
[Federal Register: June 23, 2010 (Volume 75, Number 120)]
[Notices]               
[Page 35861-35862]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr23jn10-137]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-62290; File No. SR-OCC-2010-07]

 
 Self-Regulatory Organizations; The Options Clearing Corporation; 
Order Granting Approval of a Proposed Rule Change Relating to Clearing 
Options on the CBOE Gold ETF Volatility Index

June 14, 2010.

I. Introduction

    On April 26, 2010, The Options Clearing Corporation (``OCC'') filed 
with the Securities and Exchange Commission the proposed rule change 
pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 \1\ 
and Rule 19b-4 thereunder \2\ to allow OCC to add an interpretation 
following the introduction in Article XVII of OCC's By-Laws to clarify 
that OCC will clear and treat as securities options any option 
contracts on the CBOE Gold ETF Volatility Index. The proposed rule 
change was published for comment in the Federal Register on May 19, 
2010.\3\ No comment letters were received on the proposal. This order 
approves the proposal.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ Securities Exchange Act Release No. 62094 (May 13, 2010), 75 
FR 28085.
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II. Description of the Proposal

    The proposed rule change will add an interpretation following the 
introduction in Article XVII of OCC's By-Laws to make clear that OCC 
will clear and treat as securities options any option contracts on the 
CBOE Gold ETF Volatility Index.\4\ This treatment is essentially the 
same as that extended to other similar options that OCC currently 
clears.\5\
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    \4\ The specific language of the new interpretation can be found 
on OCC's Web site at http://www.theocc.com/about/publications/
bylaws.jsp.
    \5\ Securities Exchange Act Release Nos. 59054, 73 FR 75159 
(Dec. 10, 2008) (iShares COMEX Gold Shares and iShares Silver 
Shares); 61591 (Feb. 25, 2010), 75 FR 9979 (Mar. 4, 2010) (ETFS 
Physical Swiss Gold Shares and ETFS Physical Silver Shares); 57895 
(May 30, 2008), 73 FR 32066 (June 5, 2008) (SPDR Gold Trust); 61958 
(Apr. 22, 2010), 75 FR 22673 (Apr. 29, 2010) (ETFS Palladium Shares 
And ETFS Platinum Shares). These filings also provided that futures 
on the exchange-traded funds in question would be cleared and 
treated as security futures.
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    In its capacity as a ``derivatives clearing organization'' 
registered as such with the CFTC, OCC filed this proposed rule change 
for prior approval by the CFTC pursuant to provisions of the Commodity 
Exchange Act (``CEA'') in order to foreclose potential liability based 
on an argument that the clearing by OCC of such options as securities 
options constitutes a violation of the CEA.

III. Discussion

    Section 17A(b)(3)(F) of the Act requires, among other things, that 
the rules of a clearing agency be designed to promote the prompt and 
accurate clearance and settlement of securities transactions and 
derivative transactions.\6\ By amending its By-Laws to make clear that 
OCC will clear and treat as securities options any option contracts on 
the CBOE Gold ETF Volatility Index, OCC's rule change should help 
clarify the jurisdictional status of such contracts and accordingly 
should help to promote the prompt and accurate clearance and settlement 
of securities transactions and of derivative transactions. In 
accordance with the Memorandum of Understanding entered into between 
the CFTC and the

[[Page 35862]]

Commission on March 11, 2008, and in particular the addendum thereto 
concerning Principles Governing the Review of Novel Derivative 
Products, the Commission believes that novel derivative products that 
implicate areas of overlapping regulatory concern should be permitted 
to trade in either a CFTC or Commission-regulated environment or both 
in a manner consistent with laws and regulations (including the 
appropriate use of all available exemptive and interpretive authority).
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    \6\ 15 U.S.C. 78q-1(b)(3)(F).
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IV. Conclusion

    On the basis of the foregoing, the Commission finds that the 
proposed rule change is consistent with the requirements of the Act and 
in particular Section 17A of the Act \7\ and the rules and regulations 
thereunder.
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    \7\ 15 U.S.C. 78q-1.
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    It Is Therefore Ordered, pursuant to Section 19(b)(2) of the 
Act,\8\ that the proposed rule change (File No. SR-OCC-2010-07) be and 
hereby is approved.\9\
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    \8\ 15 U.S.C. 78s(b)(2).
    \9\ In approving the proposed rule change, the Commission 
considered the proposal's impact on efficiency, competition and 
capital formation. 15 U.S.C. 78c(f).

    For the Commission by the Division of Trading and Markets, 
pursuant to delegated authority.\10\
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    \10\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-15128 Filed 6-22-10; 8:45 am]
BILLING CODE 8010-01-P

