Federal Register / Vol. 75, No. 34 / Monday, February 22, 2010 / Notices 7641 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3The Commission has modified the text of the 

summaries prepared by DTC. 

4The costs and risks associated with physical 

certificates include, among other things, those 

associated with safekeeping, transfer, shipping, 

messengers, and insurance costs. 

5FAST was designed to eliminate some of the 

risks and costs related to the creation, movement, 

processing, and storage of securities certificates. 

Under the FAST Program, FAST transfer agents 

hold FAST eligible securities in the name of Cede 

& Co. in custody and for the benefit of DTC. As 

additional securities are deposited or withdrawn 

from DTC, the FAST transfer agents adjust the size 

of DTC’s position as appropriate and electronically 

confirm these changes with DTC. For more 

information relating to FAST, see Securities 

Exchange Act Release Nos. 13342 (March 8, 1977) 

[File No. SR–DTC–76–3]; 14997 (July 26, 1978) [File 

No. SR–DTC–78–11]; 21401 (October 16, 1984) [File 

No. SR–DTC–84–8]; 31941 (March 3, 1993) [SR– 

DTC–92–15]; and 46956 (December 6, 2002) [File 

No. SR–DTC–2002–15]. 

section 12(d)(1)(A)(i) of the Act, setting 

forth from whom the securities were 

acquired, the identity of the 

underwriting syndicate’s members, the 

terms of the purchase, and the 

information or materials upon which 

the Board’s determinations were made. 

9. Before investing in an iShares Fund 

in excess of the limits in section 

12(d)(1)(A), each Investing Fund and the 

iShares Fund will execute an agreement 

stating, without limitation, that their 

respective board of directors or trustees 

and their respective investment 

advisers, or their respective sponsors or 

trustees, as applicable, understand the 

terms and conditions of the order, and 

agree to fulfill their responsibilities 

under the order. At the time of its 

investment in shares of an Open-end 

iShares Fund in excess of the limit in 

section 12(d)(1)(A)(i), an Investing Fund 

will notify the Open-end iShares Fund 

of the investment. At such time, the 

Investing Fund will also transmit to the 

Open-end iShares Fund a list of the 

names of each Investing Fund Affiliate 

and Underwriting Affiliate. The 

Investing Fund will notify the Open-end 

iShares Fund of any changes to the list 

of the names as soon as reasonably 

practicable after a change occurs. The 

iShares Fund and the Investing Fund 

will maintain and preserve a copy of the 

order, the agreement, and, in the case of 

an Open-end iShares Fund, the list with 

any updated information for the 

duration of the investment and for a 

period of not less than six years 

thereafter, the first two years in an 

easily accessible place. 

10. Before approving any advisory 

contract under section 15 of the Act, the 

board of directors or trustees of each 

Investing Management Company, 

including a majority of the disinterested 

directors or trustees, will find that the 

advisory fees charged under such 

contract are based on services provided 

that will be in addition to, rather than 

duplicative of, the services provided 

under any advisory contracts of any 

Open-end iShares Fund in which the 

Investing Management Company may 

invest. These findings and their basis 

will be recorded fully in the minute 

books of the appropriate Investing 

Management Company. 

11. Any sales charges and/or service 

fees charged with respect to shares of an 

Investing Fund will not exceed the 

limits applicable to a fund of funds as 

set forth in NASD Conduct Rule 2830. 

12. No iShares Fund in which an 

Investing Fund will invest pursuant to 

the Order will acquire securities of any 

other investment company or company 

relying on section 3(c)(1) or 3(c)(7) of 

the Act in excess of the limits contained 

in section 12(d)(1)(A) of the Act, other 

than the India Subsidiary or any similar 

wholly-owned subsidiary, and except to 

the extent permitted by rule 12d1–1 

under the Act or an exemptive order 

that allows the iShares Fund to 

purchase shares of a money market fund 

for short-term cash management 

purposes. 

For the Commission, by the Division of 

Investment Management, pursuant to 

delegated authority. 

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. 2010–3333 Filed 2–19–10; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–61507; File No. SR–DTC– 

2010–03] 

Self-Regulatory Organizations; The 

Depository Trust Company; Notice of 

Filing of Proposed Rule Change To 

Eliminate the Option To Receive a 

Physical Certificate From DTC for 

Unsponsored American Depositary 

Receipts That Are Part of the Fast 

Automated Securities Transfer 

Program 

February 5, 2010. 

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 January 

19, 2010, The Depository Trust 

Company (‘‘DTC’’) filed with the 

Securities and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I, II, and 

III below, which Items have been 

prepared primarily by DTC. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of the Substance 

of the Proposed Rule Change 

The purpose of this proposed rule 

change is to eliminate the option to 

receive a physical certificate from DTC 

for unsponsored American Depositary 

Receipts (‘‘ADRs’’) that are a part of 

DTC’s Fast Automated Securities 

Transfer Program (‘‘FAST’’). 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, 

DTC 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. DTC has prepared 

summaries, set forth in sections (A), (B), 

and (C) below, of the most significant 

aspects of these statements.3

(A) Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

An ADR is a security that trades in the 

United States but represents a specified 

number of shares in a foreign 

corporation. ADRs are issued in the U.S. 

by depositary banks. An ADR issuance 

is ‘‘unsponsored’’ when there is no 

formal agreement between the 

depositary bank(s) issuing the shares 

and the foreign company whose 

underlying shares are the basis for the 

ADR. Because there is no agreement 

between the issuer and a specific 

depositary, more than one depositary 

can be involved in the issuance and 

cancellation of the ADR in an 

unsponsored program. Unsponsored 

ADRs trade in the over-the-counter 

market. 

Currently, in order to deposit an 

unsponsored ADR at DTC, a depositary 

bank that is also a DTC participant will 

have its transfer agent create a certificate 

for the new issue ADR, which is then 

deposited at DTC by the depositary 

bank. In an effort to eliminate some of 

the risks and costs related to the 

processing of securities certificates,4

DTC recently made unsponsored ADRs 

eligible for DTC’s Fast Automated 

Securities Transfer Program (‘‘FAST’’).5

DTC’s withdrawal-by-transfer (‘‘WT’’) 

service allows participants to instruct 

DTC to have securities assets which are 

held in the participant’s DTC account 

reregistered in the name of the 


cprice-sewell on DSK2BSOYB1PROD with NOTICES
7642 Federal Register / Vol. 75, No. 34 / Monday, February 22, 2010 / Notices 

6For more information on dematerialization, see 

Securities Exchange Act Release No. 49405 (March 

11, 2004), 69 FR 12922 (March 18, 2004) ([File No. 

S7–13–04]). 

7 DWAC is a method of electronically transferring 

shares between a DTC Participant and the transfer 

agent for the shares. For more information about the 

DWAC service, see Securities Exchange Act Release 

No. 30283 (January 23, 1992), 56 FR 59307 

(November 18, 1991) (SR–DTC–91–16) (order 

granting approval of the DWAC service). 

8 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3 15 U.S.C. 78s(b)(3)(A)(ii). 

4 17 CFR 240.19b–4(f)(2). 

participant, an investor, or a third party. 

Upon receipt of a WT instruction from 

a participant, DTC either sends a 

certificate to the transfer agent for 

reregistration in the name of the person 

or entity identified in the WT 

instruction or instructs the transfer 

agent to debit DTC’s FAST position and 

to issue securities in the name of the 

person or entity identified in the WT 

instruction. 

As part of DTC’s response to an 

industry effort to reduce the number of 

securities certificates in the U.S. market 

(sometimes referred to as 

‘‘dematerialization’’),6 DTC initiated a 

program of steadily increasing its fees 

for WTs and other withdrawals to create 

strong disincentives for the use of 

physical certificates. Consistent with 

that program, DTC is now proposing to 

eliminate a participant’s ability to use 

the WT service to have physical 

certificates issued for unsponsored 

ADRs that are a part of the FAST 

Program. DTC believes that this 

modification of its WT service reaffirms 

its goals of reducing the number of 

securities certificates in the U.S. 

markets. DTC participants will continue 

to have the ability to request a physical 

certificate directly from the transfer 

agent by using the DWAC process.7

The proposed rule change is 

consistent with the requirements of the 

Securities Exchange Act of 1934, as 

amended (‘‘Act’’), and the rules and 

regulations thereunder because it 

modifies a DTC service in order to 

reduce the use of physical certificates 

and the inherent risks associated with 

the use of physical certificates and as 

such facilitates the prompt and accurate 

clearance and settlement of securities. 

(B) Self-Regulatory Organization’s 

Statement on Burden on Competition 

DTC does not believe that the 

proposed rule change would impose any 

burden on competition. 

(C) Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants or Others 

Written comments relating to the 

proposed rule change have not been 

solicited or received. DTC will notify 

the Commission of any written 

comments received by DTC. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Within thirty-five 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 

ninety 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 the 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 (http://www.sec.gov/

rules/sro.shtml) or 

• Send an e-mail to rulecomments@sec.gov. Please include File 

Number SR–DTC–2010–03 on the 

subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Elizabeth M. Murphy, Secretary, 

Securities and Exchange Commission, 

100 F Street, NE., Washington, DC 

20549–1090. 

All submissions should refer to File 

Number SR–DTC–2010–03. 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 Web site viewing and 

printing in the Commission’s Public 

Reference Section, 100 F Street, NE., 

Washington, DC 20549–1090, on official 

business days between the hours of 10 

a.m. and 3 p.m. Copies of such filings 

will also be available for inspection and 

copying at the principal office of DTC 

and on DTC’s Web site at http://

www.dtcc.com/downloads/legal/ 

rule_filings/2010/dtc/2010-03.pdf. 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–DTC–2010–03 and should 

be submitted on or before March 15, 

2010. 

For the Commission by the Division of 

Trading and Markets, pursuant to delegated 

authority.8

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. 2010–3329 Filed 2–19–10; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–61515; File No. SR– 

NASDAQ–2010–014] 

Self-Regulatory Organizations; The 

NASDAQ Stock Market LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change To Modify Fees 

for Members Using the NASDAQ 

Market Center and To Correct a 

Typographical Error in Rule 7018 

February 12, 2010. 

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 January 

26, 2010, The NASDAQ Stock Market 

LLC (‘‘NASDAQ’’) filed with the 

Securities and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I, II, and 

III below, which Items have been 

prepared by NASDAQ. Pursuant to 

Section 19(b)(3)(A)(ii) of the Act 3 and 

Rule 19b–4(f)(2) thereunder,4 NASDAQ 

has designated this proposal as 

establishing or changing a due, fee, or 

other charge, which renders the 

proposed rule change effective upon 

filing. The Commission is publishing 

this notice to solicit comments on the 


cprice-sewell on DSK2BSOYB1PROD with NOTICES