the Exchange
makes further dealings on the Exchange inadvisable.
Pricing Information
An intraday Indicative Value meant to approximate the intrinsic
economic value of the Notes will be calculated and published via the
facilities of the Consolidated Tape Association (``CTA'') every 15
seconds throughout the NYSE trading day on each day on which the Notes
are traded on the Exchange. Additionally, Barclays or an affiliate will
calculate and publish the closing Indicative Value of the Notes on each
trading day at https://www.ipathetn.com. The last sale price of the
Notes will also be disseminated over the consolidated tape, subject to
a 20-minute delay.\9\
---------------------------------------------------------------------------
\9\ As described in the notice of the NYSE's proposal, the
Indicative Value will not reflect price changes to the price of an
underlying commodity between the close of trading of the futures
contract at the relevant futures exchange and the close of trading
on the NYSE at 4 p.m. ET. While the market for futures trading for
each of the Index commodities is open, the Indicative Value can be
expected to closely approximate the redemption value of the Notes.
However, during NYSE trading hours when the futures contracts have
ceased trading, spreads and resulting premiums or discounts may
widen, and therefore, increase the difference between the price of
the Notes and their redemption value.
---------------------------------------------------------------------------
Trading Rules
The Notes will trade as equity securities, subject to NYSE rules
governing, among other things, priority, parity, and precedence of
orders; specialist responsibilities; margin; \10\ and customer
suitability requirements. The Notes will trade between the hours of
9:30 a.m. and 4 p.m. ET. The Exchange would halt trading in the
Securities if the circuit breaker parameters of Exchange Rule 80B have
been reached and may halt trading pursuant to Exchange Rule 123D
[[Page 16394]]
pending the dissemination of material news with respect to the issuer.
If the Index value or the Indicative Value is not being disseminated as
required, the Exchange may halt trading during the day on which the
interruption to the dissemination of the Index value or the Indicative
Value first occurs. If the interruption to the dissemination of the
Index value or the Indicative Value persists past the trading day in
which it occurred, the Exchange will halt trading no later than the
beginning of the trading day following the interruption.
---------------------------------------------------------------------------
\10\ See NYSE Rule 431.
---------------------------------------------------------------------------
Surveillance
The NYSE has represented that it would rely on its existing
surveillance procedures governing equities, which it represented are
adequate to monitor trading of the Notes. Through information sharing
agreements and its membership in the Intermarket Surveillance Group,
the Exchange stated that it has access to all relevant trading
information in connection with commodity futures comprising each Index.
Further, the Exchange stated that it currently has the authority under
NYSE Rule 476 to request the Exchange specialist in the Notes to
provide NYSE Regulation with information that the specialist uses in
connection with pricing the Notes on the Exchange, including specialist
proprietary or other information regarding securities, commodities,
futures, options on futures or other derivative instruments. The
Exchange believes it also has authority to request any other
information from its members--including floor brokers, specialists and
``upstairs'' firms--to fulfill its regulatory obligations.
Suitability
Pursuant to Exchange Rule 405, the Exchange will impose a duty of
due diligence on its members and member firms to learn the essential
facts relating to every customer prior to trading the Notes.\11\ With
respect to suitability recommendations and risks, the Exchange will
require members, member organizations and employees thereof
recommending a transaction in the Notes: (1) To determine that such
transaction is suitable for the customer, and (2) to have a reasonable
basis for believing that the customer can evaluate the special
characteristics of, and is able to bear the financial risks of, such
transaction.
---------------------------------------------------------------------------
\11\ NYSE Rule 405 requires that every member, member firm or
member corporation use due diligence to learn the essential facts
relative to every customer and to every order or account accepted.
---------------------------------------------------------------------------
Discussion and Commission Findings
After careful consideration, the Commission finds that the proposed
rule change is consistent with the requirements of the Act and the
rules and regulations thereunder applicable to a national securities
exchange.\12\ In particular the Commission finds that the proposed rule
change is consistent with the requirements of Section 6(b)(5) of the
Act,\13\ which requires among other things, that the Exchange's rules
be designed to promote just and equitable principles of trade, to
facilitate transactions in securities, 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 notes that it has previously approved the listing and
trading of other index-linked securities that have a structure similar
to the Notes.\14\
---------------------------------------------------------------------------
\12\ In approving the rule, the Commission notes that it has
considered the proposed rule's impact on efficiency, competition and
capital formation. See 15 U.S.C. 78c(f).
\13\ 15 U.S.C. 78f(b)(5).
\14\ See, e.g., Securities Exchange Act Release Nos. 54177 (July
19, 2006), 71 FR 54177 (July 27, 2006) (SR-NYSE-2006-19) (relating
to the trading of the Index-Linked Securities of Barclays Bank PLC
linked to the Performance of the Goldman Sachs Crude Oil Total
Return IndexTM); 53876 (May 25, 2006), 71 FR 32158 (June
2, 2006) (SR-NYSE-2006-16) (relating to the trading of the Index-
Linked Securities of Barclays Bank PLC linked to the performance of
the Dow Jones--AIG Commodity Index Total Return); and 53849 (May 22,
2006), 71 FR 30706 (May 30, 2006) (SR-NYSE-2006-20) (relating to the
trading of the Index-Linked Securities of Barclays Bank PLC linked
to the performance of the GSCI[supreg] Total Return Index).
---------------------------------------------------------------------------
The Commission further believes that the proposal is consistent
with Section 11A(a)(1)(C)(iii) of the Act,\15\ 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
Notes will be disseminated through the facilities of the Consolidated
Tape Association (``CTA''). The value of each Index is calculated and
disseminated daily and, because the composition of each Index is public
and pricing of the constituents is transparent, it may be verified by a
number of independent sources. In addition, an intraday Indicative
Value for each Note series will be available through the CTA.
Furthermore, financial information regarding the Issuer is publicly
available, allowing investors to evaluate the creditworthiness of the
Issuer. The Commission also believes that sufficient venues exist for
obtaining reliable information so that holders of the Notes can track
the value of their investment. Accordingly, the Commission finds that
NYSE's proposal is reasonably designed to promote transparency in the
pricing of the Notes, and to prevent trading when a reasonable degree
of transparency cannot be assured.
---------------------------------------------------------------------------
\15\ 15 U.S.C. 78k-1(a)(1)(C)(iii).
---------------------------------------------------------------------------
The proposal also appears reasonably designed to prevent conveyance
of inside information from the Index Calculator to market participants
who may trade the Notes.
In support of this proposal, the Exchange has made the following
representations:
(1) NYSE has received a representation from AIG-FP, the Index
Sponsor, that it will
(a) Implement and maintain procedures reasonably designed to
prevent the use and dissemination by relevant employees of AIG-FP, in
violation of applicable laws, rules and regulations, of material non-
public information relating to changes in the composition or method of
computation or calculation of the Index and (b) periodically check the
application of such procedures as they relate to officers and directors
of AIG-FP directly responsible for such changes.\16\
---------------------------------------------------------------------------
\16\ AIG-FP is a wholly-owned guaranteed subsidiary of American
International Group, Inc. It is not a broker-dealer or futures
commission merchant; however, AIG-FP may have such affiliates. The
Exchange has stated that Dow Jones does not have any affiliates
engaged in the securities or commodities trading businesses and, as
such, Dow Jones does not believe that such firewall procedures are
necessary in its case. Dow Jones and the Dow Jones--AIG Commodity
IndexSM Oversight Committee will adopt and maintain
policies that acknowledge their obligations with respect to material
non-public information. See supra note 6, 71 FR at 32159-32160
nn.10,15.
---------------------------------------------------------------------------
(2) NYSE will, prior to trading the Notes, distribute an
information memorandum to the membership providing guidance with regard
to member firm compliance responsibilities (including suitability
recommendations) when handling transactions in the Notes and
highlighting the special risks and characteristics of the Notes. In
addition, during the initial distribution of the Notes and during any
subsequent distribution of the Notes, NYSE member organizations will
deliver a prospectus to investors purchasing Notes from distributors.
(3) NYSE will rely on its existing surveillance procedures
governing equities with regard to surveillance of the Notes, which are
adequate to properly monitor trading of the Notes
[[Page 16395]]
and detect violations of Exchange rules, thereby deterring
manipulation.
(4) With regard to the Index components, the Exchange can obtain
market all relevant trading information, including customer identity
information, with respect to transactions through agreements with
futures exchanges and participation in the Intermarket Surveillance
Group.
(5) NYSE prohibits the initial and/or continued listing of any
security that is not in compliance with Rule 10A-3 under the Act.\17\
---------------------------------------------------------------------------
\17\ See 17 CFR 240.10A-3.
---------------------------------------------------------------------------
This order is conditioned on NYSE's adherence to these
representations.
Under the proposal, the Exchange will delist any series of the
Notes under the following circumstances:
(1) (a) If, following the initial twelve month period from the date
of commencement of trading of the Notes, the Notes have more than 60
days remaining until maturity and there are fewer than 50 beneficial
holders of the Notes for 30 or more consecutive trading days; (b) if
fewer than 100,000 Notes remain issued and outstanding; or (c) if the
market value of all outstanding Notes is less than $1,000,000.
(2) If the Index value ceases to be calculated or available during
the time the Notes trade on the Exchange on at least a 15 second basis
through one or more major market data vendors or the sponsors of the
Index.
(3) If, during the time the Notes trade on the Exchange, the
Indicative Value ceases to be available on a 15 second delayed basis.
In addition, NYSE has represented that it would delist the Notes
(unless the Commission approved a proposed rule change submitted
pursuant to Rule 19b-4 under the Act) if: (1) Dow Jones and AIG-FP
substantially change either the Index component selection methodology
or the weighting methodology; (2) a new component is added to the Index
(or pricing information is used for a new or existing component) that
constitutes more than 10% of the weight of the Index with whose
principal trading market the Exchange does not have a comprehensive
surveillance sharing agreement; or (3) a successor or substitute index
is used in connection with the Notes. The Commission believes that each
of these circumstances represents material changes to the
characteristics of the Index described herein and on which the
Commission is basing its findings. Under these circumstances, the
Exchange could not rely on this approval to list and trade the Notes.
Acceleration
The Commission finds good cause to approve the proposal, as
amended, prior to the thirtieth day after the amended proposal was
published for comment in the Federal Register. Accelerating approval of
the proposal should benefit investors who desire to participate in the
designated Indexes by expediting the listing and trading of the Notes
by the Exchange. The Commission also notes that the proposal is similar
to others previously approved by the Commission, and does not appear to
raise any new regulatory issues. Thus, the Commission finds good cause,
consistent with Section 19(b)(2) of the Act,\18\ to grant accelerated
approval of the proposed rule change, as amended.
---------------------------------------------------------------------------
\18\ 15 U.S.C. 78s(b)(2).
---------------------------------------------------------------------------
It is therefore ordered, pursuant to Section 19(b)(2) of the Act,
that the proposed rule change (SR-NYSE-2006-71), as modified by
Amendment No. 1, be, and it hereby is, approved on an accelerated
basis.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\19\
---------------------------------------------------------------------------
\19\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------
J. Lynn Taylor,
Assistant Secretary.
[FR Doc. E7-6189 Filed 4-3-07; 8:45 am]
BILLING CODE 8010-01-P