Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Amending Rule 6.87-Obvious Errors and Catastrophic Errors, 60386-60388 [E8-24179]
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60386
Federal Register / Vol. 73, No. 198 / Friday, October 10, 2008 / Notices
Exchange believes that the proposed
rule change will provide more specific
continued listing criteria for securities
listed under NYSE Arca Equities Rules
5.2(j)(1) and 5.2(j)(2), and provides an
adequate minimum threshold for the
dollar principal amount of derivativelypriced securities such as those listed
under Rules 5.2(j)(1) and 5.2(j)(2) to
permit sufficient market liquidity.
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 solicited
or received with respect to the proposed
rule change.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
All submissions should refer to File
Number SR–NYSEArca–2008–104. 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 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
Number SR–NYSEArca–2008–104 and
should be submitted on or before
October 31, 2008.
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 self-regulatory
organization consents, the Commission
will:
(A) By order approve the proposed
rule change; or
(B) Institute proceedings to determine
whether the proposed rule change
should be disapproved.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.7
Florence E. Harmon,
Acting Secretary.
[FR Doc. E8–24117 Filed 10–9–08; 8:45 am]
IV. Solicitation of Comments
BILLING CODE 8011–01–P
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 (https://www.sec.gov/
rules/sro.shtml); or
• Send an e-mail to rulecomments@sec.gov. Please include File
Number SR–NYSEArca–2008–104 on
the subject line.
Paper Comments
• Send paper comments in triplicate
to Secretary, Securities and Exchange
Commission, 100 F Street, NE.,
Washington, DC 20549–1090.
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SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–58717; File No. SR–
NYSEArca–2008–106]
Self-Regulatory Organizations; NYSE
Arca, Inc.; Notice of Filing and
Immediate Effectiveness of a Proposed
Rule Change Amending Rule 6.87—
Obvious Errors and Catastrophic
Errors
October 2, 2008.
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 October
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
2, 2008, NYSE Arca, Inc. (‘‘NYSE Arca’’
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 prepared
by the self-regulatory organization.
NYSE Arca filed the proposed rule
change as a ‘‘non-controversial’’
proposal pursuant to Section 19(b)(3)(A)
of the Act 3 and Rule 19b–4(f)(6)
thereunder,4 which renders 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 amend
Rule 6.87—Obvious Errors and
Catastrophic Errors. The text of the
proposed rule change is available at the
principal office of the Exchange, the
Commission’s Public Reference Room,
and at www.nyse.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
self-regulatory organization 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 those 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 parts 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 amend
Exchange rules governing obvious and
catastrophic errors, by adding
provisions which will allow for the
nullification of trades that are a result of
either an erroneous quote, or print, in
the underlying security. Specifically,
NYSE Arca is proposing new Rule
6.87(a)(4) Erroneous Print in the
Underlying, and new Rule 6.87(a)(5)
Erroneous Quote in the Underlying.
Market participants on NYSE Arca
base the value of their quotes and orders
off of the price of underlying security.
These two proposed provisions cover
7 17
1 15
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Fmt 4703
3 15
4 17
Sfmt 4703
E:\FR\FM\10OCN1.SGM
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6).
10OCN1
Federal Register / Vol. 73, No. 198 / Friday, October 10, 2008 / Notices
instances where the information the
market participants are using to price
options is erroneous, through no fault of
their own. An erroneous quote or print
in an underlying security, which is
disseminated by the primary market 5
for that security, means that market
participants are receiving erroneous
information which they then
incorporate into trading decisions. In
these instances, market participants
have little if any chance of pricing
options accurately. In order to provide
relief from transactions that occur as a
result of these erroneous prints and/or
quotes, the Exchange proposes the
following provisions.
mstockstill on PROD1PC66 with NOTICES
Rule 6.87(a)(4) Erroneous Print in
Underlying
An electronic trade resulting from an
erroneous print disseminated by the
underlying market which is later
cancelled or corrected by that
underlying market may be nullified. In
order to be nullified, however, the trade
must be the result of an erroneous print
that is higher or lower than the average
trade in the underlying security during
a two-minute period before and after the
erroneous print by an amount at least
five times greater than the average quote
width for such underlying security
during the same period.
For purposes of this Rule, the average
trade in the underlying security shall be
determined by adding the prices of each
trade during the four minute time
period referenced above (excluding the
trade in question) and dividing by the
number of trades during such time
period (excluding the trade in question).
For purposes of this Rule, the average
quote width shall be determined by
adding the quote widths of each
separate quote during the four minute
time period referenced above (excluding
the quote in question) and dividing by
the number of quotes during such time
period (excluding the quote in
question).
Rule 6.87(a)(5) Erroneous Quote in
Underlying
Electronic trades resulting from an
erroneous quote in the underlying
security may be adjusted or nullified as
set forth in section (a)(3) of Rule 6.87.
An erroneous quote occurs when the
underlying security has a width of at
least $1.00 and has a width at least five
times greater than the average quote
width for such underlying security on
the primary market (as defined in Rule
6.1(b)(27)) during the time period
5 NYSE Arca Rule 6.1(b)(27) defines Primary
Market as the principal market in which the
underlying stock or Exchange-Traded Fund Share is
traded.
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20:11 Oct 09, 2008
Jkt 217001
encompassing two minutes before and
after the dissemination of such quote.
For purposes of this Rule, the average
quote width shall be determined by
adding the quote widths of each
separate quote during the four minute
time period referenced above (excluding
the quote in question) and dividing by
the number of quotes during such time
period (excluding the quote in question)
and dividing by the number of quotes
during such time period (excluding the
quote in question).
These proposed rule changes will
provide market participants on NYSE
Arca the same opportunities for price
adjustment or trade nullification that are
available on other options exchanges.
The Exchange notes that these
provisions are similar in all respects to
rules already approved for use at The
Chicago Board Options Exchange
(‘‘CBOE’’) 6 and The American Stock
Exchange (‘‘Amex’’).7
2. Statutory Basis
The Exchange believes that its
proposal is consistent with section 6(b)
of the Act,8 in general, and furthers the
objectives of section 6(b)(5) of the Act,9
in particular, in that it is designed to
prevent fraudulent and manipulative
acts and practices, promote just and
equitable principles of trade, 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. NYSE Arca believes that
this proposal is appropriate given that it
provides for the adjustment or
nullification of trades, which are
executed at clearly erroneous prices due
to no fault of the participants on the
trade.
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 solicited
or received with respect to the proposed
rule change.
6 See
CBOE Rules 6.25(a)(4)–(5).
Amex Rules 936–ANTE(a)(4)–(5).
8 15 U.S.C. 78f(b).
9 15 U.S.C. 78f(b)(5).
7 See
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60387
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule
change: (1) Does not significantly affect
the protection of investors or the public
interest; (2) does not impose any
significant burden on competition; and
(3) by its terms does not become
operative for 30 days after the date of
this 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 10 and
Rule 19b–4(f)(6) thereunder.11
A proposed rule change filed under
Rule 19b–4(f)(6) normally does not
become operative for 30 days after the
date of filing. In addition, Rule 19b–
4(f)(6)(iii) requires a self-regulatory
organization to provide the Commission
with 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. However, Rule 19b–
4(f)(6)(iii) permits the Commission to
designate a shorter time if such action
is consistent with the protection of
investors and the public interest. The
Exchange requests that the Commission
waive the 30-day operative delay as well
as the five business-day pre-filing
requirement to allow the Exchange to
immediately offer market participants
on NYSE Arca the same potential for
relief that is available at other option
exchanges, when an erroneous print, or
quote, in an underlying security occurs
on the primary market. The Exchange
argued that such flexibility is
increasingly important in light of recent
market volatility. The Commission
believes that waiving the 30-day
operative delay 12 is consistent with the
protection of investors and the public
interest.13 Given that the Exchange’s
proposed rule change is substantially
similar to the rules of other exchanges
previously approved by the
Commission,14 the proposal does not
appear to present any novel regulatory
issues. Therefore, the Commission
10 15
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6).
12 For 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).
13 The Commission is also waiving the five
business-day pre-filing requirement.
14 See Amex Rule 936–ANTE(a)(4)–(5) and CBOE
Rule 6.25(a)(4)–(5).
11 17
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60388
Federal Register / Vol. 73, No. 198 / Friday, October 10, 2008 / Notices
designates the proposal operative upon
filing.
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.
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 (https://www.sec.gov/
rules/sro.shtml); or
• Send an e-mail to rulecomments@sec.gov. Please include File
Number SR–NYSEArca–2008–106 on
the subject line.
you wish to make available publicly. All
submissions should refer to File
Number SR–NYSEArca–2008–106 and
should be submitted on or before
October 31, 2008.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.15
Florence E. Harmon,
Acting Secretary.
[FR Doc. E8–24179 Filed 10–9–08; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–58734; File No. SR–
NYSEArca–2008–105]
Self-Regulatory Organizations; NYSE
Arca, Inc.; Notice of Filing of Proposed
Rule Change Relating to Listing
Certain Derivative Products Pursuant
to Continued Listing Criteria
October 6, 2008.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (‘‘Act’’
or ‘‘Exchange Act’’) 1 and Rule 19b–4
Paper Comments
thereunder,2 notice is hereby given that
on October 1, 2008, NYSE Arca, Inc.
• Send paper comments in triplicate
(‘‘NYSE Arca’’ or ‘‘Exchange’’) filed
to Secretary, Securities and Exchange
with the Securities and Exchange
Commission, 100 F Street, NE.,
Commission (‘‘Commission’’) the
Washington, DC 20549–1090.
proposed rule change as described in
All submissions should refer to File
Items I, II, and III below, which Items
Number SR–NYSEArca–2008–106. This
have been prepared by NYSE Arca. The
file number should be included on the
Commission is publishing this notice to
subject line if e-mail is used. To help the
solicit comments on the proposed rule
Commission process and review your
change from interested persons.
comments more efficiently, please use
only one method. The Commission will I. Self-Regulatory Organization’s
post all comments on the Commission’s Statement of the Terms of Substance of
the Proposed Rule Change
Internet Web site (https://www.sec.gov/
rules/sro.shtml). Copies of the
NYSE Arca, through its wholly owned
submission, all subsequent
subsidiary NYSE Arca Equities, Inc.
amendments, all written statements
(‘‘NYSE Arca Equities’’), proposes to
with respect to the proposed rule
adopt Commentary .01 to Rule 5.2(b) to
change that are filed with the
allow NYSE Arca to list Derivative
Commission, and all written
Products (as defined in the proposed
communications relating to the
Commentary .01 to Rule 5.2(b)) that (1)
proposed rule change between the
were originally listed on another
Commission and any person, other than registered national securities exchange
those that may be withheld from the
on an initial listing basis and continue
public in accordance with the
to be listed on such other registered
provisions of 5 U.S.C. 552, will be
national securities exchange, and (2)
available for inspection and copying in
satisfy the Exchange’s continued listing
the Commission’s Public Reference
criteria. The text of the proposed rule
Room, 100 F Street, NE., Washington,
change is set forth below (new language
DC 20549, on official business days
is in italics):
between the hours of 10 a.m. and 3 p.m.
Rule 5.2(b)
Copies of the filing also will be available *
*
*
*
*
for inspection and copying at the
Commentary:
principal office of the Exchange. All
.01 The Exchange is permitted to list
comments received will be posted
any Derivative Product, as described
without change; the Commission does
not edit personal identifying
15 17 CFR 200.30–3(a)(12).
1 15 U.S.C. 78s(b)(1).
information from submissions. You
2 17 CFR 240.19b–4.
should submit only information that
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20:11 Oct 09, 2008
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Frm 00161
Fmt 4703
Sfmt 4703
below, that (1) was originally listed on
another registered national securities
exchange (‘‘Other SRO’’) and continues
to be listed on such Other SRO; and (2)
satisfies the Exchange’s continued
listing criteria that are applicable to the
product class that would include such
Derivative Product. For the purposes of
this rule, the term ‘‘Derivative Product’’
shall include securities described in
NYSE Arca Equities Rules 5.2(j)(2)
(Equity Linked Notes); 5.2(j)(3)
(Investment Company Units); 5.2(j)(4)
(Index-Linked Exchangeable Notes);
5.2(j)(6) (Equity Index-Linked Securities,
Commodity-Linked Securities,
Currency-Linked Securities, Fixed
Income Index-Linked Securities,
Futures-Linked Securities and
Multifactor Index-Linked Securities);
8.100 (Portfolio Depositary Receipts);
and Commentary .01 to Rule 8.200
(Trust Issued Receipts).
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
self-regulatory organization 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 those 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 parts 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 adopt
Commentary .01 to NYSE Arca Equities
Rule 5.2(b) to allow NYSE Arca to list
Derivative Products (as defined in the
proposed Commentary .01 to Rule
5.2(b)) 3 that (1) were originally listed on
3 For purposes of proposed Rule 5.2(b),
Commentary .01, the term ‘‘Derivative Products’’
includes securities described in Rule 5.2(j)(2)
(Equity-Linked Notes); Rule 5.2(j)(3) (Investment
Company Units); Rule 5.2(j)(4) (Index-Linked
Exchangeable Notes); and Rule 5.2(j)(6) (IndexLinked Securities); and the following securities
enumerated in provisions of section 2 to Rule 8:
Portfolio Depositary Receipts; and Trust Issued
Receipts to be listed pursuant to Rule 8.200,
Commentary .01. Exchange rules relating to listing
and trading, including trading pursuant to unlisted
trading privileges, of ‘‘Derivative Products’’ as
described above permit listing and trading pursuant
to Rule 19b–4(e) under the Exchange Act. Rule 19b–
4(e) under the Exchange Act provides that the
listing and trading of a new derivative securities
product by a self-regulatory organization (‘‘SRO’’)
shall not be deemed a proposed rule change,
E:\FR\FM\10OCN1.SGM
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Agencies
[Federal Register Volume 73, Number 198 (Friday, October 10, 2008)]
[Notices]
[Pages 60386-60388]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-24179]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-58717; File No. SR-NYSEArca-2008-106]
Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing
and Immediate Effectiveness of a Proposed Rule Change Amending Rule
6.87--Obvious Errors and Catastrophic Errors
October 2, 2008.
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 October 2, 2008, NYSE Arca, Inc. (``NYSE Arca'' 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 prepared by the self-regulatory organization. NYSE Arca filed
the proposed rule change as a ``non-controversial'' proposal pursuant
to Section 19(b)(3)(A) of the Act \3\ and Rule 19b-4(f)(6)
thereunder,\4\ which renders 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\ 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 proposes to amend Rule 6.87--Obvious Errors and
Catastrophic Errors. The text of the proposed rule change is available
at the principal office of the Exchange, the Commission's Public
Reference Room, and at www.nyse.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 self-regulatory organization
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 those 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 parts 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 amend Exchange rules governing
obvious and catastrophic errors, by adding provisions which will allow
for the nullification of trades that are a result of either an
erroneous quote, or print, in the underlying security. Specifically,
NYSE Arca is proposing new Rule 6.87(a)(4) Erroneous Print in the
Underlying, and new Rule 6.87(a)(5) Erroneous Quote in the Underlying.
Market participants on NYSE Arca base the value of their quotes and
orders off of the price of underlying security. These two proposed
provisions cover
[[Page 60387]]
instances where the information the market participants are using to
price options is erroneous, through no fault of their own. An erroneous
quote or print in an underlying security, which is disseminated by the
primary market \5\ for that security, means that market participants
are receiving erroneous information which they then incorporate into
trading decisions. In these instances, market participants have little
if any chance of pricing options accurately. In order to provide relief
from transactions that occur as a result of these erroneous prints and/
or quotes, the Exchange proposes the following provisions.
---------------------------------------------------------------------------
\5\ NYSE Arca Rule 6.1(b)(27) defines Primary Market as the
principal market in which the underlying stock or Exchange-Traded
Fund Share is traded.
---------------------------------------------------------------------------
Rule 6.87(a)(4) Erroneous Print in Underlying
An electronic trade resulting from an erroneous print disseminated
by the underlying market which is later cancelled or corrected by that
underlying market may be nullified. In order to be nullified, however,
the trade must be the result of an erroneous print that is higher or
lower than the average trade in the underlying security during a two-
minute period before and after the erroneous print by an amount at
least five times greater than the average quote width for such
underlying security during the same period.
For purposes of this Rule, the average trade in the underlying
security shall be determined by adding the prices of each trade during
the four minute time period referenced above (excluding the trade in
question) and dividing by the number of trades during such time period
(excluding the trade in question). For purposes of this Rule, the
average quote width shall be determined by adding the quote widths of
each separate quote during the four minute time period referenced above
(excluding the quote in question) and dividing by the number of quotes
during such time period (excluding the quote in question).
Rule 6.87(a)(5) Erroneous Quote in Underlying
Electronic trades resulting from an erroneous quote in the
underlying security may be adjusted or nullified as set forth in
section (a)(3) of Rule 6.87. An erroneous quote occurs when the
underlying security has a width of at least $1.00 and has a width at
least five times greater than the average quote width for such
underlying security on the primary market (as defined in Rule
6.1(b)(27)) during the time period encompassing two minutes before and
after the dissemination of such quote. For purposes of this Rule, the
average quote width shall be determined by adding the quote widths of
each separate quote during the four minute time period referenced above
(excluding the quote in question) and dividing by the number of quotes
during such time period (excluding the quote in question) and dividing
by the number of quotes during such time period (excluding the quote in
question).
These proposed rule changes will provide market participants on
NYSE Arca the same opportunities for price adjustment or trade
nullification that are available on other options exchanges. The
Exchange notes that these provisions are similar in all respects to
rules already approved for use at The Chicago Board Options Exchange
(``CBOE'') \6\ and The American Stock Exchange (``Amex'').\7\
---------------------------------------------------------------------------
\6\ See CBOE Rules 6.25(a)(4)-(5).
\7\ See Amex Rules 936-ANTE(a)(4)-(5).
---------------------------------------------------------------------------
2. Statutory Basis
The Exchange believes that its proposal is consistent with section
6(b) of the Act,\8\ in general, and furthers the objectives of section
6(b)(5) of the Act,\9\ in particular, in that it is designed to prevent
fraudulent and manipulative acts and practices, promote just and
equitable principles of trade, 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. NYSE Arca
believes that this proposal is appropriate given that it provides for
the adjustment or nullification of trades, which are executed at
clearly erroneous prices due to no fault of the participants on the
trade.
---------------------------------------------------------------------------
\8\ 15 U.S.C. 78f(b).
\9\ 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
No written comments were solicited or received with respect to the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule change: (1) Does not
significantly affect the protection of investors or the public
interest; (2) does not impose any significant burden on competition;
and (3) by its terms does not become operative for 30 days after the
date of this 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 \10\ and Rule 19b-4(f)(6)
thereunder.\11\
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\10\ 15 U.S.C. 78s(b)(3)(A).
\11\ 17 CFR 240.19b-4(f)(6).
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A proposed rule change filed under Rule 19b-4(f)(6) normally does
not become operative for 30 days after the date of filing. In addition,
Rule 19b-4(f)(6)(iii) requires a self-regulatory organization to
provide the Commission with 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. However, Rule 19b-4(f)(6)(iii) permits the
Commission to designate a shorter time if such action is consistent
with the protection of investors and the public interest. The Exchange
requests that the Commission waive the 30-day operative delay as well
as the five business-day pre-filing requirement to allow the Exchange
to immediately offer market participants on NYSE Arca the same
potential for relief that is available at other option exchanges, when
an erroneous print, or quote, in an underlying security occurs on the
primary market. The Exchange argued that such flexibility is
increasingly important in light of recent market volatility. The
Commission believes that waiving the 30-day operative delay \12\ is
consistent with the protection of investors and the public
interest.\13\ Given that the Exchange's proposed rule change is
substantially similar to the rules of other exchanges previously
approved by the Commission,\14\ the proposal does not appear to present
any novel regulatory issues. Therefore, the Commission
[[Page 60388]]
designates the proposal operative upon filing.
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\12\ For 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).
\13\ The Commission is also waiving the five business-day pre-
filing requirement.
\14\ See Amex Rule 936-ANTE(a)(4)-(5) and CBOE Rule 6.25(a)(4)-
(5).
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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.
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-NYSEArca-2008-106 on the subject line.
Paper Comments
Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street, NE., Washington, DC 20549-1090.
All submissions should refer to File Number SR-NYSEArca-2008-106. 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 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 Number SR-NYSEArca-2008-106 and should
be submitted on or before October 31, 2008.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\15\
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\15\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Acting Secretary.
[FR Doc. E8-24179 Filed 10-9-08; 8:45 am]
BILLING CODE 8011-01-P