Self-Regulatory Organizations; NYSE Arca, Inc.; Order Granting Accelerated Approval of a Proposed Rule Change Amending NYSE Arca Equities Rules 5.1(b)(14) and 5.2(j)(2) To Permit the Listing of Equity Linked Notes That Are Linked to Securities Issued by Companies Registered Under the Investment Company Act of 1940, 60745-60747 [E8-24238]
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Federal Register / Vol. 73, No. 199 / Tuesday, October 14, 2008 / Notices
immediately implement the proposed
rule change.
The Exchange believes that given the
current market climate, immediate
implementation of the foregoing
proposed rule change is necessary in
order to avoid significant disruption to
the market and to ensure investor
protection in light of the potential for
additional volatility in the market as the
credit crisis continues. In particular,
recent and near-term events, including
the Emergency Economic Stabilization
Act of 2008 and the pending expiration
of the Commission’s Emergency Order
that prohibits persons from selling short
the securities of financial institutions,10
could cause additional volatility in the
market in the coming days. Moreover,
the Exchange proposes suspending only
those rules that could impact
specialists’ ability to arrange a fair and
orderly close during an extreme market
volatility condition. Finally, the
proposed changes to NYSE Rule 48 are
temporary and will end on December
31, 2008. The Exchange believes that its
need to immediately implement the
proposed rule change satisfies the
standards set out in the Exchange Act
and related rules.
The Commission believes that
waiving the 30-day operative delay is
consistent with the protection of
investors and the public interest. The
Commission therefore grants the
Exchange’s request and designates the
proposal to be operative upon filing.11
At any time within 60 days of the
filing of the proposed rule change, the
Commission may summarily abrogate
the 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.
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:
jlentini on PROD1PC65 with NOTICES
Electronic Comments
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
15:37 Oct 10, 2008
Jkt 217001
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–NYSE–2008–102. 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, 100 F Street, NE., Washington,
DC 20549, on official business days
between the hours of 10 a.m. and 3 p.m.
Copies of such filing also will be
available for inspection and copying at
the principal office of NYSE. 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–NYSE–2008–102 and
should be submitted on or before
November 4, 2008.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.12
Florence E. Harmon,
Acting Secretary.
[FR Doc. E8–24236 Filed 10–10–08; 8:45 am]
BILLING CODE 8011–01–P
10 See Securities Exchange Act Release No. 58592
(September 18, 2008), 73 FR 55169 (September 24,
2008).
11 For purposes only of waiving the 30-day
operative delay of this proposal, the Commission
has considered the proposed rule’s impact on
efficiency, competition, and capital formation. 15
U.S.C. 78c(f).
VerDate Aug<31>2005
• Send an e-mail to rulecomments@sec.gov. Please include File
Number SR–NYSE–2008–102 on the
subject line.
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–58745; File No. SR–
NYSEArca–2008–94]
Self-Regulatory Organizations; NYSE
Arca, Inc.; Order Granting Accelerated
Approval of a Proposed Rule Change
Amending NYSE Arca Equities Rules
5.1(b)(14) and 5.2(j)(2) To Permit the
Listing of Equity Linked Notes That
Are Linked to Securities Issued by
Companies Registered Under the
Investment Company Act of 1940
October 7, 2008.
On August 25, 2008, NYSE Arca, Inc.
(‘‘NYSE Arca’’ or ‘‘Exchange’’), through
its wholly owned subsidiary, NYSE
Arca Equities, Inc. (‘‘NYSE Arca
Equities’’), filed with the Securities and
Exchange Commission (‘‘Commission’’),
pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Exchange Act’’) 1 and Rule 19b–4
thereunder,2 a proposed rule change to
amend NYSE Arca Equities Rules
5.1(b)(14) and 5.2(j)(2) to permit the
listing of Equity Linked Notes (‘‘ELNs’’)
that are linked to securities issued by
companies registered under the
Investment Company Act of 1940
(‘‘1940 Act’’) 3 and are listed on a
national securities exchange. The
proposed rule change was published in
the Federal Register on September 19,
2008 for a 15-day comment period.4 The
Commission received no comments on
the proposal. This order grants approval
to the proposed rule change on an
accelerated basis.
I. Description of the Proposal
The Exchange proposes to amend
NYSE Arca Equities Rules 5.1(b)(14), the
Exchange’s definition of ELNs, and
NYSE Arca Equities Rule 5.2(j)(2), the
Exchange’s listing standards for ELNs,
to permit the listing of ELNs that are
linked to securities issued by companies
registered under the 1940 Act and are
listed on a national securities exchange.
A. Definition of ELN
NYSE Arca Equities Rule 5.1(b)(14)
currently defines ELNs as notes that are
linked, in whole or in part, to the
market performance of up to thirty
common stocks or non-convertible
preferred stocks. The Exchange
proposes to amend NYSE Arca Equities
Rule 5.1(b)(14) and define ELNs as notes
that are linked, in whole or in part, to
1 15
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 15 U.S.C. 80a–1.
4 See Securities Exchange Act Release No. 58518
(September 11, 2008), 73 FR 54446.
2 17
12 17
PO 00000
CFR 200.30–3(a)(12).
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60745
E:\FR\FM\14OCN1.SGM
14OCN1
60746
Federal Register / Vol. 73, No. 199 / Tuesday, October 14, 2008 / Notices
jlentini on PROD1PC65 with NOTICES
the market performance of up to thirty
underlying equity securities that meet
the criteria in NYSE Arca Equities Rule
5.2(j)(2).
B. Securities Underlying ELNs
NYSE Arca Equities Rule 5.2(j)(2)
currently provides minimum standards
applicable to the securities underlying
ELNs and the issuers of such securities.
Under NYSE Arca Equities Rule
5.2(j)(2)(C)(ii), each issuer of an
underlying security to which an ELN is
to be linked must be a reporting
company under the Exchange Act that is
listed on a national securities exchange.
The Exchange proposes to expand this
provision to provide that an issuer of an
underlying security to which an ELN is
to be linked may also be a 1940 Act
registered investment company. In
addition, the Exchange proposes to
further clarify the rule to state that, in
either case, any underlying security to
which the ELN is linked must be listed
on a national securities exchange.
The Exchange further proposes to
replace the term ‘‘common stock’’ with
the term ‘‘shares’’ in NYSE Arca
Equities Rule 5.2(j)(2)(C)(ii)(2) to take
into account that certain underlying
securities, particularly those that are
securities issued by 1940 Act registered
investment companies, are not labeled
‘‘common stock.’’ Similarly, in NYSE
Arca Equities Rule 5.2(j)(2)(D)(i), the
Exchange proposes to delete the term
‘‘common’’ when it qualifies ‘‘shares’’ to
take into account that certain
underlying securities, particularly those
that are securities issued by 1940 Act
registered investment companies, are
not labeled ‘‘common shares.’’ For
purposes of NYSE Arca Equities Rule
5.2(j)(2), as amended, the term ‘‘shares’’
shall encompass common stock, nonconvertible preferred stock, and
securities issued by 1940 Act registered
investment companies as eligible
underlying securities. As a result, with
respect to NYSE Arca Equities Rule
5.2(j)(2)(C)(ii)(2), the combined trading
volume of each non-U.S. security (a
security issued by a non-U.S. company)
and other related non-U.S. securities
occurring in the U.S. market or in
markets with which the Exchange has in
place a comprehensive surveillance
sharing agreement must represent (on a
share equivalent basis for any American
Depositary Shares (‘‘ADSs’’)) at least
50% of the combined worldwide trading
volume in each such non-U.S. security,
other related non-U.S. securities, and
other classes of common stock, nonconvertible preferred stock, or securities
of 1940 Act registered investment
companies related to each such nonU.S. security, as the case may be, over
VerDate Aug<31>2005
15:37 Oct 10, 2008
Jkt 217001
the six month period preceding the date
of listing. In addition, with respect to
NYSE Arca Equities Rule 5.2(j)(2)(D)(i):
(1) An issuance of ELNs relating to any
underlying U.S. security may not exceed
five percent of the total outstanding
common stock, non-convertible
preferred stock, or securities of 1940 Act
registered investment companies for
each such underlying security, as the
case may be; and (2) the issuance of
ELNs relating to any underlying nonU.S. security represented by ADSs,
common stock, non-convertible
preferred stock, or securities of 1940 Act
registered investment companies, or
otherwise, may not exceed: (a) Two
percent of the total shares outstanding
of the relevant underlying security
worldwide if at least 20 percent of the
worldwide trading volume in each nonU.S. security and related non-U.S.
security occurs in the U.S. market
during the six-month period preceding
the date of listing; or (b) three percent
of the total shares outstanding of the
relevant underlying security worldwide
if at least 50 percent of the worldwide
trading volume in each non-U.S.
security and related non-U.S. security
occurs in the U.S. market during the sixmonth period preceding the date of
listing; and (c) five percent of the total
shares outstanding of the relevant
underlying security worldwide if at
least 70 percent of the worldwide
trading volume in each non-U.S.
security and related non-U.S. security
occurs in the U.S. market during the sixmonth period preceding the date of
listing.
C. Additional Technical Changes
Lastly, the Exchange proposes to
correct the numbering of NYSE Arca
Equities Rule 5.2(j)(2)(C)(iv) to NYSE
Arca Equities Rule 5.2(j)(2)(C)(iii). The
Exchange also proposes to change the
reference to the Division of Market
Regulation to the Division of Trading
and Markets in NYSE Arca Equities
Rule 5.2(j)(2)(D)(i).
II. Discussion and Commission’s
Findings
The Commission has carefully
reviewed the proposed rule change and
finds that it is consistent with the
requirements of Section 6 of the
Exchange Act 5 and the rules and
regulations thereunder applicable to a
national securities exchange.6 In
particular, the Commission finds that
the proposal is consistent with Section
5 15
U.S.C. 78f.
approving this proposed rule change the
Commission has considered the proposed rule’s
impact on efficiency, competition, and capital
formation. See 15 U.S.C. 78c(f).
6 In
PO 00000
Frm 00075
Fmt 4703
Sfmt 4703
6(b)(5) of the Exchange Act,7 which
requires, among other things, that the
Exchange’s rules be 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 mechanism of a free and open
market and a national market system,
and, in general, to protect investors and
the public interest.
With respect to the proposal to
expand the listing criteria for ELNs to
encompass notes that are linked to the
securities of 1940 Act registered
investment companies, the Commission
notes that the proposed rule requires
such securities to be listed and trading
on a national securities exchange. The
Commission also notes that the issuers
of such underlying securities must be
registered under the 1940 Act and,
pursuant to the disclosure requirements
thereunder, financial and other types of
information relating to the registered
investment companies would be readily
available for investors and other market
participants. Finally, the Commission
notes that the securities issued by 1940
Act registered investment companies
would trade on the same platforms as
equity securities under the Exchange
Act and would be subject to the same
Exchange trading rules as equity
securities. As such, the Commission
believes that this proposal will benefit
investors by providing investors and
other market participants with
enhanced investment options and
flexibility, while maintaining sufficient
transparency and minimum standards
with respect to the securities underlying
ELNs.
The Commission also believes that the
proposed amendments in NYSE Arca
Equities Rules 5.2(j)(2)(C)(ii)(2) and
5.2(j)(2)(D)(i) to characterize the word
‘‘shares’’ conform with the overall
purpose of the proposed rule change
and clarify the application of the
proposed amendments as they relate to
the eligibility of securities underlying
ELNs. In addition, the Commission
believes that the additional technical
corrections made to NYSE Arca Equities
Rule 5.2(j)(2) further clarify the
application of the rule. For the foregoing
reasons, the Commission finds that the
proposed rule change is consistent with
Section 6(b)(5) of the Exchange Act 8
and the rules and regulations
thereunder applicable to a national
securities exchange.
7 15
8 15
E:\FR\FM\14OCN1.SGM
U.S.C. 78f(b)(5).
U.S.C. 78f(b)(5).
14OCN1
Federal Register / Vol. 73, No. 199 / Tuesday, October 14, 2008 / Notices
III. Accelerated Approval
The Commission finds good cause,
pursuant to Section 19(b)(2) of the
Exchange Act,9 for approving the
proposed rule change prior to the
thirtieth day after the date of
publication of the Notice in the Federal
Register. The Commission notes that the
proposal is similar to NYSE Arca
Equities Rule 5.2(j)(6)(B)(I), the
Exchange’s Equity Index-Linked
Securities listing rules, which allow
underlying indexes to include, in whole
or in part, on securities issued by
certain companies registered under the
1940 Act and are listed on a national
securities exchange.10 The Commission
finds that the proposed rule change does
not raise any novel regulatory issues
and believes that accelerating approval
of this proposal should benefit investors
by creating, without undue delay,
additional competition in the
marketplace for ELNs.
IV. Conclusion
It is therefore ordered, pursuant to
Section 19(b)(2) of the Exchange Act,11
that the proposed rule change (SR–
NYSEArca–2008–94) be, and it hereby
is, approved on an accelerated basis.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.12
Florence E. Harmon,
Acting Secretary.
[FR Doc. E8–24238 Filed 10–10–08; 8:45 am]
BILLING CODE 8011–01–P
DEPARTMENT OF STATE
[Public Notice 6392]
Culturally Significant Objects Imported
for Exhibition Determinations: ‘‘Art and
Love in Renaissance Italy’’
ACTION:
Notice, correction.
jlentini on PROD1PC65 with NOTICES
9 15
U.S.C. 78s(b)(2).
10 See Securities Exchange Act Release No. 56879
(December 3, 2007), 72 FR 69271 (December 7,
2007) (SR–NYSEArca–2007–110).
11 15 U.S.C. 78s(b)(2).
12 17 CFR 200.30–3(a)(12).
15:37 Oct 10, 2008
For
further information, including a list of
the exhibit objects, contact Wolodymyr
Sulzynsky, Attorney-Adviser, Office of
the Legal Adviser, U.S. Department of
State (telephone: (202) 453–8050). The
address is U.S. Department of State, SA–
44, 301 4th Street, SW., Room 700,
Washington, DC 20547–0001.
FOR FURTHER INFORMATION CONTACT:
Dated: October 5, 2008.
C. Miller Crouch,
Principal Deputy Assistant Secretary for
Educational and Cultural Affairs, Department
of State.
[FR Doc. E8–24333 Filed 10–10–08; 8:45 am]
BILLING CODE 4710–05–P
DEPARTMENT OF STATE
On August 26, 2008, notice
was published on page 50394 of the
Federal Register (volume 73, number
166) of determinations made by the
Department of State pertaining to the
exhibit, ‘‘Art and Love in Renaissance
Italy.’’ The referenced notice is
corrected as to additional objects to be
included in the exhibition. Pursuant to
the authority vested in me by the Act of
October 19, 1965 (79 Stat. 985; 22 U.S.C.
2459), Executive Order 12047 of March
27, 1978, the Foreign Affairs Reform and
SUMMARY:
VerDate Aug<31>2005
Restructuring Act of 1998 (112 Stat.
2681, et seq.; 22 U.S.C. 6501 note, et
seq.), Delegation of Authority No. 234 of
October 1, 1999, Delegation of Authority
No. 236 of October 19, 1999, as
amended, and Delegation of Authority
No. 257 of April 15, 2003 [68 FR 19875],
I hereby determine that the additional
objects to be included in the exhibition
‘‘Art and Love in Renaissance Italy’’,
imported from abroad for temporary
exhibition within the United States, are
of cultural significance. The additional
objects are imported pursuant to loan
agreements with the foreign owners or
custodians. I also determine that the
exhibition or display of the exhibit
objects at The Metropolitan Museum of
Art, New York, New York, from on or
about November 11, 2008, until on or
about February 16, 2009; and at the
Kimbell Art Museum, Fort Worth,
Texas, from on or about March 15, 2009
until on or about June 14, 2009; and at
possible additional exhibitions or
venues yet to be determined, is in the
national interest. Public Notice of these
Determinations is ordered to be
published in the Federal Register.
Jkt 217001
[Public Notice 6389]
Shipping Coordinating Committee;
Notice of Subcommittee Meeting
The Shipping Coordinating
Committee (SHC), through its
Subcommittee on IMO Administration
and Budgeting, will conduct an open
meeting at 2 p.m. on Friday, October 31,
2008, in Room 4420 of the United States
Coast Guard Headquarters Building,
2100 Second Street, SW., Washington,
DC 20593. The primary purpose of the
meeting is to prepare for the one
hundred and first Session of the
International Maritime Organization
(IMO) Council to be held at IMO
headquarters, in London, United
PO 00000
Frm 00076
Fmt 4703
Sfmt 4703
60747
Kingdom, from November 10 to
November 14, 2008.
The primary matters to be considered
include:
—Adoption of the agenda
—Report of the Secretary-General on
credentials
—Strategy and planning
—Organizational reforms
—Resource management:
—Voluntary IMO Member State Audit
Scheme
—Consideration of the report of the
Marine Environment Protection
Committee, the Legal Committee, and
Consultative Meeting of Contracting
Parties to the London Convention
—Protection of vital shipping lanes
—External relations (World Maritime
Day and Relations with specialized
agencies, intergovernmental
organizations, and non-governmental
organizations)
—Report on the status of the Convention
and membership of the Organization
—Report on the status of conventions
Members of the public may attend
this meeting up to the seating capacity
of the room. Persons planning to attend
this meeting should contact the meeting
coordinator, LCDR Jason Smith not later
than 72 hours before the meeting by email at jason.e.smith2@uscg.mil, by
phone at (202) 372–1372, by fax at (202)
372–1925, or in writing at Commandant
(CG–5212), U.S. Coast Guard
Headquarters, 2100 2nd Street, SW.,
Room 1308, Washington, DC 20593–
0001.
The U.S. Coast Guard Headquarters
building is accessible by taxi and
privately owned conveyance (public
transportation is not generally
available). Please note, however, that
parking in the vicinity of the building is
extremely limited. Please also note that
due to security considerations, two
valid, government issued photo
identifications must be presented to
gain entrance to the Coast Guard
Headquarters building. If you have any
questions about this SHC subcommittee
meeting, please contact LCDR Jason
Smith at the numbers or addresses listed
above.
Dated: October 3, 2008.
Mark Skolnicki,
Executive Secretary, Shipping Coordinating
Committee, Department of State.
[FR Doc. E8–24331 Filed 10–10–08; 8:45 am]
BILLING CODE 4710–09–P
E:\FR\FM\14OCN1.SGM
14OCN1
]]>Agencies
[Federal Register Volume 73, Number 199 (Tuesday, October 14, 2008)]
[Notices]
[Pages 60745-60747]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-24238]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-58745; File No. SR-NYSEArca-2008-94]
Self-Regulatory Organizations; NYSE Arca, Inc.; Order Granting
Accelerated Approval of a Proposed Rule Change Amending NYSE Arca
Equities Rules 5.1(b)(14) and 5.2(j)(2) To Permit the Listing of Equity
Linked Notes That Are Linked to Securities Issued by Companies
Registered Under the Investment Company Act of 1940
October 7, 2008.
On August 25, 2008, NYSE Arca, Inc. (``NYSE Arca'' or
``Exchange''), through its wholly owned subsidiary, NYSE Arca Equities,
Inc. (``NYSE Arca Equities''), filed with the Securities and Exchange
Commission (``Commission''), pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (``Exchange Act'') \1\ and Rule 19b-4
thereunder,\2\ a proposed rule change to amend NYSE Arca Equities Rules
5.1(b)(14) and 5.2(j)(2) to permit the listing of Equity Linked Notes
(``ELNs'') that are linked to securities issued by companies registered
under the Investment Company Act of 1940 (``1940 Act'') \3\ and are
listed on a national securities exchange. The proposed rule change was
published in the Federal Register on September 19, 2008 for a 15-day
comment period.\4\ The Commission received no comments on the proposal.
This order grants approval to the proposed rule change on an
accelerated basis.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ 15 U.S.C. 80a-1.
\4\ See Securities Exchange Act Release No. 58518 (September 11,
2008), 73 FR 54446.
---------------------------------------------------------------------------
I. Description of the Proposal
The Exchange proposes to amend NYSE Arca Equities Rules 5.1(b)(14),
the Exchange's definition of ELNs, and NYSE Arca Equities Rule
5.2(j)(2), the Exchange's listing standards for ELNs, to permit the
listing of ELNs that are linked to securities issued by companies
registered under the 1940 Act and are listed on a national securities
exchange.
A. Definition of ELN
NYSE Arca Equities Rule 5.1(b)(14) currently defines ELNs as notes
that are linked, in whole or in part, to the market performance of up
to thirty common stocks or non-convertible preferred stocks. The
Exchange proposes to amend NYSE Arca Equities Rule 5.1(b)(14) and
define ELNs as notes that are linked, in whole or in part, to
[[Page 60746]]
the market performance of up to thirty underlying equity securities
that meet the criteria in NYSE Arca Equities Rule 5.2(j)(2).
B. Securities Underlying ELNs
NYSE Arca Equities Rule 5.2(j)(2) currently provides minimum
standards applicable to the securities underlying ELNs and the issuers
of such securities. Under NYSE Arca Equities Rule 5.2(j)(2)(C)(ii),
each issuer of an underlying security to which an ELN is to be linked
must be a reporting company under the Exchange Act that is listed on a
national securities exchange. The Exchange proposes to expand this
provision to provide that an issuer of an underlying security to which
an ELN is to be linked may also be a 1940 Act registered investment
company. In addition, the Exchange proposes to further clarify the rule
to state that, in either case, any underlying security to which the ELN
is linked must be listed on a national securities exchange.
The Exchange further proposes to replace the term ``common stock''
with the term ``shares'' in NYSE Arca Equities Rule 5.2(j)(2)(C)(ii)(2)
to take into account that certain underlying securities, particularly
those that are securities issued by 1940 Act registered investment
companies, are not labeled ``common stock.'' Similarly, in NYSE Arca
Equities Rule 5.2(j)(2)(D)(i), the Exchange proposes to delete the term
``common'' when it qualifies ``shares'' to take into account that
certain underlying securities, particularly those that are securities
issued by 1940 Act registered investment companies, are not labeled
``common shares.'' For purposes of NYSE Arca Equities Rule 5.2(j)(2),
as amended, the term ``shares'' shall encompass common stock, non-
convertible preferred stock, and securities issued by 1940 Act
registered investment companies as eligible underlying securities. As a
result, with respect to NYSE Arca Equities Rule 5.2(j)(2)(C)(ii)(2),
the combined trading volume of each non-U.S. security (a security
issued by a non-U.S. company) and other related non-U.S. securities
occurring in the U.S. market or in markets with which the Exchange has
in place a comprehensive surveillance sharing agreement must represent
(on a share equivalent basis for any American Depositary Shares
(``ADSs'')) at least 50% of the combined worldwide trading volume in
each such non-U.S. security, other related non-U.S. securities, and
other classes of common stock, non-convertible preferred stock, or
securities of 1940 Act registered investment companies related to each
such non-U.S. security, as the case may be, over the six month period
preceding the date of listing. In addition, with respect to NYSE Arca
Equities Rule 5.2(j)(2)(D)(i): (1) An issuance of ELNs relating to any
underlying U.S. security may not exceed five percent of the total
outstanding common stock, non-convertible preferred stock, or
securities of 1940 Act registered investment companies for each such
underlying security, as the case may be; and (2) the issuance of ELNs
relating to any underlying non-U.S. security represented by ADSs,
common stock, non-convertible preferred stock, or securities of 1940
Act registered investment companies, or otherwise, may not exceed: (a)
Two percent of the total shares outstanding of the relevant underlying
security worldwide if at least 20 percent of the worldwide trading
volume in each non-U.S. security and related non-U.S. security occurs
in the U.S. market during the six-month period preceding the date of
listing; or (b) three percent of the total shares outstanding of the
relevant underlying security worldwide if at least 50 percent of the
worldwide trading volume in each non-U.S. security and related non-U.S.
security occurs in the U.S. market during the six-month period
preceding the date of listing; and (c) five percent of the total shares
outstanding of the relevant underlying security worldwide if at least
70 percent of the worldwide trading volume in each non-U.S. security
and related non-U.S. security occurs in the U.S. market during the six-
month period preceding the date of listing.
C. Additional Technical Changes
Lastly, the Exchange proposes to correct the numbering of NYSE Arca
Equities Rule 5.2(j)(2)(C)(iv) to NYSE Arca Equities Rule
5.2(j)(2)(C)(iii). The Exchange also proposes to change the reference
to the Division of Market Regulation to the Division of Trading and
Markets in NYSE Arca Equities Rule 5.2(j)(2)(D)(i).
II. Discussion and Commission's Findings
The Commission has carefully reviewed the proposed rule change and
finds that it is consistent with the requirements of Section 6 of the
Exchange Act \5\ and the rules and regulations thereunder applicable to
a national securities exchange.\6\ In particular, the Commission finds
that the proposal is consistent with Section 6(b)(5) of the Exchange
Act,\7\ which requires, among other things, that the Exchange's rules
be 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
mechanism 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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\5\ 15 U.S.C. 78f.
\6\ In approving this proposed rule change the Commission has
considered the proposed rule's impact on efficiency, competition,
and capital formation. See 15 U.S.C. 78c(f).
\7\ 15 U.S.C. 78f(b)(5).
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With respect to the proposal to expand the listing criteria for
ELNs to encompass notes that are linked to the securities of 1940 Act
registered investment companies, the Commission notes that the proposed
rule requires such securities to be listed and trading on a national
securities exchange. The Commission also notes that the issuers of such
underlying securities must be registered under the 1940 Act and,
pursuant to the disclosure requirements thereunder, financial and other
types of information relating to the registered investment companies
would be readily available for investors and other market participants.
Finally, the Commission notes that the securities issued by 1940 Act
registered investment companies would trade on the same platforms as
equity securities under the Exchange Act and would be subject to the
same Exchange trading rules as equity securities. As such, the
Commission believes that this proposal will benefit investors by
providing investors and other market participants with enhanced
investment options and flexibility, while maintaining sufficient
transparency and minimum standards with respect to the securities
underlying ELNs.
The Commission also believes that the proposed amendments in NYSE
Arca Equities Rules 5.2(j)(2)(C)(ii)(2) and 5.2(j)(2)(D)(i) to
characterize the word ``shares'' conform with the overall purpose of
the proposed rule change and clarify the application of the proposed
amendments as they relate to the eligibility of securities underlying
ELNs. In addition, the Commission believes that the additional
technical corrections made to NYSE Arca Equities Rule 5.2(j)(2) further
clarify the application of the rule. For the foregoing reasons, the
Commission finds that the proposed rule change is consistent with
Section 6(b)(5) of the Exchange Act \8\ and the rules and regulations
thereunder applicable to a national securities exchange.
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\8\ 15 U.S.C. 78f(b)(5).
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[[Page 60747]]
III. Accelerated Approval
The Commission finds good cause, pursuant to Section 19(b)(2) of
the Exchange Act,\9\ for approving the proposed rule change prior to
the thirtieth day after the date of publication of the Notice in the
Federal Register. The Commission notes that the proposal is similar to
NYSE Arca Equities Rule 5.2(j)(6)(B)(I), the Exchange's Equity Index-
Linked Securities listing rules, which allow underlying indexes to
include, in whole or in part, on securities issued by certain companies
registered under the 1940 Act and are listed on a national securities
exchange.\10\ The Commission finds that the proposed rule change does
not raise any novel regulatory issues and believes that accelerating
approval of this proposal should benefit investors by creating, without
undue delay, additional competition in the marketplace for ELNs.
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\9\ 15 U.S.C. 78s(b)(2).
\10\ See Securities Exchange Act Release No. 56879 (December 3,
2007), 72 FR 69271 (December 7, 2007) (SR-NYSEArca-2007-110).
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IV. Conclusion
It is therefore ordered, pursuant to Section 19(b)(2) of the
Exchange Act,\11\ that the proposed rule change (SR-NYSEArca-2008-94)
be, and it hereby is, approved on an accelerated basis.
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\11\ 15 U.S.C. 78s(b)(2).
\12\ 17 CFR 200.30-3(a)(12).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\12\
Florence E. Harmon,
Acting Secretary.
[FR Doc. E8-24238 Filed 10-10-08; 8:45 am]
BILLING CODE 8011-01-P
