Document ID: SEC-2008-0231-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: NASDAQ Stock Market LLC
Posted Date: 2008-02-12T05:00Z

[Federal Register: February 12, 2008 (Volume 73, Number 29)]
[Notices]               
[Page 8092-8096]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr12fe08-73]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-57269; File No. SR-NASDAQ-2008-008]

 
Self-Regulatory Organizations; The NASDAQ Stock Market, LLC; 
Notice of Filing and Order Granting Accelerated Approval of Proposed 
Rule Change To Trade the Shares of Eight Funds of the ProShares Trust 
Based on Four International Equity Indexes Pursuant to Unlisted Trading 
Privileges and To Amend Certain Generic Listing Standards

February 5, 2008.
    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 24, 2008, The NASDAQ Stock Market, LLC (``Nasdaq'' or 
``Exchange'') filed with the Securities and Exchange Commission 
``Commission'') the proposed rule change as described in Items I and II 
below, which Items have been substantially prepared by the Exchange. 
This order provides notice of the proposed rule change and approves it 
on an accelerated basis.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    Nasdaq proposes to trade, pursuant to unlisted trading privileges 
(``UTP''), shares (``Shares'') of eight funds of the ProShares Trust 
(``Trust''). Nasdaq also proposes to amend the generic listing 
standards contained in Nasdaq Rule 4420(m)(4).
    The text of the proposed rule change is available from the 
Exchange's Web site (http://nasdaq.complinet.com), at the principal 

office of the Exchange, 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 Exchange 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 III below. The Exchange has prepared summaries, set forth in 
Sections A, B, and C below, of the most significant aspects of such 
statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    Nasdaq proposes to trade pursuant to UTP the Shares of the eight 
new Funds of the Trust that are designated as Short Funds (``Short 
Funds'') and UltraShort Funds (``UltraShort Funds''), as described more 
fully below.\3\ The Commission has approved the original listing and 
trading of the Shares on the American Stock Exchange, LLC 
(``Amex'').\4\ Each Fund will attempt, on a daily basis, to achieve its 
distinct investment objective by corresponding to a specified multiple 
of the inverse performance of a particular equity securities index 
(each, an ``Underlying Index'' or ``Index'') as briefly described 
below.
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    \3\ The Commission has previously approved trading certain Ulta 
Funds, Short Funds, and UltraShort Funds of the Proshares Trust on 
the Exchange pursuant to UTP. See Securities Exchange Act Release 
No. 55353 (February 26, 2007), 72 FR 9802 (March 5, 2007)(SR-NASDAQ-
2007-011).
    \4\ See Securities Exchange Act Release No. 56592 (October 1, 
2007)(SR-Amex-2007-60)(``Amex Order''). See also Securities Exchange 
Act Release No. 56223 (August 8, 2007), 72 FR 45837 (August 15, 
2007)(SR-Amex-2007-60)(``Amex Notice'').
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    Short Funds. Each Short Fund seeks daily investment results, before 
fees and expenses, that correspond to the inverse or opposite of the 
daily performance (-100%) of the Underlying Index. If a Short Fund is 
successful in meeting its objective, the net asset value (``NAV'') \5\ 
of the corresponding Shares should increase approximately as much (on a 
percentage basis) as the respective Underlying Index loses when the 
prices of the securities in the Index decline on a given day, or should 
decrease approximately as much as the respective Index gains when 
prices in the Index rise on a given day. The Short Funds include: (1) 
Short MSCI Emerging Markets ProShares, (2) Short MSCI Japan ProShares, 
(3) Short MSCI EAFE ProShares, and (4) Short FTSE/Xinhua China 25 
ProShares.
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    \5\ NAV per Share of each Fund is computed by dividing the value 
of the Fund's net assets (i.e., the value of its total assets less 
total liabilities) by its total number of Shares outstanding. 
Expenses and fees are accrued daily and taken into account for 
purposes of determining NAV.
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    UltraShort Funds. An UltraShort Fund seeks daily investment 
results, before fees and expenses, that correspond to twice the inverse 
or opposite of the daily performance (-200%) of the Underlying Index. 
If an UltraShort Fund is successful in meeting its objective, the NAV 
of the corresponding Shares should increase approximately twice as much 
(on a percentage basis) as the respective Underlying Index loses when 
the prices of the securities in the Index decline on a given day, or 
should decrease approximately twice as much as the respective 
Underlying Index gains when such prices rise on a given day. The 
UltraShort Funds include: (1) UltraShort MSCI Emerging Markets 
ProShares, (2) UltraShort MSCI Japan ProShares, (3) UltraShort MSCI 
EAFE ProShares, and (4) UltraShort FTSE/Xinhua China 25 ProShares.
    No Fund will invest directly in the component securities of the 
relevant Underlying Index; instead, each Fund will create short 
exposure to the corresponding Index. Each Fund will establish positions 
in Financial Instruments (as defined below) that

[[Page 8093]]

provide, on a daily basis, the inverse or opposite of, or twice the 
inverse or opposite of, the performance of the relevant Underlying 
Index. Normally 100% of the value of the portfolio of each Fund will be 
devoted to such Financial Instruments and certain money market 
instruments. The Financial Instruments to be held by any of the Funds 
may include stock index futures contracts; options on futures 
contracts; options on securities and indices; equity caps, collars, and 
floors; swap agreements; forward contracts; repurchase agreements; and 
reverse repurchase agreements (``Financial Instruments''). Money market 
instruments include certain U.S. government securities and repurchase 
agreements.
Availability of Information About the Shares and the Underlying Indexes
    The Trust's Web site, which is and will be publicly accessible at 
no charge, will contain the following information for each Fund's 
Shares: (1) The prior business day's closing NAV, the reported closing 
price, and a calculation of the premium or discount of such price in 
relation to the closing NAV; (2) data for a period covering at least 
the four previous calendar quarters (or the life of a Fund, if shorter) 
indicating how frequently each Fund's Shares traded at a premium or 
discount to NAV based on the daily closing price and the closing NAV, 
and the magnitude of such premiums and discounts; (3) its prospectus 
and/or product description; and (4) other quantitative information such 
as daily trading volume. The prospectus and/or product description for 
each Fund will inform investors that the Trust's Web site has 
information about the premiums and discounts at which the Fund's Shares 
have traded.
    According to the Amex Proposal, Amex will disseminate for each Fund 
on a daily basis by means of Consolidated Tape Association (``CTA'') 
and CQ High Speed Lines information with respect to an Indicative 
Intra-Day Value (``IIV''), recent NAV, shares outstanding, estimated 
cash amount, and total cash amount per Creation Unit. Amex will make 
available on its Web site the daily trading volume, the closing price, 
the NAV, and the final dividend amounts to be paid for each Fund. Amex 
represented in the Amex Proposal that it will obtain a representation 
from the Trust (for each Fund), prior to listing, that the NAV per 
share for each Fund will be calculated daily and made available to all 
market participants at the same time.\6\
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    \6\ If Amex halts trading in the Shares of the Funds because the 
NAV is not being disseminated to all market participants at the same 
time, then the Exchange would do so as well.
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    Each Fund's total portfolio composition will be disclosed on the 
Trust's Web site (http://www.proshares.com) or another relevant Web 

site as determined by the Trust and/or Amex. According to the Amex 
Proposal, the Web site disclosure of portfolio holdings will be made 
daily and will include, as applicable, the specific types of Financial 
Instruments and characteristics of such instruments, cash equivalents, 
and the amount of cash held in the portfolio of each Fund.
    This public disclosure of the portfolio composition of each Fund 
will coincide with the disclosure by ProShare Advisors, LLC 
(``Advisor'') of the ``IIV File'' and the ``PCF.''\7\ Therefore, the 
portfolio information (including accrued expenses and dividends) to be 
provided on the public Web site will be the same as the information in 
the IIV File and PCF (when applicable) provided to authorized 
participants. The format of the public Web site disclosure and the IIV 
File and PCF (when applicable) will differ because the public Web site 
will list all portfolio holdings while the IIV and PCF (when 
applicable) will similarly provide the portfolio holdings but in a 
format appropriate for authorized participants, i.e., the exact 
components of a Creation Unit.\8\ Each investor will have access to the 
current portfolio composition of each Fund through the Trust's Web 
site, at http://www.proshares.com, and/or at the Amex's Web site at 

http://www.amex.com.

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    \7\ According to the Amex Proposal, the Trust will create a 
portfolio composition file (``PCF'') for each Fund, which it will 
transmit to the National Securities Clearing Corporation (``NSCC'') 
before the open of business the next business day. The information 
in the PCF will be available to all participants in the NSCC system. 
Because the NSCC's system for the receipt and dissemination to its 
participants of the PCF is not currently capable of processing 
information with respect to Financial Instruments, the Advisor has 
developed an ``IIV File,'' which it will use to disclose the Funds' 
holdings of Financial Instruments. The IIV File will contain, for 
each Fund, information sufficient by itself or in connection with 
the PCF and other available information for market participants to 
calculate a Fund's IIV and effectively arbitrage the Fund. The Trust 
or the Advisor will post the IIV File to a password-protected Web 
site before the opening of business on each business day, and all 
authorized participants and Amex will have access to a password and 
the Web site containing the IIV File.
    \8\ The composition will be used to calculate the NAV later that 
day.
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    Beneficial owners of Shares (``Beneficial Owners'') will receive 
all of the statements, notices, and reports required under the 1940 Act 
and other applicable laws. They will receive, for example, annual and 
semi-annual Fund reports, written statements accompanying dividend 
payments, proxy statements, annual notifications detailing the tax 
status of Fund distributions, and Form 1099-DIVs. Some of these 
documents will be provided to Beneficial Owners by their brokers, while 
others will be provided by the Fund through the brokers.
    The daily closing index value and the percentage change in the 
daily closing index value for each Underlying Index will be publicly 
available on various Web sites, e.g., http://www.bloomberg.com. Data 

regarding each Underlying Index are also available from the respective 
index provider to subscribers. Several independent data vendors also 
package and disseminate index data in various value-added formats 
(including vendors displaying both securities and index levels and 
vendors displaying index levels only). The value of each Underlying 
Index would be updated intra-day as its individual component securities 
change in price. These intra-day values of each Underlying Index will 
be disseminated at least every 60 seconds from 9:30 a.m. to 4:15 p.m. 
Eastern Time (``ET'') by Amex or another organization authorized by the 
relevant Underlying Index provider.\9\
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    \9\ During certain periods, the relevant Underlying Index value 
may be not updated or static.
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    According to the Amex Proposal, in order to provide updated 
information relating to each Fund for use by investors, professionals, 
and persons wishing to create or redeem Shares, Amex will disseminate 
through the facilities of the CTA: (1) Continuously from 9:30 a.m. to 
4:15 p.m. ET, the market value of a Share; and (2) at least every 15 
seconds from 9:30 a.m. to 4:15 p.m. ET, the IIV as calculated by Amex 
(the ``IIV Calculator''). Comparing these two figures helps an investor 
to determine whether, and to what extent, the Shares may be selling at 
a premium or a discount to NAV. The IIV Calculator will calculate an 
IIV for each Fund in the manner discussed in the Amex Proposal. The IIV 
is designed to provide investors with a reference value that can be 
used in connection with other related market information. The IIV does 
not necessarily reflect the precise composition of the current 
portfolio held by each Fund at a particular point in time. Therefore, 
the IIV on a per-Share basis disseminated from 9:30 a.m. to 4:15 p.m. 
ET should not be viewed as a real-time update of the NAV of a 
particular Fund, which is

[[Page 8094]]

calculated only once a day. While the IIV that will be disseminated by 
Amex is expected to be close to the most recently calculated Fund NAV 
on a per-Share basis, it is possible that the value of the portfolio 
held by a Fund may diverge from the IIV during any trading day. In such 
case, the IIV will not precisely reflect the value of the Fund 
portfolio.
Trading Halts
    Nasdaq will halt trading in the Shares under the conditions 
specified in Nasdaq Rules 4120 and 4121. The conditions for a halt 
include a regulatory halt by the listing market. UTP trading in the 
Shares of a Fund will also be governed by provisions of Nasdaq Rule 
4120(b) relating to temporary interruptions in the calculation or wide 
dissemination of the Indicative Fund Value or the value of the 
Underlying Index. Additionally, Nasdaq may cease trading the Shares of 
a Fund if other unusual conditions or circumstances exist which, in the 
opinion of Nasdaq, make further dealings on Nasdaq detrimental to the 
maintenance of a fair and orderly market. Nasdaq will also follow any 
procedures with respect to trading halts as set forth in Nasdaq Rule 
4120(c). Finally, Nasdaq will stop trading the Shares of a Fund if the 
listing market delists them.
Trading Rules
    Nasdaq deems the Shares to be equity securities, thus rendering 
trading in the Shares subject to Nasdaq's existing rules governing the 
trading of equity securities. Nasdaq will allow trading in the Shares 7 
a.m. until 8 p.m. ET.
Surveillance
    Nasdaq believes that its surveillance procedures are adequate to 
address any concerns about the trading of the Shares on Nasdaq. Trading 
of the Shares through Nasdaq will be subject to FINRA's surveillance 
procedures for equity securities in general and ETFs in particular.\10\ 
The Exchange may obtain information via the Intermarket Surveillance 
Group (``ISG'') from other exchanges that are members or affiliates of 
the ISG.\11\
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    \10\ FINRA surveils trading on Nasdaq pursuant to a regulatory 
services agreement. Nasdaq is responsible for FINRA's performance 
under this regulatory services agreement.
    \11\ For a list of the current members and affiliate members of 
ISG, see http://www.isgportal.com.

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Information Circular
    Prior to the commencement of trading, the Exchange will inform its 
members in an Information Circular of the special characteristics and 
risks associated with trading the Shares. Specifically, the Information 
Circular will discuss the following: (1) The procedures for purchases 
and redemptions of Shares in Baskets (and that Shares are not 
individually redeemable); (2) Nasdaq Rule 2310, which imposes 
suitability obligations on Nasdaq members with respect to recommending 
transactions in the Shares to customers; (3) how information regarding 
the IFV is disseminated; (4) the requirement that members deliver a 
prospectus to investors purchasing newly issued Shares prior to or 
concurrently with the confirmation of a transaction; and (5) trading 
information.
    In addition, the Information Circular will advise members, prior to 
the commencement of trading, of the prospectus delivery requirements 
applicable to the Funds. The Exchange notes that investors purchasing 
Shares directly from a Fund (by delivery of the corresponding Cash 
Deposit Amount) will receive a prospectus. Members purchasing Shares 
from a Fund for resale to investors will deliver a prospectus to such 
investors. The Information Circular will also discuss any exemptive, 
no-action, and interpretive relief granted by the Commission from any 
rules under the Act.
    In addition, the Information Circular will reference that the Funds 
are subject to various fees and expenses described in the Registration 
Statement. The Information Circular will also reference that the CFTC 
has regulatory jurisdiction over the trading of futures contracts.
    The Information Circular will also disclose the trading hours of 
the Shares of the Funds and that the NAV for the Shares will be 
calculated after 4 p.m. ET each trading day. The Circular will disclose 
that information about the Shares of each Fund and the corresponding 
Index will be publicly available on the Funds' Web site.
Nasdaq Rule 4420(m)
    Currently, the respective generic listing standards for such 
securities state, among other requirements, that the payment at 
maturity may or may not provide for a multiple of the positive 
performance of the applicable underlying Reference Asset, and in no 
event may payment at maturity be based on a multiple of the negative 
performance of the applicable underlying Reference Asset. Nasdaq seeks 
to amend the generic listing standards with respect to the listing and 
trading of an issue so that in no event may a loss or negative payment 
at maturity be accelerated by a multiple that exceeds twice the 
performance of an underlying index, indexes, or Reference Asset.\12\ 
Nasdaq believes that the current restriction is unnecessarily limiting, 
given the changes in the market for these securities and the demand for 
differing structures. In addition, the Exchange notes that the 
Commission has already approved certain ETFs seeking to provide: (1) 
Investment results that correspond to or exceed twice (200%) the direct 
performance of a specified stock index, or (2) investment results that 
correspond to twice (-200%) the inverse or opposite of the index's 
performance and that such ETFs are currently listed and traded on 
Amex.\13\
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    \12\ See, Securities Exchange Act Release No. 57150 (January 15, 
2008), 73 FR 3765 (January 22, 2008) (SR-Amex-2007-130) (approving 
certain modifications to the initial listing standards for index-
linked securities, commodity-linked securities, and currency-linked 
securities).
    \13\ See, e.g., Securities Exchange Act Release Nos. 52553 
(October 3, 2005), 70 FR 59100 (October 11, 2005) (SR-Amex-2004-62) 
(approving the listing and trading of shares of the xtraShares 
Trust); 54040 (June 23, 2006), 71 FR 37629 (June 30, 2006) (SR-Amex-
2006-41) (approving the listing and trading of shares of the 
ProShares Trust); 55117 (January 17, 2007), 72 FR 3442 (January 25, 
2007) (SR-Amex-2006-101) (approving the listing and trading of 
shares of the ProShares Trust based on various sector indexes); 
56592 (October 1, 2007), 72 FR 57364 (October 9, 2007) (SR-Amex-
2007-60) (approving the listing and trading of shares of the 
ProShares Trust based on various international equity indexes); and 
56713 (October 29, 2007), 72 FR 61915 (November 1, 2007) (SR-Amex-
2007-74) (approving the listing and trading of shares of funds of 
the Rydex ETF Trust).
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2. Statutory Basis
    Nasdaq believes that the proposed rule change is consistent with 
the Act and the rules and regulations thereunder applicable to a 
national securities exchange. Specifically, Nasdaq believes that the 
proposed rule change is consistent with the Section 6(b)(5) \14\ 
requirements that an exchange have rules designed 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. In addition, 
Nasdaq believes that the proposal is consistent with Rule 12f-5 under 
the Act \15\ because it deems the Shares to be equity securities, thus 
rendering trading in the Shares subject to the Exchange's existing 
rules governing the trading of equity securities.
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    \14\ 15 U.S.C. 78f(b)(5).
    \15\ 17 CFR 240.12f-5.

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[[Page 8095]]

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

    The Exchange neither solicited nor received comments on the 
proposal.

III. 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 rule-comments@sec.gov. Please include 

File Number SR-NASDAQ-2008-008 on the subject line.

Paper Comments

     Send paper comments in triplicate to Nancy M. Morris, 
Secretary, Securities and Exchange Commission, 100 F Street, NE., 
Washington, DC 20549-1090.

All submissions should refer to File Number SR-NASDAQ-2008-008. 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 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 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-2008-008 and should 
be submitted on or before March 4, 2008.

IV. Commission's Findings and Order Granting Accelerated Approval of 
the Proposed Rule Change

    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.\16\ In particular, the Commission finds that the proposed 
rule change is consistent with Section 6(b)(5) of the Act,\17\ which 
requires that an exchange have rules designed, among other things, 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. The Commission believes that this proposal should benefit 
investors by increasing competition among markets that trade the 
Shares.
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    \16\ In approving this rule change, the Commission notes that it 
has considered the proposal's impact on efficiency, competition, and 
capital formation. See 15 U.S.C. 78c(f).
    \17\ 15 U.S.C. 78f(b)(5).
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    In addition, the Commission finds that the proposal is consistent 
with Section 12(f) of the Act,\18\ which permits an exchange to trade, 
pursuant to UTP, a security that is listed and registered on another 
exchange.\19\ The Commission notes that it previously approved the 
listing and trading of the Shares on Amex.\20\ The Commission also 
finds that the proposal is consistent with Rule 12f-5 under the 
Act,\21\ which provides that an exchange shall not extend UTP to a 
security unless the exchange has in effect a rule or rules providing 
for transactions in the class or type of security to which the exchange 
extends UTP. The Exchange has represented that it meets this 
requirement because it deems the Shares to be equity securities, thus 
rendering trading in the Shares subject to the Exchange's existing 
rules governing the trading of equity securities.
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    \18\ 15 U.S.C. 78l(f).
    \19\ Section 12(a) of the Act, 15 U.S.C. 78l(a), generally 
prohibits a broker-dealer from trading a security on a national 
securities exchange unless the security is registered on that 
exchange pursuant to Section 12 of the Act. Section 12(f) of the Act 
excludes from this restriction trading in any security to which an 
exchange ``extends UTP.'' When an exchange extends UTP to a 
security, it allows its members to trade the security as if it were 
listed and registered on the exchange even though it is not so 
listed and registered.
    \20\ See supra note 4.
    \21\ 17 CFR 240.12f-5.
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    The Commission further believes that the proposal is consistent 
with Section 11A(a)(1)(C)(iii) of the Act,\22\ 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 
Shares are disseminated through the facilities of the CTA and the 
Consolidated Quotation System. In addition, Amex will calculate and 
disseminate the IIV per Share for each Fund through the facilities of 
the Consolidated Tape Association at least every 15 seconds throughout 
the trading hours for the Shares. The value of each Underlying Index 
will also be updated intra-day on a real-time basis as its individual 
component securities change in price and will be disseminated at least 
every 15 seconds throughout the trading hours for the Shares. Finally, 
the Trust's Web site provides various information about each Fund and 
its Shares.
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    \22\ 15 U.S.C. 78k-1(a)(1)(C)(iii).
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    The Commission also believes that the proposal appears reasonably 
designed to preclude trading of the Shares if transparency is impaired 
or there is unfair dissemination of the NAV. Trading in the Shares will 
be subject to Nasdaq Rule 4120(b), which provides that, if the listing 
market halts trading when the IIV or value of the underlying index is 
not being calculated or disseminated, the Exchange also would halt 
trading. Nasdaq will halt trading in the Shares of a Fund if it learns 
that the listing market halts trading because the NAV is not being 
disseminated to all market participants at the same time.
    In support of this proposal, the Exchange has made the following 
additional representations:
    1. The Exchange's surveillance procedures are adequate to properly 
monitor Exchange trading of the Shares in all trading sessions and to 
deter and detect violations of Exchange rules.
    2. Prior to the commencement of trading, the Exchange would inform 
its members in an Information Bulletin of the special characteristics 
and risks associated with trading the Shares.
    3. The Information Bulletin also would discuss the requirement that

[[Page 8096]]

members deliver a prospectus to investors purchasing newly issued 
Shares prior to or concurrently with the confirmation of a transaction.
    This approval order is based on the Exchange's representations.
    The Commission notes that, if the Shares should be delisted by the 
listing exchange, the Exchange would no longer have authority to trade 
the Shares pursuant to this order.
    The Commission also believes that the Exchange's proposal to amend 
Nasdaq Rule 4420(m) is consistent with the Act. The Commission notes 
that the proposed modifications to Nasdaq Rule 4420(m) are 
substantially identical to a proposal from NYSE Arca, Inc. (``NYSE 
Arca'') that the Commission approved and found consistent with the 
Act,\23\ and is approving this aspect of Nasdaq's proposal on the same 
basis.
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    \23\ See Securities Exchange Act Release No. 57149 (January 15, 
2008) 73 FR 3790 (January 22, 2008) (SR-NYSEARCA-2007-122).
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    The Commission finds good cause for approving this proposal before 
the thirtieth day after the publication of notice thereof in the 
Federal Register. As noted above, the Commission previously found that 
the listing and trading of the Shares on Amex is consistent with the 
Act. In addition, the Commission notes that the proposed amendments to 
Nasdaq Rule 4420(m) are substantially identical to a proposed rule 
change submitted by NYSE Arca, which was previously approved by the 
Commission after an opportunity for notice and comment. The Commission 
presently is not aware of any regulatory issue that should cause it to 
revisit these findings or would preclude the trading of the Shares on 
the Exchange pursuant to UTP. Therefore, accelerating approval of this 
proposal should benefit investors by creating, without undue delay, 
additional competition in the market for the Shares.

V. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\24\ that the proposed rule change (SR-NASDAQ-2008-008) be, and it 
hereby is, approved on an accelerated basis.
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    \24\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\25\
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    \25\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
 [FR Doc. E8-2468 Filed 2-11-08; 8:45 am]

BILLING CODE 8011-01-P