Document ID: SEC-2007-0966-0001
Agency: sec
Document Type: Notice
Title: Self-regulatory organizations; proposed rule changes: NYSE Arca, Inc.
Posted Date: 2007-07-17T04:00Z

[Federal Register: July 17, 2007 (Volume 72, Number 136)]
[Notices]               
[Page 39114-39118]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr17jy07-85]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-56041; File No. SR-NYSEArca-2007-43]

 
Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing 
and Order Granting Accelerated Approval of Proposed Rule Change To List 
and Trade Shares of the iShares COMEX Gold Trust

July 11, 2007.
    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 May 11, 2007, NYSE Arca, Inc. (the ``Exchange''), through its 
wholly-owned subsidiary, NYSE Arca Equities, Inc. (``NYSE Arca 
Equities''), 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 the 
proposed rule change 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

    The Exchange proposes to list and trade shares (``Shares'') of the 
iShares [supreg] \3\ COMEX [supreg] \4\ Gold Trust (``Trust'') pursuant 
to NYSE Arca Equities Rule 8.201. The text of the proposed rule change 
is available at the Exchange, the Commission's Public Reference Room, 
and http://www.nyse.com.

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    \3\ ``iShares'' is a registered trademark of Barclays Global 
Investors, N.A.
    \4\ ``COMEX'' is a registered service mark of Commodity 
Exchange, Inc., a subsidiary of the New York Mercantile Exchange, 
Inc. (``NYMEX''). COMEX is operated by Commodity Exchange, Inc. and 
the Tokyo Commodity Exchange. Open outcry trading of gold futures on 
COMEX is conducted from 8:20 a.m. Eastern Time (``ET'') until 1:30 
p.m. ET, and electronic trading of such gold futures is conducted 
from 6 p.m. ET until 5:15 p.m. ET via the CME Globex [reg] trading 
platform, Sunday through Friday. Thus, except for brief breaks (45 
minutes) to switch between open outcry and electronic trading in the 
evening and the morning, gold futures trade almost 24 hours per day, 
five business days per week.
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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
    Pursuant to NYSE Arca Equities Rule 8.201, which permits the 
trading of Commodity-Based Trust Shares \5\ either by listing or 
pursuant to unlisted trading privileges (``UTP''), the Exchange 
proposes to list and trade the Shares. The Shares are currently listed 
on the American Stock Exchange LLC (``Amex''),\6\ and the Exchange 
currently trades the Shares pursuant to UTP.\7\ The Exchange represents 
that the Shares satisfy the requirements of NYSE Arca Equities Rule 
8.201 and thereby qualify for listing on the Exchange.
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    \5\ As defined in NYSE Arca Equities Rule 8.201(c)(1), 
``Commodity-Based Trust Shares'' are securities that: (1) Are issued 
by a trust that holds a specified commodity deposited with the 
trust; (2) are issued by such trust in a specified aggregate minimum 
number in return for a deposit of a quantity of the underlying 
commodity; and (3) when aggregated in the same specified minimum 
number, may be redeemed at a holder's request by such trust which 
would deliver to the redeeming holder the quantity of the underlying 
commodity.
    \6\ See Securities Exchange Act Release No. 51058 (January 19, 
2005), 70 FR 3749 (January 26, 2005) (SR-Amex-2004-38) (granting 
approval to list and trade the Shares on Amex). See also Securities 
Exchange Act Release No. 50792 (December 3, 2004), 69 FR 71446 
(December 9, 2004) (SR-Amex-2004-38) (providing notice of Amex's 
proposal to list and trade the Shares) (``Amex Notice'').
    \7\ See Securities Exchange Act Release No. 51067 (January 21, 
2005), 70 FR 3952 (January 27, 2005) (SR-PCX-2004-132) (approving 
NYSE Arca Equities Rule 8.201 and the trading of the Shares pursuant 
to UTP) (``UTP Order'').
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    The Shares represent beneficial ownership interests in the net 
assets of the Trust, which holds gold bullion. The objective of the 
Trust is for the value of the Shares to reflect, at any given time, the 
price of gold owned by the Trust at that time, less the Trust's 
expenses and liabilities. The Trust is not actively managed and does 
not engage in any activities designed to obtain a profit from, or to 
ameliorate losses caused by, changes in the price of gold. The Trust is 
neither an investment company registered under the Investment Company 
Act of 1940 nor a commodity pool for purposes of the Commodity Exchange 
Act.\8\ Barclays Global Investors International Inc., a Delaware 
corporation and a subsidiary of Barclays Bank PLC, is the sponsor of 
the Trust (``Sponsor''). The Shares are not obligations of, and are not 
guaranteed by, the Sponsor or any of its respective subsidiaries or 
affiliates.
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    \8\ The Exchange states that the Trust does not trade in gold 
futures contracts. The Trust takes delivery of physical gold that 
complies with certain gold delivery rules. Because the Trust does 
not trade in gold futures contracts on any futures exchange, the 
Trust is not regulated as a commodity pool, and is not operated by a 
commodity pool operator.
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    A detailed discussion of the gold market, including the over-the-
counter gold market and the gold futures exchanges, gold market 
regulation, COMEX gold futures contracts, the process for creations and 
redemptions of the Shares, certificates evidencing the Shares, and 
Trust distributions, among others, can be found in the Amex Notice and 
in the Trust Prospectus.\9\
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    \9\ See supra note 6; see also iShares COMEX Gold Trust 
Prospectus dated March 1, 2007 (Registration Statement No. 333-
140874) (``Prospectus''). E-mail from Timothy J. Malinowski, 
Director, NYSE Group, Inc., to Edward Cho, Special Counsel, Division 
of Market Regulation, Commission, dated July 11, 2007 (confirming 
that additional information on the gold markets, the Trust, and the 
Shares can be found in the Amex Notice and the Prospectus, as 
supplemented).
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    The Web site for the Trust at http://www.ishares.com, which is 

publicly accessible at no charge, contains the following information 
about the Shares: (a) The prior business day's net asset value 
(``NAV'') per Share; \10\ (b) Basket Gold Amount; \11\ (c) the reported 
Share closing price; (d) the present day's Indicative Basket Gold 
Amount; \12\ (e) the mid-point of the bid-ask price in relation to the 
NAV as of the time the

[[Page 39115]]

NAV is calculated (``Bid-Ask Price''); \13\ (f) calculation of the 
premium or discount of such price against such NAV; (g) data in chart 
form displaying the frequency distribution of discounts and premiums of 
the Bid-Ask Price against the NAV, within appropriate ranges for each 
of the four previous calendar quarters; (h) the Prospectus; and (i) 
other applicable quantitative information, such as expense ratios, 
trading volumes, and the total return of the Shares. The Exchange also 
provides a hyperlink on its Web site to the Trust's Web site.
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    \10\ The Exchange states that it would obtain a representation 
from the Trust, prior to listing, that the NAV per Share would be 
calculated daily and made available to all market participants at 
the same time.
    \11\ The ``Basket Gold Amount'' is the corresponding amount of 
gold, measured in fine ounces, to be exchanged for an issuance of a 
basket of 50,000 Shares (each such basket, a ``Basket''), for the 
purpose of creating and redeeming the Shares.
    \12\ The ``Indicative Basket Gold Amount'' is the indicative 
amount of gold to be deposited for issuance of the Shares that 
Authorized Participants can use. Because the creation/redemption 
process is based entirely on the physical delivery of gold (and does 
not contemplate a cash component), the actual number of fine ounces 
required for the Indicative Basket Gold Amount would not change 
intra-day, even though the value of the Indicative Basket Gold 
Amount may change based on the market price of gold.
    \13\ The Bid-Ask Price of Shares is determined using the highest 
bid and lowest offer as of the time of calculation of the NAV.
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    The Exchange would make available, through the facilities of the 
Consolidated Tape Association (``CTA''), quotation information 
including the last sale price for the Shares, the daily trading volume, 
closing prices, and the NAV for the Shares from the previous day. In 
addition, the Exchange or a major market data vendor would disseminate 
each day through the facilities of the CTA the number of Shares 
outstanding and the Indicative Trust Value (``ITV'') on a per-Share 
basis at least every 15 seconds \14\ from 9:30 a.m. to 4:15 p.m. 
ET.\15\ The ITV is calculated based on the estimated amount of gold 
required for creations and redemptions on any particular day (e.g., the 
Indicative Basket Gold Amount) and a price of gold derived from the 
most recently reported trade price in the active gold futures contract. 
The prices reported for the active contract month are adjusted based on 
the prior day's spread differential between settlement values for that 
contract and the spot month contract. In the event that the spot month 
contract is also the active contract, the last sale price for the 
active contract is not adjusted.\16\
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    \14\ E-mail from Timothy J. Malinowski, Director, NYSE Group, 
Inc., to Edward Cho, Special Counsel, Division of Market Regulation, 
Commission, dated July 9, 2007 (confirming the updated ITV would be 
disseminated at least every 15 seconds).
    \15\ The Exchange states that the ITV will not reflect changes 
to the price of gold between the close of trading at COMEX, which is 
typically 1:30 p.m. ET, and the open of trading on the NYMEX ACCESS 
market at 2 p.m. ET. While the market for the gold futures is open 
for trading, the ITV can be expected to closely approximate the 
value per Share of the Indicative Basket Gold Amount. The ITV on a 
per-Share basis disseminated during the hours from 9:30 a.m. to 4:15 
p.m. ET should not be viewed as a real-time update of the NAV, which 
is calculated only once a day. E-mail from Timothy J. Malinowski, 
Director, NYSE Group, Inc., to Edward Cho, Special Counsel, Division 
of Market Regulation, Commission, dated July 9, 2007. See also UTP 
Order, 70 FR at 3956.
    \16\ E-mail from Timothy J. Malinowski, Director, NYSE Group, 
Inc., to Edward Cho, Special Counsel, Division of Market Regulation, 
Commission, dated July 9, 2007 (confirming the ITV calculation 
methodology). See also UTP Order, 70 FR at 3956 n.33.
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    Shortly after 4 p.m. ET each business day, the Trustee,\17\ the 
Exchange, and the Sponsor would disseminate the NAV for the Shares, the 
Basket Gold Amount (for orders placed during the day), and the 
Indicative Basket Gold Amount (for use by Authorized Participants \18\ 
contemplating placing orders the following business day). The Basket 
Gold Amount, the Indicative Basket Gold Amount, and the NAV are 
communicated by the Trustee to all Authorized Participants via 
facsimile or e-mail and are available on the Trust's Web site.
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    \17\ The Bank of New York serves as the Trustee and is 
responsible for the day-to-day administration of the Trust, 
including processing orders for the creation and redemption of 
Shares, coordinating the receipt and delivery of gold transferred 
to, or by, the Trust in connection with each creation and redemption 
of Shares, calculating the NAV and the adjusted NAV of the Trust on 
each business day, and selling the Trust's gold as needed to cover 
the Trust's expenses.
    \18\ An ``Authorized Participant'' is a person who, at the time 
of submitting to the Trustee an order to create or redeem one of 
more Baskets, (1) is a registered broker-dealer, (2) is a Depository 
Trust Company participant or an indirect participant, and (3) has in 
effect a valid authorized participant agreement.
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    The Exchange states that information on gold prices and gold 
markets is available on public Internet Web sites and through 
professional and subscription services. In most instances, real-time 
information is available only for a fee, and information available 
free-of-charge is subject to delay (typically 20 minutes). The Exchange 
also states that investors may obtain on a 24-hour basis gold pricing 
information based on the spot price for a troy ounce of gold from 
various financial information service providers, such as Reuters and 
Bloomberg. Reuters and Bloomberg provide at no charge on their Web 
sites delayed information regarding the spot price of gold and last 
sale prices of gold futures, as well as information about news and 
developments in the gold market. Reuters and Bloomberg also offer a 
professional service to subscribers for a fee that provides information 
on gold prices directly from market participants. In addition, an 
organization named EBS provides an electronic trading platform to 
institutions such as bullion banks and dealers for the trading of spot 
gold, as well as a feed of live streaming prices to Reuters and 
Moneyline Telerate subscribers.
    The Exchange further represents that complete real-time data for 
gold futures and options prices traded on COMEX is available by 
subscription from Reuters and Bloomberg. The closing price and 
settlement prices of the COMEX gold futures contracts are publicly 
available from NYMEX at http://www.nymex.com, automated quotation 

systems, published or other public sources, or on-line information 
services such as Bloomberg or Reuters. NYMEX also provides delayed 
futures and options information on current and past trading sessions 
and market news free of charge on its Web site.
    The Exchange states that the Shares are subject to the criteria for 
initial and continued listing of Commodity-Based Trust Shares under 
NYSE Arca Equities Rule 8.201. As indicated above, the Shares are 
currently trading on the Exchange pursuant to UTP. A minimum of 100,000 
Shares would be required to be outstanding when the Shares are listed. 
This minimum number of Shares required to be outstanding is comparable 
to requirements that have been applied to previously listed series of 
exchange-traded funds. The Exchange believes that the proposed minimum 
number of Shares outstanding at the start of trading is sufficient to 
provide market liquidity. In addition, the Exchange represents that the 
Trust is required to comply with Rule 10A-3 under the Act \19\ for the 
initial and continued listing of the Shares.
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    \19\ 17 CFR 240.10A-3.
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    The Exchange 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. The trading hours for 
the Shares on the Exchange are the same as those set forth in NYSE Arca 
Equities Rule 7.34 (Opening, Core, and Late Trading Sessions, 4 a.m. ET 
to 8 p.m. ET).\20\
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    \20\ The Exchange states that, while the Shares would trade on 
the Exchange until 8 p.m. ET, liquidity in the over-the-counter 
market for gold generally decreases after 1:30 p.m. ET when daily 
trading at COMEX and other world gold trading centers ends. Trading 
spreads and the resulting premium or discount on the Shares may 
widen as a result of reduced liquidity in the over-the-counter gold 
market. The Exchange does not believe that the Shares would trade at 
a material discount or premium to the value of the underlying gold 
held by the Trust because of arbitrage opportunities.
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    With respect to trading halts, the Exchange may consider all 
relevant factors in exercising its discretion to halt or suspend 
trading in the Shares. Trading may be halted because of market 
conditions or for reasons that, in the view of the Exchange, make 
trading in the Shares inadvisable. These reasons may include (1) the 
extent to which trading is not occurring in the underlying COMEX gold 
futures contract, or (2) whether other unusual conditions or 
circumstances detrimental

[[Page 39116]]

to the maintenance of a fair and orderly market are present. In 
addition, trading in the Shares could be halted pursuant to the 
Exchange's ``circuit breaker'' rule \21\ or by the halt or suspension 
of trading of the underlying gold. The Exchange further notes that, if 
the ITV or the value of the underlying gold is not being calculated or 
widely disseminated as required, the Exchange may halt trading during 
the day in which the interruption to the calculation or wide 
dissemination of the ITV or the value of the underlying gold occurs. If 
the interruption to the calculation or wide dissemination of the ITV or 
the value of the underlying gold persists past the trading day in which 
it occurred, the Exchange would halt trading no later than the 
beginning of the trading day following the interruption.
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    \21\ See NYSE Arca Equities Rule 7.12 (Trading Halts Due to 
Extraordinary Market Volatility).
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    The Exchange intends to utilize its existing surveillance 
procedures applicable to derivative products to monitor trading in the 
Shares. The Exchange represents that these procedures are adequate to 
properly monitor Exchange trading of the Shares in all trading sessions 
and to deter and detect violations of Exchange rules. The Exchange may 
also obtain information via the Intermarket Surveillance Group 
(``ISG'') from other exchanges that are members or affiliate members of 
ISG. In addition, the Exchange has an information sharing agreement in 
place with NYMEX for the purpose of providing information in connection 
with trading in or related to gold futures contracts traded on COMEX. 
Furthermore, the Exchange states that the Shares are subject to NYSE 
Arca Equities Rule 8.201(g)-(i), which set forth certain restrictions 
on ETP Holders \22\ acting as registered market makers in the Shares to 
facilitate surveillance. The Exchange also has a general policy 
prohibiting the distribution of material, non-public information by its 
employees.
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    \22\ An ETP Holder is a registered broker or dealer that has 
been issued an Equity Trading Permit (ETP) by NYSE Arca Equities.
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    Prior to the commencement of trading, the Exchange will inform its 
ETP Holders in an Information Bulletin (``Bulletin'') of the special 
characteristics and risks associated with trading the Shares. 
Specifically, the Bulletin will discuss the following: (a) Description 
of the Shares; (b) the risks involved in trading the Shares during the 
Opening and Late Trading Sessions when an updated ITV will not be 
calculated or publicly disseminated; \23\ (c) the procedures for 
purchases and redemptions of Shares in Baskets (and that Shares are not 
individually redeemable); (d) NYSE Arca Equities Rule 9.2(a), which 
imposes a duty of due diligence on its ETP Holders to learn the 
essential facts relating to every customer prior to trading the Shares; 
(e) how information regarding the ITV is disseminated; (f) the 
requirement that ETP Holders deliver a prospectus to investors 
purchasing newly issued Shares prior to or concurrently with the 
confirmation of a transaction; and (g) other relevant trading 
information. In addition, the Bulletin will reference that the Trust is 
subject to various fees and expenses, the number of ounces of gold 
required to create a Basket or to be delivered upon redemption of a 
Basket would gradually decrease over time because the Shares comprising 
a Basket would represent a decreasing amount of gold due to the sale of 
the Trust's gold to pay Trust expenses, and that there is no regulated 
source of last-sale information regarding physical gold. The Bulletin 
will also disclose that the NAV for the Shares will be calculated after 
4 p.m. ET each trading day, based on the COMEX daily settlement value, 
which is disseminated shortly after 1:30 p.m. ET each trading day and 
discuss any exemptive, no-action, and/or interpretive relief granted by 
the Commission from any rules under the Act.\24\
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    \23\ E-mail from Timothy J. Malinowski, Director, NYSE Group, 
Inc., to Edward Cho, Special Counsel, Division of Market Regulation, 
Commission, dated July 9, 2007 (confirming that such risks will be 
disclosed in the Bulletin).
    \24\ The Exchange represents that the Commission has granted 
exemptions from, or interpretive or no-action advice regarding, 
Section 11(d)(1) of the Act (15 U.S.C. 78k(d)(1)), Rules 10a-1 (17 
CFR 240.10a-1) and 11d1-2 (17 CFR 240.11d1-2), Rule 200(g) of 
Regulation SHO (17 CFR 242.200(g)), and Rules 101 and 102 of 
Regulation M (17 CFR 242.101 and 17 CFR 242.102) under the Act, in 
respect of trading of the Shares. See Letter from James A. 
Brigagliano, Assistant Director, Office of Trading Practices, 
Division of Market Regulation, Commission, to David Yeres, Esq., 
Clifford Chance U.S. LLP, dated January 27, 2005. See also Letter 
from Brian A. Bussey, Assistant Chief Counsel, Division of Market 
Regulation, Commission, to David Yeres, Esq., Clifford Chance U.S. 
LLP, dated December 12, 2005.
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2. Statutory Basis
    The proposal is consistent with Section 6(b) of the Act,\25\ in 
general, and Section 6(b)(5) of the Act,\26\ 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 mechanism of a free and open market and a national market system.
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    \25\ 15 U.S.C. 78f(b).
    \26\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will 
result in any burden on competition that is not necessary or 
appropriate in furtherance of the purpose of the Act.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants or Others

    The Exchange has neither solicited nor received written comments on 
the proposed rule change.

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-NYSEArca-2007-43 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-NYSEArca-2007-43. 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,

[[Page 39117]]

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 offices 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-NYSEArca-2007-43 and should be submitted 
on or before August 7, 2007.

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.\27\ In particular, the Commission finds that the proposed 
rule change is consistent with Section 6(b)(5) of the Act,\28\ 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 notes that it previously approved the original 
listing and trading of the Shares on Amex, and the instant proposal is 
substantively identical to the previous Amex proposal.\29\
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    \27\ In approving this rule change, the Commission notes that it 
has considered the proposed rule's impact on efficiency, 
competition, and capital formation. See 15 U.S.C. 78c(f).
    \28\ 15 U.S.C. 78f(b)(5).
    \29\ See supra note 6.
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    The Commission further believes that the proposal is consistent 
with Section 11A(a)(1)(C)(iii) of the Act,\30\ 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. The Exchange would make available, through the facilities 
of the CTA, quotation and last sale price information for the Shares, 
the daily trading volume, closing prices, and the NAV for the Shares 
from the previous day. In addition, the Exchange or a major market data 
vendor would disseminate each day through the facilities of the CTA the 
number of Shares outstanding and the ITV on a per-Share basis at least 
every 15 seconds from 9:30 a.m. to 4:15 p.m. ET. The Web site for the 
Trust contains information related to the NAV, including the Bid-Ask 
Price, the Basket Gold Amount, the Indicative Basket Gold Amount, 
calculation information and data related to the premium or discount of 
the Bid-Ask Price against the NAV, the Prospectus, and other applicable 
quantitative information, including trading volume data, total return 
of the Shares, expense ratios, and reported Share closing prices. 
Shortly after 4 p.m. ET each business day, the Trustee, the Exchange, 
and the Sponsor would disseminate the NAV for the Shares, the Basket 
Gold Amount, and the Indicative Basket Gold Amount. Information on gold 
prices and gold markets is available on public Web sites and through 
professional subscription services, and investors may obtain on a 24-
hour basis gold pricing information based on the spot price for a troy 
ounce of gold from various financial information service providers. 
Closing and settlement prices of gold futures contracts traded on COMEX 
are publicly available from NYMEX's Web site, automated quotation 
systems, published or other public sources, or on-line information 
services such as Bloomberg or Reuters. NYMEX also provides delayed 
futures and options information on current and past trading sessions 
and market news free of charge.
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    \30\ 15 U.S.C. 78k-1(a)(1)(C)(iii).
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    Furthermore, the Commission believes that the proposal to list and 
trade the Shares is reasonably designed to promote fair disclosure of 
information that may be necessary to price the Shares appropriately. 
The Commission notes that the Exchange will obtain a representation 
from the Trust, prior to listing, that the NAV per Share would be 
calculated daily and made available to all market participants at the 
same time.\31\ In addition, NYSE Arca Equities Rule 8.201(i) provides 
that, in connection with trading in an underlying physical commodity, 
related commodity futures or options on commodity futures, or any other 
related commodity derivative, including Commodity-Based Trust Shares, 
an ETP Holder acting as a Market Maker (as defined in NYSE Arca 
Equities Rule 1.1(u)) in the Shares is restricted from using any 
material non-public information received from any person associated 
with such ETP Holder who is trading such underlying physical commodity, 
related commodity futures or options on commodity futures, or other 
related commodity derivatives.
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    \31\ See supra note 10.
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    The Commission also believes that the Exchange's trading halt rules 
are reasonably designed to prevent trading in the Shares when 
transparency is impaired. NYSE Arca Equities Rule 8.201(e)(2) provides 
that, when the Exchange is the listing market, if the value of the 
underlying commodity or ITV is no longer calculated or available on at 
least a 15-second delayed basis, the Exchange would consider suspending 
trading in the Shares. The Exchange further represents that if the 
interruption to the calculation or wide dissemination of the value of 
the underlying gold or ITV persists past the trading day in which it 
occurred, the Exchange would halt trading no later than the beginning 
of the trading day following the interruption. NYSE Arca Equities Rule 
8.201(e)(2) also provides that the Exchange may seek to delist the 
Shares in the event the value of the underlying gold or ITV is no 
longer calculated or available as required.
    The Commission further believes that the trading rules and 
procedures to which the Shares will be subject pursuant to this 
proposal are consistent with the Act. The Exchange has represented that 
any securities listed pursuant to this proposal will be deemed equity 
securities, and subject to existing Exchange rules governing the 
trading of equity securities.
    In support of this proposal, the Exchange has made the following 
representations:
    (1) The Exchange's surveillance procedures are adequate to address 
any concerns associated with the trading of the Shares.
    (2) The Exchange would inform its members in an Information 
Bulletin of the special characteristics and risks associated with 
trading the Shares, including risks inherent with trading the Shares 
during the Opening and Late Trading Sessions when the updated ITV is 
not calculated and disseminated and suitability recommendation 
requirements.
    (3) The Exchange would require its members to deliver a prospectus 
or product description to investors purchasing Shares prior to or 
concurrently with a transaction in such Shares and will note this 
prospectus delivery requirement in the Information Bulletin.

This approval order is conditioned on the Exchange's adherence to these 
representations.
    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

[[Page 39118]]

previously approved the original listing and trading of the Shares on 
Amex and the trading of the Shares pursuant to UTP on the Exchange.\32\ 
The Commission presently is not aware of any regulatory issue that 
should cause it to revisit those findings or would preclude the listing 
and trading of the Shares on the Exchange. Accelerating approval of 
this proposed rule change would allow the Shares to be listed on the 
Exchange without undue delay and continuously traded without 
interruption, to the benefit of investors.
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    \32\ See supra notes 6 and 7.
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V. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\33\ that the proposed rule change (SR-NYSEArca-2007-43) be, and it 
hereby is, approved on an accelerated basis.
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    \33\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\34\
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    \34\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E7-13749 Filed 7-16-07; 8:45 am]

BILLING CODE 8010-01-P