Self-Regulatory Organizations; International Securities Exchange, LLC; Notice of Filing of Proposed Rule Change as Modified by Amendment No. 1 Thereto Relating to a Quote Mitigation Plan for Competitive Market Makers, 44903-44904 [E7-15549]

Download as PDF Federal Register / Vol. 72, No. 153 / Thursday, August 9, 2007 / Notices All submissions should refer to File Number SR–FICC–2007–07. 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, on official business days between the hours of 10 a.m. and 3 p.m. Copies of such filings also will be available for inspection and copying at the principal office of FICC and on FICC’s Web site at http://ficc.com/ commondocs/rule.filings/rule.filing.0707.pdf. 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–FICC–2007–07 and should be submitted on or before August 30, 2007. For the Commission by the Division of Market Regulation, pursuant to delegated authority.9 Florence E. Harmon, Deputy Secretary. [FR Doc. E7–15542 Filed 8–8–07; 8:45 am] (‘‘Act’’),1 and Rule 19b–4 thereunder,2 notice is hereby given that on June 8, 2007, the International Securities Exchange, LLC (‘‘ISE’’ 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 substantially prepared by the ISE. On August 1, 2007, the Exchange filed Amendment No. 1 to the proposed rule change.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 ISE proposes, on a one-year pilot basis, a quote mitigation plan for the Exchange’s Competitive Market Makers (‘‘CMMs’’). The text of the proposed rule change is available at ISE, the Commission’s Public Reference Room, and http://www.iseoptions.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, the ISE 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 BILLING CODE 8010–01–P 1. Purpose SECURITIES AND EXCHANGE COMMISSION mstockstill on PROD1PC66 with NOTICES [Release No. 34–56201; File No. SR–ISE– 2007–45] Self-Regulatory Organizations; International Securities Exchange, LLC; Notice of Filing of Proposed Rule Change as Modified by Amendment No. 1 Thereto Relating to a Quote Mitigation Plan for Competitive Market Makers August 3, 2007. Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 9 17 CFR 200.30–3(a)(12). VerDate Aug<31>2005 18:25 Aug 08, 2007 Jkt 211001 The Exchange is proposing a quote mitigation plan for its CMMs on a pilot basis for one (1) year in no more than twenty (20) securities (‘‘Pilot Program Securities’’) designated by the Exchange. With the explosion of quotation traffic—exacerbated by the penny pilot—the Exchange continues to seek ways to mitigate the generation of quotations. At least two exchanges have adopted quote mitigation plans that relieve some market makers of the obligation to quote in every series of 1 15 U.S.C. 78s(b)(1). CFR 240.19b–4. 3 Amendment No. 1 replaced the original filing in its entirety. 2 17 PO 00000 Frm 00085 Fmt 4703 Sfmt 4703 44903 every class of options in which they are a market maker.4 Under ISE’s current rules, a CMM must enter continuous quotations in all the series of at least 60 percent of the options classes for the group or ‘‘bin’’ to which it is appointed, or 60 options classes in the Group, whichever is less. Further, once a CMM enters a quote in an options class to which it is appointed, it must continuously quote in all series of that options class until the close of trading that day. ISE proposes to amend its rule so that a CMM will be required to enter continuous quotations in just 60 percent of the series, rather than in all series, of the options classes overlying the Pilot Program Securities, to which the CMM is appointed. Once a CMM enters a quote in a series, it must continue to quote in that series until the close of trading that day. The Exchange notes that ISE Rule 804(e)(2)(iii), which states that a CMM may be called upon to submit quotes in one or more series of options to which it is appointed in the interest of maintaining fair and orderly markets, shall continue to apply under the proposed pilot program. Under the proposal, the Exchange will issue a circular to CMMs identifying the initial Pilot Program Securities. The Exchange notes that the Pilot Program Securities selected by the Exchange are subject to change based on the quoting activity in these securities. The proposed pilot will consist of up to 20 of the most active classes, in terms of the number of quotes generated, that are in the Exchange’s Penny Pilot Program.5 Each time a change takes place in the Pilot Program Securities, the Exchange will issue circulars to notify CMMs of this change and shall provide them with adequate notice in order for them to make any required systems changes. The Exchange believes the proposed pilot is a good first step towards adopting an internal quote mitigation plan that is beneficial both to the Exchange and its members without adversely affecting the quality of the Exchange’s markets. 2. Statutory Basis The Exchange believes that 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) 4 See Phlx Rule 1014(b)(ii)(D)(1); see also Amex Rule 994(c)(iv). 5 See Securities Exchange Act Release Nos. 55161 (January 24, 2007), 72 FR 4754 (February 1, 2007) (SR–ISE–2006–62); 56151 (July 26, 2007), 72 FRlll (August lll, 2007) (SR–ISE–2007–68). 6 15 U.S.C. 78f(b). E:\FR\FM\09AUN1.SGM 09AUN1 44904 Federal Register / Vol. 72, No. 153 / Thursday, August 9, 2007 / Notices of the Act,7 in particular, in that it is designed to prevent fraudulent and manipulative acts and practices, 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 Written comments on the proposed rule change were neither solicited nor received. 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 Exchange 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 is consistent with the Act. Comments may be submitted by any of the following methods: mstockstill on PROD1PC66 with NOTICES 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 No. SR–ISE–2007–45 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 No. SR–ISE–2007–45. 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 at 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, 100 F Street, NE., Washington, DC 20549, on official business days between the hours of 10 a.m. and 3 p.m. Copies of the 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 No. SR–ISE–2007–45 and should be submitted on or before August 30, 2007. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.8 Florence E. Harmon, Deputy Secretary. [FR Doc. E7–15549 Filed 8–8–07; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–56195; File No. SR–NYSE– 2007–71] Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change to Exclude from Its Earnings Standard Gains or Losses From Extinguishment of Debt Prior to Maturity on a Six Month Pilot Basis August 2, 2007. Pursuant to section 19(b)(1)1 of the Securities Exchange Act of 1934 (the ‘‘Exchange Act’’),2 and Rule 19b–4 I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to amend the earnings standard of section 102.01C(I) of the Exchange’s Listed Company Manual (the ‘‘Manual’’) on a six-month pilot program basis. The amendment will enable the Exchange to adjust the earnings of companies for purposes of its pre-tax earnings standard by excluding gains or losses recognized in connection with the extinguishment of debt prior to its maturity. The text of the proposed rule change is available on the Exchange’s Web site (http:// www.nyse.com), at the Exchange’s Office of the Secretary, and at the Commission’s Public Reference Room. 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 Exchange proposes to amend the earnings standard of section 102.01C(I) of the Manual on a six-month pilot U.S.C. 78f(b)(5). VerDate Aug<31>2005 18:37 Aug 08, 2007 Jkt 211001 8 17 3 17 1 15 7 15 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 15 U.S.C. 78a. thereunder,3 notice is hereby given that on July 27, 2007, the New York Stock Exchange LLC (the ‘‘NYSE’’ or the ‘‘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. The Exchange has designated the proposed rule change as a ‘‘noncontroversial’’ rule change pursuant to section 19(b)(3)(A) of the Act4 and Rule 19b–4(f)(6) thereunder,5 which renders the proposed rule change effective upon filing with the Commission. The Commission is publishing this notice to solicit comments on the proposed rule changes from interested persons. 4 15 PO 00000 Frm 00086 Fmt 4703 CFR 240.19b–4. U.S.C. 78s(b)(3)(A). 5 17 CFR 240.19b–4(f)(6). Sfmt 4703 E:\FR\FM\09AUN1.SGM 09AUN1

Agencies

[Federal Register Volume 72, Number 153 (Thursday, August 9, 2007)]
[Notices]
[Pages 44903-44904]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-15549]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-56201; File No. SR-ISE-2007-45]


Self-Regulatory Organizations; International Securities Exchange, 
LLC; Notice of Filing of Proposed Rule Change as Modified by Amendment 
No. 1 Thereto Relating to a Quote Mitigation Plan for Competitive 
Market Makers

August 3, 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 8, 2007, the International Securities Exchange, LLC (``ISE'' 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 substantially prepared by the ISE. 
On August 1, 2007, the Exchange filed Amendment No. 1 to the proposed 
rule change.\3\ 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 replaced the original filing in its 
entirety.
---------------------------------------------------------------------------

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

    The ISE proposes, on a one-year pilot basis, a quote mitigation 
plan for the Exchange's Competitive Market Makers (``CMMs''). The text 
of the proposed rule change is available at ISE, the Commission's 
Public Reference Room, and http://www.iseoptions.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, the ISE 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 a quote mitigation plan for its CMMs on a 
pilot basis for one (1) year in no more than twenty (20) securities 
(``Pilot Program Securities'') designated by the Exchange. With the 
explosion of quotation traffic--exacerbated by the penny pilot--the 
Exchange continues to seek ways to mitigate the generation of 
quotations. At least two exchanges have adopted quote mitigation plans 
that relieve some market makers of the obligation to quote in every 
series of every class of options in which they are a market maker.\4\
---------------------------------------------------------------------------

    \4\ See Phlx Rule 1014(b)(ii)(D)(1); see also Amex Rule 
994(c)(iv).
---------------------------------------------------------------------------

    Under ISE's current rules, a CMM must enter continuous quotations 
in all the series of at least 60 percent of the options classes for the 
group or ``bin'' to which it is appointed, or 60 options classes in the 
Group, whichever is less. Further, once a CMM enters a quote in an 
options class to which it is appointed, it must continuously quote in 
all series of that options class until the close of trading that day. 
ISE proposes to amend its rule so that a CMM will be required to enter 
continuous quotations in just 60 percent of the series, rather than in 
all series, of the options classes overlying the Pilot Program 
Securities, to which the CMM is appointed. Once a CMM enters a quote in 
a series, it must continue to quote in that series until the close of 
trading that day. The Exchange notes that ISE Rule 804(e)(2)(iii), 
which states that a CMM may be called upon to submit quotes in one or 
more series of options to which it is appointed in the interest of 
maintaining fair and orderly markets, shall continue to apply under the 
proposed pilot program.
    Under the proposal, the Exchange will issue a circular to CMMs 
identifying the initial Pilot Program Securities. The Exchange notes 
that the Pilot Program Securities selected by the Exchange are subject 
to change based on the quoting activity in these securities. The 
proposed pilot will consist of up to 20 of the most active classes, in 
terms of the number of quotes generated, that are in the Exchange's 
Penny Pilot Program.\5\ Each time a change takes place in the Pilot 
Program Securities, the Exchange will issue circulars to notify CMMs of 
this change and shall provide them with adequate notice in order for 
them to make any required systems changes.
---------------------------------------------------------------------------

    \5\ See Securities Exchange Act Release Nos. 55161 (January 24, 
2007), 72 FR 4754 (February 1, 2007) (SR-ISE-2006-62); 56151 (July 
26, 2007), 72 FR------ (August ------, 2007) (SR-ISE-2007-68).
---------------------------------------------------------------------------

    The Exchange believes the proposed pilot is a good first step 
towards adopting an internal quote mitigation plan that is beneficial 
both to the Exchange and its members without adversely affecting the 
quality of the Exchange's markets.
2. Statutory Basis
    The Exchange believes that 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)

[[Page 44904]]

of the Act,\7\ in particular, in that it is designed to prevent 
fraudulent and manipulative acts and practices, 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.
---------------------------------------------------------------------------

    \6\ 15 U.S.C. 78f(b).
    \7\ 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

    Written comments on the proposed rule change were neither solicited 
nor received.

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 Exchange 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 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 No. SR-ISE-2007-45 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 No. SR-ISE-2007-45. 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 at 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, 100 F Street, NE., 
Washington, DC 20549, on official business days between the hours of 10 
a.m. and 3 p.m. Copies of the 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 No. SR-ISE-2007-45 and should be 
submitted on or before August 30, 2007.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\8\
---------------------------------------------------------------------------

    \8\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Florence E. Harmon,
Deputy Secretary.
 [FR Doc. E7-15549 Filed 8-8-07; 8:45 am]
BILLING CODE 8010-01-P