Document ID: SEC-2010-0664-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: NYSE Amex LLC
Posted Date: 2010-05-05T04:00Z

[Federal Register: May 5, 2010 (Volume 75, Number 86)]
[Notices]               
[Page 24769-24771]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr05my10-147]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-61989; File No. SR-NYSEAmex-2010-37]

 
Self-Regulatory Organizations; NYSE Amex LLC; Notice of Filing of 
Proposed Rule Change Amending Commentary to Rule 915 and Rule 916

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 Amex LLC (``NYSE Amex'' or the 
``Exchange'') filed with the Securities and Exchange Commission (the 
``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.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 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 amend Commentary .10 to Rule 915 and 
Commentary .11 to Rule 916 for the purpose of listing and trading 
options on the shares of 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 \4\ (``GLD'') the iShares COMEX Gold Trust 
(``IAU'') 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'').
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    \4\ See Securities Exchange Act Release No. 57894 (May 30, 
2008), 73 FR 32061 (June 5, 2008) (order approving SR-Amex-2008-15).
    \5\ See Securities Exchange Act Release No. 59055 (December 4, 
2008), 73 FR 238 [sic] (December 10, 2008) (order approving SR-Amex-
2008-68).
    \6\ See Securities Exchange Act Release No. 61483 (February 3, 
2010), 75 FR 6753 (February 10, 2010).
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    Currently, Amex Rule 915 deems appropriate for options trading 
Exchange-Traded Fund Shares (``ETFs'' or ``Fund Shares'') that are 
traded on a national securities exchange and are defined as an ``NMS 
stock'' in Rule 600 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, stock index futures 
contracts, options on futures, 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 Market 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 non-U.S. 
currency (``Commodity Pool Units''), or (iv) 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'').\7\ In addition, pursuant to Commentary .10 to Rule 915 the 
Exchange may also list options based on shares of GLD, IAU, SLV, SIVR, 
and SGOL. This proposed rule change seeks to expand the current 
exception set forth in Commentary .10 to Rule 915 for Exchange-Traded 
Fund Shares that may be approved for options trading on the Exchange to 
include PALL and PPLT.
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    \7\ See Commentary .06 to Rule 915.
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    Apart from allowing PALL and PPLT to be underlyings for options 
traded on the Exchange as described above, the listing standards for 
Exchange-Traded Fund Shares will remain unchanged from those that apply 
under current Exchange rules. Exchange-Traded Fund Shares 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 Commentary .06 to Rule 915. Specifically, in 
addition to satisfying the listing requirements set forth above, 
Exchange-Traded Fund Shares must meet either (1) the criteria and 
guidelines under Commentary .01 to Rule 915; or (2) 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 Exchange-Traded Fund Shares in a specified 
aggregate number even if some or all of the investment assets required 
to be deposited have not been

[[Page 24770]]

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.
    This proposal is intended to provide appropriate standards for the 
listing and trading of options on PALL and PPLT. The proposed revision 
to Commentary .11 to Rule 916 specifically provides that shares of PALL 
and PPLT be deemed ``Exchange-Traded Fund Shares'' for purposes of 
Commentary .07 to Rule 916. Under the applicable continued listing 
criteria in Commentary .07 to Amex Rule 916, the Exchange will consider 
the suspension of opening transactions in PALL or PPLT in any of the 
following circumstances: (1) Following the initial twelve-month period 
beginning upon the commencement of trading of PALL or PPLT, there are 
fewer than 50 record and/or beneficial holders of PALL or PPLT for 30 
or more consecutive 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. In 
addition, PALL or PPLT 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 PALL or 
PPLT, respectively, if PALL or PPLT ceases to be an ``NMS Stock'' as 
provided for in Commentary .07(2) to Rule 916 or PALL or PPLT is halted 
from trading on the primary listing market, or if PALL or PPLT is 
delisted.
    The Exchange represents that the listing and trading of PALL 
options or PPLT options under NYSE Amex rules will not have any effect 
on the rules pertaining to position and exercise limits \8\ or 
margin.\9\
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    \8\ See NYSE Amex Rules 904 and 905.
    \9\ See NYSE Amex Rule 462.
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    The Exchange represents that it has an adequate surveillance 
program in place for options on PALL and PPLT. The Exchange may obtain 
trading information via the Intermarket Surveillance Group (``ISG'') 
from other exchanges who are members or affiliates of the ISG. The 
Exchange may also obtain trading information from various commodity 
futures exchanges worldwide that have entered into comprehensive 
surveillance sharing agreements with the Exchange. In connection with 
PALL and PPLT, the Exchange represents that it may obtain information 
from the New York Mercantile Exchange, Inc. (``NYMEX''), pursuant to a 
comprehensive surveillance sharing agreement, related to any financial 
instrument that is based, in whole or in part, upon an interest in or 
performance of silver or gold [sic]. Prior to listing and trading 
options on PALL or PPLT, the Exchange represents that it will either 
have the ability to obtain specific trading information via ISG or 
through a comprehensive surveillance sharing agreement with the 
marketplace or marketplaces with last sale reporting that represent(s) 
the highest volume in derivatives (options or futures) on the 
underlying palladium or platinum.
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.
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    \10\ 15 U.S.C. 78f(b).
    \11\ 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 
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 rule-comments@sec.gov. Please include 
File No. SR-NYSEAmex-2010-37 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-NYSEAmex-2010-37. 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 Amex. 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.

[[Page 24771]]

SR-NYSEAmex-2010-37 and should be submitted on or before May 26, 2010.
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    \12\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\12\
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-10458 Filed 5-4-10; 8:45 am]
BILLING CODE 8010-01-P