Self-Regulatory Organizations; National Association of Securities Dealers, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change and Amendment No. 1 Thereto Related to Non-NASD Member Broker-Dealer Access to Nasdaq's Brut Facility, 3909-3910 [E6-777]

Download as PDF Federal Register / Vol. 71, No. 15 / Tuesday, January 24, 2006 / Notices Federal Register on December 12, 2005.4 The Commission received no comments regarding the proposal. This order approves the proposed rule change. The proposed rule change would establish that, in addition to a floor broker crossing a SizeQuote Order with a facilitation order in accordance with the SizeQuote Mechanism’s procedures, a floor broker also may cross the SizeQuote order with one or more solicited orders or a combination of solicited and facilitation orders. 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, and, in particular, with the requirements of Section 6(b)(5) of the Act.5 The Commission believes that, by giving floor brokers the alternative of crossing customers’ SizeQuote Orders with solicited orders, the proposed rule change is intended to expand the potential benefits of the SizeQuote Mechanism. The Commission notes that the proposal does not alter the procedures a floor broker must follow in executing SizeQuote Orders. It is therefore ordered, pursuant to Section 19(b)(2) of the Act,6 that the proposed rule change (SR–CBOE–2005– 83) is approved until the expiration of the current SizeQuote pilot program on February 15, 2006.7 rmajette on PROD1PC67 with NOTICES1 BILLING CODE 8010–01–P 4 See Securities Exchange Act Release No. 52888 (December 5, 2005), 70 FR 73492. 5 15 U.S.C. 78f(b)(5). In approving this proposed rule change, the Commission has considered the proposed rule’s impact on efficiency, competition, and capital formation. 15 U.S.C. 78c(f). 6 15 U.S.C. 78s(b)(2). 7 The Commission notes that the current SizeQuote pilot program expires on February 15, 2006. The Exchange has indicated to Commission staff its intent to propose an extension of the pilot program, as amended by the instant proposal, for an additional year. Telephone Conversation between Jennifer Lamie, Managing Senior Attorney, CBOE and Ira Brandriss, Special Counsel, Division of Market Regulation, Commission on January 13, 2006. 8 17 CFR 200.30–3(a)(12). 14:44 Jan 23, 2006 Jkt 208001 [Release No. 34–53111; File No. SR–NASD– 2006–002] Self-Regulatory Organizations; National Association of Securities Dealers, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change and Amendment No. 1 Thereto Related to Non-NASD Member Broker-Dealer Access to Nasdaq’s Brut Facility January 12, 2006. 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 January 3, 2006, the National Association of Securities Dealers, Inc. (‘‘NASD’’), through its subsidiary, The Nasdaq Stock Market, Inc. (‘‘Nasdaq’’), 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 Nasdaq. On January 12, 2006, Nasdaq submitted Amendment No. 1 to the proposed rule change.3 Nasdaq has filed the proposal pursuant to section 19(b)(3)(A) of the Act 4 and Rule 19b–4(f)(6) thereunder,5 which renders the proposal effective upon filing with the Commission. 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 For the Commission, by the Division of Market Regulation, pursuant to delegated authority.8 Jill M. Peterson, Assistant Secretary. [FR Doc. E6–778 Filed 1–23–06; 8:45 am] VerDate Aug<31>2005 SECURITIES AND EXCHANGE COMMISSION Nasdaq proposes to continue to provide, through February 8, 2006, broker-dealers that are not members of the NASD access to Nasdaq’s Brut facility. Nasdaq states that it would implement the proposed rule change, as amended, immediately. Nasdaq has designated this proposal as noncontroversial and has requested that the Commission waive the five-day prefiling requirement and the 30-day preoperative waiting period contained in Rule 19b–4(f)(6)(iii) under the Act.6 The text of the proposed rule change, as amended, is below. Proposed new language is italicized; proposed deletions are in [brackets]. * * * * * 1 15 U.S.C. 78s(b)(1). CFR 240.19b–4. 3 Amendment No. 1 made technical changes to the proposed rule change. 4 15 U.S.C. 78s(b)(3)(A). 5 17 CFR 240.19b–4(f)(6). 6 17 CFR 240.19b–4(f)(6)(iii). 2 17 PO 00000 Frm 00095 Fmt 4703 Sfmt 4703 4901. 3909 Definitions (a) through (h) No Change. (i) The term ‘‘Participant’’ shall mean an NASD member that fulfills the obligations contained in Rule 4902 regarding participation in the System. Until [December 31, 2005,] February 8, 2006, the term ‘‘Participant’’ shall also include non-NASD [members] broker/ dealers that desire to use the System and otherwise meet all other requirements for System participation. (j) through (w) No Change. * * * * * II. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, Nasdaq included statements concerning the purpose of and basis for the proposed rule change, as amended, and discussed any comments it received on the proposed rule change, as amended. The text of these statements may be examined at the places specified in Item IV below. Nasdaq 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 Under current NASD Rule 4901(i), entities that are not members of the NASD may use the Brut system until December 31, 2005. Nasdaq proposes to amend this provision so as to allow nonNASD member broker-dealers to use the Brut system through February 8, 2006.7 Nasdaq notes that the continued provision of such access impacts seven current Brut broker-dealer users (four active and three inactive), which Nasdaq believes is similar to access already being provided by the Arca Trading subsidiary of the Archipelago Exchange.8 Nasdaq commits that Brut will not accept any new broker-dealer subscribers to its system that are nonNASD members during the extended 7 Nasdaq states that non-NASD member entities that are not broker-dealers will not be able to use the Brut system beyond December 31, 2005. Nasdaq states that the February 8, 2006 date was selected to coincide with the current deadline for non-NASD member broker-dealers to leave Nasdaq’s INET Facility. See Securities Exchange Act Release No. 52902 (December 7, 2005); 70 FR 73810 (December 13, 2005) (SR–NASD–2005–128). Nasdaq states that the INET Facility is expected to be merged into the Brut broker-dealer in the near future. 8 See Securities Exchange Act Release No. 52497 (September 22, 2005); 70 FR 56949 (September 29, 2005) (SR–PCX–2005–90). E:\FR\FM\24JAN1.SGM 24JAN1 3910 Federal Register / Vol. 71, No. 15 / Tuesday, January 24, 2006 / Notices access period for current non-NASD member broker-dealer system users proposed in this filing. 2. Statutory Basis Nasdaq believes that the proposed rule change, as amended, is consistent with the provisions of section 15A of the Act,9 in general, and with section 15A(b)(6) of the Act,10 in particular, in that it is designed to promote just and equitable principles of trade, and to remove impediments to a free and open market and a national market system. B. Self-Regulatory Organization’s Statement on Burden on Competition Nasdaq does not believe that the proposed rule change, as amended, will result in 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 Written comments were neither solicited nor received. rmajette on PROD1PC67 with NOTICES1 III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The foregoing proposed rule change, as amended, is subject to section 19(b)(3)(A)(iii) of the Act 11 and Rule 19b–4(f)(6) thereunder 12 because the proposal: (i) Does not significantly affect the protection of investors or the public interest; (ii) does not impose any significant burden on competition; and (iii) does not become operative prior to 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; provided that Nasdaq has given the Commission notice of its intent to file the proposed rule change, along with a brief description and text of the proposed rule change, at least five business days prior to the date of filing of the proposed rule change, or such shorter time as designated by the Commission. Nasdaq has requested that the Commission waive the five-day prefiling requirement and the 30-day operative delay. The Commission believes that waiving the five-day prefiling requirement and the 30-day operative delay is consistent with the protection of investors and the public interest because such waiver will permit 9 15 U.S.C. 78o–3. U.S.C. 78o–3(b)(6). 11 15 U.S.C. 78s(b)(3)(A)(iii). 12 17 CFR 240.19b–4(f)(6). 10 15 VerDate Aug<31>2005 14:44 Jan 23, 2006 Jkt 208001 current non-NASD member brokerdealers continued access to the Brut system without disruption. In addition, the Commission notes that the proposed rule’s February 8, 2006 date matches the date for which non-NASD members are required to leave Nasdaq’s INET facility. For these reasons, the Commission designates the proposed rule change, as amended, to be effective and operative upon filing with the Commission.13 At any time within 60 days of the filing of such proposed rule change, as amended, 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.14 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–NASD–2006–002 on the subject line. Paper Comments • Send paper comments in triplicate to Nancy M. Morris, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549–9303. All submissions should refer to File Number SR–NASD–2006–002. 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 13 For 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). 14 The effective date of the original proposed rule change is January 3, 2006 and the effective date of Amendment No. 1 is January 12, 2006. 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 January 12, 2006, the date on which the Exchange submitted Amendment No. 1. See 15 U.S.C. 78s(b)(3)(C). PO 00000 Frm 00096 Fmt 4703 Sfmt 4703 amendments, all written statements with respect to the proposed rule change, as amended, 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 NASD. 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–NASD–2006–002 and should be submitted on or before February 14, 2006. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.15 Jill M. Peterson, Assistant Secretary. [FR Doc. E6–777 Filed 1–23–06; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–53117; File No. SR–PCX– 2005–87] Self-Regulatory Organizations; Pacific Exchange, Inc.; Order Approving Proposed Rule Change, and Amendment No. 1 Thereto, Relating to the Tracking Order Process January 13, 2006. I. Introduction On July 26, 2005, the Pacific Exchange, Inc. (‘‘PCX’’ or ‘‘Exchange’’), through its wholly-owned subsidiary PCX Equities, Inc. (‘‘PCXE’’), 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 replace the existing PCXE rules describing its current tracking order process (‘‘Tracking Order Process’’) 3 with new provisions for the Tracking Order Process. The PCX filed Amendment No. 1 to the proposed rule 15 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 See PCXE Rule 7.37(c). 1 15 E:\FR\FM\24JAN1.SGM 24JAN1

Agencies

[Federal Register Volume 71, Number 15 (Tuesday, January 24, 2006)]
[Notices]
[Pages 3909-3910]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-777]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-53111; File No. SR-NASD-2006-002]


Self-Regulatory Organizations; National Association of Securities 
Dealers, Inc.; Notice of Filing and Immediate Effectiveness of Proposed 
Rule Change and Amendment No. 1 Thereto Related to Non-NASD Member 
Broker-Dealer Access to Nasdaq's Brut Facility

January 12, 2006.
    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 January 3, 2006, the National Association of Securities Dealers, 
Inc. (``NASD''), through its subsidiary, The Nasdaq Stock Market, Inc. 
(``Nasdaq''), 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 Nasdaq. On January 12, 
2006, Nasdaq submitted Amendment No. 1 to the proposed rule change.\3\ 
Nasdaq has filed the proposal pursuant to section 19(b)(3)(A) of the 
Act \4\ and Rule 19b-4(f)(6) thereunder,\5\ which renders the proposal 
effective upon filing with the Commission. 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\ Amendment No. 1 made technical changes to the proposed rule 
change.
    \4\ 15 U.S.C. 78s(b)(3)(A).
    \5\ 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

    Nasdaq proposes to continue to provide, through February 8, 2006, 
broker-dealers that are not members of the NASD access to Nasdaq's Brut 
facility. Nasdaq states that it would implement the proposed rule 
change, as amended, immediately. Nasdaq has designated this proposal as 
non-controversial and has requested that the Commission waive the five-
day pre-filing requirement and the 30-day pre-operative waiting period 
contained in Rule 19b-4(f)(6)(iii) under the Act.\6\
---------------------------------------------------------------------------

    \6\ 17 CFR 240.19b-4(f)(6)(iii).
---------------------------------------------------------------------------

    The text of the proposed rule change, as amended, is below. 
Proposed new language is italicized; proposed deletions are in 
[brackets].
* * * * *

4901. Definitions

    (a) through (h) No Change.
    (i) The term ``Participant'' shall mean an NASD member that 
fulfills the obligations contained in Rule 4902 regarding participation 
in the System. Until [December 31, 2005,] February 8, 2006, the term 
``Participant'' shall also include non-NASD [members] broker/dealers 
that desire to use the System and otherwise meet all other requirements 
for System participation.
    (j) through (w) No Change.
* * * * *

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

    In its filing with the Commission, Nasdaq included statements 
concerning the purpose of and basis for the proposed rule change, as 
amended, and discussed any comments it received on the proposed rule 
change, as amended. The text of these statements may be examined at the 
places specified in Item IV below. Nasdaq 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
    Under current NASD Rule 4901(i), entities that are not members of 
the NASD may use the Brut system until December 31, 2005. Nasdaq 
proposes to amend this provision so as to allow non-NASD member broker-
dealers to use the Brut system through February 8, 2006.\7\ Nasdaq 
notes that the continued provision of such access impacts seven current 
Brut broker-dealer users (four active and three inactive), which Nasdaq 
believes is similar to access already being provided by the Arca 
Trading subsidiary of the Archipelago Exchange.\8\ Nasdaq commits that 
Brut will not accept any new broker-dealer subscribers to its system 
that are non-NASD members during the extended

[[Page 3910]]

access period for current non-NASD member broker-dealer system users 
proposed in this filing.
---------------------------------------------------------------------------

    \7\ Nasdaq states that non-NASD member entities that are not 
broker-dealers will not be able to use the Brut system beyond 
December 31, 2005. Nasdaq states that the February 8, 2006 date was 
selected to coincide with the current deadline for non-NASD member 
broker-dealers to leave Nasdaq's INET Facility. See Securities 
Exchange Act Release No. 52902 (December 7, 2005); 70 FR 73810 
(December 13, 2005) (SR-NASD-2005-128). Nasdaq states that the INET 
Facility is expected to be merged into the Brut broker-dealer in the 
near future.
    \8\ See Securities Exchange Act Release No. 52497 (September 22, 
2005); 70 FR 56949 (September 29, 2005) (SR-PCX-2005-90).
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2. Statutory Basis
    Nasdaq believes that the proposed rule change, as amended, is 
consistent with the provisions of section 15A of the Act,\9\ in 
general, and with section 15A(b)(6) of the Act,\10\ in particular, in 
that it is designed to promote just and equitable principles of trade, 
and to remove impediments to a free and open market and a national 
market system.
---------------------------------------------------------------------------

    \9\ 15 U.S.C. 78o-3.
    \10\ 15 U.S.C. 78o-3(b)(6).
---------------------------------------------------------------------------

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

    Nasdaq does not believe that the proposed rule change, as amended, 
will result in 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

    Written comments were neither solicited nor received.

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

    The foregoing proposed rule change, as amended, is subject to 
section 19(b)(3)(A)(iii) of the Act \11\ and Rule 19b-4(f)(6) 
thereunder \12\ because the proposal: (i) Does not significantly affect 
the protection of investors or the public interest; (ii) does not 
impose any significant burden on competition; and (iii) does not become 
operative prior to 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; provided that Nasdaq has given 
the Commission notice of its intent to file the proposed rule change, 
along with a brief description and text of the proposed rule change, at 
least five business days prior to the date of filing of the proposed 
rule change, or such shorter time as designated by the Commission.
---------------------------------------------------------------------------

    \11\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \12\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

    Nasdaq has requested that the Commission waive the five-day pre-
filing requirement and the 30-day operative delay. The Commission 
believes that waiving the five-day pre-filing requirement and the 30-
day operative delay is consistent with the protection of investors and 
the public interest because such waiver will permit current non-NASD 
member broker-dealers continued access to the Brut system without 
disruption. In addition, the Commission notes that the proposed rule's 
February 8, 2006 date matches the date for which non-NASD members are 
required to leave Nasdaq's INET facility. For these reasons, the 
Commission designates the proposed rule change, as amended, to be 
effective and operative upon filing with the Commission.\13\
---------------------------------------------------------------------------

    \13\ For 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 such proposed rule 
change, as amended, 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.\14\
---------------------------------------------------------------------------

    \14\ The effective date of the original proposed rule change is 
January 3, 2006 and the effective date of Amendment No. 1 is January 
12, 2006. 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 January 12, 2006, the date on 
which the Exchange submitted Amendment No. 1. See 15 U.S.C. 
78s(b)(3)(C).
---------------------------------------------------------------------------

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 rule-comments@sec.gov. Please include 
File Number SR-NASD-2006-002 on the subject line.

Paper Comments

     Send paper comments in triplicate to Nancy M. Morris, 
Secretary, Securities and Exchange Commission, 100 F Street, NE., 
Washington, DC 20549-9303.
All submissions should refer to File Number SR-NASD-2006-002. 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, as 
amended, 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 NASD. 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-NASD-2006-002 and should be 
submitted on or before February 14, 2006.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\15\
---------------------------------------------------------------------------

    \15\ 17 CFR 200.30-3(a)(12).
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Jill M. Peterson,
Assistant Secretary.
 [FR Doc. E6-777 Filed 1-23-06; 8:45 am]
BILLING CODE 8010-01-P