Self-Regulatory Organizations; American Stock Exchange LLC; Notice of Filing of Proposed Rule Change and Amendment Nos. 1 and 2 Relating to Contingency Trading Procedures, 53260-53262 [E5-4854]
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53260
Federal Register / Vol. 70, No. 172 / Wednesday, September 7, 2005 / Notices
factor the accounts receivable of AEP’s
public-utility company subsidiaries.
The Commission also authorized CSW
Credit to issue debt securities to finance
its accounts receivable purchases and
AEP Utilities to make equity
investments in CSW Credit. See Original
Order.
By order dated July 31, 1986, (Holding
Company Act Release No. 24157, ‘‘1986
Order’’), the Commission authorized,
among other things, CSW Credit to
expand the scope of the activities to
include the factoring receivables of nonassociate utilities. As a condition of the
1986 Order, CSW Credit was required to
limit its acquisition of utility receivables
from non-associate utilities (‘‘NonAssociate Limit’’). Later, as a condition
of granting CSW Credit temporary relief
from the Non-Associate Limit, the
Commission imposed upon the
company a quarterly reporting
requirement (‘‘Rule 24 Reporting
Requirement’’). See Holding Co. Act
Release No. 26684 (March 11, 1997).
The Commission required that CSW
Credit maintain the percentage of its
debt to equity at not less than 5% debt
and 95% equity (‘‘Debt-Equity
Requirement’’). See Holding Company
Act Release No. 25138 (August 30,
1990).
Most recently, the Commission
authorized AEP Credit to continue to
factor the accounts receivable of
associate and non-associate utility
companies, subject to certain
conditions, through September 30, 2005.
B. AEP Credit’s Current Operations
AEP Credit has entered into
agreements to purchase accounts
receivable from the following publicutility company subsidiaries of AEP:
Appalachian Power Company,
Columbus Southern Power Company,
Indiana Michigan Power Company,
Kentucky Power Company, Kingsport
Power Company, Ohio Power Company,
Public Service Company of Oklahoma,
Southwestern Electric Company, and
Wheeling Power Company (collectively,
‘‘Operating Companies’’). AEP Credit no
longer purchases accounts receivable
from non-associate public-utility
companies.
Purchases of accounts receivable are
at a discount, based on AEP Credit’s
cost of funds and collection history.1
1 Currently, there are two components of the
discount calculation: (1) A financing cost
component; and (2) a bad debt component. The
financing cost component (‘‘Carrying Charge’’) is
based on AEP Credit’s actual weighted average cost
of funds. It includes the actual cost of amounts
borrowed from the external markets (currently bank
conduits), a return on equity contribution from
Credit’s parent and actual costs of any amounts
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15:05 Sep 06, 2005
Jkt 205001
AEP Credit then sells the accounts
receivable to third party financial
institutions. Applicants state that
transactions between AEP Credit and
the Operating Companies comply with
the ‘‘at cost’’ rules under the Act and,
consequently, there is no crosssubsidization.
AEP Credit has entered into agency
agreements with each of the Operating
Companies. Those agreements provide
that the Operating Companies act as a
collection agent for the receipt of
customer payments and collection and
remit these payments to AEP Credit.
The amount of the receivables bought by
AEP Credit varies from month to month,
based on the electric usage by the
Operating Company’s customers.
These sales are on a non-recourse
basis to the Operating Companies. The
Operating Companies are not required
to sell their accounts receivable to AEP
Credit for any specified period of time;
an Operating Company may terminate
its relationship with AEP Credit on 30
days notice.
AEP Credit funds its purchases of the
receivables using funds it obtains under
a receivables purchase agreement
(‘‘RPA’’). Under the RPA, AEP Credit
sells a certain undivided ownership
interest in the accounts receivable on a
revolving basis to a group of financial
institutions, mentioned above. The RPA
also provides that American Electric
Power Service Corporation (‘‘AEP
Service’’), a service company subsidiary
of AEP, administers the collections
received by AEP Credit and reports
information regarding the receivables
and collections to the agent of the
financial institutions. AEP Service is
reimbursed for all costs and expenses it
incurs in connection with the services it
provides under the agreement.
In addition to the funds obtained
under the RPA, AEP Credit obtains
funds to purchase receivables through
equity contributions by AEP and a
subordinated revolving loan by AEP.
Sales of the accounts receivable by the
Operating Companies qualify for
treatment as true sales of assets under
Financial Accounting Standards Board
Statement No. 140 (rather than as a loan
secured by the receivables). AEP Credit
is intended to be bankruptcy remote to
borrowed through the subordinated loan from AEP.
Credit’s actual cost of equity is the State authorized
return on common equity of each individual
Operating Company. AEP Credit’s interest charges
to the Operating Companies used in the Carrying
Charge have always been and are anticipated to be
less than the ‘‘prime rate of interest,’’ as that term
is normally used. The bad debt component is based
on AEP Credit’s actual bad debt charge-offs for the
receivable pool. It is calculated as a rolling average
of the actual historical charge-off statistics for the
receivable pools of each Operating Company.
PO 00000
Frm 00113
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Sfmt 4703
isolate the receivables from the creditors
of the Operating Companies.
Applicants state that the factoring
program allows the Operating
Companies to reduce their working
capital needs by accelerating the receipt
of cash from the collection of customer
accounts receivable thereby reducing
the dependence of the Operating
Companies upon more costly sources of
working capital. Credit, as a specialpurpose financing entity, can borrow
money more cheaply than the Operating
Companies can individually. Through
the use of Credit, the Operating
Companies are able to consolidate their
accounts receivable into a larger pool
and eliminate duplicate administrative
costs in administering the program.
II. Requested Authority
Applicants request (1) authority for
AEP to retain AEP Credit, whose
business consists solely of factoring the
accounts receivable of associate publicutility companies; (2) request that the
Commission eliminate the Rule 24
Reporting Requirement; and (3) that the
Commission eliminate the Debt-Equity
Requirement.
For the Commission by the Division of
Investment Management, pursuant to
delegated authority.
Jonathan G. Katz,
Secretary.
[FR Doc. E5–4850 Filed 9–6–05; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–52360; File No. SR–Amex–
2004–76]
Self-Regulatory Organizations;
American Stock Exchange LLC; Notice
of Filing of Proposed Rule Change and
Amendment Nos. 1 and 2 Relating to
Contingency Trading Procedures
August 30, 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
September 10, 2004, 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 August 26, 2005, the Exchange
submitted Amendment No. 1 to the
1 15
2 17
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U.S.C. 78s(b)(1).
CFR 240.19b–4.
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Federal Register / Vol. 70, No. 172 / Wednesday, September 7, 2005 / Notices
proposal.3 On August 29, 2005, the
Exchange submitted Amendment No. 2
to the proposal.4 The Commission is
publishing this notice to solicit
comments on the proposed rule change,
as amended, from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to adopt
Amex Rule 119A regarding contingency
trading procedures.
The text of the proposed rule change,
as amended, is set forth below.
Proposed new language is in italics.
*
*
*
*
*
Contingency Trading Procedures—
Alternative Trading Facility
Rule 119A. (a) Definitions:
The term ‘‘Alternative Trading
Facility’’ (‘‘ATF’’) for purposes of this
Rule, shall mean the remote facility
established by the Exchange for trading
securities admitted to dealings in the
event that the Exchange’s primary
trading facility at 86 Trinity Place is
wholly or partially unusable.
(b) Except to the extent that the
provisions of Rule 119A govern, or
unless the context otherwise requires,
the provisions of the Constitution and
Rules of the Exchange are applicable to
trading conducted on the ATF.
(c) The Executive Vice President for
Market Operations and Trading Floor
Systems or his or her designee(s) shall
have authority to designate the
individuals who will be allowed to
conduct a securities business on the
ATF from among those members,
member organizations and persons
associated with members and member
organization who are entitled to trade
and support trading at the Exchange’s
facility at 86 Trinity Place. One or more
individuals from each broker and
specialist unit shall be allowed to
conduct business on the ATF.
Registered Option Traders will be
allowed to conduct business on the ATF
to the extent that there is space in the
ATF to accommodate them based upon
their volume of trading.
(d) If a Registered Option Trader is
not allowed to trade on the ATF, the
Registered Option Trader may initiate
opening trades for his or her market
maker account from off the ATF without
reference to in-person requirements or
the requirement that off-floor orders be
3 In Amendment No. 1, the Exchange
substantially revised the proposed rule text and
corresponding description of the proposal in its
Form 19b–4. Amendment No. 1 replaced Amex’s
original filing in its entirety.
4 In Amendment No. 2, the Exchange made minor
corrections to the rule text.
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15:05 Sep 06, 2005
Jkt 205001
effected only for hedging, reducing risk,
rebalancing or liquidating positions.
(See Commentary .01 to Rules 958 and
958–ANTE)
(e) A member may use a personal
cellular telephone to conduct business
in the ATF subject to the following
conditions:
(i) The member must maintain his or
her cellular telephone records,
including logs of calls placed, for a
period of not less than one year. The
Exchange reserves the right to inspect
and/or examine such telephone records.
(ii) If a Floor broker receives an
incoming call on a cellular telephone,
and the caller wishes to give the broker
an order for a security traded at the post
where the broker is standing, the broker
must step-out of the crowd prior to
accepting the order. In contrast, if a
broker receives an incoming call on a
cellular telephone, and the caller wishes
to give the broker an order for a security
traded at some other location on the
Floor, the broker does not have to leave
the crowd where he or she is standing
in order to receive the order. A Floor
broker also may initiate an outgoing call
on a cellular telephone and (1) accept
an order for a security traded at the post
where the broker is standing without
leaving the trading crowd, or (2) accept
an order for a security traded at some
other location on the Floor.
(iii) Except as provided in this Rule
119A, all other requirements applicable
to the use of an Exchange provided
telephone by a member shall apply to
the use by a member of a personal
cellular telephone. (See Rule 220)
(f) In the event that a Floor Official’s
ruling is appealed to a three Senior
Floor Official panel and there is an
insufficient number of Senior Floor
Officials to serve on the Panel, qualified
Exchange Officials may serve on the
Panel without reference to their order of
seniority.
*
*
*
*
*
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.
PO 00000
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Fmt 4703
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53261
A. Self-Regulatory Organization’s
Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule
Change
1. Purpose
Proposed Amex Rule 119A sets forth
the Exchange’s contingency trading with
respect to the use of the Exchange’s
‘‘Alternative Trading Facility’’ (‘‘ATF’’),
which is a remote facility established by
the Exchange for trading securities
admitted to dealings in the event that
the Exchange’s primary trading facility
at 86 Trinity Place is wholly or partially
unusable.
Under proposed Amex Rule 119A(b)
the provisions of the Constitution and
Rules of the Exchange are applicable to
trading conducted on the ATF, except to
the extent that the provisions of Amex
Rule 119A govern, or unless the context
otherwise requires. Paragraph (c) of
proposed Amex Rule 119A provides
that the Exchange’s Executive Vice
President for Market Operations and
Trading Floor Systems or his or her
designee(s) shall have authority to
designate the individuals who will be
allowed to conduct a securities business
on the ATF from among those members,
member organizations, and persons
associated with those members and
member organizations who are entitled
to trade and support trading at the
Exchange’s facility at 86 Trinity Place.
Not all persons who generally conduct
business at the Exchange’s regular
facility will be able to use the ATF due
to occupancy restrictions at the facility.
One or more individuals from each
broker and specialist unit will be
allowed to conduct business on the
ATF. Registered Option Traders
(‘‘ROTs’’) will be allowed to conduct
business on the ATF to the extent that
there is space in the ATF to
accommodate them based upon their
volume of trading. Paragraph (d) to
proposed Amex Rule 119A provides
that if a ROT is not allowed to trade on
the ATF, the ROT may initiate opening
trades for his or her market maker
account from off the ATF without
reference to in-person requirements or
the requirement that off-floor orders be
effected only for hedging, reducing risk,
rebalancing or liquidating positions.
Although the Exchange has installed
tethered telephones at the ATF, it has
not replicated its wireless telephone
system at this facility. As a result, the
Exchange is proposing to allow
members to use personal cellular
telephones to conduct business on the
ATF subject to the same conditions that
were applicable to the use of personal
cellular telephones on the Amex
following September 11, 2001. The
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53262
Federal Register / Vol. 70, No. 172 / Wednesday, September 7, 2005 / Notices
conditions applicable to the use of
personal cellular telephones on the ATF
are set forth in paragraph (e) to the
proposed rule. Paragraph (f) provides
that Exchange Officials may substitute
for Senior Floor Officials without
reference to their seniority in the event
that a Floor Official’s ruling is appealed
to a three Senior Floor Official panel
and there is an insufficient number of
available Senior Floor Officials to
consider the appeal.5
2. Statutory Basis
The proposed rule change is
consistent with Section 6(b) of the Act 6
in general and furthers the objectives of
Section 6(b)(5) 7 in particular in that it
is designed to foster cooperation and
coordination with persons engaged in
regulating, clearing, settling and
processing information with respect to,
and facilitating transactions in
securities.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The proposed rule change will impose
no burden on competition not necessary
or appropriate in furtherance of the
purposes of the Act.
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 by the Exchange 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.
5 The Exchange has a proposal pending with the
Commission that would modify Amex Rule 22 to
establish a three-level review process in which
Floor Official decisions, as needed, may be
appealed to a three Senior Floor Official Panel. See
Securities Exchange Act Release No. 52325 (August
23, 2005), 70 FR 51392 (August 30, 2005) (SR–
AMEX–2005–052).
6 15 U.S.C. 78f(b).
7 15 U.S.C. 78f(b)(5).
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15:05 Sep 06, 2005
Jkt 205001
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:
• 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-Amex-2004–76 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
Number SR-Amex-2004–76. 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-2004–76 and should
be submitted on or before September 28,
2005.
Frm 00115
Fmt 4703
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
Electronic Comments
PO 00000
For the Commission, by the Division of
Market Regulation, pursuant to delegated
authority.8
Jonathan G. Katz,
Secretary.
[FR Doc. E5–4854 Filed 9–6–05; 8:45 am]
Sfmt 4703
[Docket No. 34–52345; File No. SR–PCX–
2005–61]
Self-Regulatory Organizations; Pacific
Exchange, Inc.; Order Approving
Proposed Rule Change, and
Amendment No. 1 Thereto Establishing
a De Minimis Exception to the 80/20
Test
August 26, 2005.
I. Introduction
On April 26, 2005, the Pacific
Exchange, Inc. (‘‘PCX’’ or ‘‘Exchange’’)
filed with the Securities and Exchange
Commission (‘‘Commission’’), pursuant
to section 19(b)(1) of the Securities
Exchange Act of 1954 (‘‘Act’’) 1 and Rule
19b–4 thereunder,2 a proposed rule
change seeking to modify the 80/20 Test
in determining limitations on Principal
Order 3 access under the rules imposed
by the Plan for the Purpose of Creating
and Operating an Intermarket Option
Linkage (‘‘Linkage Plan’’) 4 and related
rules. On July 29, 2005, the Exchange
submitted Amendment No. 1 to the
proposed rule change. The proposed
rule change, as amended, was noticed
for comment in the Federal Register on
July 27, 2005.5 The Commission
received no comments on the proposed
rule change. This order approves the
proposed rule change, as amended.
8 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 The Exchange defines a Principal Order as an
order for a principal account of an eligible Market
Maker that does not relate to a customer order the
Market Maker is holding. See PCX Rule
6.92(a)(12)(ii).
4 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 the
American Stock Exchange, LLC, Chicago Board
Options Exchange, Inc., and the International Stock
Exchange, Inc. See Securities Exchange Act Release
No. 43086 (July 28, 2000), 65 FR 48023 (August 4,
2000). Subsequently, the Philadelphia Stock
Exchange, Inc., the PCX and the Boston Stock
Exchanges, 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).
5 See Securities Exchange Act Release No. 52070
(July 20, 2005), 70 FR 43490 (July 27, 2005).
1 15
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]]>Agencies
[Federal Register Volume 70, Number 172 (Wednesday, September 7, 2005)]
[Notices]
[Pages 53260-53262]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E5-4854]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-52360; File No. SR-Amex-2004-76]
Self-Regulatory Organizations; American Stock Exchange LLC;
Notice of Filing of Proposed Rule Change and Amendment Nos. 1 and 2
Relating to Contingency Trading Procedures
August 30, 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 September 10, 2004, 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
August 26, 2005, the Exchange submitted Amendment No. 1 to the
[[Page 53261]]
proposal.\3\ On August 29, 2005, the Exchange submitted Amendment No. 2
to the proposal.\4\ The Commission is publishing this notice to solicit
comments on the proposed rule change, as amended, from interested
persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ In Amendment No. 1, the Exchange substantially revised the
proposed rule text and corresponding description of the proposal in
its Form 19b-4. Amendment No. 1 replaced Amex's original filing in
its entirety.
\4\ In Amendment No. 2, the Exchange made minor corrections to
the rule text.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to adopt Amex Rule 119A regarding contingency
trading procedures.
The text of the proposed rule change, as amended, is set forth
below. Proposed new language is in italics.
* * * * *
Contingency Trading Procedures--Alternative Trading Facility
Rule 119A. (a) Definitions:
The term ``Alternative Trading Facility'' (``ATF'') for purposes of
this Rule, shall mean the remote facility established by the Exchange
for trading securities admitted to dealings in the event that the
Exchange's primary trading facility at 86 Trinity Place is wholly or
partially unusable.
(b) Except to the extent that the provisions of Rule 119A govern,
or unless the context otherwise requires, the provisions of the
Constitution and Rules of the Exchange are applicable to trading
conducted on the ATF.
(c) The Executive Vice President for Market Operations and Trading
Floor Systems or his or her designee(s) shall have authority to
designate the individuals who will be allowed to conduct a securities
business on the ATF from among those members, member organizations and
persons associated with members and member organization who are
entitled to trade and support trading at the Exchange's facility at 86
Trinity Place. One or more individuals from each broker and specialist
unit shall be allowed to conduct business on the ATF. Registered Option
Traders will be allowed to conduct business on the ATF to the extent
that there is space in the ATF to accommodate them based upon their
volume of trading.
(d) If a Registered Option Trader is not allowed to trade on the
ATF, the Registered Option Trader may initiate opening trades for his
or her market maker account from off the ATF without reference to in-
person requirements or the requirement that off-floor orders be
effected only for hedging, reducing risk, rebalancing or liquidating
positions. (See Commentary .01 to Rules 958 and 958-ANTE)
(e) A member may use a personal cellular telephone to conduct
business in the ATF subject to the following conditions:
(i) The member must maintain his or her cellular telephone records,
including logs of calls placed, for a period of not less than one year.
The Exchange reserves the right to inspect and/or examine such
telephone records.
(ii) If a Floor broker receives an incoming call on a cellular
telephone, and the caller wishes to give the broker an order for a
security traded at the post where the broker is standing, the broker
must step-out of the crowd prior to accepting the order. In contrast,
if a broker receives an incoming call on a cellular telephone, and the
caller wishes to give the broker an order for a security traded at some
other location on the Floor, the broker does not have to leave the
crowd where he or she is standing in order to receive the order. A
Floor broker also may initiate an outgoing call on a cellular telephone
and (1) accept an order for a security traded at the post where the
broker is standing without leaving the trading crowd, or (2) accept an
order for a security traded at some other location on the Floor.
(iii) Except as provided in this Rule 119A, all other requirements
applicable to the use of an Exchange provided telephone by a member
shall apply to the use by a member of a personal cellular telephone.
(See Rule 220)
(f) In the event that a Floor Official's ruling is appealed to a
three Senior Floor Official panel and there is an insufficient number
of Senior Floor Officials to serve on the Panel, qualified Exchange
Officials may serve on the Panel without reference to their order of
seniority.
* * * * *
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
Proposed Amex Rule 119A sets forth the Exchange's contingency
trading with respect to the use of the Exchange's ``Alternative Trading
Facility'' (``ATF''), which is a remote facility established by the
Exchange for trading securities admitted to dealings in the event that
the Exchange's primary trading facility at 86 Trinity Place is wholly
or partially unusable.
Under proposed Amex Rule 119A(b) the provisions of the Constitution
and Rules of the Exchange are applicable to trading conducted on the
ATF, except to the extent that the provisions of Amex Rule 119A govern,
or unless the context otherwise requires. Paragraph (c) of proposed
Amex Rule 119A provides that the Exchange's Executive Vice President
for Market Operations and Trading Floor Systems or his or her
designee(s) shall have authority to designate the individuals who will
be allowed to conduct a securities business on the ATF from among those
members, member organizations, and persons associated with those
members and member organizations who are entitled to trade and support
trading at the Exchange's facility at 86 Trinity Place. Not all persons
who generally conduct business at the Exchange's regular facility will
be able to use the ATF due to occupancy restrictions at the facility.
One or more individuals from each broker and specialist unit will be
allowed to conduct business on the ATF. Registered Option Traders
(``ROTs'') will be allowed to conduct business on the ATF to the extent
that there is space in the ATF to accommodate them based upon their
volume of trading. Paragraph (d) to proposed Amex Rule 119A provides
that if a ROT is not allowed to trade on the ATF, the ROT may initiate
opening trades for his or her market maker account from off the ATF
without reference to in-person requirements or the requirement that
off-floor orders be effected only for hedging, reducing risk,
rebalancing or liquidating positions.
Although the Exchange has installed tethered telephones at the ATF,
it has not replicated its wireless telephone system at this facility.
As a result, the Exchange is proposing to allow members to use personal
cellular telephones to conduct business on the ATF subject to the same
conditions that were applicable to the use of personal cellular
telephones on the Amex following September 11, 2001. The
[[Page 53262]]
conditions applicable to the use of personal cellular telephones on the
ATF are set forth in paragraph (e) to the proposed rule. Paragraph (f)
provides that Exchange Officials may substitute for Senior Floor
Officials without reference to their seniority in the event that a
Floor Official's ruling is appealed to a three Senior Floor Official
panel and there is an insufficient number of available Senior Floor
Officials to consider the appeal.\5\
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\5\ The Exchange has a proposal pending with the Commission that
would modify Amex Rule 22 to establish a three-level review process
in which Floor Official decisions, as needed, may be appealed to a
three Senior Floor Official Panel. See Securities Exchange Act
Release No. 52325 (August 23, 2005), 70 FR 51392 (August 30, 2005)
(SR-AMEX-2005-052).
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2. Statutory Basis
The proposed rule change is consistent with Section 6(b) of the Act
\6\ in general and furthers the objectives of Section 6(b)(5) \7\ in
particular in that it is designed to foster cooperation and
coordination with persons engaged in regulating, clearing, settling and
processing information with respect to, and facilitating transactions
in securities.
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\6\ 15 U.S.C. 78f(b).
\7\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition
The proposed rule change will impose no burden on competition not
necessary or appropriate in furtherance of the purposes of the Act.
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 by the Exchange 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, 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-2004-76 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 Number SR-Amex-2004-76. 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-2004-76 and should be submitted on or before
September 28, 2005.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\8\
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\8\ 17 CFR 200.30-3(a)(12).
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Jonathan G. Katz,
Secretary.
[FR Doc. E5-4854 Filed 9-6-05; 8:45 am]
BILLING CODE 8010-01-P
