Self-Regulatory Organizations; Notice of Filing and Immediate Effectiveness of Proposed Rule Change and Amendments No. 1 and 2 thereto by the American Stock Exchange LLC Relating to Revisions to the ANTE Roll-Out Schedule, 12250-12251 [E5-1021]

Agencies

• SECURITIES AND EXCHANGE COMMISSION

[Federal Register Volume 70, Number 47 (Friday, March 11, 2005)]
[Notices]
[Pages 12250-12251]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E5-1021]



[[Page 12250]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-51306; File No. SR-Amex-2005-013]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change and Amendments No. 1 and 2 
thereto by the American Stock Exchange LLC Relating to Revisions to the 
ANTE Roll-Out Schedule

March 3, 2005.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on January 28, 2005, the American Stock Exchange LLC (``Amex'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change as described in Items I, II, 
and III below, which Items have been prepared by the Exchange. On 
February 11, 2005, the Exchange filed Amendment No. 1 to the proposed 
rule change.\3\ On February 24, 2005, the Exchange filed Amendment No. 
2 to the proposed rule change.\4\ The Commission is publishing this 
notice to solicit comments on the proposed rule change, as amended, 
from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ Amendment No. 1 made technical corrections to the rule text 
and discussion section, which are incorporated herein.
    \4\ Partial Amendment No. 2 made technical corrections to 
underline the word ``began'' and insert a comma in the proposed rule 
text.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Amex proposes to amend Rule 900--ANTE to provide a revised date 
for the implementation of the Amex New Trading Environment (``ANTE'') 
System for the three hundred most actively traded option classes. The 
text of the proposed rule change is set forth below. Proposed new 
language is in italics. Deleted language is in [brackets].
* * * * *

Rule 900--ANTE Applicability, Definitions and References

    (a) Applicability--The Exchange's new trading system (known as the 
ANTE System or ANTE) will be rolled-out over a period of time 
(approximately eighteen months) on a specialist post-by-specialist post 
basis. [It is anticipated that t] The roll-out [will begin] began on 
[or about March 1] May 25, 2004 and will continue until the end of the 
[third] second quarter of 2005 at which time all equity and index 
option classes traded by the Exchange will be on the ANTE System. It is 
anticipated that by [August 31, 2004] March 31, 2005, the three hundred 
most actively traded option classes will be traded on the ANTE System. 
Therefore, during the roll-out period, while the Exchange has option 
classes trading on both systems, current rules (as they are amended 
from time to time) will apply to those option classes continuing to 
trade on its current system while the following ANTE rules will apply 
to those option classes trading on the new trading system. Once the 
roll-out of ANTE is complete, the amendments to the Exchange's options 
rules reflecting the implementation of ANTE set forth below will 
replace, where applicable, the corresponding provisions in Rules 900 
through 958A. The following Trading of Option Contracts Rules shall 
apply to the trading of option contracts on the ANTE System: 901, 902, 
903, 904, 905, 906, 907, 908, 909, 915, 916, 917, 920, 921, 922, 923, 
924, 925, 926, 927, 928, 930, 932, 940, 942, 943, 944, 952, 953, 954, 
956, 957, 959, 960, 961, 962, 963, 964, 965, 966, 967, 970, 971, 972, 
980, 981, 982, 990, 991, and 992. In addition, the following Trading of 
Option Contract Rules, which have been amended to reflect usage in the 
ANTE System, shall apply to the trading of options contracts on the 
ANTE System.
    Moreover, the Rules in this Chapter (Trading of Options Contracts) 
shall be applicable to (i) the trading on and through the facilities of 
the Exchange of option contracts issued by the Options Clearing 
Corporation and the terms and conditions thereof; and (ii) the exercise 
and settlement, the handling of orders, and the conduct of accounts and 
other matters, relating to option contracts dealt in by any member or 
member organization. Except to the extent that specific Rules in this 
Chapter govern, or unless the context otherwise requires, the 
provisions of the Constitution and of all other Rules and policies of 
the Board of Governors shall be applicable to the trading on the 
Exchange of option contracts. Pursuant to the provisions of Article I, 
Section 3(i) of the Constitution, option contracts (as defined below) 
are included within the definition of ``security'' or ``securities'' as 
such terms are used in the Constitution and the Rules of the Exchange.
    (b) through (d)--No changes.
* * * * *

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

    In its filing with the Commission, the Exchange included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it received on the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item IV below. The Exchange has prepared summaries, set forth in 
sections A, B, and C below, of the most significant aspects of such 
statements.

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

1. Purpose
    On May 20, 2004, the Commission approved the Amex's proposal to 
implement a new options trading platform known as the ANTE. On May 25, 
2004, the Amex began rolling out the ANTE System on its trading floor 
on a specialist's post-by-specialist's post basis. At that time, the 
Exchange anticipated the three hundred most actively traded option 
classes would be trading on the ANTE System by January 31, 2005. 
However, as of January 31, 2005, 260 of the 300 most active options 
classes, and 1,627 out of 1,920 total option classes are trading on the 
ANTE System.
    The Exchange now anticipates that all of the three hundred most 
active option classes (that is, the remaining 40 classes) will be on 
the ANTE System by March 31, 2005. The Amex plans to put a systems 
enhancement in place in February 2005, which will alleviate the 
capacity issues that can occur when the most active classes begin 
trading on ANTE. Once the enhancement is in place, the most active 
classes will begin to be traded on ANTE. The Exchange believes that 
maintaining two systems for the trading of options--the legacy system 
(XTOPS, AODB and Auto-Ex) and ANTE---is costly. As a result, the 
Exchange is working diligently to have all option classes on the ANTE 
System by March 31, 2005 in order to retire its legacy systems before 
its original estimated date of completion, which was the end of the 
second quarter.
    Furthermore, the Exchange notes that the roll-out schedule 
presently contained in Rule 900 (a)--ANTE does not reflect the roll-out 
schedule approved by the Commission on May

[[Page 12251]]

20, 2004.\5\ The roll-out schedule currently set forth in Rule 900(a)--
ANTE was part of an amendment to the original proposal seeking to 
implement the ANTE system.\6\ Filed on February 9, 2004, Amendment No. 
3 to the proposal anticipated for Commission approval of the ANTE 
implementation date by March 1, 2004 and accordingly provided a roll-
out schedule based on that date. However, the Order describes the 
actual roll-out schedule based upon the Commission's approval date of 
May 20, 2004.\7\ Accordingly, the Exchange seeks to amend Rule 900(a)--
ANTE to correct where appropriate the roll-out schedule and to set 
forth adjustments to the schedule proposed by the Exchange.
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    \5\ See Securities Exchange Act Release No. 49747 (May 20, 
2004), 69 FR 30344 (May 27, 2004) (SR-Amex-2003-89) (``Order'').
    \6\ See Amendment No. 3 to SR-Amex-2003-89, supra note 5.
    \7\ See Order, supra note 5, at 30345-30346.
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2. Statutory Basis
    The Exchange believes that the proposed rule change, as amended, is 
consistent with Section 6(b) of the Act \8\ in general, and furthers 
the objectives of Section 6(b)(5) of the Act \9\ in particular, in that 
it is designed to prevent fraudulent and manipulative acts and 
practices, to promote just and equitable principles of trade, to foster 
cooperation and coordination with persons engaged in regulating, 
clearing, settling, processing information with respect to and 
facilitating transactions in securities, to remove impediments to and 
perfect the mechanism of a free and open market and a national market 
system, and, in general, to protect investors and the public interest, 
and is designed to prohibit unfair discrimination between customers, 
issuers, brokers and dealers.
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    \8\ 15 U.S.C. 78f(b).
    \9\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change, as 
amended, will impose any burden on competition.

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, as amended.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    The foregoing proposed rule change, as amended, has become 
effective pursuant to Section 19(b)(3)(A)(i) of the Act \10\ and Rule 
19b-4(f)(1) thereunder \11\ because it constitutes a stated policy, 
practice, or interpretation with respect to the meaning, 
administration, or enforcement of an existing rule of the Exchange. At 
any time within 60 days of the filing of such proposed rule change, the 
Commission may summarily abrogate such rule change if it appears to the 
Commission that such action is necessary or appropriate in the public 
interest, for the protection of investors, or otherwise in furtherance 
of the purposes of the Act.\12\
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    \10\ 15 U.S.C. 78s(b)(3)(A)(i).
    \11\ 17 CFR 240.19b-4(f)(1).
    \12\ For purposes of calculating the 60-day period within which 
the Commission may summarily abrogate the proposed rule change, as 
amended, under Section 19(b)(3)(C) of the Act, the Commission 
considers the period to commence on February 24, 2005, the date on 
which the Amex filed Partial Amendment No. 2. See 15 U.S.C. 
78s(b)(3)(C).
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IV. Solicitation of Comments

    Interested persons are invited to submit written data, views and 
arguments concerning the foregoing, including whether the proposed rule 
change, as amended, is consistent with the Act. Comments may be 
submitted by any of the following methods:

Electronic Comments

     Use the Commission's Internet comment form (https://
www.sec.gov/rules/sro.shtml); or
     Send an e-mail to rule-comments@sec.gov. Please include 
File Number SR-Amex-2005-013 on the subject line.

Paper Comments

     Send paper comments in triplicate to Jonathan G. Katz, 
Secretary, Securities and Exchange Commission, 450 Fifth Street, NW., 
Washington, DC 20549-0609.
    All submissions should refer to File Number SR-Amex-2005-013. This 
file number should be included on the subject line if e-mail is used. 
To help the Commission process and review your comments more 
efficiently, please use only one method. The Commission will post all 
comments on the Commission's Internet Web site (https://www.sec.gov/
rules/sro.shtml). Copies of the submission, all subsequent amendments, 
all written statements with respect to the proposed rule change that 
are filed with the Commission, and all written communications relating 
to the proposed rule change between the Commission and any person, 
other than those that may be withheld from the public in accordance 
with the provisions of 5 U.S.C. 552, will be available for inspection 
and copying in the Commission's Public Reference Room. Copies of such 
filing also will be available for inspection and copying at the 
principal office of the Amex. All comments received will be posted 
without change; the Commission does not edit personal identifying 
information from submissions. You should submit only information that 
you wish to make available publicly. All submissions should refer to 
File Number SR-Amex-2005-013 and should be submitted on or before April 
1, 2005.

    For the Commission by the Division of Market Regulation, 
pursuant to delegated authority.\13\
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    \13\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. E5-1021 Filed 3-10-05; 8:45 am]
BILLING CODE 8010-01-P