Federal Register / Vol. 74, No. 9 / Wednesday, January 14, 2009 / Notices 2149 

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

2 17 CFR 240.19b–4. 

3See Securities Exchange Act Release No. 59098 

(December 12, 2008), 73 FR 78415 (‘‘Notice’’). 

4 17 CFR 240.19b–4(e). 

5 15 U.S.C. 78s(b)(2). 

6 17 CFR 240.19b–4(e). 

7See supra note 3. 

8 15 U.S.C. 78f(b). 

9 15 U.S.C. 78f(b)(5). 

10 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). 

11See, e.g., Securities Exchange Act Release Nos. 

56713 (October 29, 2007), 72 FR 61915 (November 

1, 2007) (SR–Amex–2007–74) (approving the listing 

and trading of Rydex Leveraged Funds, Inverse 

Funds and Leveraged Inverse Funds); 52553 

(October 3, 2005), 70 FR 59100 (October 11, 2005) 

(SR–Amex–2004–62) (approving the listing and 

trading of the ProShares Ultra Funds and Short 

Funds); 54040 (June 23, 2006), 71 FR 37629 (June 

30, 2006) (SR–Amex–2006–41) (approving the 

listing and trading of the ProShares UltraShort 

Funds); 55117 (January 17, 2007), 72 FR 3442 

(January 25, 2007) (SR–Amex–2006–101) 

(approving the listing and trading of Ultra, Short 

and UltraShort Funds based on various indexes); 

56592 (October 1, 2007), 72 FR 57364 (October 9, 

2007) (SR–Amex–2007–60) (approving the listing 

and trading of ProShares Ultra, Short and 

UltraShort Funds based on various international 

indexes); and 56998 (December 19, 2007), 72 FR 

73404 (December 27, 2007) (SR–Amex–2007–104) 

(approving the listing and trading of ProShares 

Ultra, Short and UltraShort Funds based on several 

fixed income indexes, among others). See also, e.g., 

Securities Exchange Act Release Nos. 56763 

(November 7, 2007), 72 FR 64103 (November 14, 

2007) (SR–NYSEArca–2007–81) (approving UTP 

trading of shares of funds of Rydex ETF Trust); 

56601 (October 2, 2007), 72 FR 57625 (October 10, 

2007) (SR–NYSEArca–2007–79) (approving UTP 

trading of shares of eight funds of the ProShares 

Trust); 55125 (January 18, 2007), 72 FR 3462 

(January 25, 2007) (SR–NYSEArca–2006–87) 

(approving UTP trading of shares of 81 funds of the 

ProShares Trust); and 54026 (June 21, 2006), 71 FR 

36850 (June 28, 2006) (SR–PCX–2005–115) 

(approving UTP trading of shares of funds of the 

ProShares Trust). 

12See Securities Exchange Act Release No. 58825 

(October 21, 2008), 73 FR 63756 (October 27, 2008) 

(SR–NYSEArca–2008–89). 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–59214; File No. SR– 

NASDAQ–2008–096] 

Self-Regulatory Organizations; The 

NASDAQ Stock Market LLC; Order 

Granting Accelerated Approval to a 

Proposed Rule Change Relating to the 

Generic Listing Standards for Index 

Multiple Exchange Traded Fund 

Shares and Index Inverse Exchange 

Traded Fund Shares 

January 7, 2009. 

I. Introduction 

On December 9, 2008, The NASDAQ 

Stock Market LLC (‘‘Nasdaq’’) 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 permit Nasdaq to list and 

trade, or trade pursuant to unlisted 

trading privileges (‘‘UTP’’), shares of a 

series of Index Multiple Exchange 

Traded Fund Shares (‘‘Multiple Fund 

Shares’’) and Index Inverse Exchange 

Traded Fund Shares (‘‘Inverse Fund 

Shares’’) (collectively, the ‘‘Fund 

Shares’’). The proposed rule change was 

published in the Federal Register on 

December 22, 2008 for a 15-day 

comment period.3 The Commission 

received no comments on the proposal. 

This order approves the proposed rule 

change on an accelerated basis. 

II. Description of the Proposal 

Nasdaq Rule 4420(j) provides 

standards for listing Index Fund Shares 

(‘‘IFSs’’) on the Exchange. Nasdaq 

proposes to revise Nasdaq Rule 

4420(j)(1)(B)(iii) to allow the listing and 

trading of Multiple Fund Shares and 

Inverse Fund Shares that sought to 

provide investment results, before fees 

and expenses, in an amount not 

exceeding ¥300%, rather than ¥200%, 

of the underlying benchmark index 

pursuant to Rule 19b–4(e) under the 

Act,4 where the other applicable generic 

listing standards for IFSs are satisfied. 

In connection with Inverse Funds that 

seek to provide investment results, 

before fees and expenses, in an amount 

that exceeds ¥300% of the underlying 

benchmark index, the Exchange’s 

proposal would continue to require 

specific Commission approval pursuant 

to Section 19(b)(2) of the Act.5 In 

particular, Nasdaq Rule 4420(j)(1)(B)(iii) 

would expressly prohibit Inverse Funds 

that seek to provide investment results, 

before fees and expenses, in an amount 

that exceeds ¥300% of the underlying 

benchmark index, from being approved 

by the Exchange for listing and trading 

pursuant to Rule 19b–4(e) under the 

Act.6

Additional information about the 

proposed rule change and IFSs, 

including applicable generic listing 

standards, limitation on leverage, 

availability of information about Fund 

Shares and underlying indexes, trading 

halts, suitability, and surveillance, 

among other things, is contained in the 

Notice.7

III. Discussion and Accelerated 

Approval 

After careful review, 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 and, in particular, 

with Section 6(b) of the Act 8 and the 

rules and regulations thereunder. 

Specifically, the Commission finds that 

the proposed rule change is consistent 

with Section 6(b)(5) of the Act 9 which 

requires, among other things, that the 

rules of a national securities exchange 

be designed to prevent fraudulent and 

manipulative acts and practices, to 

promote just and equitable principles of 

trade, to remove impediments to and 

perfect the mechanism of a free and 

open market and a national market 

system, and, in general, to protect 

investors and the public interest.10

The Commission believes that the 

Exchange’s proposal reasonably 

balances the removal of impediments to 

a free and open market with the 

protection of investors and the public 

interest, two principles set forth in 

Section 6(b)(5) of the Act. The 

Commission notes that it has previously 

approved the listing and trading of 

various leveraged exchange-traded 

funds, including trading pursuant to 

unlisted trading privileges on the 

Exchange, that seek daily investment 

results, before fees and expenses, that 

correspond to twice the inverse or 

opposite of the daily performance 

(¥200%) of the underlying index.11 The 

Commission also notes that the 

proposed rule change is substantially 

similar to another exchange’s generic 

listing requirements for Multiple Fund 

Shares and Inverse Fund Shares.12 With 

respect to the listing and trading of a 

series of Inverse Fund Shares that seek 

to provide investment results that 

exceed ¥300% of the percentage 

performance of an underlying 

benchmark index, the Commission 

further notes that the Exchange would 

be required to obtain prior Commission 

approval pursuant to Section 19(b)(2) of 

the Act. 

The Commission also notes that Fund 

Shares must comply with all of the 

applicable provisions under Nasdaq 

Rule 4420(j), as proposed to be amended 

as well as all other requirements 

applicable to IFSs including, without 

limitation, requirements relating to the 

dissemination of intraday indicative 

value, index value, disclosure of 

portfolio holdings, rules and policies 

governing the trading of equity 

securities, trading hours, trading halts, 

surveillance, firewalls, and Information 

Circulars to member and member 

organizations, as set forth in prior 

Commission orders approving the 

generic listing rules applicable to the 

listing and trading of IFSs. 

The Commission further notes that 

the proposed rule change is reasonably 

designed to promote fair disclosure of 


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2150 Federal Register / Vol. 74, No. 9 / Wednesday, January 14, 2009 / Notices 

13 17 CFR 240.10A–3. 

14See supra note 12. 

15 15 U.S.C. 78s(b)(2). 

16 17 CFR 200.30–3(a)(12). 

information that may be necessary to 

price the Shares appropriately and to 

prevent trading when a reasonable 

degree of transparency cannot be 

assured. Nasdaq Rule 4420(j)(1)(B)(iv) 

requires daily public Web site 

disclosure of its portfolio holdings 

including, as applicable, the identity 

and number of shares held of each 

specific equity security, the identity and 

amount held of each fixed income 

security, the specific types of Financial 

Instruments and characteristics of such 

instruments, and cash equivalents and 

the amount of cash held in the portfolio 

of a fund. With respect to such 

Financial Instruments, the Commission 

notes that a notification procedure will 

be implemented by the Exchange so that 

timely notice from the investment 

adviser of such Multiple or Inverse 

Fund is received by the Exchange when 

a particular Financial Instrument is in 

default or shortly to be in default. The 

Commission also notes that the 

Exchange would be required to halt 

trading if Nasdaq becomes aware that 

the NAV or the identities and quantities 

of the portfolio of securities and other 

assets with respect to a Fund Share is 

not disseminated to all market 

participants at the same time. 

In addition, the Commission notes 

that the Exchange’s suitability 

requirements would apply to the trading 

of Multiple Fund Shares and Inverse 

Fund Shares. Specifically, prior to 

commencement of trading, the Exchange 

will issue an Information Circular to its 

members and member organizations 

providing guidance with regard to 

member firm compliance 

responsibilities (including suitability 

obligations) when effecting transactions 

in the Fund Shares and highlighting the 

special risks and characteristics of 

Funds Shares as well as applicable 

Exchange rules. 

In sum, the Commission believes that 

the Exchange’s proposed amendments 

to Nasdaq Rule 4420(j) relating to the 

listing and trading of Multiple Fund 

Shares and Inverse Fund Shares should 

fulfill the intended objective of Rule 

19b–4(e) under the Act by allowing such 

derivative securities products to be 

listed and traded without separate 

Commission approval. The Commission 

believes that the proposed rule change 

should facilitate the listing and trading 

of additional types of exchange-traded 

products and reduce the time frame for 

bringing these securities to market, 

thereby reducing the burdens on issuers 

and other market participants and 

promoting competition. 

The Commission finds good cause, 

pursuant to Section 19(b)(2) of the 

Act,13 for approving the proposed rule 

change prior to the 30th day after the 

date of publication of notice in the 

Federal Register. The Commission notes 

that it has previously approved a 

substantially similar proposed rule 

change of another self-regulatory 

organization.14 No comments were 

received on the proposed rule change 

during the 15-day comment period, and 

the Commission believes that the 

Exchange’s proposal does not present 

any novel regulatory issues. 

As such, the Commission believes 

that accelerating approval of this 

proposal should benefit investors by 

creating, without undue delay, 

additional competition in the market for 

such products. 

IV. Conclusion 

It is therefore ordered, pursuant to 

Section 19(b)(2) of the Act,15 that the 

proposed rule change (SR–NASDAQ– 

2008–096) be, and hereby is, approved 

on an accelerated basis. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.16

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. E9–611 Filed 1–13–09; 8:45 am] 

BILLING CODE 8011–01–P 

SOCIAL SECURITY ADMINISTRATION 

[Docket No. SSA 2008–0045] 

Privacy Act of 1974, as Amended; 

Computer Matching Program (SSA/ 

Health and Human Services, 

Administration for Children and 

Families, Office of Child Support 

Enforcement (OCSE) Match Number 

1074. 

AGENCY: Social Security Administration 

(SSA). 

ACTION: Notice of the renewal of an 

existing computer matching program 

scheduled to expire on March 12, 2009. 

SUMMARY: In accordance with the 

provisions of the Privacy Act, as 

amended, this notice announces the 

renewal of an existing computer 

matching program that SSA is currently 

conducting with HHS/ACF/OCSE. 

DATES: SSA will file a report of the 

subject matching program with the 

Committee on Homeland Security and 

Governmental Affairs of the Senate; the 

Committee on Oversight and 

Government Reform of the House of 

Representatives; and the Office of 

Information and Regulatory Affairs, 

Office of Management and Budget 

(OMB). The renewal of the matching 

program will be effective as indicated 

below. 

ADDRESSES: Interested parties may 

comment on this notice by either 

telefaxing to (410) 965–0201 or writing 

to the Deputy Commissioner for Budget, 

Finance and Management, 800 Altmeyer 

Building, 6401 Security Boulevard, 

Baltimore, MD 21235–6401. All 

comments received will be available for 

public inspection at this address. 

FOR FURTHER INFORMATION CONTACT: The 

Deputy Commissioner for Budget, 

Finance and Management as shown 

above. 

SUPPLEMENTARY INFORMATION: 

A. General 

The Computer Matching and Privacy 

Protection Act of 1988 (Pub. L. 100– 

503), amended the Privacy Act (5 U.S.C. 

552a) by describing the conditions 

under which computer matching 

involving the Federal government could 

be performed and adding certain 

protections for individuals applying for 

and receiving Federal benefits. Section 

7201 of the Omnibus Budget 

Reconciliation Act of 1990 (Pub. L. 101– 

508) further amended the Privacy Act 

regarding protections for such 

individuals. 

The Privacy Act, as amended, 

regulates the use of computer matching 

by Federal agencies when records in a 

system of records are matched with 

other Federal, state or local government 

records. It requires Federal agencies 

involved in computer matching 

programs to: 

(1) Negotiate written agreements with 

the other agency or agencies 

participating in the matching programs; 

(2) Obtain the approval of the 

matching agreement by the Data 

Integrity Boards (DIB) of the 

participating Federal agencies; 

(3) Publish notice of the computer 

matching program in the Federal 

Register; 

(4) Furnish detailed reports about 

matching programs to Congress and 

OMB; 

(5) Notify applicants and beneficiaries 

that their records are subject to 

matching; and 

(6) Verify match findings before 

reducing, suspending, terminating or 

denying an individual’s benefits or 

payments. 


sroberts on PROD1PC70 with NOTICES