Self-Regulatory Organizations; Boston Stock Exchange; Notice of Filing of Proposed Rule Change Relating to Trade Shredding, 42396-42397 [E5-3913]

Download as PDF 42396 Federal Register / Vol. 70, No. 140 / Friday, July 22, 2005 / Notices SECURITIES AND EXCHANGE COMMISSION [Release No. 34–52033; File No. SR–BSE– 2005–20] Self-Regulatory Organizations; Boston Stock Exchange; Notice of Filing of Proposed Rule Change Relating to Trade Shredding July 14, 2005. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934, as amended, (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 notice is hereby given that on June 23, 2005, the Boston Stock Exchange (‘‘BSE’’ 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. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to amend its rules relating to trade shredding (‘‘Units of Trading’’). The text of the proposed rule change appears below. Additions are in italics. * * * * * Chapter II Dealings on the Exchange SEC. 4. Units of Trading The unit of trading in bonds shall be $1000 in par value thereof. The unit of trading in stocks shall be 100 shares, except that the Exchange may fix a smaller number of shares in any particular instance. Bids or offers for less than the unit of trading shall specify the par value of the bonds or number of shares of stock covered by the bid or offer. A customer’s order in the unit of trading, or multiples thereof, in any security traded on the Exchange, the primary market for which is on another Exchange, may not be split into oddlots. A member may not split any order into multiple smaller orders for any purpose other than seeking the best execution of the entire order. * * * * * 1 15 2 17 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 BSE 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 BSE 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 The purpose of the proposed rule change is to amend a section of the Rules of the Board of Governors of the Boston Stock Exchange (‘‘BSE Rules’’) to prohibit trade shredding. The BSE is proposing to add language to its existing BSE Rules to prohibit BSE members from splitting large orders into multiple smaller orders for any purpose other than best execution. 2. Statutory Basis The proposed rule change is consistent with Section 6(b) of the Act,3 in general, and furthers the objectives of Section 6(b)(5) of the Act,4 in particular, in that it is designed to promote just and equitable principles of trade, to remove impediments to and perfect the mechanism of a free and open market and a national market system, and is not designed to permit unfair discrimination between customers, brokers, or dealers, or to regulate by virtue of any authority matters not related to the administration of the Exchange. B.Self-Regulatory Organization’s Statement on Burden on Competition The Exchange believes that the proposed rule change will impose no burden on competition. C.Self-Regulatory Organization’s Statement on Comments on the Proposed Rule Change Received From Members, Participants or Others The Exchange has neither solicited nor received comments on this proposal. U.S.C. 78s(b)(1). CFR 240.19b–4. VerDate jul<14>2003 19:28 Jul 21, 2005 3 15 4 15 Jkt 205001 PO 00000 U.S.C. 78f(b). U.S.C. 78f(b)(5). Frm 00098 Fmt 4703 Sfmt 4703 III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Within 35 days of the date of publication of this notice in the Federal Register or within such longer period (i) as the Commission may designate up to 90 days of such date if it finds such longer period to be appropriate and publishes its reasons for so finding or (ii) as to which the self-regulatory organization consents, the Commission will: (A) By order approve such proposed rule change, or (B) Institute proceedings to determine whether the proposed rule change should be disapproved. IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods: Electronic Comments • Use the Commission’s Internet comment form (https://www.sec.gov/ rules/sro.shtml); or • Send an e-mail to rulecomments@sec.gov. Please include File Number SR–BSE–2005–20 on the subject line. Paper Comments • Send paper comments in triplicate to Jonathan G. Katz, Secretary, Securities and Exchange Commission, Station Place, 100 F Street, NE., Washington, DC 20549–9303. All submissions should refer to File Number SR–BSE–2005–20. 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 offices of BSE. All E:\FR\FM\22JYN1.SGM 22JYN1 Federal Register / Vol. 70, No. 140 / Friday, July 22, 2005 / Notices 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–BSE–2005–20 and should be submitted on or before August 12, 2005. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.5 Jill M. Peterson, Assistant Secretary. [FR Doc. E5–3913 Filed 7–21–05; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–52044; File No. SR–CBOE– 2005–28] Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing of a Proposed Rule Change Relating to DPM Obligations for Maintaining Backup Autoquote Systems July 15, 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 April 1, 2005, the Chicago Board Options Exchange, Incorporated (‘‘CBOE’’ 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 CBOE. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange submits this rule change filing, which proposes to amend CBOE rules to remove the requirement that Designated Primary Market-Makers maintain a back-up quoting system for Hybrid and non-Hybrid option classes. The text of the proposed rule change is provided below. Additions are in italics; deletions are in [brackets]. * * * * * 5 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 1 15 VerDate jul<14>2003 19:28 Jul 21, 2005 Jkt 205001 CHAPTER VIII Market-Makers, Trading Crowds and Modified Trading Systems (Rules 8.1– 8.95) * * * Rule 8.1–8.84 * 1st Offense ................ * No Change. Rule 8.85. DPM Obligations 2nd–3rd Offense ....... (a) Dealer Transactions. Each DPM shall fulfill all of the obligations of a Market-Maker under the Rules, and shall satisfy each of the following requirements in respect of each of the securities allocated to the DPM. To the extent that there is any inconsistency between the specific obligations of a DPM set forth in subparagraphs (a)(i) through (a)(xi) of this Rule and the general obligations of a Market Maker under the Rules, subparagraphs (a)(i) through (a)(xi) of this Rule shall govern. Each DPM shall: (i)–(x) No Change. [(xi) in the case of a DPM utilizing a proprietary autoquote system in a nonCBOE Hybrid System class, assure that the Exchange’s AutoQuote system is maintained as a back-up at all times and ready for immediate use. (xii) in the case of a DPM utilizing a proprietary autoquote system in a Hybrid System class, the DPM must have available for immediate use an alternative autoquote system that is entirely independent of the DPM’s primary autoquote system.] (b)–(e) No Change. * * * * * * * * Interpretations and Policies: .01–.04 No Change. * * * * * Rule 17.50. Imposition of Fines for Minor Rule Violations (a)–(f) No Change. (g) The following is a list of the rule violations subject to, and the applicable fines that may be imposed by the Exchange pursuant to this Rule: (1)–(9) No Change. [(10) Violations of DPM Obligation to Assure that a Back-Up Auto Quote System is Maintained at all Times. (Rules 8.85(a)(xi) and (xii)) (a) A fine shall be imposed upon a DPM that fails to assure that disseminated market quotations are accurate for any given trading station because of a failure of the DPM’s proprietary autoquote system during market hours coupled with the DPM’s failure to maintain a back-up autoquote system. PO 00000 Frm 00099 Number of Violations in any Rolling Twelve-Month Period Fmt 4703 Sfmt 4703 Subsequent Offenses 42397 Fine Amount $100 to $2,500 or Referral to Business Conduct Committee $100 to $5,000 or Referral to Business Conduct Committee Referral to Business Conduct Committee] [(11)](10) Communications to the Exchange or the Clearing Corporation (Rule 4.11) No Change. * * * * * * * * Interpretations and Policies: .01–.04 No Change. * * * * * II. Self-Regulatory Organization’s Statement of the Purpose and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, CBOE 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 CBOE has prepared summaries, set forth in sections (A), (B), and (C) below, of the most significant aspects of such statements. A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose Exchange Rules 8.85(a)(xi) and (xii) both impose an obligation on DPMs to maintain independent backup autoquote systems that can be employed in the event that a DPM’s proprietary autoquote system should fail or be otherwise unavailable. Rule 8.85(a)(xi) governs non-CBOE Hybrid System (‘‘non-Hybrid’’) classes and requires DPMs to maintain the Exchange’s AutoQuote system as a backup for nonHybrid classes. Because of compatibility restrictions, the Exchange’s AutoQuote system cannot be used as a backup for Hybrid classes, so the Exchange adopted Rule 8.85(a)(xii), which requires DPMs to maintain an independent backup autoquote system that it may employ in the event its proprietary autoquote E:\FR\FM\22JYN1.SGM 22JYN1

Agencies

SECURITIES AND EXCHANGE COMMISSION

[Federal Register Volume 70, Number 140 (Friday, July 22, 2005)]
[Notices]
[Pages 42396-42397]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E5-3913]



[[Page 42396]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-52033; File No. SR-BSE-2005-20]


Self-Regulatory Organizations; Boston Stock Exchange; Notice of 
Filing of Proposed Rule Change Relating to Trade Shredding

July 14, 2005.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 
1934, as amended, (``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is 
hereby given that on June 23, 2005, the Boston Stock Exchange (``BSE'' 
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. The 
Commission is publishing this notice to solicit comments on the 
proposed rule change from interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend its rules relating to trade 
shredding (``Units of Trading''). The text of the proposed rule change 
appears below. Additions are in italics.
* * * * *

Chapter II

Dealings on the Exchange

SEC. 4.

Units of Trading

    The unit of trading in bonds shall be $1000 in par value thereof.
    The unit of trading in stocks shall be 100 shares, except that the 
Exchange may fix a smaller number of shares in any particular instance.
    Bids or offers for less than the unit of trading shall specify the 
par value of the bonds or number of shares of stock covered by the bid 
or offer.
    A customer's order in the unit of trading, or multiples thereof, in 
any security traded on the Exchange, the primary market for which is on 
another Exchange, may not be split into odd-lots. A member may not 
split any order into multiple smaller orders for any purpose other than 
seeking the best execution of the entire order.
* * * * *

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 BSE 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 BSE 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
    The purpose of the proposed rule change is to amend a section of 
the Rules of the Board of Governors of the Boston Stock Exchange (``BSE 
Rules'') to prohibit trade shredding. The BSE is proposing to add 
language to its existing BSE Rules to prohibit BSE members from 
splitting large orders into multiple smaller orders for any purpose 
other than best execution.
2. Statutory Basis
    The proposed rule change is consistent with Section 6(b) of the 
Act,\3\ in general, and furthers the objectives of Section 6(b)(5) of 
the Act,\4\ in particular, in that it is designed to promote just and 
equitable principles of trade, to remove impediments to and perfect the 
mechanism of a free and open market and a national market system, and 
is not designed to permit unfair discrimination between customers, 
brokers, or dealers, or to regulate by virtue of any authority matters 
not related to the administration of the Exchange.
---------------------------------------------------------------------------

    \3\ 15 U.S.C. 78f(b).
    \4\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

B.Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange believes that the proposed rule change will impose no 
burden on competition.

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

    The Exchange has neither solicited nor received comments on this 
proposal.

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

    Within 35 days of the date of publication of this notice in the 
Federal Register or within such longer period (i) as the Commission may 
designate up to 90 days of such date if it finds such longer period to 
be appropriate and publishes its reasons for so finding or (ii) as to 
which the self-regulatory organization consents, the Commission will:
    (A) By order approve such proposed rule change, or
    (B) Institute proceedings to determine whether the proposed rule 
change should be disapproved.

IV. Solicitation of Comments

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

Electronic Comments

     Use the Commission's Internet comment form (https://
www.sec.gov/rules/sro.shtml); or
     Send an e-mail to rule-comments@sec.gov. Please include 
File Number SR-BSE-2005-20 on the subject line.

Paper Comments

     Send paper comments in triplicate to Jonathan G. Katz, 
Secretary, Securities and Exchange Commission, Station Place, 100 F 
Street, NE., Washington, DC 20549-9303.
    All submissions should refer to File Number SR-BSE-2005-20. 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 offices of BSE. All

[[Page 42397]]

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-BSE-2005-20 and should be 
submitted on or before August 12, 2005.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\5\
---------------------------------------------------------------------------

    \5\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Jill M. Peterson,
Assistant Secretary.
[FR Doc. E5-3913 Filed 7-21-05; 8:45 am]
BILLING CODE 8010-01-P

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