Joint Industry Plan; Notice Filing of Amendment No. 17 to the Plan for the Purpose of Creating and Operating an Intermarket Option Linkage Regarding Modifying the 80/20 Test for Determining Limitations on Principal Order Access to Linkage, 43469-43470 [E5-3986]

Download as PDF Federal Register / Vol. 70, No. 143 / Wednesday, July 27, 2005 / Notices listing and registration on the Pacific Exchange, Inc. (‘‘PCX’’). On May 10, 2005, the Board of Directors (‘‘Board’’) of the Issuer approved a resolution to withdraw the Security from listing and registration on PCX. The Board stated that the reason for its decision to withdraw the Security from PCX is that the volume of trading in the Security on PCX has been very modest. The Board determined that the benefits of continued listing on PCX do not outweigh the incremental costs of the listing fee and administrative time and expense associated with listing on PCX. The Security is currently listed and traded on the New York Stock Exchange, Inc. (‘‘NYSE’’). The Issuer stated in its application that it has complied with applicable rules of PCX by providing PCX with the required documents governing the withdrawal of securities from listing and registration on PCX. The Issuer’s application relates solely to the withdrawal of the Security from listing on PCX, and shall not affect its continued listing on NYSE or its obligation to be registered under Section 12(b) of the Act.3 Any interested person may, on or before August 12, 2005, comment on the facts bearing upon whether the application has been made in accordance with the rules of PCX, and what terms, if any, should be imposed by the Commission for the protection of investors. All comment letters may be submitted by either of the following methods: Electronic Comments • Use the Commission’s Internet comment form (http://www.sec.gov/ rules/delist.shtml); or • Send an e-mail to rulecomments@sec.gov. Please include the File Number 1–10016 or; Paper Comments • Send paper comments in triplicate to Jonathan G. Katz, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549–9303. All submissions should refer to File Number 1–10016. This file number should be included on the subject line if e-mail is used. To help us process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission’s Internet Web site (http://www.sec.gov/rules/delist.shtml). Comments are also available for public inspection and copying in the Commission’s Public Reference Room. 3 15 U.S.C. 781(b). VerDate jul<14>2003 20:48 Jul 26, 2005 Jkt 205001 All comments received will be posted without change; we do not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. The Commission, based on the information submitted to it, will issue an order granting the application after the date mentioned above, unless the Commission determines to order a hearing on the matter. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.4 Jonathan G. Katz, Secretary. [FR Doc. E5–3975 Filed 7–26–05; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–52074; File No. 4–429] Joint Industry Plan; Notice Filing of Amendment No. 17 to the Plan for the Purpose of Creating and Operating an Intermarket Option Linkage Regarding Modifying the 80/20 Test for Determining Limitations on Principal Order Access to Linkage July 20, 2005. Pursuant to Section 11A of the Securities Exchange Act of 1934 (‘‘Act’’)1 and Rule 11Aa3–2 thereunder,2 notice is hereby given that on April 20, 2005, May 20, 2005, May 12, 2005, April 13, 2005, April 27, 2005 and May 11, 2005, the American Stock Exchange LLC (‘‘Amex’’), the Boston Stock Exchange, Inc. (‘‘BSE’’), the Chicago Board Options Exchange, Incorporated (‘‘CBOE’’), the International Securities Exchange (‘‘ISE’’), the Pacific Exchange, Inc. (‘‘PCX’’), and the Philadelphia Stock Exchange, Inc. (‘‘Phlx’’) (collectively, ‘‘Participants’’), respectively, filed with the Securities and Exchange Commission (‘‘Commission’’) Joint Amendment No. 17 to the Plan for the Purpose of Creating and Operating an Intermarket Option Linkage (‘‘Linkage Plan’’).3 In Joint Amendment No. 17, the CFR 200.30–3(a)(1). U.S.C. 78k–1. 2 17 CFR 240.11Aa3–2. 3 On July 28, 2000, the Commission approved a national market system plan for the purpose of creating and operating an intermarket options market linkage (‘‘Linkage’’) proposed by Amex, CBOE, and ISE. See Securities Exchange Act Release No. 43086 (July 28, 2000), 65 FR 48023 (August 4, 2000). Subsequently, Phlx, PCX, and BSE joined the Linkage Plan. See Securities Exchange Act Release Nos. 43573 (November 16, 2000), 65 FR 70851 (November 28, 2000); 43574 (November 16, 2000), 65 FR 70850 (November 28, 2000); and 49198 (February 5, 2004), 69 FR 7029 (February 12, 2004). PO 00000 4 17 1 15 Frm 00080 Fmt 4703 Sfmt 4703 43469 Participants propose to modify the ‘‘80/ 20 Test’’ to determine limitations on principal order access to Linkage.4 I. Description and Purpose of the Proposed Amendment The purpose of the Joint Amendment is to modify the so-called ‘‘80–20 Test’’ (‘‘Test’’) contained in Section 8(b)(iii) of the Linkage Plan, which provides that market makers should send Principal Orders through the Linkage on a limited basis and not as a primary aspect of their business.5 The Test implements this general principle by prohibiting a market maker from sending Principal Orders in an eligible option class if, in the last calendar quarter, the market maker’s Principal Order contract volume is disproportionate to the market maker’s contract volume executed against customer orders in its own market. The Participants believe that applying the Test has resulted in anomalies for market makers with limited volume in an eligible option class. Specifically, if a market maker has very little overall trading volume in an option, the execution of one or two Principal Orders during a calendar quarter could result in the market maker failing to meet the Test. This would bar the market maker from using the Linkage to send Principal Orders for the following calendar quarter. The Participants contend that it was not their intent to bar market makers with limited volume from sending Principal Orders through the Linkage in these circumstances since such trading clearly was not ‘‘a primary aspect of their business.’’ Thus, Joint Amendment No. 17 proposes to create a de minimis exemption from the Test for market makers that have total contract volume of less than 1000 contracts in an options class for a calendar quarter. II. Implementation of the Proposed Amendment The Participants intend to make the Joint Amendment to the Linkage Plan reflected in this filing effective when the Commission approves the Joint Amendment. III. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether proposed Joint Amendment No. 17 is consistent with 4 Specified in Section 8(b)(iii) of the Linkage Plan. Principal Order is an order for the principal account of an eligible market maker that does not relate to a customer order the market maker is holding. See Section 2(16)(b) of the Linkage Plan. 5A E:\FR\FM\27JYN1.SGM 27JYN1 43470 Federal Register / Vol. 70, No. 143 / Wednesday, July 27, 2005 / Notices the Act. Comments may be submitted by any of the following methods: SECURITIES AND EXCHANGE COMMISSION proposed rule change (SR–Amex–2005– 55), be, and it hereby is, approved. Electronic Comments [Release No. 34–52061; File No. SR–Amex– 2005–55] For the Commission, by the Division of Market Regulation, pursuant to delegated authority.8 Jill M. Peterson, Assistant Secretary. [FR Doc. E5–3984 Filed 7–26–05; 8:45 am] • Use the Commission’s Internet comment form (http://www.sec.gov/ rules/sro.shtml); or • Send an e-mail to rulecomments@sec.gov. Please include File Number 4–429 on the subject line. Paper Comments July 19, 2005. • 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 4–429. This file number should be included on the subject line if e-mail is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission’s Internet Web site (http://www.sec.gov/rules/ sro.shtml). Copies of the submission, all subsequent amendments, all written statements with respect to proposed Joint Amendment No. 17 that are filed with the Commission, and all written communications relating to proposed Joint Amendment No. 17 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 filings also will be available for inspection and copying at the principal offices of the Amex, BSE, CBOE, ISE, PCX and Phlx. 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 publicly available. All submissions should refer to File Number 4–429 and should be submitted on or before August 17, 2005. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.6 Jonathan G. Katz, Secretary. [FR Doc. E5–3986 Filed 7–26–05; 8:45 am] BILLING CODE 8010–01–P 6 17 CFR 200.30–3(a)(29). VerDate jul<14>2003 20:48 Jul 26, 2005 Self-Regulatory Organizations; American Stock Exchange LLC; Order Granting Approval to Proposed Rule Change Relating to the Continuation of a Quote Assist Feature in Options on a Pilot Basis Jkt 205001 On May 19, 2005, the American Stock Exchange LLC (‘‘Amex’’ or ‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘Commission’’), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’)1 and Rule 19b–4 thereunder,2 a proposed rule change to extend its pilot program implementing a quote-assist feature retroactively from April 30, 2005 to May 18, 2005. The proposed rule change was published for comment in the Federal Register on June 16, 2005.3 The Commission received no comments on the proposal. This order approves the proposed rule change. The Commission finds that the proposed rule change is consistent with the requirements of the Act and the rules and regulations thereunder applicable to a national securities exchange 4 and, in particular, the requirements of Section 6 of the Act 5 and the rules and regulations thereunder. Specifically, the Commission finds the proposal to be consistent with Section 6(b)(5) of the Act,6 in that is designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, and, in general, to protect investors and the public interest. The quote assist feature provides a mechanism to ensure that eligible customer limit orders are displayed within the appropriate time frame. Additionally, by extending the pilot program retroactively from April 30, 2005 to May 18, 2005, the Exchange rules will accurately reflect the fact that the pilot program was in place during this time. It is therefore ordered, pursuant to Section 19(b)(2) of the Act,7 that the U.S.C. 78s(b)(1). CFR 240.19b–4. 3 See Securities Exchange Act Release No. 51815 (June 9, 2005), 70 FR 35142 (June 16, 2005) (SR– Amex–2005–55). 4 In approving this proposed rule change, as amended, the Commission has considered the proposed rule’s impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). 5 15 U.S.C. 78f. 6 15 U.S.C. 78f(b)(5). 7 15 U.S.C. 78s(b)(2). PO 00000 1 15 2 17 Frm 00081 Fmt 4703 Sfmt 4703 BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–52067; File No. SR–Amex– 2005–048] Self-Regulatory Organizations; American Stock Exchange LLC; Notice of Filing of Proposed Rule Change Establishing a De Minimis Exception to the 80/20 Test July 20, 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 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 Amex. 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 Amex Rule 944 to provide a de minimis exception to the limitation on principal order access imposed by the Plan for the Purpose of Creating and Operating an Intermarket Option Linkage (‘‘Linkage Plan’’) 3 and related rules. The text of the proposed rule change is available on the Amex’s Web site at http://www.amex.com, the Office of the Secretary, the Amex and at the Commission’s Public Reference Room. 8 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 On July 28, 2000, the Commission approved a national market system plan for the purpose of creating and operating an intermarket options market linkage (‘‘Linkage’’) proposed by Amex, Chicago Board Options Exchange, Inc., and International Securities Exchange, Inc. See Securities Exchange Act Release No. 43086 (July 28, 2000), 65 FR 48023 (August 4, 2000). Subsequently, Philadelphia Stock Exchange, Inc., Pacific Exchange, and Boston Stock Exchange, Inc. joined the Linkage Plan. See Securities Exchange Act Release Nos. 43573 (November 16, 2000), 65 FR 70851 (November 28, 2000); 43574 (November 16, 2000), 65 FR 70850 (November 28, 2000); and 49198 (February 5, 2004), 69 FR 7029 (February 12, 2004). 1 15 E:\FR\FM\27JYN1.SGM 27JYN1

Agencies

[Federal Register Volume 70, Number 143 (Wednesday, July 27, 2005)]
[Notices]
[Pages 43469-43470]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E5-3986]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-52074; File No. 4-429]


Joint Industry Plan; Notice Filing of Amendment No. 17 to the 
Plan for the Purpose of Creating and Operating an Intermarket Option 
Linkage Regarding Modifying the 80/20 Test for Determining Limitations 
on Principal Order Access to Linkage

July 20, 2005.
    Pursuant to Section 11A of the Securities Exchange Act of 1934 
(``Act'')\1\ and Rule 11Aa3-2 thereunder,\2\ notice is hereby given 
that on April 20, 2005, May 20, 2005, May 12, 2005, April 13, 2005, 
April 27, 2005 and May 11, 2005, the American Stock Exchange LLC 
(``Amex''), the Boston Stock Exchange, Inc. (``BSE''), the Chicago 
Board Options Exchange, Incorporated (``CBOE''), the International 
Securities Exchange (``ISE''), the Pacific Exchange, Inc. (``PCX''), 
and the Philadelphia Stock Exchange, Inc. (``Phlx'') (collectively, 
``Participants''), respectively, filed with the Securities and Exchange 
Commission (``Commission'') Joint Amendment No. 17 to the Plan for the 
Purpose of Creating and Operating an Intermarket Option Linkage 
(``Linkage Plan'').\3\ In Joint Amendment No. 17, the Participants 
propose to modify the ``80/20 Test'' to determine limitations on 
principal order access to Linkage.\4\
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78k-1.
    \2\ 17 CFR 240.11Aa3-2.
    \3\ On July 28, 2000, the Commission approved a national market 
system plan for the purpose of creating and operating an intermarket 
options market linkage (``Linkage'') proposed by Amex, CBOE, and 
ISE. See Securities Exchange Act Release No. 43086 (July 28, 2000), 
65 FR 48023 (August 4, 2000). Subsequently, Phlx, PCX, and BSE 
joined the Linkage Plan. See Securities Exchange Act Release Nos. 
43573 (November 16, 2000), 65 FR 70851 (November 28, 2000); 43574 
(November 16, 2000), 65 FR 70850 (November 28, 2000); and 49198 
(February 5, 2004), 69 FR 7029 (February 12, 2004).
    \4\ Specified in Section 8(b)(iii) of the Linkage Plan.
---------------------------------------------------------------------------

I. Description and Purpose of the Proposed Amendment

    The purpose of the Joint Amendment is to modify the so-called ``80-
20 Test'' (``Test'') contained in Section 8(b)(iii) of the Linkage 
Plan, which provides that market makers should send Principal Orders 
through the Linkage on a limited basis and not as a primary aspect of 
their business.\5\ The Test implements this general principle by 
prohibiting a market maker from sending Principal Orders in an eligible 
option class if, in the last calendar quarter, the market maker's 
Principal Order contract volume is disproportionate to the market 
maker's contract volume executed against customer orders in its own 
market.
---------------------------------------------------------------------------

    \5\ A Principal Order is an order for the principal account of 
an eligible market maker that does not relate to a customer order 
the market maker is holding. See Section 2(16)(b) of the Linkage 
Plan.
---------------------------------------------------------------------------

    The Participants believe that applying the Test has resulted in 
anomalies for market makers with limited volume in an eligible option 
class. Specifically, if a market maker has very little overall trading 
volume in an option, the execution of one or two Principal Orders 
during a calendar quarter could result in the market maker failing to 
meet the Test. This would bar the market maker from using the Linkage 
to send Principal Orders for the following calendar quarter. The 
Participants contend that it was not their intent to bar market makers 
with limited volume from sending Principal Orders through the Linkage 
in these circumstances since such trading clearly was not ``a primary 
aspect of their business.'' Thus, Joint Amendment No. 17 proposes to 
create a de minimis exemption from the Test for market makers that have 
total contract volume of less than 1000 contracts in an options class 
for a calendar quarter.

II. Implementation of the Proposed Amendment

    The Participants intend to make the Joint Amendment to the Linkage 
Plan reflected in this filing effective when the Commission approves 
the Joint Amendment.

III. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether proposed Joint 
Amendment No. 17 is consistent with

[[Page 43470]]

the Act. Comments may be submitted by any of the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://
www.sec.gov/rules/sro.shtml); or
     Send an e-mail to rule-comments@sec.gov. Please include 
File Number 4-429 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 4-429. This file number 
should be included on the subject line if e-mail is used. To help the 
Commission process and review your comments more efficiently, please 
use only one method. The Commission will post all comments on the 
Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). 
Copies of the submission, all subsequent amendments, all written 
statements with respect to proposed Joint Amendment No. 17 that are 
filed with the Commission, and all written communications relating to 
proposed Joint Amendment No. 17 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 
filings also will be available for inspection and copying at the 
principal offices of the Amex, BSE, CBOE, ISE, PCX and Phlx. 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 publicly available. All 
submissions should refer to File Number 4-429 and should be submitted 
on or before August 17, 2005.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\6\
Jonathan G. Katz,
Secretary.
---------------------------------------------------------------------------

    \6\ 17 CFR 200.30-3(a)(29).
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[FR Doc. E5-3986 Filed 7-26-05; 8:45 am]
BILLING CODE 8010-01-P