Self-Regulatory Organizations; Pacific Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Obligations of Lead Market Makers, 958-959 [E6-20]

Download as PDF 958 Federal Register / Vol. 71, No. 4 / Friday, January 6, 2006 / Notices interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act.13 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 (http://www.sec.gov/ rules/sro.shtml); or • Send an e-mail to rulecomments@sec.gov. Please include File Number SR–CBOE–2005–114 on the subject line. cprice-sewell on PROD1PC66 with NOTICES 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–CBOE–2005–114. 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 such 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 13 The effective date of the original proposed rule change is December 16, 2005, and the effective date of Amendment No. 1 is December 22, 2005. For purposes of calculating the 60-day period within which the Commission may summarily abrogate the proposed rule change, as amended, under Section 19(b)(3)(C) of the Act, the Commission considers the period to commence on December 22, 2005, the date on which CBOE submitted Amendment No. 1. See 15 U.S.C. 78s(b)(3)(C). VerDate Aug<31>2005 15:23 Jan 05, 2006 Jkt 208001 submissions should refer to File Number SR–CBOE–2005–114 and should be submitted on or before January 27, 2006. II. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change For the Commission, by the Division of Market Regulation, pursuant to delegated authority.14 Jonathan G. Katz, Secretary. [FR Doc. E6–22 Filed 1–5–06; 8:45 am] 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. BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–53045; File No. SR–PCX– 2005–132] Self-Regulatory Organizations; Pacific Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Obligations of Lead Market Makers December 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 December 30, 2005, the Pacific Exchange, Inc. (‘‘Exchange’’ or ‘‘PCX’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change as described in Items I and II below, which Items have been substantially prepared by the Exchange. The Exchange filed the proposed rule change as a ‘‘non-controversial’’ rule change under Rule 19b–4(f)(6) under the Act,3 which rendered the proposal effective upon filing with the Commission. 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 delete PCX Rule 6.82(c)(15) in its entirety. The Exchange also proposes to amend Commentary .02 to PCX Rule 6.82. The text of the proposed rule change is available on PCX’s Web site, http:// www.pacificex.com, at PCX’s Office of the Secretary, and at the Commission’s Public Reference Section. 14 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 17 CFR 240.19b–4(f)(6). 1 15 PO 00000 Frm 00055 Fmt 4703 Sfmt 4703 A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The purpose of this filing is to delete PCX Rule 6.82(c)(15), a sub–paragraph of Obligations of Lead Market Makers. Along with the deletion of PCX Rule 6.82(c)(15), the PCX proposes to amend Commentary .02 to PCX Rule 6.82, which addresses PCX Rule 6.82(c)(15). This rule, dealing with the handling of public customer orders that are not automatically executed on the PCX because there is a better-displayed bid or offer on another exchange, is scheduled to be operative on January 1, 2006. Under PCX Rule 6.82(c)(15), when a public customer order is not automatically executed on the PCX due to a better bid or ask price being displayed on another exchange, a Lead Market Maker (‘‘LMM’’) is obligated, as soon as practical, to address the order by either executing the public customer order at a price that matches the best available price displayed at any other exchange or by routing the public customer order via intermarket linkage (‘‘Linkage’’) for execution at any other exchange displaying the best price in the market at the time. Outbound Linkage orders on the PCX are still handled via manual interaction with the Linkage system. Manual interaction with the Linkage system can be a time consuming process that potentially could result in the delay of a public customer order being executed at a better price available at a competing exchange. By deleting PCX Rule 6.82(c)(15), in the event that an LMM does not execute the order at the better price displayed on another exchange, the LMM would not be required to send the order to the competing exchange via Linkage. Public customer orders that are not executed on the PCX could still be E:\FR\FM\06JAN1.SGM 06JAN1 Federal Register / Vol. 71, No. 4 / Friday, January 6, 2006 / Notices rejected to the initiating brokerage firm for rerouting to a competing exchange. Due to delays in technology development, the PCX has not been able to implement an automated outbound Linkage function into the PCX Plus trading system. The PCX is presently developing a new enhanced options trading system, called the OX System. Included in the design plans for the OX System is functionality that will route outbound Linkage orders to other exchanges via an automated process. 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with Section 6(b) of the Act 4 in general, and furthers the objectives of section 6(b)(5) of the Act 5 in particular, in that it is designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, to foster cooperation and coordination with persons engaged in facilitating transactions in securities, and to remove impediments to and perfect the mechanism of a free and open market and a national market system. B. Self-Regulatory Organization’s Statement on Burden on Competition The Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. cprice-sewell on PROD1PC66 with NOTICES 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 written comments on the proposed rule change. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Because the proposed rule change: (i) Does not significantly affect the protection of investors or the public interest; (ii) does not impose any significant burden on competition; and (iii) by its terms, does not become operative for 30 days after the date of filing, or such shorter time as the Commission may designate, if consistent with the protection of investors and the public interest, the proposed rule change has become effective pursuant to Section 19(b)(3)(A) of the Act 6 and subparagraph (f)(6) of Rule 19b–4 thereunder.7 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–PCX–2005–132 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–PCX–2005–132. 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 U.S.C. 78f(b). U.S.C. 78f(b)(5). 6 6 15 U.S.C. 78s(b)(3)(A). 7 17 CFR 240.19b–4(f)(6). Jkt 208001 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 Section, 100 F Street, NE., Washington, DC 20549. Copies of such 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 Number SR–PCX–2005–132 and should be submitted on or before January 27, 2006. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.9 Jonathan G. Katz, Secretary. [FR Doc. E6–20 Filed 1–5–06; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–53043; File No. SR–Phlx– 2005–72] Self-Regulatory Organizations; Philadelphia Stock Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change and Amendment No. 1 Thereto Relating to Remote Streaming Quote Trader Permit Fees December 29, 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 November 10, 2005, the Philadelphia Stock Exchange, Inc. (‘‘Phlx’’ 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 Phlx. On December 19, 2005, the Phlx submitted Amendment No. 1 to the proposed rule change.3 The Exchange has designated 9 17 the purposes only of accelerating the operative date of this proposal, the Commission has considered the proposed rule’s impact on efficiency, competition and capital formation. 15 U.S.C. 78c(f). 5 15 15:23 Jan 05, 2006 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: 8 For 4 15 VerDate Aug<31>2005 The Exchange has requested that the Commission waive the 30-day operative delay period for ‘‘non-controversial’’ proposals and make the proposed rule change effective and operative upon filing. The Commission believes that waiver of the 30-day operative delay is consistent with the protection of investors and the public interest, because PCX Rule 6.82(c)(15) has never become operative (as its operative date was January 1, 2006), and deleting a rule that has never become operative has no real effect and thus raises no issues of regulatory concern. For this reason, the Commission designates the proposal to be effective and operative upon filing with the Commission.8 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 the furtherance of the purposes of the Act. 959 PO 00000 Frm 00056 Fmt 4703 Sfmt 4703 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 In Amendment No. 1, the Exchange revised the proposed rule text to clarify that RSQTs and SQTs 1 15 E:\FR\FM\06JAN1.SGM Continued 06JAN1

Agencies

[Federal Register Volume 71, Number 4 (Friday, January 6, 2006)]
[Notices]
[Pages 958-959]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-20]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-53045; File No. SR-PCX-2005-132]


Self-Regulatory Organizations; Pacific Exchange, Inc.; Notice of 
Filing and Immediate Effectiveness of Proposed Rule Change Relating to 
Obligations of Lead Market Makers

December 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 December 30, 2005, the Pacific Exchange, Inc. (``Exchange'' or 
``PCX'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change as described in Items I and 
II below, which Items have been substantially prepared by the Exchange. 
The Exchange filed the proposed rule change as a ``non-controversial'' 
rule change under Rule 19b-4(f)(6) under the Act,\3\ which rendered the 
proposal effective upon filing with 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\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

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

    The Exchange proposes to delete PCX Rule 6.82(c)(15) in its 
entirety. The Exchange also proposes to amend Commentary .02 to PCX 
Rule 6.82. The text of the proposed rule change is available on PCX's 
Web site, http://www.pacificex.com, at PCX's Office of the Secretary, 
and at the Commission's Public Reference Section.

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 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The purpose of this filing is to delete PCX Rule 6.82(c)(15), a 
sub-paragraph of Obligations of Lead Market Makers. Along with the 
deletion of PCX Rule 6.82(c)(15), the PCX proposes to amend Commentary 
.02 to PCX Rule 6.82, which addresses PCX Rule 6.82(c)(15). This rule, 
dealing with the handling of public customer orders that are not 
automatically executed on the PCX because there is a better-displayed 
bid or offer on another exchange, is scheduled to be operative on 
January 1, 2006.
    Under PCX Rule 6.82(c)(15), when a public customer order is not 
automatically executed on the PCX due to a better bid or ask price 
being displayed on another exchange, a Lead Market Maker (``LMM'') is 
obligated, as soon as practical, to address the order by either 
executing the public customer order at a price that matches the best 
available price displayed at any other exchange or by routing the 
public customer order via intermarket linkage (``Linkage'') for 
execution at any other exchange displaying the best price in the market 
at the time. Outbound Linkage orders on the PCX are still handled via 
manual interaction with the Linkage system. Manual interaction with the 
Linkage system can be a time consuming process that potentially could 
result in the delay of a public customer order being executed at a 
better price available at a competing exchange. By deleting PCX Rule 
6.82(c)(15), in the event that an LMM does not execute the order at the 
better price displayed on another exchange, the LMM would not be 
required to send the order to the competing exchange via Linkage. 
Public customer orders that are not executed on the PCX could still be

[[Page 959]]

rejected to the initiating brokerage firm for rerouting to a competing 
exchange.
    Due to delays in technology development, the PCX has not been able 
to implement an automated outbound Linkage function into the PCX Plus 
trading system. The PCX is presently developing a new enhanced options 
trading system, called the OX System. Included in the design plans for 
the OX System is functionality that will route outbound Linkage orders 
to other exchanges via an automated process.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act \4\ in general, and furthers the 
objectives of section 6(b)(5) of the Act \5\ in particular, in that it 
is designed to prevent fraudulent and manipulative acts and practices, 
to promote just and equitable principles of trade, to foster 
cooperation and coordination with persons engaged in facilitating 
transactions in securities, and to remove impediments to and perfect 
the mechanism of a free and open market and a national market system.
---------------------------------------------------------------------------

    \4\ 15 U.S.C. 78f(b).
    \5\ 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 change will 
impose any burden on competition that is 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

    The Exchange has neither solicited nor received written comments on 
the proposed rule change.

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

    Because the proposed rule change: (i) Does not significantly affect 
the protection of investors or the public interest; (ii) does not 
impose any significant burden on competition; and (iii) by its terms, 
does not become operative for 30 days after the date of filing, or such 
shorter time as the Commission may designate, if consistent with the 
protection of investors and the public interest, the proposed rule 
change has become effective pursuant to Section 19(b)(3)(A) of the Act 
\6\ and subparagraph (f)(6) of Rule 19b-4 thereunder.\7\
---------------------------------------------------------------------------

    \6\ 6 15 U.S.C. 78s(b)(3)(A).
    \7\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

    The Exchange has requested that the Commission waive the 30-day 
operative delay period for ``non-controversial'' proposals and make the 
proposed rule change effective and operative upon filing. The 
Commission believes that waiver of the 30-day operative delay is 
consistent with the protection of investors and the public interest, 
because PCX Rule 6.82(c)(15) has never become operative (as its 
operative date was January 1, 2006), and deleting a rule that has never 
become operative has no real effect and thus raises no issues of 
regulatory concern. For this reason, the Commission designates the 
proposal to be effective and operative upon filing with the 
Commission.\8\
---------------------------------------------------------------------------

    \8\ For the purposes only of accelerating the operative date of 
this proposal, the Commission has considered the proposed rule's 
impact on efficiency, competition and capital formation. 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 the 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 Number SR-PCX-2005-132 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-PCX-2005-132. 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 Section, 100 F Street, 
NE., Washington, DC 20549. Copies of such 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 Number SR-PCX-2005-132 and should be 
submitted on or before January 27, 2006.
---------------------------------------------------------------------------

    \9\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\9\
Jonathan G. Katz,
Secretary.
[FR Doc. E6-20 Filed 1-5-06; 8:45 am]
BILLING CODE 8010-01-P