Self-Regulatory Organizations; National Stock Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Extend the Effective Period for Rule 2.12 Regarding Third-Party Routing Services in Respect of Orders Entered Into NSX BLADE, 19732-19733 [E7-7422]
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19732
Federal Register / Vol. 72, No. 75 / Thursday, April 19, 2007 / Notices
SECURITIES AND EXCHANGE
COMMISSION
and C below, of the most significant
aspects of such statements.
[Release No. 34–55624; File No. SR–NSX–
2007–04]
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
Self-Regulatory Organizations;
National Stock Exchange, Inc.; Notice
of Filing and Immediate Effectiveness
of Proposed Rule Change To Extend
the Effective Period for Rule 2.12
Regarding Third-Party Routing
Services in Respect of Orders Entered
Into NSX BLADE
April 12, 2007.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’) 1 and Rule 19b–4 thereunder,2
notice is hereby given that on April 3,
2007, the National Stock Exchange, Inc.
(‘‘NSX’’ 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
substantially prepared by NSX. The
Exchange has filed the proposal as a
‘‘non-controversial’’ rule change
pursuant to Section 19(b)(3)(A) of the
Act 3 and Rule 19b–4(f)(6) thereunder,4
which renders it effective upon filing
with the Commission. The Commission
is publishing this notice to solicit
comments on the proposed rule change
from interested persons.
cprice-sewell on PROD1PC66 with NOTICES
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange is proposing to extend
the effective period for Rule 2.12, which
describes the terms under which the
Exchange provides routing services
procured from a third party with respect
to orders entered into its new state of
the art trading system, NSX BLADE. The
text of the proposed rule change is
available at NSX, the Commission’s
Public Reference Room, and https://
www.nsx.com.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission,
NSX 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. NSX has prepared
summaries, set forth in Sections A, B,
1 15
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 15 U.S.C. 78s(b)(3)(A).
4 17 CFR 240.19b–4(f)(6).
2 17
VerDate Aug<31>2005
15:39 Apr 18, 2007
Jkt 211001
1. Purpose
The Exchange is proposing to amend
Exchange Rules 2.11 and 2.12 to extend
the effective period for Rule 2.12
(relating to the Exchange’s use of a third
party to provide outbound routing of
orders from the Exchange to other
trading centers (‘‘Routing Services’’))
through June 30, 2007, and to delay the
effectiveness of Rule 2.11 (relating to the
outbound routing function of the
Exchange’s affiliate, NSX Securities,
LLC (‘‘NSX Securities’’)) until July 1,
2007.
Rule 2.11 provides for certain terms
and conditions under which NSX
Securities, an affiliate of the Exchange,
will provide Routing Services. Rule 2.11
was approved by the Commission in
connection with the approval of the
Exchange’s new trading rules relating to
NSX BLADE on August 31, 2006.5 The
Exchange subsequently filed and
received approval for the addition of
Rule 2.12, which provides for terms and
conditions of the Exchange’s use of a
third party to provide Routing Services.6
Rule 2.12 currently provides that it is
effective through February 28, 2007,
with Rule 2.11 becoming effective on
March 1, 2007. In connection with the
rule filing adding Rule 2.12,7 the
Exchange requested this finite period of
effectiveness so that the Exchange could
offer routing services through NSX
BLADE while NSX Securities completed
its registration process as a brokerdealer with the National Association of
Securities Dealers, Inc. (and thus
became available to provide routing
services),8 and while the Exchange
evaluated its options for providing
routing services to ETP Holders.
In the instant rule filing, the Exchange
is proposing to extend the effectiveness
of Rule 2.12 through June 30, 2007, and
to delay the effectiveness of Rule 2.11
until July 1, 2007, in order to allow the
Exchange more time to evaluate its
options for providing routing services to
5 See Securities Exchange Act Release No. 54391
(August 31, 2006), 71 FR 52836 (September 7, 2006)
(SR–NSX–2006–08).
6 See Securities Exchange Act Release No. 54808
(November 21, 2006), 71 FR 69163 (November 29,
2006) (SR–NSX–2006–15).
7 Id.
8 In January 2007, NSX Securities’ application for
registration as a broker-dealer was approved by the
National Association of Securities Dealers, Inc. As
of March 1, 2007, the Exchange had not yet begun
using NSX Securities for routing services.
PO 00000
Frm 00054
Fmt 4703
Sfmt 4703
ETP Holders. The ability to route orders
entered into NSX BLADE to away
markets for execution at the best
available prices is a key feature of NSX’s
new system.
The Exchange intends to provide
routing services in accordance with
Rule 2.12 until June 30, 2007, unless the
Exchange, with the Commission’s
approval, amends Rule 2.12 before such
date. During such time period, the
Exchange intends to evaluate its options
for providing routing services. At the
conclusion of such time period, the
Exchange may decide to (i) Continue the
approach provided for in Rule 2.12 on
a permanent basis, and not use NSX
Securities as the outbound router (by
filing a proposed rule change to delete
Rule 2.11 and renumbering Rule 2.12);
(ii) use the Exchange’s original approach
of NSX Securities as an outbound router
and discontinue the approach provided
for in Rule 2.12 (by filing a proposed
rule change to delete Rule 2.12) or (iii)
file a proposed rule change to allow ETP
Holders to use either NSX Securities or
the approach provided for in proposed
Rule 2.12 for outbound routing.
2. Statutory Basis
NSX believes the proposed rule
change is consistent with Section 6(b) of
the Act,9 in general, and furthers the
objectives of Section 6(b)(5) of the Act,10
in particular, which requires, among
other things, that the rules of an
exchange be designed to promote just
and equitable principles of trade, to
remove impediments to and 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 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
No written comments were either
solicited or received.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Because the foregoing rule change
does not: (1) Significantly affect the
protection of investors or the public
9 15
U.S.C. 78f(b).
U.S.C. 78f(b)(5).
10 15
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19APN1
19733
Federal Register / Vol. 72, No. 75 / Thursday, April 19, 2007 / Notices
interest; (2) impose any significant
burden on competition; and (3) become
operative for 30 days after the date of
this filing, or such shorter time as the
Commission may designate, it has
become effective pursuant to Section
19(b)(3)(A) of the Act11 and Rule 19b–
4(f)(6) thereunder.12
A proposed rule change filed under
19b–4(f)(6) normally may not become
operative prior to 30 days after the date
of filing.13 However, Rule 19b–
4(f)(6)(iii) 14 permits the Commission to
designate a shorter time if such action
is consistent with the protection of
investors and the public interest. The
Exchange has requested that the
Commission waive the 30-day operative
delay. The Commission believes that
waiving the 30-day operative delay is
consistent with the protection of
investors and the public interest
because such waiver would permit the
Exchange to immediately update the
effective dates for NSX Rules 2.11 and
2.12. For this reason, the Commission
designates the proposed rule change to
be operative upon filing with the
Commission.15
At any time within 60 days of the
filing of such 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.
Number SR–NSX–2007–04 on the
subject line.
SECURITIES AND EXCHANGE
COMMISSION
Paper Comments
[Release No. 34–55631; File No. SR–NSX–
2006–16]
• Send paper comments in triplicate
to Nancy M. Morris, Secretary,
Securities and Exchange Commission,
100 F Street, NE., Washington, DC
20549–1090.
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:
All submissions should refer to File
Number SR–NSX–2007–04. 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 the filing also will be
available for inspection and copying at
the principal office of NSX. 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–NSX–2007–04 and should
be submitted on or before May 10, 2007.
Electronic Comments
• 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
For the Commission, by the Division of
Market Regulation, pursuant to delegated
authority.16
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E7–7422 Filed 4–18–07; 8:45 am]
11 15
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6).
13 17 CFR 240.19b–4(f)(6)(iii). In addition, Rule
19b–4(f)(6)(iii) requires that a self-regulatory
organization submit to the Commission written
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. NSX has satisfied the five-day prefiling notice requirement.
14 Id.
15 For the 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).
BILLING CODE 8010–01–P
cprice-sewell on PROD1PC66 with NOTICES
15:39 Apr 18, 2007
Jkt 211001
April 13, 2007.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (the
‘‘Act’’) 1 and Rule 19b–4 thereunder,2
notice is hereby given that on November
22, 2006, the National Stock Exchange,
Inc. (‘‘NSX’’ 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 April 9, 2007, the NSX filed
Amendment No. 1 to the proposed rule
change (‘‘Amendment No. 1’’).3 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 NSX
Rule 5.7 and accompanying
Interpretations and Policies .01 (Annual
Compliance and Supervision
Certification) to require each Equity
Trading Permit (‘‘ETP’’) Holder’s Chief
Executive Officer (‘‘CEO’’) to certify
annually to having in place a process to
establish, maintain, review, modify, and
test policies and procedures reasonably
designed to achieve compliance with
applicable Rules of the Exchange, and
federal securities laws and regulations.
The text of the proposed rule and
interpretation is set forth below.
Proposed new language is italicized.
*
*
*
*
*
CHAPTER V.
SUPERVISION
12 17
VerDate Aug<31>2005
Self-Regulatory Organizations;
National Stock Exchange, Inc.; Notice
of Filing of Proposed Rule Change and
Amendment No. 1 Thereto Regarding
the Annual Certification of Compliance
and Supervisory Processes
*
*
*
*
*
Rule 5.7. Annual Certification of
Compliance and Supervisory Processes
Each ETP Holder shall have its chief
executive officer (or equivalent officer)
certify annually, as set forth in
1 15
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 Amendment No. 1, which supplemented the
original filing, the NSX provided more information
regarding the certification process and corrected a
grammatical error.
2 17
16 17
PO 00000
CFR 200.30–3(a)(12).
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]]>Agencies
[Federal Register Volume 72, Number 75 (Thursday, April 19, 2007)]
[Notices]
[Pages 19732-19733]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-7422]
[[Page 19732]]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-55624; File No. SR-NSX-2007-04]
Self-Regulatory Organizations; National Stock Exchange, Inc.;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Extend the Effective Period for Rule 2.12 Regarding Third-Party Routing
Services in Respect of Orders Entered Into NSX BLADE
April 12, 2007.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on April 3, 2007, the National Stock Exchange, Inc. (``NSX'' 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 substantially prepared by NSX. The
Exchange has filed the proposal as a ``non-controversial'' rule change
pursuant to Section 19(b)(3)(A) of the Act \3\ and Rule 19b-4(f)(6)
thereunder,\4\ which renders it 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\ 15 U.S.C. 78s(b)(3)(A).
\4\ 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 is proposing to extend the effective period for Rule
2.12, which describes the terms under which the Exchange provides
routing services procured from a third party with respect to orders
entered into its new state of the art trading system, NSX BLADE. The
text of the proposed rule change is available at NSX, the Commission's
Public Reference Room, and https://www.nsx.com.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, NSX 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. NSX 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 Exchange is proposing to amend Exchange Rules 2.11 and 2.12 to
extend the effective period for Rule 2.12 (relating to the Exchange's
use of a third party to provide outbound routing of orders from the
Exchange to other trading centers (``Routing Services'')) through June
30, 2007, and to delay the effectiveness of Rule 2.11 (relating to the
outbound routing function of the Exchange's affiliate, NSX Securities,
LLC (``NSX Securities'')) until July 1, 2007.
Rule 2.11 provides for certain terms and conditions under which NSX
Securities, an affiliate of the Exchange, will provide Routing
Services. Rule 2.11 was approved by the Commission in connection with
the approval of the Exchange's new trading rules relating to NSX BLADE
on August 31, 2006.\5\ The Exchange subsequently filed and received
approval for the addition of Rule 2.12, which provides for terms and
conditions of the Exchange's use of a third party to provide Routing
Services.\6\
---------------------------------------------------------------------------
\5\ See Securities Exchange Act Release No. 54391 (August 31,
2006), 71 FR 52836 (September 7, 2006) (SR-NSX-2006-08).
\6\ See Securities Exchange Act Release No. 54808 (November 21,
2006), 71 FR 69163 (November 29, 2006) (SR-NSX-2006-15).
---------------------------------------------------------------------------
Rule 2.12 currently provides that it is effective through February
28, 2007, with Rule 2.11 becoming effective on March 1, 2007. In
connection with the rule filing adding Rule 2.12,\7\ the Exchange
requested this finite period of effectiveness so that the Exchange
could offer routing services through NSX BLADE while NSX Securities
completed its registration process as a broker-dealer with the National
Association of Securities Dealers, Inc. (and thus became available to
provide routing services),\8\ and while the Exchange evaluated its
options for providing routing services to ETP Holders.
---------------------------------------------------------------------------
\7\ Id.
\8\ In January 2007, NSX Securities' application for
registration as a broker-dealer was approved by the National
Association of Securities Dealers, Inc. As of March 1, 2007, the
Exchange had not yet begun using NSX Securities for routing
services.
---------------------------------------------------------------------------
In the instant rule filing, the Exchange is proposing to extend the
effectiveness of Rule 2.12 through June 30, 2007, and to delay the
effectiveness of Rule 2.11 until July 1, 2007, in order to allow the
Exchange more time to evaluate its options for providing routing
services to ETP Holders. The ability to route orders entered into NSX
BLADE to away markets for execution at the best available prices is a
key feature of NSX's new system.
The Exchange intends to provide routing services in accordance with
Rule 2.12 until June 30, 2007, unless the Exchange, with the
Commission's approval, amends Rule 2.12 before such date. During such
time period, the Exchange intends to evaluate its options for providing
routing services. At the conclusion of such time period, the Exchange
may decide to (i) Continue the approach provided for in Rule 2.12 on a
permanent basis, and not use NSX Securities as the outbound router (by
filing a proposed rule change to delete Rule 2.11 and renumbering Rule
2.12); (ii) use the Exchange's original approach of NSX Securities as
an outbound router and discontinue the approach provided for in Rule
2.12 (by filing a proposed rule change to delete Rule 2.12) or (iii)
file a proposed rule change to allow ETP Holders to use either NSX
Securities or the approach provided for in proposed Rule 2.12 for
outbound routing.
2. Statutory Basis
NSX believes the proposed rule change is consistent with Section
6(b) of the Act,\9\ in general, and furthers the objectives of Section
6(b)(5) of the Act,\10\ in particular, which requires, among other
things, that the rules of an exchange be designed to promote just and
equitable principles of trade, to remove impediments to and perfect the
mechanism of a free and open market and a national market system, and,
in general, to protect investors and the public interest.
---------------------------------------------------------------------------
\9\ 15 U.S.C. 78f(b).
\10\ 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
No written comments were either solicited or received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Because the foregoing rule change does not: (1) Significantly
affect the protection of investors or the public
[[Page 19733]]
interest; (2) impose any significant burden on competition; and (3)
become operative for 30 days after the date of this filing, or such
shorter time as the Commission may designate, it has become effective
pursuant to Section 19(b)(3)(A) of the Act\11\ and Rule 19b-4(f)(6)
thereunder.\12\
---------------------------------------------------------------------------
\11\ 15 U.S.C. 78s(b)(3)(A).
\12\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------
A proposed rule change filed under 19b-4(f)(6) normally may not
become operative prior to 30 days after the date of filing.\13\
However, Rule 19b-4(f)(6)(iii) \14\ permits the Commission to designate
a shorter time if such action is consistent with the protection of
investors and the public interest. The Exchange has requested that the
Commission waive the 30-day operative delay. The Commission believes
that waiving the 30-day operative delay is consistent with the
protection of investors and the public interest because such waiver
would permit the Exchange to immediately update the effective dates for
NSX Rules 2.11 and 2.12. For this reason, the Commission designates the
proposed rule change to be operative upon filing with the
Commission.\15\
---------------------------------------------------------------------------
\13\ 17 CFR 240.19b-4(f)(6)(iii). In addition, Rule 19b-
4(f)(6)(iii) requires that a self-regulatory organization submit to
the Commission written 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. NSX has satisfied the five-day pre-filing notice
requirement.
\14\ Id.
\15\ For the 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 such 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 (https://
www.sec.gov/rules/sro.shtml); or
Send an e-mail to rule-comments@sec.gov. Please include
File Number SR-NSX-2007-04 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 20549-1090.
All submissions should refer to File Number SR-NSX-2007-04. 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 the filing
also will be available for inspection and copying at the principal
office of NSX. 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-NSX-
2007-04 and should be submitted on or before May 10, 2007.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\16\
---------------------------------------------------------------------------
\16\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E7-7422 Filed 4-18-07; 8:45 am]
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