Self-Regulatory Organizations; Chicago Stock Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Extend the Pilot Rule Interpretation Relating to Trading of Nasdaq National Market Securities in Sub-Penny Increments, 51394-51395 [E5-4723]

Download as PDF 51394 Federal Register / Vol. 70, No. 167 / Tuesday, August 30, 2005 / Notices (ii) as to which the Amex 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 should be submitted on or before September 20, 2005. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.13 Margaret H. McFarland, Deputy Secretary. [FR Doc. E5–4727 Filed 8–29–05; 8:45 am] BILLING CODE 8010–01–P 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 (http://www.sec.gov/ rules/sro.shtml); or • Send an e-mail to rulecomments@sec.gov. Please include File Number SR–Amex–2005–052 on the subject line. SECURITIES AND EXCHANGE COMMISSION [Release No. 34–52326; File No. SR–CHX– 2005–22] Self-Regulatory Organizations; Chicago Stock Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Extend the Pilot Rule Interpretation Relating to Trading of Nasdaq National Market Securities in Sub-Penny Increments August 23, 2005. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 Paper Comments notice is hereby given that on August • Send paper comments in triplicate 17, 2005, the Chicago Stock Exchange, to Jonathan G. Katz, Secretary, Inc. (‘‘CHX’’ or ‘‘Exchange’’) filed with Securities and Exchange Commission, the Securities and Exchange Station Place, 100 F Street, NE., Commission (‘‘Commission’’) the Washington, DC 20549–9303. proposed rule change as described in Items I and II below, which Items have All submissions should refer to File been prepared by CHX. The Exchange Number SR–Amex–2005–052. This file has filed this proposal pursuant to number should be included on the 3 subject line if e-mail is used. To help the Section 19(b)(3)(A) of the Act and Rule 19b–4(f)(6) thereunder,4 which renders Commission process and review your the proposal effective upon receipt of comments more efficiently, please use only one method. The Commission will this filing by the Commission. The post all comments on the Commission’s Commission is publishing this notice to solicit comments on the proposed rule Internet Web site (http://www.sec.gov/ change from interested persons. rules/sro.shtml). Copies of the submission, all subsequent I. Self-Regulatory Organization’s amendments, all written statements Statement of the Terms of Substance of with respect to the proposed rule the Proposed Rule Change change that are filed with the CHX requests an extension, until Commission, and all written January 31, 2006, the compliance date of communications relating to the new Rule 612 of Regulation NMS,5 of a proposed rule change between the Commission and any person, other than pilot rule interpretation (Article XXX, Rule 2, Interpretation and Policy .06 those that may be withheld from the ‘‘Trading in Nasdaq/NM Securities in public in accordance with the Subpenny Increments’’) which requires provisions of 5 U.S.C. 552, will be a CHX specialist (including a market available for inspection and copying in maker who holds customer limit orders) the Commission’s Public Reference Room. Copies of such filing also will be to better the price of a customer limit order in his book which is priced at the available for inspection and copying at the principal office of the Exchange. 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 SR–Amex–2005–052 and VerDate Aug<18>2005 15:17 Aug 29, 2005 Jkt 205001 13 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 15 U.S.C. 78s(b)(3)(A). 4 17 CFR 240.19b–4(f)(6). 5 17 CFR 242.612. The Commission recently extended the compliance date for Rule 612 to January 31, 2006. See Securities Exchange Act Release No. 52196 (August 2, 2005) 70 FR 45529 (August 8, 2005). 1 15 PO 00000 Frm 00067 Fmt 4703 Sfmt 4703 national best bid or offer (‘‘NBBO’’) by at least one penny if the specialist determines to trade with an incoming market or marketable limit order. The pilot, which was approved in conjunction with exemptive relief granted by the Commission to allow for trading in Nasdaq National Market securities in sub-penny increments, expires on August 29, 2005. The Exchange proposes that the pilot remain in effect until January 31, 2006, the compliance date of Rule 612. II. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, CHX included statements concerning the purpose of, and basis for, the proposed rule change and discussed any comments it received regarding the proposal. The text of these statements may be examined at the places specified in Item IV below. CHX 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 On April 6, 2001, the Commission approved, on a pilot basis through July 9, 2001, a pilot rule interpretation (Article XXX, Rule 2, Interpretation and Policy .06 ‘‘Trading in Nasdaq/NM Securities in Subpenny Increments’’) 6 that requires a CHX specialist (including a market maker who holds customer limit orders) to better the price of a customer limit order in his book which is priced at the NBBO by at least one penny if the specialist determines to trade with an incoming market or marketable limit order. The pilot, which was approved in conjunction with exemptive relief granted by the Commission to allow for trading in Nasdaq National Market securities in sub-penny increments, has been extended many times and now is set to expire on August 29, 2005.7 The 6 See Securities Exchange Act Release No. 44164 (April 6, 2001), 66 FR 19263 (April 13, 2001) (SR– CHX–2001–07). 7 See Securities Exchange Act Release Nos. 44535 (July 10, 2001), 66 FR 37251 (July 17, 2001) (extending pilot through November 5, 2001); 45062 (November 15, 2001), 66 FR 58768 (November 23, 2001) (extending pilot through January 14, 2002); Securities Exchange Act Release No. 45386 (February 1, 2002), 67 FR 6062 (February 8, 2002) (extending the pilot through April 15, 2002); 45755 (April 15, 2002), 67 FR 19607 (April 22, 2002) (extending the pilot through September 30, 2002); 46587 (October 2, 2002), 67 FR 63180 (October 10, E:\FR\FM\30AUN1.SGM 30AUN1 Federal Register / Vol. 70, No. 167 / Tuesday, August 30, 2005 / Notices Exchange is not proposing any substantive (or typographical) change to the pilot; rather, the Exchange proposes that the pilot remain in effect through January 31, 2006, the compliance date of Rule 612 of Regulation NMS. 2. Statutory Basis CHX believes the proposal is consistent with the requirements of the Act and the rules and regulations thereunder that are applicable to a national securities exchange, and, in particular, with the requirements of Section 6(b) of the Act.8 CHX believes the proposal is consistent with Section 6(b)(5) of the Act 9 in that it is designed to promote just and equitable principles of trade; to remove impediments to, and to perfect the mechanism of, a free and open market and a national market system; and, in general, to protect investors and the public interest. B. Self-Regulatory Organization’s Statement on Burden on Competition The Exchange does not believe that the proposed rule changes would impose any burden on competition. 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: C. Self-Regulatory Organization’s Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others No written comments were either solicited or received. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The Exchange asserts the foregoing rule change has become effective pursuant to Section 19(b)(3)(A) of the Act 10 and Rule 19b–4(f)(6) 11 thereunder because the proposed rule change does not: (i) Significantly affect the protection of investors or the public interest; (ii) Impose any significant burden on competition; and (iii) Become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, if consistent with the protection of investors and the public 2002) (extending the pilot through January 31, 2003); 47372 (February 14, 2003), 68 FR 8955 (February 26, 2003) (extending the pilot through May 31, 2003); 47951 (May 30, 2003), 68 FR 34448 (June 9, 2003) (extending the pilot through December 1, 2003); 48871 (December 3, 2003), 68 FR 69097 (December 11, 2003) (extending pilot through June 30, 2004); 49994 (July 9, 2004), 69 FR 42486 (July 15, 2004) (extending pilot through June 30, 2005); 51944 (June 30, 2005), 70 FR 39539 (August 8, 2005) (extending pilot through August 29, 2005, the effective date of Rule 612). 8 15 U.S.C. 78f(b). 9 15 U.S.C. 78f(b)(5). 10 15 U.S.C. 78s(b)(3)(A). 11 17 CFR 240.19b–4(f)(6). VerDate Aug<18>2005 15:17 Aug 29, 2005 Jkt 205001 interest.12 The Exchange has requested that the Commission waive the 30-day operative delay and designate the proposed rule change operative immediately so that the pilot can continue uninterrupted. The Commission hereby grants the request.13 The Commission believes that such waiver is consistent with the protection of investors and the public interest because it will allow the protection of customer limit orders provided by the pilot to continue without interruption and designates the proposed rule change to be operative upon filing with the Commission. At any time within 60 days of the filing of the 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. Electronic Comments • 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 No. SR–CHX–2005–22 on the subject line. 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 No. SR–CHX–2005–22. 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 12 In addition, Rule 19b-4(f)(6)(iii) states that the Exchange must provide the Commission with written notice of its intent to file the proposed rule change at least five days prior to the date of filing of the proposed rule change or such shorter time as designated by the Commission. The Commission has determined to waive the requirement in this case. 13 For purposes only of waiving the 30-day operative delay, the Commission has considered the proposed rule’s impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). PO 00000 Frm 00068 Fmt 4703 Sfmt 4703 51395 Internet Web site (http://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 the filing also will be available for inspection and copying at the principal office of the Exchange. 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 No. SR–CHX–2005–22 and should be submitted on or before September 20, 2005. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.14 Margaret H. McFarland, Deputy Secretary. [FR Doc. E5–4723 Filed 8–29–05; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–52332; File No. SR–NASD– 2005–094] Self-Regulatory Organizations; National Association of Securities Dealers, Inc.; Notice of Filing of Proposed Rule Change and Amendment No. 1 Thereto Relating to Amendments to the Classification of Arbitrators Pursuant to Rule 10308 of the NASD Code of Arbitration August 24, 2005. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’ or ‘‘Exchange Act’’) 1 and Rule 19b–4 thereunder,2 notice is hereby given that on June 22, 2005, the National Association of Securities Dealers, Inc. (‘‘NASD’’) filed with the Securities and Exchange Commission (‘‘SEC’’ or ‘‘Commission’’) the proposed rule change as described in Items I, II, and III below, which Items have been prepared by NASD. On August 5, 2005, NASD filed amendment No. 1 to the 14 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 1 15 E:\FR\FM\30AUN1.SGM 30AUN1

Agencies

[Federal Register Volume 70, Number 167 (Tuesday, August 30, 2005)]
[Notices]
[Pages 51394-51395]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E5-4723]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-52326; File No. SR-CHX-2005-22]


Self-Regulatory Organizations; Chicago Stock Exchange, Inc.; 
Notice of Filing and Immediate Effectiveness of a Proposed Rule Change 
To Extend the Pilot Rule Interpretation Relating to Trading of Nasdaq 
National Market Securities in Sub-Penny Increments

August 23, 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 August 17, 2005, the Chicago Stock Exchange, Inc. (``CHX'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change as described in Items I and 
II below, which Items have been prepared by CHX. The Exchange has filed 
this proposal pursuant to Section 19(b)(3)(A) of the Act \3\ and Rule 
19b-4(f)(6) thereunder,\4\ which renders the proposal effective upon 
receipt of this filing by the Commission. 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.
    \3\ 15 U.S.C. 78s(b)(3)(A).
    \4\ 17 CFR 240.19b-4(f)(6).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    CHX requests an extension, until January 31, 2006, the compliance 
date of new Rule 612 of Regulation NMS,\5\ of a pilot rule 
interpretation (Article XXX, Rule 2, Interpretation and Policy .06 
``Trading in Nasdaq/NM Securities in Subpenny Increments'') which 
requires a CHX specialist (including a market maker who holds customer 
limit orders) to better the price of a customer limit order in his book 
which is priced at the national best bid or offer (``NBBO'') by at 
least one penny if the specialist determines to trade with an incoming 
market or marketable limit order. The pilot, which was approved in 
conjunction with exemptive relief granted by the Commission to allow 
for trading in Nasdaq National Market securities in sub-penny 
increments, expires on August 29, 2005. The Exchange proposes that the 
pilot remain in effect until January 31, 2006, the compliance date of 
Rule 612.
---------------------------------------------------------------------------

    \5\ 17 CFR 242.612. The Commission recently extended the 
compliance date for Rule 612 to January 31, 2006. See Securities 
Exchange Act Release No. 52196 (August 2, 2005) 70 FR 45529 (August 
8, 2005).
---------------------------------------------------------------------------

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

    In its filing with the Commission, CHX included statements 
concerning the purpose of, and basis for, the proposed rule change and 
discussed any comments it received regarding the proposal. The text of 
these statements may be examined at the places specified in Item IV 
below. CHX 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
    On April 6, 2001, the Commission approved, on a pilot basis through 
July 9, 2001, a pilot rule interpretation (Article XXX, Rule 2, 
Interpretation and Policy .06 ``Trading in Nasdaq/NM Securities in 
Subpenny Increments'') \6\ that requires a CHX specialist (including a 
market maker who holds customer limit orders) to better the price of a 
customer limit order in his book which is priced at the NBBO by at 
least one penny if the specialist determines to trade with an incoming 
market or marketable limit order. The pilot, which was approved in 
conjunction with exemptive relief granted by the Commission to allow 
for trading in Nasdaq National Market securities in sub-penny 
increments, has been extended many times and now is set to expire on 
August 29, 2005.\7\ The

[[Page 51395]]

Exchange is not proposing any substantive (or typographical) change to 
the pilot; rather, the Exchange proposes that the pilot remain in 
effect through January 31, 2006, the compliance date of Rule 612 of 
Regulation NMS.
---------------------------------------------------------------------------

    \6\ See Securities Exchange Act Release No. 44164 (April 6, 
2001), 66 FR 19263 (April 13, 2001) (SR-CHX-2001-07).
    \7\ See Securities Exchange Act Release Nos. 44535 (July 10, 
2001), 66 FR 37251 (July 17, 2001) (extending pilot through November 
5, 2001); 45062 (November 15, 2001), 66 FR 58768 (November 23, 2001) 
(extending pilot through January 14, 2002); Securities Exchange Act 
Release No. 45386 (February 1, 2002), 67 FR 6062 (February 8, 2002) 
(extending the pilot through April 15, 2002); 45755 (April 15, 
2002), 67 FR 19607 (April 22, 2002) (extending the pilot through 
September 30, 2002); 46587 (October 2, 2002), 67 FR 63180 (October 
10, 2002) (extending the pilot through January 31, 2003); 47372 
(February 14, 2003), 68 FR 8955 (February 26, 2003) (extending the 
pilot through May 31, 2003); 47951 (May 30, 2003), 68 FR 34448 (June 
9, 2003) (extending the pilot through December 1, 2003); 48871 
(December 3, 2003), 68 FR 69097 (December 11, 2003) (extending pilot 
through June 30, 2004); 49994 (July 9, 2004), 69 FR 42486 (July 15, 
2004) (extending pilot through June 30, 2005); 51944 (June 30, 
2005), 70 FR 39539 (August 8, 2005) (extending pilot through August 
29, 2005, the effective date of Rule 612).
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2. Statutory Basis
    CHX believes the proposal is consistent with the requirements of 
the Act and the rules and regulations thereunder that are applicable to 
a national securities exchange, and, in particular, with the 
requirements of Section 6(b) of the Act.\8\ CHX believes the proposal 
is consistent with Section 6(b)(5) of the Act \9\ in that it is 
designed to promote just and equitable principles of trade; to remove 
impediments to, and to perfect the mechanism of, a free and open market 
and a national market system; and, in general, to protect investors and 
the public interest.
---------------------------------------------------------------------------

    \8\ 15 U.S.C. 78f(b).
    \9\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

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

    The Exchange does not believe that the proposed rule changes would 
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 either solicited or received.

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

    The Exchange asserts the foregoing rule change has become effective 
pursuant to Section 19(b)(3)(A) of the Act \10\ and Rule 19b-4(f)(6) 
\11\ thereunder because the proposed rule change does not:
---------------------------------------------------------------------------

    \10\ 15 U.S.C. 78s(b)(3)(A).
    \11\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

    (i) Significantly affect the protection of investors or the public 
interest;
    (ii) Impose any significant burden on competition; and
    (iii) Become operative for 30 days from the date on which it was 
filed, or such shorter time as the Commission may designate, if 
consistent with the protection of investors and the public 
interest.\12\ The Exchange has requested that the Commission waive the 
30-day operative delay and designate the proposed rule change operative 
immediately so that the pilot can continue uninterrupted.
---------------------------------------------------------------------------

    \12\ In addition, Rule 19b-4(f)(6)(iii) states that the Exchange 
must provide the Commission with written notice of its intent to 
file the proposed rule change at least five days prior to the date 
of filing of the proposed rule change or such shorter time as 
designated by the Commission. The Commission has determined to waive 
the requirement in this case.
---------------------------------------------------------------------------

    The Commission hereby grants the request.\13\ The Commission 
believes that such waiver is consistent with the protection of 
investors and the public interest because it will allow the protection 
of customer limit orders provided by the pilot to continue without 
interruption and designates the proposed rule change to be operative 
upon filing with the Commission.
---------------------------------------------------------------------------

    \13\ For purposes only of waiving the 30-day operative delay, 
the Commission has considered the proposed rule's impact on 
efficiency, competition, and capital formation. See 15 U.S.C. 
78c(f).
---------------------------------------------------------------------------

    At any time within 60 days of the filing of the 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.

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 (http://
www.sec.gov/rules/sro.shtml); or
     Send an e-mail to rule-comments@sec.gov. Please include 
File No. SR-CHX-2005-22 on the subject line.

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 No. SR-CHX-2005-22. 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 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 the filing 
also will be available for inspection and copying at the principal 
office of the Exchange. 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 No. SR-
CHX-2005-22 and should be submitted on or before September 20, 2005.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\14\
---------------------------------------------------------------------------

    \14\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Margaret H. McFarland,
Deputy Secretary.
[FR Doc. E5-4723 Filed 8-29-05; 8:45 am]
BILLING CODE 8010-01-P