Notice2026-01969
Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing of Amendment No. 1 and Order Granting Accelerated Approval of a Proposed Rule Change, as Modified by Amendment No. 1, To List and Trade Units of the Sprott Physical Copper Trust
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
February 2, 2026
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 91 Issue 21 (Monday, February 2, 2026)</title>
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[Federal Register Volume 91, Number 21 (Monday, February 2, 2026)]
[Notices]
[Pages 4656-4668]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-01969]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-104700; File No. SR-NYSEARCA-2025-24]
Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing
of Amendment No. 1 and Order Granting Accelerated Approval of a
Proposed Rule Change, as Modified by Amendment No. 1, To List and Trade
Units of the Sprott Physical Copper Trust
January 28, 2026.
On June 10, 2025, NYSE Arca, Inc. (``NYSE Arca'' or ``Exchange'')
filed with the Securities and Exchange Commission (``Commission''),
pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'' or ``Exchange Act'')) \1\ and Rule 19b-4 thereunder,\2\ a
proposed rule change to list and trade units of the Sprott Physical
Copper Trust under NYSE Arca Rule 8.201-E (Commodity-Based Trust
Shares). The proposed rule change was published for comment in the
Federal Register on June 26, 2025.\3\
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ See Securities Exchange Act Release No. 103296 (June 23,
2025), 90 FR 27362.
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On August 5, 2025, pursuant to Section 19(b)(2) of the Act,\4\ the
Commission designated a longer period within which to approve the
proposed rule change, disapprove the proposed rule change, or institute
proceedings to determine whether to disapprove the proposed rule
change.\5\ On September 8, 2025, the Commission instituted proceedings
pursuant to Section 19(b)(2)(B) of the Act \6\ to determine whether to
approve or disapprove the proposed rule change.\7\ On December 9,
[[Page 4657]]
2025, pursuant to Section 19(b)(2) of the Act,\8\ the Commission
designated a longer period for Commission action on the proposed rule
change.\9\ On January 26, 2026, the Exchange filed Amendment No. 1 to
the proposed rule change as described in Items I and II below, which
Items have been prepared by the Exchange.\10\ The Commission has
received one comment on the proposed rule change.\11\
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\4\ 15 U.S.C. 78s(b)(2).
\5\ See Securities Exchange Act Release No. 103634, 90 FR 38528
(Aug. 8, 2025).
\6\ 15 U.S.C. 78s(b)(2)(B).
\7\ See Securities Exchange Act Release No. 103904, 90 FR 44117
(Sept. 11, 2025).
\8\ 15 U.S.C. 78s(b)(2).
\9\ See Securities Exchange Act Release No. 104351, 90 FR 57795
(Dec. 12, 2025). The Commission, pursuant to Section 19(b)(2) of the
Act, designated February 21, 2026, as the date by which the
Commission shall either approve or disapprove the proposed rule
change.
\10\ Amendment No. 1 to the proposed rule change is available on
the Commission's website at: <a href="https://www.sec.gov/comments/sr-nysearca-2025-24/srnysearca202524-697347-2182694.pdf">https://www.sec.gov/comments/sr-nysearca-2025-24/srnysearca202524-697347-2182694.pdf</a>.
\11\ Comments on the proposed rule change are available at:
<a href="https://www.sec.gov/comments/sr-nysearca-2025-24/srnysearca202524.htm">https://www.sec.gov/comments/sr-nysearca-2025-24/srnysearca202524.htm</a>.
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The Commission is publishing this notice to solicit comments on
Amendment No. 1 from interested persons, and is approving the proposed
rule change, as modified by Amendment No. 1, on an accelerated basis.
I. The Exchange's Description of the Proposal, as Modified by Amendment
No. 1
The Exchange proposes to list and trade shares of the following
under NYSE Arca Rule 8.201-E (Non-Generic): Sprott Physical Copper
Trust (``Trust''). This Amendment No. 1 to SR-NYSEARCA-2025-24 replaces
SR-NYSEARCA-2025-24 as originally filed and supersedes such filing in
its entirety. The proposed rule change is available on the Exchange's
website at <a href="http://www.nyse.com">www.nyse.com</a> and at the principal office of the Exchange.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change, as Modified by Amendment
No. 1
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
Statutory Basis for, the Proposed Rule Change, as Modified by Amendment
No. 1
1. Purpose
The Exchange proposes to list and trade the units (``Units'') of
the Trust under NYSE Arca Rule 8.201-E (Non-Generic).\12\ Under NYSE
Arca Rule 8.201-E(a), the Exchange may propose to list and/or trade
pursuant to unlisted trading privileges (``UTP''), ``Commodity-Based
Trust Shares.'' \13\ The Commission has previously approved listing on
the Exchange of other issues of Commodity-Based Trust Shares, including
units of the Sprott Physical Gold Trust,\14\ Sprott Physical Silver
Trust,\15\ and Sprott Physical Gold and Silver Trust.\16\ The
Commission has also previously approved listing on the Exchange of
shares of the JPM XF Physical Copper Trust \17\ and the iShares Copper
Trust.\18\ The Commission has also previously approved listing on the
Exchange under NYSE Arca Rules 5.2-E(j)(5) and 8.201-E of other
precious metals-based commodity trusts, including: Merk Gold Trust;
\19\ ETFS Gold Trust; \20\ ETFS Platinum Trust; \21\ ETFS Palladium
Trust; \22\ APMEX Physical-1 oz. Gold Redeemable Trust; \23\ iShares
Silver Trust; \24\ iShares COMEX Gold Trust; \25\ Long Dollar Gold
Trust.\26\ Prior to their listing on the Exchange, the Commission
approved listing of the streetTRACKS Gold Trust on the New York Stock
Exchange LLC (``NYSE'') \27\ and listing of iShares COMEX Gold Trust
and iShares Silver Trust on the American Stock Exchange LLC
(``Amex'').\28\ In addition, the Commission has approved trading of the
streetTRACKS Gold Trust and iShares Silver Trust on the Exchange
pursuant to UTP.\29\
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\12\ The Trust will file with the Commission a registration
statement on Form 40-F to register the Units (``Registration
Statement'') under Section 12 of the Securities Exchange Act of
1934, as amended, and will file with the Commission as part of such
Registration Statement all information material to an investment
decision that the Trust, since the beginning of its last full fiscal
year: (i) made or was required to make public pursuant to the law of
any Canadian jurisdiction, (ii) filed or was required to file with a
stock exchange on which its securities are traded and which was made
public by such exchange, or (iii) distributed or was required to
distribute to its securityholders. The Registration Statement is not
yet effective, and shares of the Units will not trade on the
Exchange until such time that the Registration Statement is
effective.
\13\ The term ``Commodity-Based Trust Shares'' means a security
(a) that is issued by a trust that holds a specified commodity
deposited with the trust; (b) that is issued by such trust in a
specified aggregate minimum number in return for a deposit of a
quantity of the underlying commodity; and (c) that, when aggregated
in the same specified minimum number, may be redeemed at a holder's
request by such trust which will deliver to the redeeming holder the
quantity of the underlying commodity. See NYSE Arca Rule 8.201-
E(c)(1).
\14\ See Securities Exchange Act Release No. 61496 (February 4,
2010), 75 FR 6758 (February 10, 2010) (SR-NYSEArca-2009-113)
(approving listing on the Exchange of Sprott Physical Gold Trust).
\15\ See Securities Exchange Act Release No. 63043 (October 5,
2010), 75 FR 62615 (October 12, 2010) (SR-NYSEArca-2010-84)
(approving listing on the Exchange of the Sprott Physical Silver
Trust).
\16\ See Securities Exchange Act Release No. 34-82448 (January
5, 2018), 83 FR 1428 (November 1, 2018) (SR-NYSEArca-2017-131)
(approving listing on the Exchange of the Sprott Physical Gold and
Silver Trust).
\17\ See Securities Exchange Act Release No. 69256 (March 28,
2013), 78 FR 20164 (April 3, 2013 (SR-NYSEArca-2012-28) (approving
listing on the Exchange of the JPM XF Physical Copper Trust).
\18\ See Securities Exchange Act Release No. 68973 (February 22,
2013), 78 FR 13726 (February 28, 2013) (SR-NYSEArca-2012-66)
(approving listing on the Exchange of the iShares Copper Trust).
\19\ See Securities Exchange Act Release No. 71378 (January 23,
2014), 79 FR 4786 (January 29, 2014) (SR-NYSEArca-2013-137)
(approving listing on the Exchange of the Merk Gold Trust).
\20\ See Securities Exchange Act Release No. 59895 (May 8,
2009), 74 FR 22993 (May 15, 2009) (SR-NYSEArca-2009-40) (approving
listing on the Exchange of the ETFS Gold Trust).
\21\ See Securities Exchange Act Release No. 61219 (December 22,
2009), 74 FR 68886 (December 29, 2009) (SR-NYSEArca-2009-95)
(approving listing on the Exchange of the ETFS Platinum Trust).
\22\ See Securities Exchange Act Release No. 61220 (December 22,
2009), 74 FR 68895 (December 29, 2009) (SR-NYSEArca-2009-94)
(approving listing on the Exchange of the ETFS Palladium Trust).
\23\ See Securities Exchange Act Release No 66930 (May 7, 2012),
77 FR 27817 (May 11, 2012) (SR-NYSEArca-2012-18) (approving listing
on the Exchange of the APMEX Physical-1 oz. Gold Redeemable Trust).
\24\ See Securities Exchange Act Release No. 58956 (November 14,
2008), 73 FR 71074 (November 24, 2008) (SR-NYSEArca-2008-124)
(approving listing on the Exchange of the iShares Silver Trust).
\25\ See Securities Exchange Act Release Nos. 56224 (August 8,
2007), 72 FR 45850 (August 15, 2007) (SR-NYSEArca-2007-76)
(approving listing on the Exchange of the streetTRACKS Gold Trust);
and 56041 (July 11, 2007), 72 FR 39114 (July 17, 2007) (SR-NYSEArca-
2007-43) (order approving listing on the Exchange of iShares COMEX
Gold Trust).
\26\ See Securities Exchange Act Release No. 79518 (December 9,
2016), 81 FR 90876 (December 15, 2016) (SR-NYSEArca-2016-84) (order
approving listing and trading of shares of the Long Dollar Gold
Trust).
\27\ See Securities Exchange Act Release No. 50603 (October 28,
2004), 69 FR 64614 (November 5, 2004) (SR-NYSE-2004-22) (order
approving listing of streetTRACKS Gold Trust on NYSE).
\28\ See Securities Exchange Act Release Nos. 51058 (January 19,
2005), 70 FR 3749 (January 26, 2005) (SR-Amex-2004-38) (order
approving listing of iShares COMEX Gold Trust on AMEX); 53521 (March
20, 2006), 71 FR 14967 (March 24, 2006) (SR-Amex-2005-72) (approving
listing of the iShares Silver Trust on AMEX).
\29\ See Securities Exchange Act Release Nos. 53520 (March 20,
2006), 71 FR 14977 (March 24, 2006) (SR-PCX-2005-117) (approving
trading on the Exchange pursuant to UTP of the iShares Silver
Trust); 51245 (February 23, 2005), 70 FR 10731 (March 4, 2005) (SR-
PCX-2004-117) (approving trading on the Exchange of the streetTRACKS
Gold Trust pursuant to UTP).
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[[Page 4658]]
Sprott Asset Management LP is the manager of the Trust
(``Manager'').\30\ WMC Energy B.V. (``WMC'' or ``Technical Advisor'')
serves as technical advisor to the Manager and advises and assists with
respect to the holding, buying and selling of physical copper.\31\ RBC
Investor Services Trust (``RBC'') is the trustee and valuation agent of
the Trust (``Trustee'' or ``Valuation Agent,'' as the case may be) \32\
and the custodian of the Trust's assets that it holds, including cash,
if any.\33\ TSX Trust Company is the transfer agent and registrar of
the Trust (``Transfer Agent'').
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\30\ The Manager is a limited partnership formed and organized
under the laws of the Province of Ontario, Canada, and acts as
manager of the Trust pursuant to the Trust Agreement (as defined
herein) and the management agreement. The Manager is responsible for
the day-to-day activities and administration of the Trust. The
Manager manages and directs the business and affairs of the Trust.
Additional details regarding the Manager are set forth in the
Registration Statement. The Manager has adopted a policy pursuant to
which any entity or account that is: (a) managed; or (b) for whom
investment decisions are made, directly or indirectly, by a person
that is involved in the decision-making process of, or has non-
public information about, follow-on offerings of the Trust is
prohibited from investing in the Trust, and no such decision-making
person is permitted to invest in the Trust for that decision-making
person's benefit, directly or indirectly. The Manager has a
fiduciary responsibility under applicable Canadian law to act in the
best interest of the Trust.
\31\ WMC is an independent physical commodity merchant and
industrial asset development company established to provide physical
supply chain solutions to the nuclear and energy transition metals
industries, and sources, stores, finances and delivers physical
commodities worldwide.
\32\ RBC is a trust company existing under the laws of Canada.
RBC is affiliated with a broker-dealer. RBC has represented to the
Exchange that it has put in place and will maintain the appropriate
information barriers and controls between itself and the broker-
dealer affiliate so that the broker-dealer affiliate will not have
access to information concerning the composition and/or changes to
the Trust's holdings that are not available on the Trust's website,
as defined herein. The Trustee holds title to the Trust's assets on
behalf of the unitholders of the Trust (``Unitholders'') and has
exclusive authority over the assets and affairs of the Trust, but
has delegated the day-to-day activities and administration of the
affairs of the Trust to the Manager. The Trustee has a fiduciary
responsibility to act in the best interest of the Unitholders.
Additional details regarding the Trustee are set forth in the
Registration Statement.
\33\ According to the Registration Statement, the Trustee is
responsible for the safekeeping of all of the assets of the Trust
delivered to it and acts as the custodian of such assets. The
Trustee is not responsible for the safekeeping of the Trust's
physical Copper, as defined herein. The Manager, with the consent of
the Trustee, has the authority to change the custodial arrangement,
including, but not limited to, the appointment of a replacement
custodian and/or additional custodians. Additional details regarding
the Trustee and the custodial arrangements of the Trust are set
forth in the Registration Statement.
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The Trust is established under the laws of the Province of Ontario
and is managed by the Manager. According to the Registration Statement,
the investment objective of the Trust is to invest and hold
substantially all of its assets in physical copper metal in either
Grade 1 Cathode \34\ form or Grade A Cathode \35\ form, or equivalent
copper cathodes, that is fully allocated or stored at a Facility \36\
(``Copper''),\37\ and cash. The Trust seeks to provide a secure,
convenient and exchange-traded investment alternative for investors
interested in holding Copper. The Trust intends to achieve its
objective by investing primarily in long-term holdings of unencumbered
Copper and will not speculate with regard to short-term changes in
Copper prices.
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\34\ The term ``Grade 1 Cathode'' means a physical copper metal
cathode that, at the time of purchase by the Trust, satisfies the
CME (as defined herein) standards for classification as a Grade 1
electrolytic copper cathode.
\35\ The term ``Grade A Cathode'' means a physical copper metal
cathode that, at the time of purchase by the Trust, satisfies the
LME (as defined herein) standards for classification as Grade A
copper.
\36\ According to the Registration Statement, the term
``Facility'' means a CME (as defined herein) or LME-approved storage
or similar facility for copper operated by a Warehouse Provider or
such other facility as the Manager may determine in accordance with
the Trust Agreement.
\37\ References to ``copper'' refers to physical copper metal in
any form.
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Units of the Trust currently trade on the Toronto Stock Exchange
(the ``TSX'') under the symbol ``COP.U'' in U.S. dollars and ``COP.UN''
in Canadian dollars.
The Exchange represents that the Units satisfy the requirements of
NYSE Arca Rule 8.201-E (Non-Generic) and thereby qualify for listing on
the Exchange.\38\
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\38\ With respect to application of Rule 10A-3 (17 CFR 240.10A-
3) under the Exchange Act, the Trust relies on the exemption
contained in Rule 10A-3(c)(7).
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Organization of the Trust
According to the Registration Statement, the Trust was established
as of April 12, 2024 under the laws of the Province of Ontario, Canada,
and its provisions and features are set out in an amended and restated
trust agreement dated as of May 10, 2024 (the ``Trust Agreement'').
Pursuant to the Exemptive Relief granted to the Trust, the Trust is not
subject to certain of the policies and regulations of the Canadian
Securities Administrators that apply to other non-redeemable investment
funds.\39\
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\39\ The Trust has obtained exemptive relief from the Canadian
securities regulatory authorities for relief from certain
requirements of National Instrument 81-102--Investment Funds,
legislation which governs mutual funds and non-redeemable investment
funds in each of the provinces and territories of Canada
(``Exemptive Relief''), to permit the Trust to, among other things,
appoint the Facilities as custodians of the Trust's Copper.
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Operation of the Trust
According to the Registration Statement, the investment objective
of the Trust is to invest and hold substantially all of its assets in
Copper. The Trust will not hold any assets other than Copper and cash.
The Trust does not anticipate making regular cash distributions to
Unitholders.
The Trust will not invest in futures, options, warrants, options on
futures, swap contracts, or warehouse receipts. The Trust will not hold
or trade in commodity futures contracts, ``commodity interests,'' or
any other instruments regulated by the Commodity Exchange Act
(``CEA'').\40\
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\40\ 17 U.S.C. 1.
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The Trust will issue Units, each of which represents an equal,
fractional undivided ownership interest in the net assets of the Trust
attributable to the particular class of Units. Except with respect to
cash held by the Trust to pay expenses and anticipated redemptions, the
Trust expects to own only Copper. The investment objective of the Trust
is for the Units to reflect the performance of the spot price of
Copper, less the expenses of the Trust's operations.
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 spot price of Copper. The Trust is neither an
investment company registered or required to be registered under the
Investment Company Act of 1940,\41\ nor a commodity pool for purposes
of the CEA, and neither the Manager nor the Trustee is subject to
regulation as a commodity pool operator or a commodity trading adviser
in connection with the operation of the Trust.
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\41\ 15 U.S.C. 80a-1.
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According to the Registration Statement, the Trust will store its
Copper with Warehouse Providers (as defined in the Registration
Statement) at Facilities that are reputable and exclusively in
warehouses that are approved by the Chicago Mercantile Exchange
(``CME'') or the London Metal Exchange (``LME''), which is the main
global market standard for physical metal warehousing services that is
accepted by market participants and financiers.\42\
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\42\ The Manager, with the consent of the Trustee, has the
authority to change the storage arrangements of the Trust.
Additional details regarding the Facilities and the storage
arrangements of the Trust are set forth in the Registration
Statement.
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According to the Registration Statement, the Trust will only store
Copper with such Facilities at locations in Belgium, Canada, Germany,
Italy,
[[Page 4659]]
Malaysia, the Netherlands, Singapore, South Korea, Spain, Sweden, the
United Arab Emirates and the United States. In addition, the Manager
will maintain market standard insurance for the physical Copper stored
with Warehouse Providers. Finally, the Facilities to be used by the
Trust are owned or contracted by the Warehouse Providers, which are
well-regarded multi-national providers of global storage for physical
metals.
Overview of the Copper Industry
According to the Registration Statement, copper is a metallic
element that occurs naturally in sulfide, carbonate and silicate
deposits.\43\ Copper's physical, chemical and aesthetic properties make
it the material of choice in a diverse range of electrical,
communication, construction, transportation, industrial machinery and
equipment, and general consumer applications. These properties include:
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\43\ International Copper Study Group--The World Copper Factbook
2023.
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<bullet> Electrical conductivity: Copper has the highest electrical
conductivity of any non-precious metal. Because of its electrical
conductivity, copper is often used in electrical wiring and conductors,
and has become a key component in clean power generation technologies
including solar, wind and batteries.
<bullet> Heat conductivity: Copper is one of the best performing
metals for heat conductivity, leading to its frequent use in heat
exchange equipment, radiators, and cooling systems.
<bullet> Corrosion resistance: Copper is naturally resistant to
corrosion, making it suitable for use in marine and other challenging
environments, such as underwater vessels, tanks, piping exposed to
seawater, propellers, oil platforms and coastal power stations.
<bullet> Malleability and ductility: Copper can be shaped into
various forms without breaking or compromising its performance, leading
to its frequent use in the manufacturing of wiring, tubing, and other
industrial components.
<bullet> Strength: Copper has sufficient strength and durability to
withstand mechanical stresses without easily deforming or breaking,
making it suitable for certain structural applications.
<bullet> Antimicrobial properties: Copper has antimicrobial
properties which inhibit microorganism growth on its surface, allowing
for use in healthcare, food processing and HVAC applications.
In addition, when alloyed with other metals, such as zinc (to form
brass), aluminum or tin (to form bronzes), or nickel, copper acquires
new characteristics for use in specialized applications such as
shipbuilding, automobiles and home appliances.
Copper is typically produced into and sold in the form of cathodes
for which globally accepted specification standards apply. Market
quotations exist for the base price of spot copper on exchanges such as
the CME and the LME, which are further supplemented by cathode premia
for specific locations and grades of copper. In 2023, global copper
usage amounted to approximately 31.2Mt, making the copper market one of
the largest base metals markets in the world.\44\
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\44\ CRU--March 2024.
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Operation of the Copper Market
According to the Registration Statement, the copper market is one
of the largest and most liquid base metal markets globally. For the
North American market, CME is the leading spot (for front-month
delivery) and futures market venue for copper while the LME is the
leading spot and futures market venue for other regions, including
Europe and Asia (excluding China). Standards for copper have been
established by CME (i.e., Grade 1 Cathode) and LME (i.e., Grade A
Cathode) that are based on the chemical composition of the copper as
recognized by market participants around the world.
According to the Registration Statement, any Copper purchased by
the Trust will be, at the time of purchase, either Grade 1 Cathode or
Grade A Cathode, or equivalent quality of cathodes. In addition, the
Manager and Technical Advisor are committed to incorporating
Environmental, Social and Governance principles into the sourcing of
the Copper purchased for the Trust. This means that the Trust will
follow the rules for Responsible Sourcing as set by the LME. For brands
that are not approved by the LME, the Trust will only source such
Copper if the supplier guarantees to use reasonable commercial efforts
to comply with the Ten Principles of the UN Global Compact and the OECD
Due Diligence Guidance for Responsible Mineral Supply Chains. All
procurement of Copper by the Trust will comply with applicable
sanctions laws.
According to the Registration Statement, the copper market is large
and mature. The size of the copper market was approximately $226
billion in 2024,\45\ making it the third largest global metals market
behind iron ore and gold. Copper's large market size and wide-ranging
applications have historically made its price a barometer of the global
economy.
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\45\ USGS Mineral Commodity Summaries, 2025.
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In anticipation of growing copper demand and in recognizing that
clean energy technologies require significantly greater copper than
traditional energy sources, world governments, including the United
States,\46\ Canada,\47\ the European Union \48\ and Australia,\49\
among others, have added copper to their lists of critical and/or
strategic materials. Due to copper's distinctive properties, including
electrical and thermal conductivity, ductility, malleability, and
corrosion resistance, in addition to considerations of cost and
availability, there is limited substitution risk for copper in its
existing applications.
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\46\ US Department of Energy, 2023 final critical materials
list.
\47\ The Canadian Critical Minerals Strategy 2022.
\48\ European Commission, 2023 list of critical raw materials
for the EU.
\49\ Australia's Critical Minerals List and Strategic Materials
List 2024.
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[[Page 4660]]
[GRAPHIC] [TIFF OMITTED] TN02FE26.014
The global energy transition is driving increased demand for
commodities, in particular copper. The expansion of copper-intensive
infrastructure, such as power grids, electric vehicles and clean energy
technologies coincide with an anticipated 165% increase in global
electricity consumption by 2050.\50\
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\50\ IEA World Energy Outlook 2023 Net Zero Emissions Scenario.
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Operation of the Spot Price Market for Copper
The CME publishes spot prices for copper on a daily basis for
front-month delivery. The LME publishes spot prices for copper on a
daily basis for prompt delivery (T+2). These spot prices are then
generally subject to either a premium or discount, which is determined
by various commercial and logistical factors. As copper is used in many
different industrial processes, its location relative to the place of
consumption is highly important for determining the premium or
discount. Different premium levels are published by price reporters for
different locations reflecting the supply and demand dynamics of the
specific location. Fundamentally, copper that is stored in a location
that is low in supply and high in demand will carry a higher premium
than copper that is stored in a location where supply is generally
high, and demand is low.
Operation of the Futures Price Market for Copper
The CME and LME publish futures prices for copper across a range of
standardized contract maturities. These futures prices take into
account, amongst other things, market dynamics regarding future supply
and demand conditions, inventory levels, financing and storage costs,
interest rates, and broader macroeconomic factors. Futures contracts
are standardized in terms of contract size, delivery specifications,
and approved delivery locations, allowing market participants to hedge
price risk or obtain price exposure without immediate physical
ownership of copper. Prices across different delivery months form a
forward curve, which can exhibit contango or backwardation depending on
prevailing market conditions. The shape of the forward curve is
influenced by exchange warehouse inventories, anticipated mine
production and smelter output, demand expectations, and the cost of
carry. Tight near-term supply conditions can result in higher prices
for nearby contracts, while ample inventories and weaker demand
expectations typically support higher prices for deferred contracts.
Although most futures positions are closed out prior to delivery, the
option of physical settlement anchors futures prices to underlying
physical market fundamentals.
Copper Supply and Demand
According to the Registration Statement, in 2023, copper supply and
demand returned to relative equilibrium, following a supply deficit in
2022. Due to the supply deficit, copper prices on the LME reached a
high of approximately US$11,000 in the first quarter of 2022, before
falling to approximately US$8,000 in 2023.
The global copper supply currently faces challenges due to
declining ore grades of existing copper mines and the long lead time
required for new mine development. In addition, the ore bodies of
existing copper mines have been declining in quality, which increases
production costs and makes mine expansion challenging. Currently,
copper ore grades are typically discovered at 1% purity or less,
whereas copper ore grades discovered in the 19th century typically
exceeded 5% purity.\51\
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\51\ S&P Global, The Future of Copper.
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Copper supply disruptions also negatively impact the global copper
supply. A recent example is the closure of the Cobre Panama copper mine
in 2023, which accounted for approximately 1.5% of global mined copper
production prior to its closure.\52\ In 2023, Chile produced
approximately 24% of global mined copper production, the most of any
country. Peru and the Democratic Republic of Congo each produced
approximately 12% of global mined copper production, followed by China
and the United States at approximately 8% and 5%, respectively.
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\52\ <a href="http://Mining.com">Mining.com</a>, Cobre Panama: How a $10 billion copper mine is
now sitting idle in the jungle, April 2024.
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From 2025 to 2026, the copper market is forecasted to be in a
slight supply deficit, which deficit is expected to increase in
subsequent years due to supply and demand dynamics. From 2027 to 2028,
there may be a significant supply deficit driven by lower growth in
copper supply.
A key driver of growth in the demand for copper beyond 2028 is
expected to be electricity consumption, which is forecasted to increase
165%\53\ by 2050 due to the greater adoption of clean energy
technologies by energy producers and consumers, globally.\54\
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\53\ IEA World Energy Outlook 2023 Net Zero Emissions Scenario.
\54\ IEA--World Energy Outlook 2023.
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Description of Units
According to the Registration Statement, the Trust is authorized to
[[Page 4661]]
issue an unlimited number of units in one or more classes and series of
a class. Currently, the Trust has issued only one class or series of
Units.\55\ All Units of the same class or series of a class will have
equal rights and privileges with respect to all matters, including
voting, receipt of distributions from the Trust, liquidation and other
events in connection with the Trust. Units and fractions thereof are
issued only as fully paid and non-assessable. Units will have no
preference, conversion, exchange or pre-emptive rights. In addition,
subject to limitations and requirements determined from time to time by
the Manager, each unit of a particular class or series of a class of
the Trust may be redesignated by the Manager as a unit of another class
or series of the Trust.
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\55\ According to the Trust's website, as defined herein, as of
March 11, 2025, the total net asset value (``NAV'') of the Trust and
the NAV per unit of the Trust were US$99.2 and US$8.99,
respectively, and there were a total of 11,034,857 Units issued and
outstanding.
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As noted above, each Unit represents an equal, fractional,
undivided ownership interest in the net assets of the Trust
attributable to the particular class of Units. The Trust may issue
additional Units (i) in future offerings if the gross proceeds received
by the Trust per Unit are not less than 100% of the most recently
calculated NAV; (ii) by way of distribution in Units in connection with
an income distribution; or (iii) with the approval of Unitholders by
extraordinary resolution.
Redemption of Units
According to the Registration Statement, the Trust does not intend
to issue new Units, or redeem existing Units, on a day-to-day basis.
Units may be redeemed at the option of a Unitholder on a monthly basis
for physical Copper or cash.\56\
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\56\ The Commission has previously approved the listing and
trading of Commodity-Based Trust Shares under NYSE Arca Rule 8.201-E
that allow redemptions on a monthly basis. See Securities Exchange
Act Release Nos. 61496 (February 4, 2010), 75 FR 6758 (February 10,
2010) (SR-NYSEArca-2009-113) (approving listing on the Exchange of
Sprott Physical Gold Trust with monthly redemptions); 63043 (October
5, 2010), 75 FR 62615 (October 12, 2010) (SR-NYSEArca-2010-84)
(approving listing on the Exchange of the Sprott Physical Silver
Trust with monthly redemptions); and 69256 (March 28, 2013), 78 FR
20164 (April 3, 2013 (SR-NYSEArca-2012-28) (approving listing on the
Exchange of the JPM XF Physical Copper Trust with monthly
redemptions).
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Redemption for Physical Copper
Subject to the terms of the Trust Agreement and the Manager's right
to suspend redemptions under certain circumstances described in the
Registration Statement, Units may be redeemed at the option of a
Unitholder for physical Copper in any calendar month.
According to the Registration Statement, Units redeemed for Copper
shall have a redemption value equal to the aggregate value of the Class
Net Asset Value per Unit \57\ of the redeemed Units as at the valuation
time (as determined by the Manager) on the last Business Day, as
defined herein, of the calendar month in which the redemption request
is processed (the ``Redemption Date''), less redemption and delivery
expenses. Redemption requests for Copper must be for amounts that are
at least equivalent in value of one Minimum Physical Redemption Lot
\58\ or an integral multiple thereof, plus applicable expenses. Any
fractional amount of redemption proceeds payable in excess of one
Minimum Physical Redemption Lot, or an integral multiple thereof, will
be paid in Copper or the equivalent value in cash at a rate equal to
100% of the NAV of the class redeemed Units as at the valuation time
(as determined by the Manager) on the applicable Redemption Date that
represents such excess amount. A Unitholder redeeming Units for Copper
will be responsible for expenses incurred by the Trust in connection
with such redemption and applicable transfer and delivery expenses,
including the handling, logistical requirements and administration of
the notice of redemption, the transfer of the Copper for the Units that
are being redeemed and the applicable fees.
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\57\ The term ``Net Asset Value per Unit'' means the Net Asset
Value divided by the total number of Units then outstanding.
\58\ The term ``Minimum Physical Redemption Lot'' means the
equivalent of 100 metric tons of Copper.
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A redemption notice to redeem Units for physical Copper must be
received by the Transfer Agent no later than 4:00 p.m., Eastern Time,
on the 15th day of the calendar month in which the redemption notice
will be processed or, if such day is not a day on which banks located
in New York, New York or Toronto, Ontario, are open for the transaction
of banking business (``Business Day''), then on the immediately
following day that is a Business Day. Any redemption notice to redeem
Units for physical Copper received after such time will be processed in
the next month.
According to the Registration Statement, on or before the fifth
Business Day of a calendar month, the Manager will designate the
Facility where the transfer of Copper will occur for the nearest
following redemption date (``Designated Facility''). Such designation
will be made available by the Trust on a public website, at <a href="https://sprott.com/investment-strategies/physical-commodity-funds/copper/">https://sprott.com/investment-strategies/physical-commodity-funds/copper/</a> (the
``Trust's website'').
A Unitholder redeeming Units for Copper will receive the Copper via
an ``in warehouse'' transfer and delivery from the Trust's holdings of
Copper at the Designated Facility to the Unitholder's account at the
Designated Facility. Copper received by a Unitholder as a result of a
redemption of Units will be transferred pursuant to delivery
instructions provided by the Unitholder and will only be delivered to
an account established by the Unitholder at the Designated Facility.
Costs associated with the redemption of Units and the transfer of
Copper will be borne by the redeeming Unitholder. The redeeming
Unitholder will also be responsible for any and all fees charged by the
Designated Facility, including any transfer or setup fees. The transfer
of physical Copper in connection with a redemption of Units will occur
as soon as practicable and, in any event, approximately 15 Business
Days after the applicable redemption date, subject to the timelines,
policies and procedures at any Designated Facility. Any cash to be
received by a redeeming Unitholder in connection with a redemption of
Units for physical Copper will be delivered to the Unitholder's
brokerage account within 10 Business Days after the calendar month in
which the redemption is processed.
Redemption for Cash
Subject to the terms of the Trust Agreement and the Manager's right
to suspend redemptions under certain circumstances described in the
Registration Statement, Units may be redeemed at the option of a
Unitholder for cash on a monthly basis.
According to the Registration Statement, Units redeemed for cash
will be entitled to a redemption price equal to 95% of the lesser of
(i) the volume-weighted average trading price (in U.S. dollars) of the
Units traded on NYSE Arca or, if trading has been suspended on NYSE
Arca, the trading price of the Units traded on TSX, for the last five
Business Days ending on the applicable Redemption Date; and (ii) the
NAV of the class of redeemed Units as of 4:00 p.m. on the applicable
Redemption Date, less applicable fees, costs and expenses. Cash
redemption proceeds will be transferred to a redeeming Unitholder
approximately 15 Business Days following the applicable Redemption
Date, subject to the terms of and conditions of the sales of Copper by
[[Page 4662]]
the Trust to fund the cash redemption amount.
A redemption notice to redeem Units for cash must be received by
the Transfer Agent no later than 4:00 p.m., Eastern time, on the 15th
day of the calendar month in which the redemption notice will be
processed or, if such day is not a Business Day, then on the
immediately following day that is a Business Day. Any redemption notice
to redeem Units for cash received after such time will be processed in
the next month. Additional details regarding redemption of Units for
cash are set forth in the Registration Statement.
Termination Events
The Trust does not have a fixed termination date but will be
terminated and dissolved in the event of any of the following occurs:
1. there are no outstanding Units;
2. the Trustee resigns or is removed and no successor trustee is
appointed by the Manager by the time the resignation or removal becomes
effective;
3. the Manager resigns and no successor manager is appointed by the
Manager and approved by Unitholders by the time the resignation becomes
effective;
4. the Manager is, in the opinion of the Trustee, in material
default of its obligations under the Trust Agreement and such default
continues for 120 days from the date the Manager receives notice of
such default from the Trustee and no successor manager has been
appointed by Unitholders;
5. the Manager experiences certain insolvency events; or
6. the assets of the Manager are seized or confiscated by a public
or governmental authority.
In addition, the Manager may, in its discretion, at any time
terminate and dissolve the Trust, without Unitholder approval, if, in
the opinion of the Manager, after consulting with the independent
review committee, the NAV has been reduced such that it is no longer
economically feasible to continue the Trust and it would be in the best
interests of the Unitholders to terminate the Trust, by giving the
Trustee and each holder of Units at the time at least 90 days' written
notice prior to the effective date of the termination of the Trust. To
the extent such termination of the Trust in the discretion of the
Manager may involve a matter that would be a ``conflict of interest
matter'' as set forth under applicable Canadian securities legislation,
the matter will be referred by the Manager to the Trust's independent
review committee for its recommendation. In connection with the
termination of the Trust, the Trust will, to the extent possible,
convert its assets to cash and, after paying or making adequate
provision for all of the Trust's liabilities, distribute the net assets
of the Trust to Unitholders, on a pro rata basis, as soon as
practicable after the termination date.
Net Asset Value
The NAV for each class of Units will be calculated by the Valuation
Agent, as of 4:00 p.m., Eastern time, on each Business Day. The Trust
will report a daily NAV, based on the value of the Copper assets held
by the Trust. According to the Registration Statement, the Manager and
Technical Advisor initially calculate the fair market value of the
Copper held by the Trust separately for each location where the Copper
is held. For each location, the fair market value of the Copper is
calculated using (1) spot prices from the CME or LME, which are
obtained from Bloomberg by the Manager and Technical Advisor, and (2)
any applicable premiums to the spot prices based on the location of the
Copper, which are obtained from Fastmarkets, a globally recognized
price reporter. Price reporters are private business organizations that
offer subscription services to which most copper market participants
subscribe. The Manager and Technical Advisor sum the fair market value
of the Copper at each location to calculate the total fair market value
of the Copper held by the Trust.\59\
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\59\ According to the Trust, the Trust is a mutual fund under
applicable Canadian securities legislation and must calculate its
NAV pursuant to Part 14 of National Instrument 81-106--Investment
Fund Continuous Disclosure (``NI 81-106''), a rule applicable to
Canadian mutual funds and administered by Canadian securities
regulatory authorities. Pursuant to Subsection 14.2(1) of NI 81-106,
the Trust must subtract the ``fair value'' of its liabilities from
the fair value of its assets when calculating its NAV. Subsection
14.2(1.2) of NI 81-106 defines fair value as (a) the market value
based on reported prices and quotations in an active market; or (b)
if the market value is not available, or the Manager believes that
it is unreliable, a value that is fair and reasonable in all the
relevant circumstances, and requires the Manager to establish and
maintain appropriate written policies and procedures for determining
fair value of the Trust's assets and liabilities and to consistently
follow those policies and procedures.
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The NAV as of the valuation time on each Business Day will be the
amount obtained by deducting from the aggregate fair market value of
the assets of the Trust as of such date an amount equal to the value of
the liabilities of the Trust (excluding all liabilities represented by
outstanding Units, if any) as of such date. The Valuation Agent
calculates the NAV per Unit by dividing the value of the net assets of
the class of the Trust represented by the Units on such day by the
total number of Units of that class then outstanding on such day.
Registration or transfers of the Units may be made through Clearing and
Depository Services, Inc. (and/or Depository Trust Corporation,
beginning at the time when Trust's Units have been listed on the
Exchange), each of which hold the Units on behalf of its participants
(i.e., brokers), which in turn may hold the Units on behalf of their
customers.
Prior to commencement of trading in the Units, the Exchange will
obtain a representation from the Trust that the NAV per Unit will be
calculated daily and will be made available to all market participants
at the same time.
Intraday Indicative Value
The Trust's website will provide an intraday indicative value
(``IIV'') per Unit, as calculated by a third party financial data
provider during the Exchange's Core Trading Session (9:30 a.m. to 4:00
p.m., Eastern time). Intercontinental Exchange, Inc. calculates the IIV
on behalf of the Trust. The IIV will be calculated by using the prior
day's closing NAV per Unit of the Trust as a base and updating that
value throughout the trading day to reflect changes in the most
recently reported price of spot Copper.\60\ Although the IIV will be
disseminated throughout the Core Trading Session, the customary trading
and reporting hours for spot Copper are 8 p.m. (previous day) to 2 p.m.
Eastern Time. During the gap in time at the end of each trading day
during which the Units are traded on the Exchange, but real-time
trading prices for spot Copper are not available, the IIV will be
calculated based on the last reported mid-point of the bid-ask spread
of the spot Copper price in the immediately preceding trading session
until the day's settlement price is reported, in which case the day's
settlement price will be used.
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\60\ The IIV on a per Unit basis disseminated during the NYSE
Arca Core Trading Session should not be viewed as an actual real
time update of the NAV, because the NAV is calculated only once at
the end of each trading day based upon the relevant end of day
values of the Trust's investments.
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The IIV will be disseminated on a per Unit basis every 15 seconds
during regular NYSE Arca Core Trading Session (as defined herein).
Availability of Information Regarding Copper
Currently, the Consolidated Tape Plan does not provide for
dissemination of the spot price of a commodity, such as copper, over
the Consolidated Tape. However, the quotation and last sale price for
the Units will be disseminated
[[Page 4663]]
over the Consolidated Tape, as is the case for all equity securities
traded on the Exchange. In addition, investors may obtain copper price
and copper market information through public websites and through
professional subscription services.
Investors may obtain almost on a 24-hour basis copper pricing
information based on the spot and futures price of copper from various
financial information service providers, such as Reuters, Bloomberg, as
well as other sources. Reuters and Bloomberg provide at no charge on
their websites delayed information regarding the spot price of copper
and last sale prices of copper futures, as well as information about
news and developments in the copper market. Reuters, Bloomberg and
Fastmarkets, a globally recognized price reporter, also offer a
professional service to subscribers for a fee that provides information
on copper premium data aggregated directly from market participants.
Complete real-time data for copper futures and options prices traded on
the CME and the LME are available by subscription from Reuters and
Bloomberg. In addition, the LME publishes on its website with a one-day
delay the LME Official Prices, which includes both spot and futures
prices. These prices are the last bid and ask price quoted during the
second ring (open outcry) trading session on a given date. The current
day's LME Official Prices are available from major market data vendors
for a fee. The CME also provides delayed futures and options
information on current and past trading sessions and market news free
of charge on its website. There are a variety of other public websites
providing information on copper, ranging from those specializing in
commodities to sites maintained by major newspapers.
Availability of Information
The NAV for the Trust's Units will be disseminated daily to all
market participants at the same time. The intraday, closing, and
settlement spot and futures prices for copper will be readily available
from the websites of the CME and LME, automated quotation systems,
published or other public sources, or major market data vendors. The
IIV for the units per Unit will be disseminated by one or more major
market data vendors on at least a 15 second delayed basis as required
by NYSE Arca Rule 8.201-E(e)(2)(v).
Complete real-time data for copper is available by subscription
through on-line information services. Quotation and last-sale
information regarding the Units will be disseminated through the
facilities of the Consolidated Tape Association. The IIV will be
available through on-line information services. The trading prices for
spot copper and copper futures will be disseminated by on-line
subscription services or by one or more major market data vendors
during the NYSE Arca Core Trading Session of 9:30 a.m. to 4:00 p.m.
Eastern time.
In addition, the Trust's website will contain the following
information, on a per Unit basis, for the Trust: (a) the prior business
day's end of day closing NAV; (b) the Official Closing Price \61\ or
the midpoint of the national best bid and the national best offer
(``NBBO'') as of the time the NAV is calculated (``Bid-Ask Price'');
(c) calculation of the premium or discount of the Official Closing
Price or the Bid-Ask Price against the NAV expressed as a percentage of
such NAV; (d) the latest prospectus of the Trust and (e) other
applicable quantitative information. The Trust will also provide
website disclosure of its Copper holdings before 9:30 a.m. E.T. on each
trading day.
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\61\ The term ``Official Closing Price'' is defined in NYSE Arca
Rule 1.1(ll) as the reference price to determine the closing price
in a security for purposes of Rule 7-E Equities Trading, and the
procedures for determining the Official Closing Price are set forth
in that rule.
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The Trust's website is publicly available and accessible at no
charge. Accordingly, each investor will have access to the current
daily holdings of the Trust through the Trust's website. In addition,
information regarding market price and trading volume of the Units will
be continually available on a real-time basis throughout the day on
brokers' computer screens and other electronic services. Information
regarding the previous day's closing price and trading volume
information for the Units will be published daily in the financial
section of newspapers.
In addition, the Trust will furnish reports to the Commission on
Form 6-K in accordance with Rule 13a-16 under the Exchange Act and will
also file with the Commission annual reports on Form 40-F under the
Canada/U.S. Multijurisdictional Disclosure System. Information included
in such filings (and which will be made available to Unitholders) will
include (i) annual information form, (ii) annual financial statements,
(iii) annual management report on fund performance (``MRFP''), (iv)
quarterly financial statements, (v) quarterly MRFP and (vi) report of
independent review committee.
Trading Rules
The Exchange deems the Units to be equity securities, thus
rendering trading in the Units subject to the Exchange's existing rules
governing the trading of equity securities. Trading in the Units on the
Exchange will occur in accordance with NYSE Arca Rule 7.34-E (Early,
Core, and Late Trading Sessions). The Exchange has appropriate rules to
facilitate transactions in the Units during all trading sessions. As
provided in NYSE Arca Rule 7.6-E, the minimum price variation (``MPV'')
for quoting and entry of orders in equity securities traded on the NYSE
Arca Marketplace is $0.01, with the exception of securities that are
priced less than $1.00, for which the MPV for order entry is $0.0001.
The Units will conform to the initial and continued listing
criteria under NYSE Arca Rule 8.201-E (Non-Generic). The trading of the
Units will be subject to NYSE Arca Rule 8.201-E(g), which sets forth
certain restrictions on Equity Trading Permit (``ETP'') Holders acting
as registered Market Makers in Commodity-Based Trust Shares to
facilitate surveillance. The Exchange represents that, for initial and
continued listing, the Trust will be in compliance with Rule 10A-3 \62\
under the Exchange Act, as provided by NYSE Arca Rule 5.3-E. A minimum
of 100,000 Units will be outstanding at the commencement of trading on
the Exchange.
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\62\ With respect to the application of Rule 10A-3 (17 CFR
240.10A-3) under the Exchange Act, the Trust relies on the exemption
contained in Rule 10A-3(c)(7).
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Trading Halts
With respect to trading halts, the Exchange may consider all
relevant factors in exercising its discretion to halt or suspend
trading in the Units. Trading on the Exchange in the Units may be
halted because of market conditions or for reasons that, in the view of
the Exchange, make trading in the Units inadvisable. These may include:
(1) the extent to which conditions in the underlying copper market have
caused disruptions and/or lack of trading, or (2) whether other unusual
conditions or circumstances detrimental to the maintenance of a fair
and orderly market are present. In addition, trading in Units will be
subject to trading halts caused by extraordinary market volatility
pursuant to the Exchange's ``circuit breaker'' rule.\63\
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\63\ See NYSE Arca Rule 7.12-E.
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The Exchange may halt trading during the day in which an
interruption occurs to the dissemination of the IIV, as described
above. If the interruption to the dissemination of the IIV persists
past the trading day in which it occurs, the Exchange will halt trading
no later than the beginning of the trading day following the
interruption. In addition,
[[Page 4664]]
if the Exchange becomes aware that the NAV with respect to the Units is
not disseminated to all market participants at the same time, it will
halt trading in the Units until such time as the NAV is available to
all market participants.
Surveillance
The Exchange represents that trading in the Units will be subject
to the existing trading surveillances administered by the Exchange, as
well as cross-market surveillances administered by the Financial
Industry Regulatory Authority (``FINRA'') on behalf of the Exchange,
which are designed to detect violations of Exchange rules and
applicable federal securities laws.\64\ The Exchange represents that
these procedures are adequate to properly monitor Exchange trading of
the Units in all trading sessions and to deter and detect violations of
Exchange rules and federal securities laws applicable to trading on the
Exchange.
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\64\ FINRA conducts cross-market surveillances on behalf of the
Exchange pursuant to a regulatory services agreement. The Exchange
is responsible for FINRA's performance under this regulatory
services agreement.
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The surveillances referred to above generally focus on detecting
securities trading outside their normal patterns, which could be
indicative of manipulative or other violative activity. When such
situations are detected, surveillance analysis follows and
investigations are opened, where appropriate, to review the behavior of
all relevant parties for all relevant trading violations.
The Exchange or FINRA, on behalf of the Exchange, or both, will
communicate as needed regarding trading in the Units with other markets
and other entities that are members of the Intermarket Surveillance
Group (``ISG''),\65\ and the Exchange or FINRA, on behalf of the
Exchange, or both, may obtain trading information regarding trading in
the Units from such markets and other entities. The Exchange also may
obtain information regarding spot copper and copper futures trading
from markets trading such instruments that are members of ISG or with
which the Exchange has in place a comprehensive surveillance sharing
agreement (``CSSA''). For the North American market, CME is the leading
spot (for front-month delivery) and futures market venue for copper
while the LME is the leading spot and futures market venue for other
regions, including Europe and Asia (excluding China).
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\65\ For the list of current members of ISG, see <a href="https://www.isgportal.org/home.html">https://www.isgportal.org/home.html</a>.
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The Exchange, the CME and the LME are each a member of the ISG,
which provides a global network for the sharing of information and the
coordination of regulatory efforts among exchanges trading securities
and other products to address potential intermarket manipulation and
trading abuses. In effect, the ISG is an information sharing
cooperative governed by a written agreement, formed to facilitate
certain regulatory responsibilities of its members in connection with
market surveillance. A prerequisite to ISG membership is that the
member exchange is not subject to local laws or regulations that
prevent information sharing. Information is shared upon request and may
only be used for regulatory purposes. Accordingly, the CME and the LME
are obligated, and have undertaken a commitment, to share information
with the Exchange including, but not limited to, with respect to
trading in spot copper and copper futures.
Additionally, the Exchange is able to obtain information regarding
trading in the Units in connection with ETP Holders' proprietary or
customer trades which they effect through ETP Holders on any relevant
market. Additionally, under NYSE Arca Rule 8.201-E(g), an ETP Holder
acting as a registered Market Maker in the Units is required to provide
the Exchange with information relating to its accounts for trading in
any underlying commodity, related futures or options on futures, or any
other related derivatives. Commentary .04 of NYSE Arca Rule 11.3-E
requires an ETP Holder acting as a registered Market Maker, and its
affiliates, in the Units to establish, maintain and enforce written
policies and procedures reasonably designed to prevent the misuse of
any material nonpublic information with respect to such products, any
components of the related products, any physical asset or commodity
underlying the product, applicable currencies, underlying indexes,
related futures or options on futures, and any related derivative
instruments (including the Units).
As a general matter, the Exchange has regulatory jurisdiction over
its ETP Holders and their associated persons, which include any person
or entity controlling an ETP Holder. To the extent the Exchange may be
found to lack jurisdiction over a subsidiary or affiliate of an ETP
Holder that does business only in commodities or futures contracts and
that subsidiary or affiliate is a member of another regulatory
organization, the Exchange could obtain information regarding the
activities of such subsidiary or affiliate through a surveillance
sharing agreement with that regulatory organization.
In addition, the Exchange also has a general policy prohibiting the
distribution of material, non-public information by its employees.
All statements and representations made in this filing regarding
(a) the description of the portfolio holdings or reference assets, (b)
limitations on portfolio holdings or reference assets and (c) the
applicability of Exchange listing rules specified in this rule filing
shall constitute continued listing requirements for listing the Units
on the Exchange.
The Manager has represented to the Exchange that it will advise the
Exchange of any failure by the Trust to comply with the continued
listing requirements, and, pursuant to its obligations under Section
19(g)(1) of the Exchange Act, the Exchange will monitor for compliance
with the continued listing requirements. If the Exchange becomes aware
that the Trust or the Units are not in compliance with the applicable
listing requirements, the Exchange will commence delisting procedures
under NYSE Arca Rule 5.5-E(m).
Information Bulletin
Prior to the commencement of trading, the Exchange will inform its
ETP Holders in an Information Bulletin of the special characteristics
and risks associated with trading the Units. Specifically, the
Information Bulletin will discuss the following: (1) the procedures for
purchases and redemptions of Units (including noting that Units are not
individually redeemable); (2) NYSE Arca Rule 9.2-E(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 Units; (3) how
information regarding the IIV and NAV is disseminated; (4) the
requirement that ETP Holders deliver a prospectus to investors
purchasing newly issued Units prior to or concurrently with the
confirmation of a transaction; (5) the possibility that trading spreads
and the premium or discount on the Units may widen as a result of
reduced liquidity of copper trading during the Core and Late Trading
Sessions; and (6) trading information. For example, the Information
Bulletin will advise ETP Holders, prior to the commencement of trading,
of the prospectus delivery requirements applicable to the Trust. The
Exchange notes that investors purchasing Units directly from the Trust
will receive a prospectus. ETP Holders purchasing Units from the Trust
for
[[Page 4665]]
resale to investors will deliver a prospectus to such investors.
In addition, the Information Bulletin will reference that the Trust
is subject to various fees and expenses as will be described in a
prospectus. The Information Bulletin will also reference the fact that
there is no regulated source of last sale information regarding
physical copper, that the Commission has no jurisdiction over the
trading of copper as a physical commodity, and that the CFTC has
regulatory jurisdiction over the trading of copper futures contracts
and options on copper futures contracts.
The Information Bulletin will also disclose the trading hours of
the Units and that the NAV for the Units will be calculated as of 4:00
p.m. Eastern time, each trading day. The Information Bulletin will
disclose that information about Units of the Trust will be publicly
available on the Trust's website.
The Information Bulletin will also discuss any relief, if granted,
by the Commission or the staff from any rules under the Exchange Act.
2. Statutory Basis
The basis under the Exchange Act for this proposed rule change is
the requirement under Section 6(b)(5) \66\ that an exchange have rules
that are designed to prevent fraudulent and manipulative acts and
practices, to promote just and equitable principles of trade, to remove
impediments to, and perfect the mechanism of a free and open market
and, in general, to protect investors and the public interest.
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\66\ 15 U.S.C. 78f(b)(5).
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The Exchange believes that the proposed rule change is designed to
prevent fraudulent and manipulative acts and practices in that the
Units will be listed and traded on the Exchange pursuant to the initial
and continued listing criteria in NYSE Arca Rule 8.201-E (Non-Generic).
The Exchange has in place surveillance procedures that are adequate to
properly monitor trading in the Units in all trading sessions and to
deter and detect violations of Exchange rules and applicable federal
securities laws.
The Exchange or FINRA, on behalf of the Exchange, or both, will
communicate as needed regarding trading in the Units with other markets
and other entities that are members of the ISG, and the Exchange or
FINRA, on behalf of the Exchange, or both, may obtain trading
information regarding trading in the Units from such markets and other
entities. In addition, the Exchange may obtain information regarding
trading in the Units from markets and other entities that are members
of ISG or with which the Exchange has in place a CSSA. The Exchange may
also obtain information regarding trading in spot copper and copper
futures from markets trading such futures that are members of ISG or
with which the Exchange has in place a CSSA. For the North American
market, CME is the leading spot (for front-month delivery) and futures
market venue for copper while the LME is the leading spot and futures
market venue for other regions, including Europe and Asia (excluding
China).
The Exchange may obtain information regarding trading in the spot
copper and copper futures from the CME and the LME, each a member of
the ISG. The Exchange represents that pursuant to its membership in
ISG, the CME and the LME have undertaken a commitment to share
information with the Exchange on an as-needed basis when such
surveillance-sharing information is used for regulatory purposes.
The Exchange also represents that the Trust will not invest in
futures, options, warrants, options on futures, swap contracts, or
warehouse receipts. The Trust will also not hold or trade in commodity
futures contracts, ``commodity interests,'' or any other instruments
regulated by the CEA.
Also, pursuant to NYSE Arca Rule 8.201-E(g), the Exchange is able
to obtain information regarding trading in the Units and the underlying
Copper through ETP Holders acting as registered Market Makers, in
connection with such ETP Holders' proprietary or customer trades
through ETP Holders which they effect on any relevant market.
The proposed rule change is designed to promote just and equitable
principles of trade and to protect investors and the public interest.
Investors may obtain copper price and copper market information through
public websites and through professional subscription services.
Complete real-time data for copper futures and options prices
traded on the CME and the LME are available by subscription from
Reuters and Bloomberg. In addition, the LME publishes on its website
with a one-day delay the LME Official Prices, which includes both spot
and future prices. These prices are the last bid and ask price quoted
during the second ring (open outcry) trading session on a given date.
The current day's LME Official Prices are also available from major
market data vendors for a fee. The CME also provides delayed futures
and options information on current and past trading sessions and market
news free of charge on its website. There are a variety of other public
websites providing information on copper, ranging from those
specializing in commodities to sites maintained by major newspapers.
The Trust's daily NAV will be posted on the Trust's website as soon
as practicable. The Trust's website will provide an IIV per Unit, as
calculated by a third-party financial data provider during the
Exchange's Core Trading Session. The Trust's website will also provide
the Trust's prospectus. Quotation and last-sale information regarding
the Units will be disseminated through the facilities of the
Consolidated Tape Association. In addition, if the Exchange becomes
aware that the NAV with respect to the Units is not disseminated to all
market participants at the same time, it will halt trading in the Units
until such time as the NAV is available to all market participants. The
NAV per Unit will be calculated daily and made available to all market
participants at the same time. One or more major market data vendors
will disseminate for the Trust on a daily basis information with
respect to the recent NAV per Unit and Units outstanding.
The proposed rule change is designed to perfect the mechanism of a
free and open market and, in general, to protect investors and the
public interest in that it will facilitate the listing and trading of
an additional type of exchange-traded product that will enhance
competition among market participants, to the benefit of investors and
the marketplace. As noted above, the Exchange has in place surveillance
procedures relating to trading in the Units and may obtain information
regarding trading in the spot copper and copper futures from the CME
and the LME pursuant to their membership in ISG. In addition, as noted
above, investors will have ready access to information regarding the
Trust's NAV, IIV and spot Copper and copper futures pricing
information.
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 Exchange Act. The Exchange
believes the proposed rule change will enhance competition by
accommodating Exchange trading of an exchange-traded product relating
to physical copper, which will enhance competition among market
participants, to the benefit of investors and the marketplace.
[[Page 4666]]
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. Discussion and Commission Findings
After careful review, the Commission finds that the proposed rule
change, as modified by Amendment No. 1, is consistent with the Act and
the rules and regulations thereunder applicable to a national
securities exchange.\67\ In particular, the Commission finds that the
proposed rule change, as modified by Amendment No. 1, is consistent
with Section 6(b)(5) of the Act,\68\ which requires, among other
things, that the Exchange's rules be designed to prevent fraudulent and
manipulative acts and practices and, in general, to protect investors
and the public interest; and with Section 11A(a)(1)(C)(iii) of the
Act,\69\ 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.
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\67\ In approving this proposed rule change, as modified by
Amendment No. 1, the Commission has considered the proposed rule's
impact on efficiency, competition, and capital formation. See 15
U.S.C. 78c(f).
\68\ 15 U.S.C. 78f(b)(5).
\69\ 15 U.S.C. 78k-1(a)(1)(C)(iii).
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A. Exchange Act Section 6(b)(5)
The Commission has previously recognized that surveillance-sharing
agreements assist in the detection and deterrence of fraudulent and
manipulative activity.\70\ The Commission also has stated that it
considers two markets that are members of the ISG to have a
comprehensive surveillance-sharing agreement with one another, even if
they do not have a separate bilateral surveillance-sharing
agreement.\71\
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\70\ See, e.g., Securities Exchange Act Release No. 35518 (Mar.
21, 1995), 60 FR 15804, 15807 (Mar. 27, 1995) (SR-Amex-94-30)
(approving the exchange listing and trading of Commodity Linked
Notes). In that matter, the Commission stated that the listing
exchange had comprehensive surveillance-sharing agreements with all
of the exchanges upon which the futures contracts overlying the
notes traded and was able to obtain market surveillance information,
including customer identity information, for transactions occurring
on NYMEX and other futures exchanges. See id. at 15807 n.21; see
also Securities Exchange Act Release No. 36885 (Feb. 26, 1996), 61
FR 8315, 8319 n.17 (Mar. 4, 1996) (SR-Amex-95-50) (approving the
exchange listing and trading of Commodity Indexed Securities, and
stating: (a) that through the comprehensive surveillance-sharing
agreements, the listing exchange was able to obtain market
surveillance information, including customer identity information,
for transactions occurring on NYMEX and COMEX and that, through the
ISG information-sharing agreement, the listing exchange was able to
obtain, upon request, surveillance information with respect to
trades effected on the London Metal Exchange, including client
identity information and (b) that, if a different market were
utilized for purposes of calculating the value of a designated
futures contract, the listing exchange had represented that it would
ensure that it entered into a surveillance-sharing agreement with
respect to the new relevant market). The Commission has made similar
statements about surveillance-sharing agreements with respect to the
listing and trading of stock-index, currency, and currency-index
warrants. See, e.g., Securities Exchange Act Release No. 36166 (Aug.
29, 1995), 60 FR 46660 (Sept. 7, 1995) (SR-PSE-94-28) (approving a
proposal to adopt uniform listing and trading guidelines for stock-
index, currency, and currency-index warrants). Specifically, the
Commission stated that ``a surveillance sharing agreement should
provide the parties with the ability to obtain information necessary
to detect and deter market manipulation and other trading abuses''
and stated that the Commission ``generally requires that a
surveillance sharing agreement require that the parties to the
agreement provide each other, upon request, information about market
trading activity, clearing activity, and the identity of the
ultimate purchasers for securities.'' Id. at 46665 n.35. In
addition, the Commission stated that ``[t]he ability to obtain
relevant surveillance information, including, among other things,
the identity of the ultimate purchasers and sellers of securities,
is an essential and necessary component of a comprehensive
surveillance sharing agreement.'' Id. at 46665 n.36.
\71\ See Amendment to Rule Filing Requirements for Self-
Regulatory Organizations Regarding New Derivative Securities
Products, Securities Exchange Act Release No. 40761 (Dec. 8, 1998),
63 FR 70952, 70959 (Dec. 22, 1998) (stating the importance of ISG,
which ``was formed to coordinate, among other things, effective
surveillance and investigative information sharing arrangements in
the stock and options markets,'' and that, if an exchange trades
component securities underlying a new derivative securities product
and is not a member of the ISG, the exchange seeking to list and
trade such new derivative securities product should enter into a
comprehensive information sharing agreement with the non-ISG market,
and conversely, if an exchange seeks to list and trade a new
derivative securities product and is not a member of the ISG, such
exchange should enter into a comprehensive information sharing
agreement with each market that trades securities underlying the new
derivative securities product).
---------------------------------------------------------------------------
As stated in Amendment No. 1, the Trust will invest and hold
substantially all of its assets in Copper \72\ and cash. The Trust will
not hold any assets other than Copper and cash and will not invest in
futures, options, warrants, options on futures, swap contracts, or
warehouse receipts.\73\ According to the Exchange, for the North
American market, CME is the leading spot (for front-month delivery) and
futures market venue for copper, while the LME is the leading spot and
futures market venue for other regions, including Europe and Asia
(excluding China).\74\ According to the Exchange, NYSE Arca, CME, and
LME are each a member of the ISG.\75\ Accordingly, the Exchange states
that CME and LME are obligated, and have undertaken a commitment, to
share information with the Exchange including, but not limited to, with
respect to trading in spot copper and copper futures.\76\
---------------------------------------------------------------------------
\72\ The Exchange represents that the Trust intends to achieve
its objective by investing primarily in long-term holdings of
unencumbered Copper and will not speculate with regard to short-term
changes in Copper prices. See Amendment 1, supra note 10.
\73\ Specifically, the Exchange represents that the Trust will
not hold or trade in commodity futures contracts, ``commodity
interests,'' or any other instruments regulated by the CEA. See
supra note 40 and accompanying text.
\74\ The Exchange represents that CME publishes spot prices for
copper on a daily basis for front-month delivery. The LME publishes
spot prices for copper on a daily basis for prompt delivery (T+2).
See Amendment 1, supra note 10. In addition, CME and LME publish
futures prices for copper across a range of standardized contract
maturities. See id.
\75\ The Exchange states that ISG ``provides a global network
for the sharing of information and the coordination of regulatory
efforts among exchanges trading securities and other products to
address potential intermarket manipulation and trading abuses. In
effect, the ISG is an information sharing cooperative governed by a
written agreement, formed to facilitate certain regulatory
responsibilities of its members in connection with market
surveillance. A prerequisite to ISG membership is that the member
exchange is not subject to local laws or regulations that prevent
information sharing. Information is shared upon request and may only
be used for regulatory purposes.'' Id.
\76\ See id.
---------------------------------------------------------------------------
Based on the record before it, the Commission is able to conclude
that the Exchange's surveillance sharing agreement by virtue of CME's
and LME's ISG membership, with respect to the spot Copper proposed to
be held by the Trust, as well as with respect to copper futures, can be
reasonably expected to assist in surveilling for fraudulent and
manipulative acts and practices. These agreements through ISG
membership should help to ensure the availability of information
necessary to detect and deter potential manipulations and other trading
abuses, thereby making the Units of the Trust less readily susceptible
to manipulation.\77\ The
[[Page 4667]]
Commission therefore finds that the proposed rule change, as modified
by Amendment No. 1, is consistent with Section 6(b)(5) of the Act,\78\
which requires, among other things, that the Exchange's rules be
designed to prevent fraudulent and manipulative acts and practices and,
in general, to protect investors and the public interest.
---------------------------------------------------------------------------
\77\ The Exchange further represents that the Exchange is able
to obtain information regarding trading in the Units in connection
with ETP Holders' proprietary or customer trades which they effect
through ETP Holders on any relevant market. Additionally, under NYSE
Arca Rule 8.201-E(g), an ETP Holder acting as a registered Market
Maker in the Units is required to provide the Exchange with
information relating to its accounts for trading in any underlying
commodity, related futures or options on futures, or any other
related derivatives. Commentary .04 of NYSE Arca Rule 11.3-E
requires an ETP Holder acting as a registered Market Maker, and its
affiliates, in the Units to establish, maintain, and enforce written
policies and procedures reasonably designed to prevent the misuse of
any material non-public information with respect to such products,
any components of the related products, any physical asset or
commodity underlying the product, applicable currencies, underlying
indexes, related futures or options on futures, and any related
derivative instruments (including the Units). As a general matter,
the Exchange has regulatory jurisdiction over its ETP Holders and
their associated persons, which include any person or entity
controlling an ETP Holder. To the extent the Exchange may be found
to lack jurisdiction over a subsidiary or affiliate of an ETP Holder
that does business only in commodities or futures contracts and that
subsidiary or affiliate is a member of another regulatory
organization, the Exchange could obtain information regarding the
activities of such subsidiary or affiliate through a surveillance
sharing agreement with that regulatory organization. In addition,
the Exchange also has a general policy prohibiting the distribution
of material, non-public information by its employees. See id.
\78\ 15 U.S.C. 78f(b)(5). For avoidance of doubt, a
surveillance-sharing agreement is not the only means by which an
exchange may demonstrate consistency with Section 6(b)(5) of the
Act.
---------------------------------------------------------------------------
B. Exchange Act Section 11A(a)(1)(C)(iii)
The proposed rule change, as modified by Amendment No. 1, sets
forth aspects of the Trust, including the availability of copper
pricing and market information, transparency of Trust holdings, and
types of surveillance procedures, that are consistent with other
exchange-traded products that the Commission has approved.\79\ This
includes commitments regarding: the availability via the Consolidated
Tape Association of quotation and last-sale information for the Units;
the availability on the Trust's website of certain information related
to the Trust and the Units, including NAV; the dissemination of the IIV
by one or more major market data vendors, updated every 15 seconds
throughout the Exchange's regular trading hours; the Exchange's
surveillance procedures and ability to obtain information regarding
trading in the Units of the Trust and trading in the spot copper traded
on CME and LME and copper futures traded on both CME and LME; the
conditions under which the Exchange would implement trading halts and
suspensions; and the requirements of registered market makers in the
Units of the Trust.
---------------------------------------------------------------------------
\79\ See, e.g., Securities Exchange Act Release No. 61220 (Dec.
22, 2009), 74 FR 68895 (Dec. 29, 2009) (SR-NYSEARCA-2009-94) (Order
Granting Approval of Proposed Rule Change Relating To Listing and
Trading Shares of the ETFS Palladium Trust); and Securities Exchange
Act Release No. 94518 (Mar. 25, 2022), 87 FR 18837 (Mar. 31, 2022)
(SR-NYSEARCA-2021-65) (Notice of Filing of Amendment No. 1 and Order
Granting Accelerated Approval of a Proposed Rule Change, as Modified
by Amendment No. 1, To List and Trade Shares of the Sprott ESG Gold
ETF Under NYSE Arca Rule 8.201-E (Commodity-Based Trust Shares)).
---------------------------------------------------------------------------
A commenter expressed general support for the proposal and
encouraged the Commission to monitor the tracking performance versus
spot copper prices, and ensure that any deviation from NAV remains
minimal.\80\ According to the Exchange, and as discussed above,
investors and other market participants will be able to track the
performance of the Trust's NAV against spot copper prices.\81\ The
Exchange also represents that, if the Exchange becomes aware that the
NAV with respect to the Units is not disseminated to all market
participants at the same time, it will halt trading in the Units until
such time as the NAV is available to all market participants.\82\ In
addition, the Exchange represents that it deems the Units to be equity
securities, thus rendering trading in the Units subject to the
Exchange's rules governing the trading of equity securities.\83\
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\80\ See supra note 11 and accompanying text.
\81\ According to the Exchange, investors may obtain almost on a
24-hour basis, copper pricing information based on the spot price of
copper from various financial information service providers, such as
Reuters, Bloomberg, as well as other sources. Reuters and Bloomberg
provide at no charge on their websites delayed information regarding
the spot price of copper and last sale prices of copper futures, as
well as information about news and developments in the copper
market. Reuters, Bloomberg and Fastmarkets, a globally recognized
price reporter, also offer a professional service to subscribers for
a fee that provides information on copper prices directly from
market participants. Complete real-time data for copper futures and
options prices traded on the CME and the LME are available by
subscription from Reuters and Bloomberg. In addition, the LME
publishes the LME official price information on its website with a
one-day delay. The current day's LME official prices are available
from major market data vendors for a fee. The CME also provides
delayed futures and options information on current and past trading
sessions and market news free of charge on its website. There are a
variety of other public websites providing information on copper,
ranging from those specializing in commodities to sites maintained
by major newspapers. See Amendment No. 1, supra note 10.
\82\ See id. The Exchange states that the NAV for the Trust's
Units will be disseminated daily to all market participants at the
same time, and that prior to commencement of trading in the Units,
the Exchange will obtain a representation from the Trust that the
NAV per Unit will be calculated daily and will be made available to
all market participants at the same time. See id. In addition, the
Trust's website will contain the following information, on a per
Unit basis, for the Trust: (a) the prior business day's end of day
closing NAV; (b) the Official Closing Price or the midpoint of the
NBBO as of the time the NAV is calculated; (c) calculation of the
premium or discount of the Official Closing Price or the Bid-Ask
Price against the NAV expressed as a percentage of such NAV; (d) the
latest prospectus of the Trust; and (e) other applicable
quantitative information. See id. The Exchange also states that the
IIV for the units per Unit will be disseminated by one or more major
market data vendors on at least a 15 second delayed basis as
required by NYSE Arca Rule 8.201-E(e)(2)(v). See id.
\83\ See id.
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Further, the applicable listing rule of the Exchange requires that
all statements and representations made in its filing regarding, among
others, the description of the portfolio holdings or reference assets,
limitations on such portfolio holdings or reference assets, and the
applicability of the Exchange's listing rules specified in the filing,
will constitute continued listing requirements.\84\ Moreover, the
proposed rule change states that the Manager has represented to the
Exchange that it will advise the Exchange of any failure by the Trust
to comply with the applicable continued listing requirements; pursuant
to obligations under Section 19(g)(1) of the Exchange Act, the Exchange
will monitor for compliance with the continued listing requirements;
and if the Exchange becomes aware that the Trust is not in compliance
with the applicable listing requirements, that Exchange will commence
delisting procedures.\85\
---------------------------------------------------------------------------
\84\ See NYSE Arca Rule 8.201-E, Commentary .04. See also
Amendment No. 1, supra note 10.
\85\ See Amendment No. 1, supra note 10.
---------------------------------------------------------------------------
The Commission therefore finds that the proposed rule change, as
modified by Amendment No. 1, is reasonably designed to promote fair
disclosure of information that may be necessary to price the Units
appropriately, to prevent trading when a reasonable degree of
transparency cannot be assured, to safeguard material non-public
information relating to the Trust's holdings, and to ensure fair and
orderly markets for the Units of the Trust.
The Commission has previously approved listing and trading on the
Exchange of other issues of Commodity-Based Trust Shares, including
units of the Sprott Physical Gold Trust,\86\ Sprott Physical Silver
Trust,\87\ and Sprott Physical Gold and Silver Trust,\88\ that are
substantially similar in terms of operation and representations to
those in the proposed rule change, as modified by Amendment No. 1. With
respect to Commodity-Based Trust Shares based on copper, the Commission
also previously approved
[[Page 4668]]
the listing and trading on the Exchange of shares of the JPM XF
Physical Copper Trust \89\ and the iShares Copper Trust.\90\
---------------------------------------------------------------------------
\86\ See Securities Exchange Act Release No. 61496 (Feb. 4,
2010), 75 FR 6758 (Feb. 10, 2010) (SR-NYSEArca-2009-113) (approving
listing on the Exchange of Sprott Physical Gold Trust).
\87\ See Securities Exchange Act Release No. 63043 (Oct. 5,
2010), 75 FR 62615 (Oct. 12, 2010) (SR-NYSEArca-2010-84) (approving
listing on the Exchange of the Sprott Physical Silver Trust).
\88\ See Securities Exchange Act Release No. 82448 (Jan. 5,
2018), 83 FR 1428 (Jan. 11, 2018) (SR-NYSEArca-2017-131) (approving
listing on the Exchange of the Sprott Physical Gold and Silver
Trust).
\89\ See Securities Exchange Act Release No. 69256 (Mar. 28,
2013), 78 FR 20164 (Apr. 3, 2013 (SR-NYSEArca-2012-28) (approving
listing on the Exchange of the JPM XF Physical Copper Trust).
\90\ See Securities Exchange Act Release No. 68973 (Feb. 22,
2013), 78 FR 13726 (Feb. 28, 2013) (SR-NYSEArca-2012-66) (approving
listing on the Exchange of the iShares Copper Trust).
---------------------------------------------------------------------------
This approval order is based on all the Exchange's representations
and descriptions in the proposed rule change, as modified by Amendment
No. 1, and comment received, which the Commission has carefully
evaluated as discussed above. For the foregoing reasons, the Commission
finds that the proposed rule change, as modified by Amendment No. 1, is
consistent with the requirements of the Act and the rules and
regulations thereunder applicable to a national securities exchange,
and in particular, Section 6(b)(5) and Section 11A(a)(1)(C)(iii) of the
Act.\91\
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\91\ 15 U.S.C. 78f(b)(5); 15 U.S.C. 78k-1(a)(1)(C)(iii).
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IV. Solicitation of Comments on Amendment No. 1 to the Proposed Rule
Change
Interested persons are invited to submit written data, views, and
arguments concerning whether the proposed rule change, as modified by
Amendment No. 1, is consistent with the Act. Comments may be submitted
by any of the following methods:
Electronic Comments
<bullet> Use the Commission's internet comment form (<a href="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>); or
<bullet> Send an email to <a href="/cdn-cgi/l/email-protection#d0a2a5bcb5fdb3bfbdbdb5bea4a390a3b5b3feb7bfa6"><span class="__cf_email__" data-cfemail="b5c7c0d9d098d6dad8d8d0dbc1c6f5c6d0d69bd2dac3">[email protected]</span></a>. Please include
file number SR-NYSEARCA-2025-24 on the subject line.
Paper Comments
<bullet> Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
All submissions should refer to file number SR-NYSEARCA-2025-24. This
file number should be included on the subject line if email 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 website (<a href="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>). Copies of the filing will be available for inspection and
copying at the principal office of the Exchange. Do not include
personal identifiable information in submissions; you should submit
only information that you wish to make available publicly. We may
redact in part or withhold entirely from publication submitted material
that is obscene or subject to copyright protection. All submissions
should refer to file number SR-NYSEARCA-2025-24 and should be submitted
on or before February 23, 2026.
V. Accelerated Approval of Proposed Rule Change, as Modified by
Amendment No. 1
The Commission finds good cause to approve the proposed rule
change, as modified by Amendment No. 1, prior to the 30th day after the
date of publication of Amendment No. 1 in the Federal Register.
Amendment No. 1 makes certain clarifications with respect to references
to spot copper and copper futures pricing and information and makes
additional corrections to conform to defined terms that are minor and
technical in nature.
The Commission finds that Amendment No. 1 to the proposed rule
change raises no novel regulatory issues that have not previously been
subject to comment, and is reasonably designed, among other things, to
prevent fraudulent and manipulative acts and practices, to remove
impediments to and perfect the mechanism of a free and open market,
and, in general, to protect investors and the public interest. The
Commission also finds that Amendment No. 1 to the proposed rule change
is consistent with Section 11A(a)(1)(C)(iii) of the Act.\92\
Accordingly, pursuant to Section 19(b)(2) of the Act,\93\ the
Commission finds good cause to approve the proposed rule change, as
modified by Amendment No. 1, on an accelerated basis.
---------------------------------------------------------------------------
\92\ See supra note 69 and accompanying text.
\93\ 15 U.S.C. 78s(b)(2).
---------------------------------------------------------------------------
VI. Conclusion
It is therefore ordered, pursuant to Section 19(b)(2) of the
Act,\94\ that the proposed rule change (SR-NYSEARCA-2025-24), as
modified by Amendment No. 1, be, and it hereby is, approved on an
accelerated basis.
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\94\ Id.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\95\
---------------------------------------------------------------------------
\95\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2026-01969 Filed 1-30-26; 8:45 am]
BILLING CODE 8011-01-P
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