Federal Register / Vol. 75, No. 87 / Thursday, May 6, 2010 / Notices 25005 

9See Securities Exchange Act Release No. 60598 

(September 1, 2009), 74 FR 46280 (September 8, 

2009). 

10See Securities Exchange Act Release No. 60382 

(July 24, 2009), 74 FR 38068 (July 30, 2009). 

11See Securities Exchange Act Release No. 61853 

(April 6, 2010), 75 FR 18925 (April 13, 2010). 

12 15 U.S.C. 78q(d). 13 17 CFR 240.17d–2(c). 14Apparent violations of such ISE rules by any 

Inbound Router Member will be processed by, and 

enforcement proceedings will be conducted by, 

FINRA. 

14a ISE’s other Inbound Router Member, Direct 

Edge ECN LLC, is not addressed by this 17d–2 Plan, 

but is instead addressed in a similar manner under 

a separate, stand-alone plan. See Securities 

Exchange Act Release No. 59134 (December 22, 

2008), 73 FR 79943 (December 30, 2008) (File No. 

4–574) (order declaring effective the 17d–2 plan 

concerning Direct Edge ECN LLC). 

15 17 CFR 200.30–3(a)(34). 

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

2 15 U.S.C. 78a. 

3 17 CFR 240.19b–4. 

II. Ballista Securities LLC 

On June 5, 2009, ISE Holdings, Inc. 

(‘‘ISE Holdings’’), the parent of ISE, 

entered into a Membership Purchase 

Agreement with Optifreeze LLC 

(‘‘Optifreeze’’). ISE Holdings acquired 

membership interests in Optifreeze by 

contributing cash to the capital of 

Optifreeze. As a result of the purchase, 

ISE Holdings has an 8.57% membership 

interest in Optifreeze, which whollyowns and operates an Electronic Access 

Member of the ISE, Ballista Securities 

LLC (‘‘Ballista’’). The ownership interest 

of ISE Holdings in Ballista is subject to 

the conditions set forth in the 

Commission’s approval order relating to 

ISE Holdings’ purchase of Optifreeze.9

Recognizing that the Commission has 

previously expressed concern regarding 

(1) the potential for conflicts of interest 

in instances where an exchange is 

affiliated with one of its members, and 

(2) the potential for informational 

advantages that could place an affiliated 

member of an exchange at a competitive 

advantage vis-a`-vis the other nonaffiliated members, the ISE submitted a 

proposed rule change to amend ISE Rule 

312 to permit the proposed affiliation 

subject to several conditions and 

limitations, including that a condition 

that the Exchange enter into a plan with 

a non-affiliated self-regulatory 

organization to regulate and oversee the 

activities of Ballista, pursuant to Rule 

17d–2 under the Act.10

On March 19, 2010, the Parties 

submitted the proposed 17d–2 Plan to 

the Commission. On April 13, 2010, the 

Commission published notice of the 

Plan filed by ISE and FINRA in the 

Federal Register.11 The Commission 

received no comments on the Plan. The 

text of the Plan allocates regulatory 

responsibilities among the Parties with 

respect to Ballista, which is a common 

member. Included in the Plan is an 

attachment (the ‘‘ISE Rules Certification 

for 17d–2 Agreement with FINRA,’’ 

referred to herein as the ‘‘Certification’’) 

that lists every ISE rule and federal 

securities law and rule and regulation 

thereunder for which, under the Plan, 

FINRA would bear responsibility for 

examining, and enforcing compliance 

by, Ballista. 

III. Discussion 

The Commission finds that the 

proposed Plan is consistent with the 

factors set forth in Section 17(d) 12 of the 

Act and Rule 17d–2(c) 13 thereunder in 

that the proposed Plan is necessary or 

appropriate in the public interest and 

for the protection of investors, fosters 

cooperation and coordination among 

SROs, and removes impediments to and 

fosters the development of the national 

market system. Among other things, the 

Commission believes that the proposed 

Plan should reduce unnecessary 

regulatory duplication by allocating to 

FINRA certain responsibilities for 

Ballista, a common member, that would 

otherwise be performed by both ISE and 

FINRA. Accordingly, the proposed Plan 

promotes efficiency by reducing costs to 

Ballista. Furthermore, because FINRA 

will be responsible for regulating 

Ballista instead of ISE, the plan should 

promote investor protection and help 

avoid any potential conflicts of interest 

that could arise if ISE was primarily 

responsible for regulating Ballista, with 

which ISE is affiliated. 

The Commission notes that, under the 

Plan, FINRA would assume examination 

and enforcement responsibility relating 

to compliance by Ballista and persons 

associated therewith, with all applicable 

rules. Specifically, FINRA would 

assume examination and enforcement 

responsibility relating to compliance by 

Ballista and persons associated 

therewith, with the rules of ISE that are 

substantially similar to the rules of 

FINRA, as well as any provisions of the 

federal securities laws and the rules and 

regulations thereunder delineated in the 

Exhibit 1 to the 17d–2 Plan (‘‘Common 

Rules’’). In addition, under the Plan, 

FINRA would assume regulatory 

responsibility, with respect to Ballista, 

for all other ISE rules that do not qualify 

as Common Rules, as discussed below, 

on account of Ballista’s status as an 

‘‘Inbound Router Member.’’ 

Under the 17d–2 Plan, ISE would 

retain full responsibility for 

surveillance, examination, investigation, 

and enforcement with respect to trading 

activities or practices involving ISE’s 

own marketplace; registration pursuant 

to its unique rules (i.e., registration rules 

that are not Common Rules); its duties 

as a Designated Examining Authority 

pursuant to Rule 17d–1 under the Act; 

and any rules that are not substantially 

similar to the rules of FINRA, except for 

ISE rules for any ISE member that acts 

as an inbound router for ISE and is a 

member of both ISE and FINRA 

(‘‘Inbound Router Member’’).14 For 

purposes of the proposed 17d–2 Plan, 

Ballista would meet the definition of the 

term ‘‘Inbound Router Member’’ as it is 

used in the plan.14a The effect of these 

provisions is that regulatory oversight 

and enforcement responsibilities for 

Ballista would be vested with FINRA. 

These provisions should help avoid any 

potential conflicts of interest that could 

arise if ISE was primarily responsible 

for regulating Ballista, with which ISE is 

affiliated. 

IV. Conclusion 

This Order gives effect to the Plan 

filed with the Commission in File No. 

4–596. The Parties shall notify all 

members affected by the Plan of their 

rights and obligations under the Plan. 

It is therefore ordered, pursuant to 

Sections 17(d) of the Act, that the Plan 

in File No. 4–596, between ISE and 

FINRA, filed pursuant to Rule 17d–2 

under the Act, is approved and declared 

effective. 

It is therefore ordered that ISE is 

relieved of those responsibilities 

allocated to FINRA under the Plan in 

File No. 4–596. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.15

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. 2010–10596 Filed 5–5–10; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–61990; File No. SR– 

NYSEArca–2010–25] 

Self-Regulatory Organizations; NYSE 

Arca, Inc.; Notice of Filing of Proposed 

Rule Change Amending the Listing and 

Trading of ETFS Palladium Trust and 

ETFS Platinum Trust 

April 27, 2010. 

Pursuant to Section 19(b)(1) 1 of the 

Securities Exchange Act of 1934 (the 

‘‘Act’’) 2 and Rule 19b–4 thereunder,3

notice is hereby given that, on April 8, 

2010, NYSE Arca, Inc. (‘‘NYSE Arca’’ or 

the ‘‘Exchange’’) filed with the Securities 

and Exchange Commission (the 

mstockstill on DSKH9S0YB1PROD with NOTICES

25006 Federal Register / Vol. 75, No. 87 / Thursday, May 6, 2010 / Notices 

4See Securities Exchange Act Release No. 57894 

(May 30, 2008), 73 FR 32061 (June 5, 2008) (order 

approving SR–NYSEArca–2008–52). 

5See Securities Exchange Act Release No. 59055 

(December 4, 2008), 73 FR 238 [sic] (December 10, 

2008) (order approving SR–NYSEArca–2008–66). 

6See Securities Exchange Act Release No. 61483 

(February 3, 2010), 75 FR 6753 (February 10, 2010). 7See Rule 5.3(g). 

‘‘Commission’’) the proposed rule 

change as described in Items I, II, and 

III below, which Items have been 

prepared by the self-regulatory 

organization. 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 Substance of 

the Proposed Rule Change 

The Exchange proposes to amend 

certain rules in order to enable the 

listing and trading on the Exchange of 

options on the ETFS Palladium Trust 

and the ETFS Platinum Trust. The text 

of the proposed rule change is available 

on the Commission’s Web Site at 

http://www.sec.gov. A copy of this filing 

is available on the Exchange’s Web site 

at http://www.nyse.com, at the 

Exchange’s principal office and at the 

Commission’s Public Reference Room. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

self-regulatory organization 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 those statements may be examined at 

the places specified in Item IV below. 

The Exchange has prepared summaries, 

set forth in sections A, B, and C below, 

of the most significant parts of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and the 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

Recently, the U.S. Securities and 

Exchange Commission (‘‘SEC’’ or 

‘‘Commission’’) authorized the Exchange 

to list and trade options on the SPDR 

Gold Trust (‘‘GLD’’) 4 and on the iShares 

COMEX Gold Trust (‘‘IAU’’) and the 

iShares Silver Trust (‘‘SLV’’),5 the ETFS 

Silver Trust (‘‘SIVR’’) and the ETFS Gold 

Trust (‘‘SGOL’’).6 Now, the Exchange 

proposes to list and trade options on the 

ETFS Palladium Trust (‘‘PALL’’) and the 

ETFS Platinum Trust (‘‘PPLT’’). 

Currently, Rule 5.3 deems appropriate 

for options trading Exchange-Traded 

Fund Shares (‘‘ETFs’’ or ‘‘Fund Shares’’ 

or ‘‘Units’’) that are traded on a national 

securities exchange and are defined as 

an ‘‘NMS stock’’ in Rule 600(b)(47) of 

Regulation NMS and that represent (i) 

interests in registered investment 

companies (or series thereof) organized 

as open-end management investment 

companies, unit investment trusts or 

similar entities that hold portfolios of 

securities and/or financial instruments 

including, but not limited to, options on 

securities and indexes, equity caps, 

collars and floors, swap agreements, 

forward contracts, repurchase 

agreements and reverse purchase 

agreements (the ‘‘Financial 

Instruments’’), and money market 

instruments, including, but not limited 

to, U.S. government securities and 

repurchase agreements (the ‘‘Money 

Market Instruments’’) comprising or 

otherwise based on or representing 

investments in indexes or portfolios of 

securities and/or Financial Instruments 

and Money Market Instruments (or that 

hold securities in one or more other 

registered investment companies that 

themselves hold such portfolios of 

securities and/or Financial Instruments 

and Money Marker Instruments); or (ii) 

interests in a trust or similar entity that 

holds a specified non-U.S. currency 

deposited with the trust or similar entity 

when aggregated in some specified 

minimum number may be surrendered 

to the trust by the beneficial owner to 

receive the specified non-U.S. currency, 

and pays the beneficial owner interest 

and other distributions on deposited 

non-U.S. currency, if any, declared and 

paid by the trust; or (iii) commodity 

pool interests principally engaged, 

directly or indirectly, in holding and/or 

managing portfolios or baskets of 

securities, commodity futures contracts, 

options on commodity futures contracts, 

swaps, forward contracts and/or options 

on physical commodities and/or nonU.S. currency (‘‘Commodity Pool 

Units’’), or (iv) represent interests in the 

SPDR Gold Trust, are eligible as 

underlying securities for options traded 

on the Exchange or (iv) represent 

interests in the SPDR Gold Trust, or (v) 

represent interests in the iShares 

COMEX Gold Trust, or (vi) represent 

interests in the iShares Silver Trust, or, 

(vii) represents an interest in a 

registered investment company 

(‘‘Investment Company’’) organized as an 

open-end management investment 

company or similar entity, that invests 

in a portfolio of securities selected by 

the Investment Company’s investment 

adviser consistent with the Investment 

Company’s investment objectives and 

policies, which is issued in a specified 

aggregate minimum number in return 

for a deposit of a specified portfolio of 

securities and/or a cash amount with a 

value equal to the next determined net 

asset value (‘‘NAV’’), and when 

aggregated in the same specified 

minimum number, may be redeemed at 

a holder’s request, which holder will be 

paid a specified portfolio of securities 

and/or cash with a value equal to the 

next determined NAV (‘‘Managed Fund 

Share’’) or, (viii) represents interest in 

the ETFS Silver Trust or the ETFS Gold 

Trust.7 This rule change proposes to 

expand the types of ETFs that may be 

approved for options trading on the 

Exchange to include the ETFS 

Palladium Trust and the ETFS Platinum 

Trust. 

Apart from allowing the ETFS 

Palladium Trust and ETFS Platinum 

Trust to be underlyings for options 

traded on the Exchange as described 

above, the listing standards for ETFs 

will remain unchanged from those that 

apply under current Exchange rules. 

ETFs on which options may be listed 

and traded must still be listed and 

traded on a national securities exchange 

and must satisfy the other listing 

standards set forth in Rule 5.3(g). 

Specifically, in addition to satisfying 

the aforementioned listing 

requirements, Units must meet either (1) 

the criteria and guidelines under Rule 

5.3(a) and (b) or (2) they must be 

available for creation or redemption 

each business day from or through the 

issuer in cash or in kind at a price 

related to net asset value, and the issuer 

must be obligated to issue Units in a 

specified aggregate number even if some 

or all of the investment assets required 

to be deposited have not been received 

by the issuer, subject to the condition 

that the person obligated to deposit the 

investments has undertaken to deliver 

the investment assets as soon as 

possible and such undertaking is 

secured by the delivery and 

maintenance of collateral consisting of 

cash or cash equivalents satisfactory to 

the issuer, as provided in the respective 

prospectus. 

The Exchange states that the current 

continued listing standards for options 

on ETFs will apply to options on the 

ETFS Palladium Trust and ETFS 

Platinum Trust. Specifically, under Rule 

5.4(k), options on Units may be subject 

to the suspension of opening 

transactions as follows: (1) Following 

the initial twelve-month period 

beginning upon the commencement of 

trading of the Units, there are fewer than 

50 record and/or beneficial holders of 

the Units for 30 or more consecutive 

mstockstill on DSKH9S0YB1PROD with NOTICES

Federal Register / Vol. 75, No. 87 / Thursday, May 6, 2010 / Notices 25007 

8See Rule 6.8 regarding positions limits, and Rule 

6.9 regarding exercise limits. 9See Rules 4.15 and 4.16 regarding margins. 10 15 U.S.C. 78f(b). 

11 15 U.S.C. 78f(b)(5). 

12 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3See Securities Exchange Act Release No. 61748 

(March 19, 2010), 75 FR 14644 (‘‘Notice’’). 

trading days; (2) the value of the 

underlying silver or underlying gold 

[sic] is no longer calculated or available; 

or (3) such other event occurs or 

condition exists that in the opinion of 

the Exchange makes further dealing on 

the Exchange inadvisable. 

Additionally, the ETFS Palladium 

Trust and ETFS Platinum Trust shall 

not be deemed to meet the requirements 

for continued approval, and the 

Exchange shall not open for trading any 

additional series of option contracts of 

the class covering the ETFS Palladium 

Trust or the ETFS Platinum Trust, 

respectively, if the ETFS Palladium 

Trust or the ETFS Platinum Trust ceases 

to be an ‘‘NMS stock’’ as provided for in 

Rule 5.4(b)(5) or the ETFS Palladium 

Trust or the ETFS Platinum Trust is 

halted from trading on its primary 

market. 

The addition of the ETFS Palladium 

Trust and ETFS Platinum Trust to Rule 

5.3(g) will not have any effect on the 

rules pertaining to position and exercise 

limits 8 or margin.9

The Exchange represents that its 

surveillance procedures applicable to 

trading in options on the ETFS 

Palladium Trust and ETFS Platinum 

Trust will be similar to those applicable 

to all other options on other ETFs 

currently traded on the Exchange. Also, 

the Exchange may obtain information 

from the New York Mercantile 

Exchange, Inc. (‘‘NYMEX’’) (a member of 

the Intermarket Surveillance Group) 

related to any financial instrument 

traded there that is based, in whole or 

part, upon an interest in or performance 

of silver or gold [sic]. 

2. Statutory Basis 

The proposed rule change is 

consistent with Section 6(b) 10 of the 

Securities Exchange Act of 1934 (the 

‘‘Act’’), in general, and furthers the 

objectives of Section 6(b)(5) 11 in 

particular in that it is designed to 

prevent fraudulent and manipulative 

acts and practices, to promote just and 

equitable principles of trade, to foster 

cooperation and coordination with 

persons engaged in facilitating 

transactions in securities, and to remove 

impediments to and perfect the 

mechanisms of a free and open market 

and a national market system. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange does not believe that 

the proposed rule change will impose 

any burden on competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

No written comments were solicited 

or received with respect to the proposed 

rule change. 

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 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 

No. SR–NYSEArca–2010–25 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 No. 

SR–NYSEArca–2010–25. 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 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 

Arca. 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 No. 

SR–NYSEArca–2010–25 and should be 

submitted on or before May 27, 2010. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.12

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. 2010–10592 Filed 5–5–10; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–61999; File No. SR– 

NYSEArea–2010–15] 

Self-Regulatory Organizations; NYSE 

Arca, Inc.; Order Approving a 

Proposed Rule Change Amending Its 

Schedule of Fees and Charges for 

Exchange Services 

April 29, 2010. 

I. Introduction 

On March 5, 2010, NYSE Arca, Inc. 

(‘‘NYSE Arca’’ or the ‘‘Exchange’’) 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 relating to co-location services 

and related fees. The proposed rule 

change was published for comment in 

the Federal Register on March 26, 

2010.3 The Commission received no 

comment letters on the proposal. This 

order approves the proposed rule 

change. 

mstockstill on DSKH9S0YB1PROD with NOTICES