Self-Regulatory Organizations; Boston Stock Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change and Amendment No. 1 Thereto Amending Section 5 (Obligations of Market Makers) of Chapter VI of the Rules of the Boston Options Exchange for Clarification Purposes Regarding the Guaranteed Directed Order, 35735-35736 [E7-12604]

Agencies

• SECURITIES AND EXCHANGE COMMISSION

[Federal Register Volume 72, Number 125 (Friday, June 29, 2007)]
[Notices]
[Pages 35735-35736]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-12604]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-55945; File No. SR-BSE-2007-23]


Self-Regulatory Organizations; Boston Stock Exchange, Inc.; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change 
and Amendment No. 1 Thereto Amending Section 5 (Obligations of Market 
Makers) of Chapter VI of the Rules of the Boston Options Exchange for 
Clarification Purposes Regarding the Guaranteed Directed Order

June 22, 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 June 1, 2007, the Boston Stock Exchange, Inc. (``BSE'' 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 the Exchange. 
BSE 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) \4\ 
thereunder, which renders the proposal effective upon filing with the 
Commission. On June 21, 2007, BSE filed Amendment No. 1 to the proposed 
rule change. The Commission is publishing this notice to solicit 
comments on the proposed rule change, as amended, from interested 
persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A).
    \4\ 17 CFR 240.19b-4(f)(6).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange is proposing to amend Section 5 (Obligations of Market 
Makers) of Chapter VI of the Rules of the Boston Options Exchange 
(``BOX Rules'') for clarification purposes regarding the Guaranteed 
Directed Order (``GDO''). The text of the proposed rule is available at 
the Exchange, the Commission's Public Reference Room, and on the 
Exchange's Web site (https://www.bostonstock.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, BSE 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 Exchange is proposing to amend Section 5 (Obligations of Market 
Makers) of Chapter VI of the BOX Rules \5\ to clarify that the GDO is 
exposed for one time period with an NBBO filter at the end of the 
exposition. The section of the BOX Rules which discusses the GDO 
contains a cross reference to Chapter V, Section 16(b). The Exchange 
proposes to extend the cross reference and numbering to reflect the 
specific subsection of the corresponding BOX Rule so that the 
Exchange's rules are accurate, comprehendible, and transparent to the 
marketplace. The GDO exposure time is not affected by this filing and 
remains three seconds, as set forth in Chapter VI, Section 5 of the BOX 
Rules.
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    \5\ Specifically, the Exchange is amending Chapter VI, Section 
5(c)(iii)(2)(b)(5) of the BOX Rules. Telephone conversation between 
Terri Evans, Special Counsel, Division of Market Regulation, 
Commission, and Brian Donnelly, AVP Regulation and Compliance, BSE, 
on June 21, 2007 (clarifying the specific rule being amended by the 
proposed rule change as described in Amendment No. 1).
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2. Statutory Basis
    The Exchange believes that the proposal is consistent with the 
requirements of Section 6(b) of the Act,\6\ in general, and Section 
6(b)(5) of the Act,\7\ in particular, in that it is designed to promote 
just and equitable principles of trade, and to protect investors and 
the public interest.
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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 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 comments on the 
proposed rule change.

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

    Because the foregoing proposed rule change does not (i) 
significantly affect the protection of investors or the public 
interest; (ii) impose any significant burden on competition; and (iii) 
become operative for 30 days after the date of the filing, or such 
shorter time as the Commission may designate if consistent with the 
protection of investors and the public interest, it has become 
effective pursuant to Section 19(b)(3)(A) of the Act \8\ and Rule 19b-
4(f)(6) \9\ thereunder.\10\
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    \8\ 15 U.S.C. 78s(b)(3)(A).
    \9\ 17 CFR 240.19b-4(f)(6).
    \10\ BSE provided the Commission with written notice of its 
intent to file the proposed rule change. See Section 19(b)(3)(A) of 
the Act, and Rule 19b-4(f)(6)(iii) thereunder. 15 U.S.C. 
78s(b)(3)(A), 17 CFR 240.19b-4(f)(6)(iii).
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    The Exchange has requested that the Commission waive the 30-day 
operative delay. The Commission believes waiving the 30-day operative 
delay is consistent with the protection of investors and the public 
interest. The Commission notes that the proposed rule change provides 
greater specificity as to a cross-reference within a rule, thereby 
avoiding confusion resulting from an incomplete cross-reference. 
Accordingly, the Commission designates the proposal to be operative 
upon filing with the Commission.\11\ At any time within 60 days of the 
filing of the proposed rule change, the Commission may summarily 
abrogate such rule change if it appears to the Commission that such 
action is necessary or appropriate in the public interest, for the 
protection of investors, or otherwise in furtherance of the purposes of 
the Act.\12\
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    \11\ For purposes only of waiving the 30-day operative delay of 
the proposal, the Commission has considered the proposed rule's 
impact on efficiency, competition and capital formation. 15 U.S.C. 
78c(f).
    \12\ 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 June 21, 2007, the date on which 
BSE submitted Amendment No. 1. See 15 U.S.C. 78s(b)(3)(C).
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IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing,

[[Page 35736]]

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-BSE-2007-23 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-BSE-2007-23. 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, 100 F Street, NE., 
Washington, DC 20549, on official business days between the hours of 10 
a.m. and 3 p.m. Copies of such filing also will be available for 
inspection and copying at the principal office of BSE. 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-BSE-2007-23 and should be 
submitted on or before July 20, 2007.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\13\
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    \13\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
 [FR Doc. E7-12604 Filed 6-28-07; 8:45 am]
BILLING CODE 8010-01-P